The Economic Consequences Of The Peaceby John Maynard Keynes
In 1919, John Maynard Keynes participated in the negotiations of World War I's armistice at the Versailles Peace Conference. A senior Treasury official with the British delegation, Keynes strongly disagreed with terms of reparation imposed on Germany, arguing that German impoverishment would threaten all of Europe. Indeed, the imposition of an economic burden that Germany could not pay led to the dismantling of the European market, famine, social unrest, and, ultimately, to World War II. The Economic Consequences of the Peace became an instant best-seller upon its initial publication, its controversial issues transforming Keynes into an overnight celebrity. Its real impact occurred several years later, when the wisdom of Keynes' reasoning was recognized at the close of World War II. The United States and Great Britain followed his advice and undertook an ambitious rebuilding program that paved the way for a solid democratic base in Germany, Italy, and Japan. In addition to its excellent economic analysis of reparations, this volume presents an insightful analysis of the Versailles conference's Council of Four (Georges Clemenceau of France, Prime Minister Lloyd George of Britain, President Woodrow Wilson of the United States, and Vittorio Orlando of Italy). A prophetic view of the European marketplace in the early twentieth century by a brilliant economist, this volume represents a much-studied landmark of economic theory.
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Meet the Author
John Maynard Keynes (1883-1946) was one of the greatest economic theorists of the twentieth century. He was chairman of the liberal journal of opinion The Nation and economics advisor for more than thirty years to British governments. He wrote several books, including his masterpiece, The General Theory of Employment, Interest and Money, the two-volume Treatise on Money, and A Tract on Monetary Reform.
David Felix is professor emeritus of history in the City University of New York. His research interests include the history of ideas, economic history, and biography. He is the author of Biography of an Idea: John Maynard Keynes and the General Theory of Employment, Interest and Money, Keynes: A Critical Life, Marx as Politician, and other works.
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A prophetic book about the long-term consequences of retaliation of the I World War winners against Germany. Keynes clearly demonstrates how the harsh conditions imposed to Germany plunged the country in starvation, unemployement, riots, revolutionary plots and eventually open the way to nazism. This book has been ignored and/or obscured for long time since it highlights the blind, greedy behavior of Brits and French and somehow forecasts the great turmoil that swept Europe and the whole World in the years onward. Strongly recommended for scholars really dealing with the human History.
This book achieved instant fame when it was published in 1919, not only for its scathing criticism of the Versailles Treaty but also for its personal attacks against leading signatories (especially Clemenceau and Wilson). For a book focused primarily on economic concerns, the text is surprisingly easy to read. However, the book's poor organization vitally detracts from its effectiveness. The principle reason the book is still famous today lies in the fact that it was written by none other than John Maynard Keynes, the founder of 20th century style, gov't & debt driven economics. The book is organized into chapters on pre-war Europe, Allied statesmen, summary of key treaty points, reparations, post-war Europe predictions, and Keynes' suggestion of remedies to provide a practical treaty settlement. Unfortunately, within each chapter things are jumbled together without clear rhyme or reason. (Is this indicative of Keynes' own personal organization and logical thinking?) Within the book, he makes a very practical (but politically infeasible) argument for a non-vindictive treaty. He basically suggests that the Allies should forget both about reparations and repayment of wartime debts from the other Allies, and instead they should settle (though not ideally) for frontier adjustments and confiscation of only German gov't property. (Did the German gov't sponsor Keynes' work in writing this book?) Keynes argues that a crushing reparations burden on the German people would disincent them to produce anything beyond a mere subsistence minimum and discourage entrepreneurial enterprise. There is some logic in this point however, later on he goes on to state that the US should forgive its $10 billion debt to its wartime allies ($5 billion of which was owed by the UK). Forgive me if I'm wrong, but doesn't such a move disincent American entreprises from entrepreneurship as well. It's extremely hypocritical that the Allied gov'ts desperately sought loans from the US during the war and then once it was over to claim that they couldn't pay them. If they didn't want to repay, then they shouldn't have borrowed the money - period. (If I borrow money to buy a home, the bank won't ever agree to forgive my debt - regardless of whether I'm out of work, injured, or the house burns down. I don't see why gov'ts should get any exceptional treatment.) Notwithstanding his problems with disorganization and inconsistent logic, Keynes does produce a reasonable, brief list of treaty rememdies, especially in his efforts to restore economic life throughout Central and Eastern Europe. Not until the advent of the Cold War and the interests of extending American political influence would Keynes' policies largely succeed (albeit yet again to the detriment of American taxpayers). Overall, I felt the book was ok. I would only recommend it if you have an interest in reading all of Keynes' work. Don't expect to find any theoretical economic insights in the book, though.