Sunday, October 3, 2010

Germany's Debt and Reunification

Lot's of people were reporting this week on the last World War I reparations payments by Germany and several people noted it to me and asked if I was going to blog on it. Well you know what? The last payment didn't actually happen until today, and I was planning on blogging on it but just didn't want to jump the gun like everyone else :)

In addition to paying off the reparations saddled on it in Versailles ninety years ago, Germany celebrates the twentieth anniversary of their reunification after the fall of the Berlin Wall. So today we can finally put a terrible peace behind us for good, and we can celebrate a more hopeful, seemingly more robust peace than the one struck at Versailles.

And of course, it's hard to think of German reparations without thinking of John Maynard Keynes - and I would be remiss if I didn't cite him here:
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"This chapter must be one of pessimism. The Treaty includes no provisions for the economic rehabilitation of Europe, - nothing to make the defeated Central Empires into good neighbors, nothing to stabilize the new States of Europe, nothing to reclaim Russia; nor does it promote in any way a compact of economic solidarity amongst the Allies themselves; no arrangement was reached at Paris for restoring the disordered finances of France and Italy, or to adjust the systems of the Old World and the New.

The Council of Four paid no attention to these issues, being preoccupied with others, - Clemenceau to crush the economic life of his enemy, Lloyd George to do a deal and bring home something which would pass muster for a week, the President to do nothing that was not just and right. It is an extraordinary fact that the fundamental economic problems of a Europe starving and disintegrating before their eyes, was the one question in which it was impossible to arouse the interest of the Four. Reparation was their main excursion into the economic field, and they settled it as a problem of theology, of politics, of electoral chicane, from every point of view except that of the economic future of the States whose destiny they were handling...

...Men will not always die quietly. For starvation, which brings to some lethargy and a helpless despair, drives other temperaments to the nervous instability of hysteria and to a mad despair. And these in their distress may overturn the remnants of organization, and submerge civilization itself in their attempts to satisfy desperately the overwhelming needs of the individual. This is the danger against which all our resources and courage and idealism must now co-operate."

14 comments:

  1. Best comment I have seen on the matter: obold.blogspot.com/2010/09/germany-pays-off-first-world-war-puts.html

    "...nothing to make the defeated Central Empires into good neighbors, nothing to stabilize the new States of Europe, nothing to reclaim Russia..."

    This illustrates perfectly well just how naive Keynes was. Ahh, dude, the powers in Paris couldn't even do anything about what was happening regarding the day to day border drawing in Eastern Europe or Turkey/Greece much less "reclaim Russia" or "stabilize the new States." This attitude simply amazes me - clearly Keynes did not understand what was happening on the ground and he clearly greatly overestimated the ability of Britain, the U.S., France (and Italy before it left the conference) to do anything about it.

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  2. http://urkobold.blogspot.com/2010/09/germany-pays-off-first-world-war-puts.html

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  3. Are you seriously telling me that you don't think they could have done more to provide a more stable system in central and eastern Europe?

    Keynes never once said that these issues could be completely solved - what he decried was that the conferees had no interest in them - that they didn't try anything.

    Xenophon, I've heard a lot of people raise a lot of criticisms of Keynes's views before - never until today have I heard anyone raise the point that the Treaty of Versailles wasn't all that bad and Keynes was naive to think a better peace could have been struck.

    It's not Keynes that comes across as naive here - I think it's you.

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  4. "...never until today have I heard anyone raise the point that the Treaty of Versailles wasn't all that bad and Keynes was naive to think a better peace could have been struck."

    Oh yeah, that's exactly what I was getting at.

    *rolls eyes*

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  5. Well, your link mentions how the terms weren't all that bad, and you said that Keynes' wishes for the treaty illustrated how naive he was. I think it was a pretty fair assessment on Daniel's part. Could you enlighten us as to exactly what you were trying to get at? There's apparently a lot of subterfuge to cut through.

