The destruction of Nuremberg during the second world war (photo: Pictorial Press Ltd/Alamy)
Every country has its own perspective on the second world war. This is not surprising when experiences and memories are so different. For Americans, the war started in December 1941; for Russians, it began in June that year. Most Europeans believe it commenced in Poland in September 1939. But for the Chinese it started in 1937, with the Sino-Japanese war, and many in Spain are still convinced that it began in 1936 with General Franco’s nationalist rising to overthrow the Republic. Some historians extend the conflict further, arguing that it lasted from 1914 to 1945, or even from the Russian Revolution in 1917 until the collapse of the Soviet empire in 1989.
The second world war was a monstrous state-on-state war between the major powers, but it was also an international civil war, especially affecting those countries which had been occupied. It was a conglomeration of many different conflicts, constituting the first truly global war.
Although the Germans and the Japanese did not coordinate their strategies, events in the Pacific and in Europe affected each other. But for those fighting it, they could have been wars fought on different planets. On 9th May 1945, when US Marines were still fighting on Okinawa and they heard the news of the German surrender in Europe, their reaction was “So what?”
The memory of the second world war hangs over Europe, an inescapable and irresistible point of reference. Historical parallels are usually misleading and dangerous. The threat of economic collapse now is not the same as the threat of Nazism and war. But the current crisis still poses a threat to parliamentary democracy in Europe. It may awaken the nationalist monsters which the European ideal had tried to consign to history.
Today it is very hard to appreciate the huge historical forces that killed some 60m to 70m people, or even more. Chinese historians now claim that more than 40m of their countrymen died, double the number that had been assumed earlier. And when counting the war dead, we could add to these figures all the victims of famine and illness brought on by malnutrition. It is almost impossible to distinguish between categories of suffering.
When we dwell on the enormity of the second world war and its victims, we try to absorb all those statistics of national and ethnic tragedy. But, as a result, there is a tendency to overlook the way the war changed even the survivors’ lives in ways impossible to predict.
In June 1944, a young Asian soldier surrendered to American paratroopers in the Allied invasion of Normandy. Although his captors believed he was Japanese, he was in fact Korean. His name was Yang Kyoungjong.
In 1938, at the age of 18, Yang had been forcibly conscripted by the Japanese into the Kwantung army in Manchuria. A year later, he was captured by the Red army after the Battle of Khal-khin-Gol and sent to a labour camp. In 1942, the Soviet military authorities drafted him, along with thousands of other prisoners, into their forces. He was soon taken prisoner by the German army at the Battle of Kharkov in Ukraine, and by 1944 he was wearing German uniform. He was sent to France to serve with an Ostbataillon supposedly boosting the strength of the Atlantic Wall at the base of the Cotentin peninsula, inland from Utah Beach. After time in a prison camp in Britain, he went to the United States where he said nothing of his past. He settled there and finally died in Illinois in 1992.
In a war which killed so many millions of people and stretched around the globe, this reluctant veteran of the Japanese, Soviet and German armies had been comparatively fortunate. Yet Yang remains perhaps the most striking illustration of the helplessness of most ordinary mortals in the face of what appeared to be overwhelming historical forces.
Experiences can mark a whole life. Earlier this year, I heard from a German friend that her sister’s father-in-law had died. His last words were: “I can hear the cracking of the ice,” the result of an intense childhood memory of East Prussia in January 1945, when his mother took her children across the ice of the Frisches Haff to escape from the Red Army. The ice began cracking all around, with many civilians falling through it to freeze and drown.
Many aspects are not as they appear on the surface, as I have learned over the years. I remember as a young officer in Germany based next to Belsen concentration camp, being horrified by a memorial to the French Jews who had died there. It stated: “Aux Juifs français qui sont morts pour la gloire et la patrie.” I found the idea of French Jews dying for glory and the fatherland quite grotesque. Many years later I mentioned this to the French historian Henry Rousso. He replied: “I entirely understand your reaction, but you are completely wrong. It was the French Jews themselves who insisted after the war that memorials to their dead should have exactly the same wording as those of all the French. This was because they would never forgive Vichy for having tried to take away their French citizenship.”
It is important to understand the continuing, confused fascination with the second world war. For most of us, the great unspoken question is how would we have behaved in the face of danger and when forced to make major moral choices.
But the war also fascinates many of the young because we now live in a post-military society; a health and safety environment almost devoid of personal risk and moral decisions. Those brought up in this new civilian age are therefore intrigued by those very personal questions: How would I have measured up? Would I have survived? And even: would I have shot or mistreated civilians and prisoners?
