John Maynard Keynes: A Prophet for Our Times

He Predicted the Tragedy of World War II

His Warnings about Versailles are Valid Today

As I witness the American President Joe Biden strutting about like the Alpha male of the Western herd, with NATO and the EU subject to his command, as he gloats and brags about how the economic sanctions he is imposing will bring Great Russia – a nuclear super-power – to her knees, my mind harkens back to the Versailles Treaty and Dr. Keynes’ prophetic treatise: “The Economic Consequences of The Peace.” In this brilliant deeply insightful work, Dr. Keynes warned that the economic sanctions imposed on Germany at the Versailles Conference of 1919, held in the aftermath of World War I to establish the new world order, would set forces in motion within German society that would lead to another even more devastating war. And history has verified the accuracy of his prediction.

Although historians are wary of the analogy, and rightly so, because the devil is always in the details and what seems like history repeating itself often proves untrue upon close inspection. Yet there is merit in Mark Twains observation that “History may not repeat itself, but it rhymes.”  And the oft repeated axiom of the late Harvard Philosopher George Santayana is altogether fitting for Bumbling Biden and his vassals in the EU and NATO to heed at this moment:” Those who fail to learn the lessons of history are doomed to repeat its mistakes.”

Alas, even after considering the particularities of the situation that prevailed in western civilization in 1919, and the crisis we are facing a hundred years later, if we think of the problems as a general class of political phenomenon some vital lessons can be drawn that, if properly understood, could guide our statesmen from leading the world into a worse disaster than World War II.  Indeed, western civilization has reached a stage of technological development where wrong decisions can lead to the destruction of civilization and even the extinction of all life on this planet.

Hence the compelling question is: What can we learn from the scribblings of a British economist a century removed. Well, the most important lesson is Keynes’ warning that imposing crippling economic sanctions on Germany would lead to a resurgence of nationalistic anger and resentment that would spark another war that would be more destructive than the “Great War” that had just devastated Europe, physically and psychologically. With uncanny prescience he wrote, the victors:

“run the risk of completing the ruin, which Germany began, by a Peace which, if it is carried into effect, must impair yet further, when it might have restored, the delicate, complicated organization, already shaken and broken by war. And invite their own destruction also, being so deeply and inextricably intertwined with their victims by hidden psychic and economic bonds.”

Angry and disillusioned after witnessing their civilization – which many Europeans believed was the apex of human achievement – descend into barbarism, the victors were in no mood for reconciliation, they wanted to punish the vanquished Germans, whom they blamed for starting the war. And the sanctions they imposed were designed to accomplish just that. Keynes, who was a senior economic advisor to the British delegation at Versailles, argued for a different approach, one that would allow Germany to rebuild their economy in a post war European system that would promote peace and prosperity for all.

When his proposals were ignored, and dismissed as naïve wishful thinking by many, he resigned his post at the British Treasury, retreated to a house in the countryside with his fellow artistic and intellectual luminaries in the Bloomsbury Circle, and wrote his scathing critique of the folly that passed for diplomacy at the Conference, and the Treaty they produced, considering it both inhumane and a barrier to constructing a peaceful world order.  Keynes published his views as “The Economic Consequences of the Peace,” in which he predicted the Second World War.

He denounced the Treaty of Versailles a “Carthaginian Peace” – a reference to the destruction of the ancient North African nation of Carthage by Rome – and warned that it would lead to chaos and yet another war.

“If we aim deliberately at the impoverishment of Central Europe, vengeance, I dare predict, will not limp. Nothing can then delay for very long that final civil war between the forces of reaction and the despairing convulsions of revolution, before which the horrors of the late German war will fade into nothing, and which will destroy, whoever is the victor, the civilization and the progress of our generation.”

Written in exquisite prose, with characterizations of major players who crafted the Versailles Treaty that won the admiration of his literary cohorts in the Bloomsbury Group such as the novelist Virginia Wolfe, and the writer/critic Lytton Strachey. In fact, conventional wisdom has it that Keynes’s irreverent portrayals of British Prime Minister  Lloyd George, US President Woodrow Wilson – whom he called “slow witted” -and French Prime Minister Georges Clemenceau, was influenced by Strachey’s satirical  portrait of the British elite in his book “The Eminent Victorians.”