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  6. Evan,

    (1) Yes, they weren't all that bad in comparison to the historical context of other European wars. Honestly, Germany's fate could have been far, far worse - it could been divided up into pieces by its enemies as Poland had been by Austria, Russia and Prussia. I have little sympathy for Germany in this regard; it started a war that it lost; then it started another war in order to make up for that defeat and was handed an even worse defeat. Don't want to reap the fruits of war? Don't invade your neighbors and start them.

    (2) "...and you said that Keynes' wishes for the treaty illustrated how naive he was."

    They were naive because he completely overestimated the abilities of the "Four powers" to do much of anything. That can clearly can be taken from what I wrote. There is no subterfuge.

    Think about it - who determined the borders of Poland? The Poles. In their victorious war with Russia from 1919-1921. What did the "Four powers" have to say about that possibly? Nothing. What were the "Four powers" going to do about the civil war going on in Russia and the hostility by Russia towards the West during the 1920s? They tried. They invaded. They had no stomache for it nor the economic means by which to undertake it. All of this illustrates the essential cultural arrogance of Keynes that under-girded his entire worldview.

    The one place that they did take an active role was between Greece and Turkey, and that ended up aiding in the creation of a triple genocide and Turkey destroying the entire Greek cultural heritage that had existed in Asia Minor since well, before Thales of Miletus.

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  7. Right... so how is this different than Daniel's assessment? I'm still not clear on what you found so inaccurate about it.

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  8. Evan,

    I have as yet to write a word about Daniel's assessment. What I wrote about was Keynes' assessment.

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  9. Okay... so how is what you said here misrepresented by Daniel?

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  10. He's right Evan - he didn't write anything about my assessment. He just rolled his eyes at it.

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  11. So Xenophon - will you agree that the Treaty of Versailles could have done more than it did with regard to stabilizing central and eastern Europe, and that Keynes was therefore not naive to wish they had done more?

    This is the consistent problem with you - you're so damned evasive. You bluster and condescend on everything and then you roll your eyes and say "that's not what I said at all".

    If that's not what you meant, then please - write a post that says "I agree that..." and then copy everything I just wrote in that paragraph.

    And if you think nothing more could have been done with the treaty and you think that Keynes was naive for thinking that anything more could have been done, then come out and say that. and if you don't have a solid position that's fine too.

    But don't run around the issue without committing to a position while tossing insults at everyone and getting scandalized when people call you out on it.

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  12. "And if you think nothing more could have been done with the treaty and you think that Keynes was naive for thinking that anything more could have been done, then come out and say that."

    That's exactly what I wrote from the start. Much of that naiveté was based on the cultural arrogance inherited by his nation's role as empire.

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  13. Then why did you respond with "Oh yeah, that's exactly what I was getting at *rolls eyes*" When I said that the first time! Did I misidentify sarcasm???

    If that's what you've been saying from the start (which I thought it was initially until you responded with your eye roll), then I think that's absurd.

    The treaty could have done one easy thing to improve the stability of central and eastern Europe which Keynes suggested doing: not lay nearly as heavy reparations on Germany. That alone would qualify. It's absurd to suggest that Keynes was naive to think the the Treaty could have been improved. You go on about Poland as if I had said "Keynes thought the Allies could have made Europe a perfect peaceful place forever and ever". I never said that, Xenophon. I said Keynes thought there was considerable room for improvement that could have made central and eastern Europe more stable - he was right on that, and you are wrong.

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  14. "I said Keynes thought there was considerable room for improvement that could have made central and eastern Europe more stable - he was right on that, and you are wrong."

    No, Keynes was wrong. Keynes was naive, stupid, misguided, etc. The Treaty was exactly what one should have expected and predicted. Don't want that Treaty? Well, the Germans should not have started WWI.

    I go on about Poland because of his specific, moronic claims about the new states. Keynes wasn't even that intelligent where it would have been easy for him to be intelligent.

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