History, which used to be written in collective terms—the history of a country, an army or a political movement—has itself become more personal, with much greater emphasis on the individual. This change of attitude can be traced back to the as yet unanalysed revolution of the late-1980s and early-1990s; that is, the combination of geopolitical change with the end of the Cold War; the communications revolution, with the invention of the internet; the economic upheaval, with Big Bang and the spread of globalisation; the decline of collective or tribal loyalties—with both the trade unions in Britain and the traditional officer class disintegrating at the same time; a growing scepticism about authority and all the other anti-hierarchical changes, leading to a much less deferential society; and the emphasis on the individual, whether Margaret Thatcher’s championship of the family over the state or John Major’s rhetoric of citizenship. It will take historians many years before they can assess whether all these changes coming together were purely coincidental or whether they were inextricably linked.
Due to the rise of individualism in the late 1980s and 1990s, expectations of historical writing soon followed a similar route. A new generation, which had shrugged off the ideals of collective loyalty, suddenly wanted to know about the experiences and suffering of ordinary people, caught up in huge events and with no control over their own fate.
But the key point is that, still after 70 years, for politicians and the media the second world war remains the dominant reference point for conflicts and crises.
Some three months before the beginning of the 2003 Iraq war, the Financial Times asked me to write an article on why the Battle of Baghdad would be another Stalingrad. I tried to explain that history never repeats itself, but another half dozen newspapers had exactly the same idea. Wars and crises are by definition unpredictable and this encourages a tendency to look backwards for comparisons rather than forwards.
There is an interesting paradox here: that the British media, which so enjoyed depicting our army as stiffly traditional and old fashioned, revealed how utterly out of date they were in their own ideas of warfare. Newspaper editors felt compelled to draw parallels with something which they knew, and which their readers recognised.
Politicians have their own particular blind spot. They tend to forget before every conflict that war, rather like social engineering, has a troubled history of producing consequences very different to what was originally intended. It is the law of unintended consequences writ large. And nobody is worse than politicians in making grandiose historical parallels, trying to put themselves on pedestals along with Churchill or Roosevelt. The effect on strategy can be disastrous.
One could argue that the whole of the so-called “war on terror” was misdirected by the way that George W Bush immediately compared the 9/11 attacks to Pearl Harbour. This resurrected the mentality of state-on-state warfare, when in fact the threat from al Qaeda was an international security issue. The neo-conservatives in the department of defence—Donald Rumsfeld, Paul Wolfowitz, Douglas Feith—all compared Saddam Hussein to Hitler when, if anything, he was like a poor man’s Stalin. Tony Blair did the same, forgetting how Anthony Eden at the time of Suez compared Nasser to Hitler. The second world war had indeed become the dominant reference point for almost all subsequent conflicts.
President John F Kennedy, who had been against intervention in Vietnam before he came to power, was turned round by the journalist Joseph Alsop and realpolitik professors who became White House advisers. They persuaded him that failure to intervene in Vietnam would be as dangerous as the policy of appeasing Hitler, which his father Joseph Kennedy had strongly supported when US ambassador in London. It was an embarrassment that had always haunted the young president.
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Why are historical parallels so dangerous when considering the present European crisis? A few months ago, a leading figure in Britain asked me to come up with second world war parallels for a speech he was making, to underline the seriousness of the situation. I sympathised with his frustration but begged him to avoid any comparison with the second world war. It was bound to be misunderstood or twisted.
But there is one parallel which might be valid. The general public as a whole is as badly informed today about the dangers facing the eurozone as the populations of Britain and France were in the late summer of 1938 during the Czechoslovak crisis. The poet WH Auden called that period “a low, dishonest decade.” Politicians have to sell hope. No Cassandra ever won an election. Churchill, who had been dismissed as a war monger, only came to power after the crisis had broken in all its fury.
When my book on the Spanish civil war was published in 2005, journalists in Madrid asked me in all seriousness whether it could ever happen again. I replied that thank goodness the same conditions simply did not exist. The vicious circle of fear between right and left, which had originated in the extreme cruelty by both sides in the Russian civil war, did not exist.
But some things have begun to change alarmingly since then. We again face the danger of a world depression and we are beginning to see mass unemployment in some countries, especially in southern Europe (see left). Last year, Giles Paxman, the British ambassador in Madrid, pointed out how remarkable it was that despite the terrifying levels of youth unemployment in Spain, there had been an astonishingly low level of social disorder. The demonstrations of the “Indignados,” the young Spaniards who have taken to the streets to protest against austerity measures and unemployment, have been passionate but not violent. His theory is that the memory of the horrors of the Spanish civil war is acting like a nuclear threat in the background. He may well be right. Greece also suffered from a civil war, and although there have been a considerable amount of violent protests in Athens, folk memory is likely to hold the country back from outright conflict.