The Economic Consequences of the Peace would become the first best seller penned by an academic economist. And just as Dr. Keynes predicted war again descended upon Europe within a generation. It was generated by German resentment over the dire economic conditions imposed upon Germany by the Treaty, and fueled a ultranationalist movement that put a deranged autocrat in power.  And as the historical record testifies it sparked a world war that resulted in the slaughter of 50 million souls!  Twenty- seven million in Russia alone.

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It is important to understand that one of the major sources of German resentment was that they did not feel they were the sole cause of World War I, nor did they start it. Hence, they were convinced that the ruinous economic sanction imposed on them at the Versailles Conference, were unjust and those responsible for it should be made to pay. Hence, “Death to the October Criminals!” referring to the German officials who signed the Versailles Treaty, became the most effective slogan around which Adolph Hitler mobilized the masses into a movement that eventually transformed Weimar Germany from the most enlightened, tolerant, democratic society in the world  – where Afro-American Jazz was the background sound animating the cultural milieu; more books were published and read than anywhere in the world; homosexuality, interracial dating, and cocaine use was common fare, and Jewish life flourished at the highest levels of society – to Nazi Germany, where racism and anti-homosexuality became official government policy. Jazz was deemed the nefarious work of degenerate Untermensch like Blacks and Jews, books were banned and burned, Jews were stripped of their German citizenship and gassed.

Although Jazz was officially banned by the Nazis as decadent, and a danger to the moral health of German society, it remained popular with many Germans, who listened surreptitiously at great risks to their safety. Just as many people in the Communist Soviet bloc countries would do after the Communist Party deemed Jazz the cultural product of a decadent capitalist society. However, both Jazz and cocaine continued to flourish among the Nazi elite as Rutgers Professor, John A. Williams, brilliantly portrays in his illuminating novel “Clifford’s Blues,” set in the Weimar Republic that preceded the Third Reich.

Setting the stage for the modern tragedy of Nazism, in which Germans murdered six million of their Jewish countrymen who had contributed mightily to German society, was the horrendous economic conditions that impoverished the German masses due to the impositions of Versailles. Which resulted in the twin evils of hyperinflation and depression that rendered the German Mark almost valueless.

Obviously, when we look at the draconian ruinous economic sanctions the Biden Administration is presently imposing on Russia, and with ostentatious glee, it is all too obvious that the lessons of Versailles have yet to be learned by our President and his enablers in this dangerous folly. To begin with, the Russians consider the sanctions imposed on them by the US to be “the moral equivalent of war,” as President Jimmy Carter put it when he warned the oil producing nations of OPEC not to  engage in a proposed oil boycott. And furthermore, even before their invasion of Ukraine, Putin had publicly stated that he believed the US was trying to provoke Russia into taking actions that could then be used as the raison d’etre for imposing crippling sanctions against Russia to stifle their economic development. Which is exactly what has happened from their perspective, and thus cause for deep resentments and impassioned hatred for the US, EU, and NATO. The great Russian /American Journalist, Vladimir Posner, says even at the height of the cold war Russian hatred of Americans never reached this fevered pitch! Not to mention their animosity for Ukrainian collaborators with the US. All of this makes for a combustible situation, especially when we consider the nature and extent of the sanctions.

In a recent announcement from the US Treasury Department, we are told:

The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) today imposed expansive economic measures, in partnership with allies and partners, that target the core infrastructure of the Russian financial system — including all of Russia’s largest financial institutions and the ability of state-owned and private entities to raise capital — and further bars Russia from the global financial system. The actions also target nearly 80 percent of all banking assets in Russia and will have a deep and long-lasting effect on the Russian economy and financial system.

