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Naother instnace of historic revisionism.

To quote Wikipedia:

the total sum due was decided by an Inter-Allied Reparations Commission and was set at 269 billion gold marks (the equivalent of around 100,000 tonnes of pure gold). This 100,000 tonnes of gold is equivalent to more than 50% of all the gold ever mined in history (est. 165000 tonnes) which was clearly not within the means of the Germans to pay. Consequently their only way of paying back the debt was in devalued Gold Marks which ultimately led to the hyperinflation;

The treaty of Frankfurt mandated 5 billion francs, to my knowledge the gold equivalent of 4.5 billion gold marks.

So there is a factor of about 50 between them.

by cris0 on Sat Feb 18th, 2012 at 08:34:41 AM EST
[ Parent ]
Well, I read several articles that came to that conclusion back in 2010 but admittedly cannot manage to trace them right now. It might be that part of the reason for the conclusion was that France had to pay within three years whereas Germany was allowed to spread its payments over decades, therefore being able to grow a lot in the interval.
Still:

"the total sum due was decided by an Inter-Allied Reparations Commission and was set at 269 billion gold marks" is more than misleading.

-That was the initial sum but it was promptly brought down to 132 billion marks. Please note that it is estimated that Germany had caused 150 billion marks of damage to the neighbouring countries.
-Yes the currency was called gold mark and one can give a gold weight equivalent, but this would give the impression that it had to be paid in gold which was certainly not the case. It took many forms, including sharing intellectual property (unlike for the treaty of Frankfurt, where it was entirely in currency).

I don't know about the exchange rate in those days, but "So there is a factor of about 50 between them. " is worse than misleading.

First, 132 is less than half of 269.

Then, the German GDP in 1919 was VASTLY superior to the French GDP in 1871 (especially stripped of Alsace and Moselle). I did make my case in terms of percentage of GDP, which in the case of the treaty of Versailles you should spread over several decades (thus the percentage of GDP would fall rather a lot over time).

Which is not to defend the treaty of Versailles. I agree with Keynes in that respect. Now, what Germany insists Greece suffers is probably worse than what Versailles asked of Germany -although Greece did not launch a war in the other European countries.

As for the insistence that Greece follows the European treaties (that were passed with no little political flexing of muscles) come what may, even where they are demonstrably unworkable, well, France abided by all its obligations of the treaty of Frankfurt until 1914. Germany did not.
Yet it's Germany giving the morality evening classes these days.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Sat Feb 18th, 2012 at 01:08:01 PM EST
[ Parent ]

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