Surprisingly little has been said in the newspapers about one of the main weights on the Greek national budget: the totally disproportionate spending on their armed forces, swollen by the bogeyman figure of Turkey. One foreign minister revealed in private earlier this year that the Greek armed forces have bought so many Leopard tanks that they can hardly fit them all in along the strip of frontier facing Turkey. The Greek government must be afraid of cutting the defence budget back as much as is needed through fear of another coup. In fact, according to the editor-in-chief of Politiken in Denmark, a senior Greek official privately warned that their army is ready to take over at any moment, but senior officers have no idea how to run the economy. Presumably they also know that a military takeover would automatically force Greece’s ejection from the EU as well as the euro.
What are the dangers and threats to parliamentary democracy in Europe? Can the fundamental contradictions in the euro project be overcome? The dynamic of the moment seems to be that political integration must be drastically accelerated to make up for the flagrant paradoxes that existed from the euro’s very foundation and were scandalously ignored. The same foreign minister argued to me last autumn that the economic situation was so grave that Europe must adopt a presidential system with direct elections. That idea is now becoming general currency in top European circles. Economic and political control would be drastically centralised with virtually no accountability. This would be nothing less than an elective dictatorship bringing with it the threat of nationalism, the very thing the European project intended to avoid.
In Greece, there is already a bitter hatred of the Troika: the European Union, the European Central Bank (ECB) and the International Monetary Fund. The ECB and German politicians are depicted as Nazis, imposing another occupation on Greece. At one point it looked as if German tourists would be too afraid to go to Greece this summer, and no Greek politician from Pasok or New Democracy dared walk openly on the streets of Athens.
Political fragmentation has already begun there, with Golden Dawn on the extreme right and Syriza on the left led by Alexis Tsipras. Tsipras was quoted as saying to the EU that, “if you sink us we will take you down with us.” But at the last moment, the pro-European New Democracy just managed to prevail over Syriza in the elections on 17th June to form a coalition.
In other countries we are also seeing the decline of centrist parties with the accompanying rise of extremists or alternative groups. In Italy, the Five Star party of the comedian Beppe Grillo swept past all the traditional parties in local elections and is now expected to take 12 per cent of the vote in national elections. In Germany, recent poll estimates gave the Pirate Party 10 per cent of the vote, ahead of the Greens, even if this was not quite confirmed in the North Rhine-Westphalia election. Is this development similar to the 1930s, where countries with systems of proportional representation found themselves vulnerable to political polarisation and disorder? Is the whole European project doomed to achieve the opposite of what it set out to achieve? Will the European centralising ideology, and now the need proclaimed by some leaders to exert a quasi-dictatorship over the eurozone, exacerbate the militant nationalism that it sought to make redundant? The former head of the European Central Bank, Jean-Claude Trichet, even argued in a speech on 17th May that eurozone states should be able to declare fellow members bankrupt, and take over their tax and spending policy. Germany is in the unenviable position of being the only country with the clout to take on such a role, and there are already too many insults about a Fourth Reich in Europe.
The argument that it was European unification which prevented another war on the continent was always a completely false one. It is simply a question of governance. Democracies do not fight each other. The key question is therefore the inverse: will a dramatic increase in the democratic deficit lead to unrest and even conflict as Europe “tears itself apart,” in the controversial phrase of the governor of the Bank of England?
The euro crisis has been a train crash in very slow motion, accompanied by several years of political and economic denial. The ideology of European unity has been such an article of faith that it has prevented its political establishment from understanding the harsh reality of a wider world. Those arguing for a relaxation of austerity, such as the new French government, are trying to wish into being their ideal international order. One of Hollande’s ministers, Arnaud Montebourg, even calls for “de-globalisation,” as if clocks can be turned back, with tariff barriers reintroduced. Globalisation and the internet go hand in hand.
The left in France dreams of a world in which the bond markets no longer exist to punish over-spending. This defiance of cause and effect is slightly reminiscent of that bankrupt France after the Liberation in 1944 when the Parisian intelligentsia convinced themselves that progressive ideas would triumph over the “filthy money” of the capitalist system. And that in turn was a curious echo of the Grandmaison doctrine on the eve of the first world war, which stated that French élan in a bayonet charge could somehow overcome heavy artillery.
If Europe starts to suffer from copycat riots—rather as Britain experienced last year—they are likely to start in France where the culture of protest and the battle cry of “Aux barricades!” lie deep in the national subconscious. Whether faced with farmers dumping cabbages in the Champs Elysées or protesters taking to the streets, French governments have usually caved in rapidly. But no longer will they be able to borrow more money to buy off the demonstrators.
