Prof reminds Germany of its WWII debts to Greece
An LSE professor says Germany should be nice to Greeks, who let them off World War II reparations
Greece may seem like Europe's prime debt-dodger, but an economic historian has pointed out that Germany was, in fact, "the biggest debt transgressor of the 20th century".
Albrecht Ritschl, a professor at the London School of Economics, has slammed Germans for their hostile attitude to the struggling Mediterranean country, warning that if Germany isn't careful it could face claims from angry Greeks for unpaid World War II reparations.
According to polls, the German public is 90 per cent against underwriting a second bailout of Greece, a nation they see as profligate with a particular bugbear being supposedly overgenerous state pensions.
But in an interview with Der Spiegel, Ritschl points out that Germany itself failed to pay back its debts three times in the last century.
First the post-World War I Weimar Republic borrowed money from the United States to help pay back its crippling reparations to the victorious allied nations. This money disappeared during the Wall Street Crash – at great cost to the US.
Then after the Second World War, Germany, now divided into East and West, was let off paying reparations to countries - including Greece - it had invaded.
Under a 1953 treaty, the issue of reparations should have been revisited following reunification in 1990. But Ritschl says: "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."
Ritschl makes it plain he believes that Germany's economic success - it is vying with China to be the world's premier exporter of manufactured goods - has only been possible "through waiving extensive debt payments and stopping reparations to its World War II victims".
In Greece, he says, "no one has forgotten that Germany owes its economic prosperity to the grace of other nations".
Ritschl warns that if Germany keeps up its antagonistic attitude, Greece – and other European nations - may well feel like raising the issue of reparations again.
As for the current crisis, Ritschl believes there will have to be a default in all but name. Creditors should give up part of the money they are owed by Greece – and some banks will struggle. "For Germany," he says, "this could be expensive, but we will have to pay either way." ·