Friday, June 6, 2014

A factoid for D-Day (with Addendum)

I’m currently reading William Shirer’s The Collapse of the Third Republic (published in 1969).  The title might be confusing;  unlike for his better-known book The Rise and Fall of the Third Reich, Shirer did not retain the political term in the original language;  he means La Troisième République.  Anyhow, regarding the aftermath of the first World War (whose groaning later echo  we commemorate today), he writes as follows  about the much-derided reparations, often pointed to as a burden on Germany that fueled the resentments that eventually led to WWII (p. 150):

Actually, Germany never had to pay a single mark out of her own resources.  Her borrowings from America bankers, which were never repaid, amounted to more than her total reparation payments.  Naïve American investors footed the German reparations bill.

The matter is even more curious in light of a companion fact mentioned on the next page:

Though the United States refused to take a cent of reparations from Germany, its government and Congress insisted that its Allies, especially Britain and France, pay their war debts in full and with interest.

[Consult the Reader’s Comment below, for an update to what happened with the debts post German Reunification.]
Meanwhile, we are once again not being very gentle with our former French ally:


Also of interest:  The New Republic’s original D-Day issue in its entirety:

Bonus philological phactoid:  The French call D-Day le Débarquement.


[Update, D-Day’s “Boxing Day”, or “D+1-Day”.  AKA le lendemain du Débarquement.] 

During that post-War period of wrangling over debts and reparations, France and Germany each repeatedly stomped, stabbed, and shot themselves in the foot:  bitterly remarking, “Take that!”

Intent on not letting a cent of reparations to go to France, after the Ruhr occupation the German “government deliberately organized the destruction of the currency, the mark falling to … 25 billions [to the dollar], becoming worthless” (id, p. 148).  (The folk term for this is:  Cutting off your nose to spite your face. )  France, facing much larger infrastructure reconstruction costs than did Germany (a point often forgotten, since France was ultimately the nominal victor:   but the war had been fought largely on its own soil), was left in the lurch by the French rich, who vigorously evaded such direct taxes as there were, and squirreled their capital abroad (p. 154).   The State was allowed to teeter on the brink of bankruptcy for years.  The tacit strategy of the wealthy was:  fiat opulentia, et ruat respublica :  for if the Republic did fall (as, in 1940, it did) “were there not other forms of government possible which promised more security for entrenched wealth?  The thoghts of some of the biggest entrepreneurs began to turn to the Fascist ‘experiment’ in Italy, and to the growing success of the Nazi Party in Germany” (p. 157).  Meanwhile, “instead of raising taxes, the government raised loans, a habit it had acquired during the war.”   As for those (mostly the thrifty French petite bourgeoisie) who were foolish enough to buy those government guarantees, “In the end, the state, in effect, repudiated most of it  by allowed the franc to fall to] one-fifth of its prewar value” -- an 80% haircut for those who had retrieved their savings from beneath the mattress, and entrusted them to the stabilization of the State.


At this point, a light-bulb begins dimly to flicker, in the mind of the suspicious reader.  “Wai-ait a minute!  Is this whole thing intended as some kind of allegory of the Bush Administration, and subsequent obstruction/destructivism of the Tea-Party types?”  Well, it didn’t start out that way;  but as you read along, the parallels become stark.

And the point here, indeed, is not to rake of the chronicles of another place, another time, but to remind ourselves that “He who forgets History is condemned to …” …. to … darn it  it was on the tip of my tongue … something-something …  Forgotten.  Anyhow (to quote our gnomic ancestors again), “If the shoe fits, wear it.”  
(Note, and not:  “If the shoe fits, buy it on credit and stash it in your fashion-closet and then go out and buy a dozen more pairs.”
-- Though actually, that was exactly the scene in Paris, in July of 1926:
“Along the boulevards, large crowds of women were storming the department stores  and the smart shops  in a frenzy to convert their falling francs into something more durable” [p. 162].)

[For our essays touching on this Plus ça change, plus c’est la même chose aspect of things, click here.]

And so to the parallels:

The bankers and businessmen, and even the more thriving peasants and shopkeepers, came to believe, with a certainty that brooked no compromise, that the political “Left” -- which, aside from the small Communist Party, was in reality little more than reformist and middle-of-the-way, -- was incapable of governing the country.
-- Wm Shirer, The Collapse of the Third Republic (1969), p. 166

(Cf. the meme of the centrist Obama as “socialist”.)

The employers’ associations, having lost their fight to prevent Parliament from enacting the modest social-security legislation, continued their well-financed campaign  in rthe press and on billboards  to render it ineffective  and to get it repealed.
-- Wm Shirer, The Collapse of the Third Republic (1969), p. 167

(Compare the continued assaults on “Obamacare” -- a program that Congress itself passed not long ago.)

There are even parallels in the sideshow characters.   On the magnate François Coty:

Flattered by the politically discontented,  who used his money to assault the Republic, Coty began to conceive himself as a savior of the nation who one day  not too far off  might be called upon to take over the helm of state and save it from democracy.  Ridiculous as the thought was, for Coty was a political nincompoop, he seems to have taken it with growing seriousness.
-- Wm Shirer, The Collapse of the Third Republic (1969), p. 158

Remind you of someone whose name rhymes with “rump”?   (A further parallel:  Both Coty and Trump made their fortunes in the degraded armpits of the Lucullan-Bacchanalian economy, the former in fancy perfumes, the latter in casino gambling.)


So, then as now, the picture isn’t pretty.   But the wan hope is, that if the Plutocratic Party ever manages to get rid of that Nigerian-born socialist and control both houses of Congress,  they will immediately cease their antics and their Wrecker strategy, and begin to govern responsibly.  Something like that did happen in France in 1926, with the election of the sensible conservative Raymond Poincaré.

[Note:  Readers of this blog will feel their ears prick up at the surname.  Any relation to Henri, eponym of the Poincaré Conjecture, and one of the immortal heroes of both physics and mathematics?  Indeed;  they were cousins.  And since I’m not especially fond of Cousin Raymond, I’ll post a photo of Cousin Henri instead.]

To restore national solvency, the new French President  “rushed through Pariliament, practically without debate, a number of laws calling for new taxes, and increase of old ones, which the bankers and businessmen and the political Right  would never have accepted from a less ‘conservative’ government.” (p. 164)
Such is the fond faint hope of the Left and Center, that by knuckling under and electing a ‘conservative’, some necessary reforms might be enacted (as happened under Nixon and under Reagan) which the same party would oppose hysterically they came from the Democrats (compare the very different treatment of those twins, Romneycare and Obamacare).

The whole financial crisis had been a charade (again, compare the Republican push to go over the “fiscal cliff”):

In six months, Poincaré had stabilized the franc. … There was -- there had been all along -- plenty of French money to restore the finances of the state.
-- Wm Shirer, The Collapse of the Third Republic (1969), p. 165


1 comment:

  1. The Germans did pay some reparations in kind (coal and timber, maybe other stuff). Also, recall that the French and Belgians did occupy the Saar to extract reparations in kind after one (of several) German defaults on reparations. As of 1969, the Germans hadn't paid off the American loans, but they began to after East and West Germany united. I think the loans and remaining reparations were settled and/or paid off in the early 21st century.