France always wanted a United Europe in order to counter-balance the power of the United States. Fiscal union with the euro was politically driven, with the consequences we now know only too well. At the time, politicians knew Greece had flattered its figures and that the country had used complex financial techniques to lower its debt-to-GDP ratio. The country’s application to join was waved through nonetheless, as political objectives took precedence. Even the Germans, who knew that Greece’s figures were fabricated, let them through, but whether a lingering sense of guilt over the terrible wartime occupation of Greece played a part, we cannot tell. In any case, Greece, with its sudden demands for huge compensation, is certainly trying to push that button rather too late in the day.
Curiously, American neo-conservatives also favoured a centralised Europe. This was partly because they felt that it would make Europe more like them—they cannot resist remaking the world in their own image—but more immediately they hoped that a stabilisation of the eurozone would avert global economic catastrophe. One of George W Bush’s speech writers said a few months ago at a private party that a stadium should be hired so that British eurosceptics could all get together and beat their breasts and shout “We were right! We were right! We knew it couldn’t work!” and then they could start to think how to solve the problem. He did not add that perhaps the reverse should also be organised, with eurodreamers made to chant: “We were wrong! We were wrong!” and then they should start to consider alternatives to the federal super-state. They should perhaps remember that both in war and in peace, reinforcing failure through obstinacy has always tended to turn a crisis into a catastrophe.
Thinking in American business circles has not necessarily followed the neo-conservative prescription, especially as the crisis deepened. Peter Boone and Simon Johnson of the Peterson Institute for International Economics, wrote on Bloomberg earlier this year: “One potential way forward would be to create a European-level fiscal union that assumes all national debt, much like what Alexander Hamilton did as first US secretary of the Treasury. That isn’t going to happen in modern Europe. Why would German taxpayers and savers agree to pay for the good times previously enjoyed in Greece, Italy or Spain? Who could even ask them to do so? As a result, all eyes are turning to the European Central Bank, because some in the euro policy elite still hope that loose monetary policy and higher inflation rates will provide an escape hatch. But addressing fiscal issues through monetary means generally doesn’t work, and it does nothing to improve the competitiveness of the struggling euro-area periphery.”
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The closer the possibility of a euro disintegration comes, the more vicious the downward spiral is likely to be. Investors pull out, companies make sure that they keep no deposits in the zone, and citizens in Greece, Italy and Spain withdraw their euros, which risks a run on local banks. Those who can will move their money outside their country even more than they are at the moment. The “bank-jog” of withdrawals in Spain and Greece may turn into a full sprint, and that is regarded as the most dangerous potential trigger of a mass panic. Most of the money taken out has gone to Germany, but astonishingly, the German public is only now just waking up to the dangers that their economy has been taken hostage as a result.
The central banks of the stronger economies, especially the Bundesbank, have a huge “counterparty” risk to Greece, Italy and Spain from the way that the payments system in the eurozone works. Under this—the “Target2” system—one consequence of businesses and households taking their money out of the bank accounts of deficit countries is that the German central bank ends up lending corresponding sums to the central banks of those countries. This is because Target2 makes the Bundesbank balance all deposits received from, say, Greece with an equivalent loan to the Greek central bank. The liability for Germany is mounting vertiginously. This July, the German central bank already had €750bn of claims on other central banks, equivalent to more than a third of German GDP. These are euros owed to the Bundesbank by the central banks of the economies where there has been the greatest capital flight, namely those of Greece, Italy and Spain. Spain alone accounted for €450bn. I dread to think what the true figure is now as the withdrawal of euros gathers pace in the south.
If the euro becomes cheaper because the popular revolt against austerity prods the ECB into printing money, it still will not solve Europe’s deeper problems. “Depreciation,” Boone and Johnson added, “amounts to a nontransparent way for the Germans to bear more of the costs of the failed euro experiment as their purchasing power falls, but investors will still prefer Germany to Greece. It also increases the risk that European and international investors may simply lose confidence in the euro, leading to mayhem in the area’s leveraged financial markets.”
Attempting to cope with the short term dangers, without any guarantee of success, may well lead to an accelerated decline of Europe in the longer term when faced with the challenges from the east. The need for the centralisation of political and economic power in the EU and the ECB to force countries, banks and companies to adhere to rigid new regulations, tantamount to war socialism, will make them incapable of competing with Asian economies. And as the value of the euro is forced down, we will probably see China and India buying more European companies. We have been here before a generation ago when Japan began an aggressive takeover policy, and the country has since experienced a long period of stagnation [see p50]. But surely it was the lack of flexibility in the Japanese business model, combined with a social rigidity, which led that country into this. China and India are not Japan, even if China is now suddenly suffering the problems of an ageing population.
