Anti-Greek media propaganda will come back to haunt Germany – A dire warning from 2011

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By Norbert Häring

In June 2011, Spiegel Online conducted and published a remarkable interview with Albrecht Ritschl. Ritschl is one of Germany’s most renowned economic historians, teaching at the London School of Economics.  Already for years ago, he warned that Germany, being the worst debt offender in history, would ultimately regret it, if it insisted on behaving like the tough taskmaster of Athens and the rest of Europe. What Ritschl predicted is happening now. Greece is presenting us with huge unpaid bills from our dark past. Others might follow, if we are required to pay our long/evaded dues. Some highlights of what Ritschl said in the interview that was conducted by Yasmin El-Sharif:

 1. Sitting in a glass-house

    “During the 20th century, Germany was responsible for what were the biggest national bankruptcies in recent history. It is only thanks to the United States, which sacrificed vast amounts of money after both World War I and World War II, that Germany is financially stable today and holds the status of Europe’s headmaster…  After World War II, America immediately took steps to ensure there wouldn’t be a repeat of high reparations demands made on Germany. With only a few exceptions, all such demands were put on the backburner until Germany’s future reunification. For Germany, that was a life-saving gesture, and it was the actual financial basis of the Wirtschaftswunder, or economic miracle. But it also meant that the victims of the German occupation in Europe also had to forgo reparations, including the Greeks.”

2. The biggest debt transgressor

     “Calculated based on the amount of losses compared to economic performance, Germany was the biggest debt transgressor of the 20th century…After the first default during the 1930s, the US gave Germany a “haircut” in 1953, reducing its debt problem to practically nothing. Germany has been in a very good position ever since, even as other Europeans were forced to endure the burdens of World War II and the consequences of the German occupation.”

 3. Unpaid dues

    “Germany even had a period of non-payment in 1990…Then-Chancellor Helmut Kohl refused at the time to implement changes to the London Agreement on German External Debts of 1953. Under the terms of the agreement, in the event of a reunification, the issue of German reparations payments from World War II would be newly regulated. ..With the exception of compensation paid out to forced labourers, Germany did not pay any reparations after 1990 — and neither did it pay off the loans and occupation costs it pressed out of the countries it had occupied during World War II. Not to the Greeks, either.”

 4. Anti-Greek propaganda

    “The anti-Greek sentiment that is widespread (link in the original) in many German media outlets is highly dangerous. (In the German version it actually says: The Anti-Greek sentiments that are being spread by German media outlets.) And we are sitting in a glass house: Germany’s resurgence has only been possible through waiving extensive debt payments and stopping reparations to its World War II victims… Germany started two world wars, the second of which was conducted as a war of annihilation and extermination, and subsequently its enemies waived its reparations payments completely or to a considerable extent. No one in Greece has forgotten that Germany owes its economic prosperity to the grace of other nations.”

 5. The warning

    “The Greeks are very well aware of the antagonistic articles in the German media. If the mood in the country turns, old claims for reparations could be raised, from other European nations as well. And if Germany ever had to honor them, we would all be taken to the cleaners. If we follow public opinion here with its cheap propaganda and not wanting to pay, then eventually the old bills will be presented again. (This is a very mild translation, the German version is: Wenn wir hier der Stimmungsmache folgen und den dicken Emil geben, der die Zigarre pafft und nicht zahlen will, …: My own translation: If we follow the cheap propaganda and play the bully puffing his cigar and not wanting to pay, …)”

It is ironic that this warning has been aired in a medium that has recently put itself at the top of those who are bashing the Greek government and its people, to the point of declaring them mentally insane (Paranoia of the Greek Government: Intrigue everywhere and Go get the shrink) , a treatment otherwise reserved for external “enemies” like Vladimir Putin and his people (Russia’s delusion). Ironic, but also scary.

This brief piece first appeared on the blog of the Real-World Economics Review , essential reading for anyone on the left.