Building off of President Biden’s initial sanctions announcement this week, today Treasury is taking action against Russia’s top financial institutions, including sanctioning by far Russia’s two largest banks and almost 90 financial institution subsidiaries around the world. Treasury is also sanctioning additional Russian elites and their family members and imposing additional new prohibitions related to new debt and equity of major Russian state-owned enterprises and large privately owned financial institutions. This will fundamentally imperil Russia’s ability to raise capital key to its acts of aggression. These actions are specifically designed to impose immediate costs and disrupt and degrade future economic activity, isolate Russia from international finance and commerce, and degrade the Kremlin’s future ability to project power.”

The Russians consider these measures acts of war, as would the US government if such measures were-imposed upon them. So here we go again, off to war without a declaration from Congress, as the constitution clearly  mandates by assigning the war making powers to the representatives of all the people. Alas, it is abundantly clear that our Statesmen are dancing in the dark, and nobody knows what morning light will reveal.

One thing is clear to Putin, however, should a Russian missile or bomb intended to interdict arms shipments to the Ukrainians at the border, misfire and lands on the territory of a NATO country, he will be facing attack from a thirty-nation military alliance that includes the United States.  In which case, Russia’s national existence will be at stake because he could not hope to defeat the NATO alliance in a conventional war, since Article 5 of the treaty commits all members to war should any member enter a state of war.  Recognizing the situation his nation is in, Putin has been increasingly candid about his willing to deploy nuclear weapons if Russia is attacked by NATO, either in the Russian Federation or Ukraine!

First the Russian leader warned that if any country attempted to intervene on behalf of Ukraine, there would be unimaginable consequences, then he announced that his “Strategic Nuclear Weapons” had been placed on “high alert.”  And as the war drags on, and he warns the EU and NATO to stop arming the Ukrainian forces with the latest killing machines to deploy against Russians, the world moves closer to Doomsday. Just two days ago Putin flexed his nuclear muscles at the West in a televised statement announcing the successful testing of a new inter-continental missile capable of carrying MIRVED – Multiple Independent, Reentry Vehicles – nuclear warheads with the explosive power of two million tons of TNT.

Lest we forget, the two atomic bombs that created the unspeakable horrors in the two Japanese cities of Hiroshima and Nagasaki – the details of which are easy to access on-line* – equaled only 20, 000 tons of TNT each. Hence the new Russian Rocket, with its amazing stealth features, is aptly named Satan II.  In a statement rife with swagger and braggadocio the supreme Russian leaders said:

“The new complex has the highest tactical and technical characteristics and is capable of overcoming all modern means of anti-missile defense. It has no analogs in the world and won’t have for a long time to come.  This truly unique weapon will strengthen the combat potential of our armed forces, reliably ensure Russia’s security from external threats and provide food for thought for those who, in the heat of frenzied aggressive rhetoric, try to threaten our country.”

Although Putin’s message is abundantly clear, there remain some Mighty Whitey, American Exceptionalist, rah rah USA types, who think we should call his bluff like Clint Eastwood in “Dirty Harry.” But this is madness! The idea that anyone thinks the right for Ukraine to join NATO or the EU is worth playing Russian Roulette with the fate of the earth is unimaginable. But if it is to some people, then nuclear war with Russia is also imaginable. And attempting to strangle the Russian economy over a proxy war that the Russians believe the US has instigated in Ukraine, could well produce the results that Dr. Keynes forecasted for Europe when they wrecked the German economy with the Treaty of Versailles.

Keynes predicted the next World War would be far worse than the last, and the NAZI horrors certainly were. One need not possess the power of prophecy to accurately predict that a nuclear war between NATO  and Russia will make World War II – the last big military conflict to break out in Europe –  look like a playground brawl. I can envision only one way out of this murderous mess. First there must be an immediate cease fire. The NATO countries must stop arming Ukrainians. The neutrality of Ukraine successfully negotiated and all sanctions against Russia rescinded. The alternative is a protracted war, and one miscalculation could lead to Doomsday! Hence the prophecy of John Maynard Keynes in the second decade of the 20th Century, remains frighteningly  relevant as we approach the third decade of the 21st century.

 

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Playthell Benjamin

The Village of Harlem

April 30, 2022

 

 

 

 

 

 

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