Just because we in the west have enjoyed a rising standard of living over several centuries, we are deluding ourselves if we try to believe that has somehow become an inalienable human right. Christine Lagarde’s controversial interview earlier this year, in which she said she had more sympathy with sub-Saharan Africa and which caused such fury in Greece, was probably also a veiled warning that parts of Europe may soon face conditions akin to those of the third world. Europe is also much more vulnerable to what one might call the moral crisis of capitalism. That sense of entitlement, of materialistic human rights in social security that has grown over the years, has produced an angry disbelief at any suggestion that this cannot continue and that government spending needs to be cut. At the same time, European populations are reacting against another integral part of the change. In the past, capitalism has always been able to justify its inherent inequalities on the grounds that, however wide the gap, at least the poor were slightly better off. That is patently no longer the case.
This is the other aspect of the hidden revolution, which we are not yet prepared to discuss openly, because the consequences are so socially toxic. With the communications and globalisation revolution which I mentioned earlier, we have passed a tipping point. The wages of the semi-skilled and unskilled stagnate or are driven down in a world economy that searches ruthlessly for the lowest wage costs. Automation on the shop floor is now the main driver in increasing industrial productivity, so fewer and fewer skilled workers are needed. But at the upper levels of the management hierarchy, productivity increases are achieved by recruiting internationally from a small pool of the brightest and the best. In a world of instant communication, decision-making is increasingly concentrated. This is one of the reasons why salaries and bonuses have increased exponentially at the very top.
And yet it is not so long since the New Economics Foundation, a left-wing think tank in Britain, wanted the working week to be cut to 21 hours to help ease unemployment, reduce stress and improve family life. People would earn less, the foundation admitted, but “they would have more time to carry out worthy tasks.” Others still argue that job-sharing would reduce unemployment. But, crudely put, it is always going to be far more cost-effective to squeeze one good lemon thoroughly than several partially. Can Europe afford to bring in the social luxury of job-sharing when faced with the strong winds of competition from the east?
Another favoured idea is the Tobin tax to deter short term currency transactions. We should all support this so-called Robin Hood tax if it could be imposed effectively on a world-wide basis, but a partial version covering just Europe would constitute economic self-mutilation. Like water moving downhill, money finds a way around obstacles or sweeps them away. Fewer and fewer international bankers now believe that the euro system can survive. Most think that it is just a question of when it will unravel, at least in part. But because the opportunities for a reasonably controlled dismantling of the system have been rejected due to ideological obstinacy, the collapse when it comes is likely to be horrendous, and not just for those within the eurozone.
Even the historical parallel about the public’s ignorance during the Munich crisis of 1938 is misleading in a very important way. The threat of war and the threat of economic collapse are very different, because the former tends to unite while the latter divides. The truth then about the menace of Nazi Germany might have braced public attitudes far better for the struggle ahead. But the terrible paradox today is that if governments are now suddenly honest about the real scope of the threat, the effect is likely to hasten and worsen the disaster.
* * *
Perhaps the only consolation is that we are living in an ideological vacuum. Europe is not torn between the Manichaean false alternatives of Stalinism and Nazism as it was in the 1930s. But both socialism and now capitalism also appear to have failed. Socialism because it depends on state spending and now all states have to cut back. And capitalism is in crisis, partly because of the self-destructive volatility which Marx identified, but also because the poor are getting poorer for the first time, and thus do not have the means to spend to create growth. Capitalism has also entered a downward cycle because incestuously corrupt dealing in financial centres is now alienating the very mass of the middle class on whom stock markets depend. Some claim that capitalism always manages to reinvent itself, but this time it looks unlikely.
Protesters, such as the Occupy movement, may rage against the greed of bankers, but if one cannot disinvent the internet and roll back globalisation, where can countries expect to go? Autarchy—that attempt at national self-sufficiency—can only be the solution of a dictator, whether of the left or the right. It seldom worked in the past and it is even harder to see it working today. In an inventive, fast-moving world, inflexibility is fatal. And nothing could be more inflexible than the euro system, as we have seen. Over the last few months, in Spain especially, there has been a terrible sense emerging that it cannot recover within the euro. The Spanish will just be ground down and down, with more and more useless sacrifices, as further rounds of cuts, accompanied by further rounds of bailout borrowing, destroy any hope for the future. This is what risks creating the bitterness and national resentments which encourages people to listen to demagogues and turn their backs on democracy.
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