In 1920, after the first World War, John M. Keynes wrote “The Economic Consequences of the Peace” on his dissatisfaction with the Treaty of Versailles and calls out to those who are drafting the treaty to think of the potential economic consequences it would have on Germany and Europe as a whole. Keynes was an established economist in England and most notably would revolutionize the ideas seen in macroeconomics. Throughout the chapter Keynes writes in a style of urgency and fear as he sees the stability of Europe at risk.
Right from the beginning of the chapter, Keynes believes the treaty does not promote the idea of ‘good neighbors’ for the defeated states. He believes the arrangement reached in Paris was not based on the future of economics in Europe, but rather on political folly1 . After such a dramatic and long war, it seems that the victorious states wanted to extensively punish those who stood against them in the so called ‘heat of the moment’, without taking account of its long-term effects. Keynes goes on to express how European countries have become economically interdependent on each other and how this treaty would disrupt each country’s economy2 . With declining trade and commerce comes a lower standard of living, or even the possibility of starvation. On the topic of starvation, Keynes makes the statement, ” Men will not always die quietly”, inferring that revolution and instability could develop in certain countries.
Keynes is very concerned with how the treaty will specifically effect Germany, stating that those who sign this treaty will be responsible for the death of millions of Germans. The treaty would cause Germany to lose all of its colonies, merchant fleet and foreign investments3 . In basic economic terms, the demand of the German people will become greater than what can be supplied according to Keynes. He predicts that Germany will regress in its industrial development, and as a result negatively impact the rest of Europe.
I find this reading to be related to the discussion we had in class about the effects of propaganda. It seems that the allied powers could not forgive the countries they had defeated and still viewed them as barbarians or inhuman.
Were the conditions in the Treaty of Versailles towards Germany too harsh after WWI? Do wars need propaganda?