The sovereign can no longer say, "You shall think as I do on pain of death;" but he says, "You are free to think differently from me, and to retain your life, your property, and all that you possess; but if such be your determination, you are henceforth an alien among your people."

(Alexis de Tocqueville, Democracy in America, 1835)

Saturday, 2 October 2010

Germany pays off WWI debt

It may seem incredible but Germany has only just finished paying off the war debt imposed on it after its defeat in the First World War. This week-end will see a final payment of €70m - from an original demand of 269bn gold marks (or 100,000 tonnes of gold).

Of course Germany has not continually paid reparations during the 89 years since the sum was fixed in 1921. The original sum of 269bn gold marks was later to reduced to 112bn by the Dawes Plan and the Young Plan during the 1920s. At various stages during the 1920s the Weimar government was not able to pay and during the 1930s Hitler was flat out not willing to pay - although the same was true of the Weimar government. In 1953 the London Treaty suspended payments until Germany was reunited, at which point a reduced amount of payments was reactivated.

John Maynard Keynes was among the many prominent voices criticising the Treaty of Versailles, arguing that it would not achieve its objectives and, needless to say, he was proved absolutely right. At least the Allies made a better fist of it twenty years later.
"After WWII they decided to hang the leaders and not to punish the nation but in WWI it was the other way around." ... "The lesson was learned eventually. Unfortunately, it required another 20 or so million people to be killed."
NB: It's a little strange that this story does not seem to have been reported very widely. Aside from the BBC, a cursory search via Google News reveals not much more than this report on (US) National Public Radio.

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