Feedback from Warren Wagar

john enyang x03002f at
Sat May 31 23:02:48 MDT 2003

Lou Proyect writes:
> From the point of view of the German ruling class, the
> Versailles treaty did not leave Europe in a balance of power after WWI.
> It was legitimate grievances against British and American
> heavy-handedness that allowed Hitler to gain a hearing.
To which Warren Wagar replies:
> The heaviest hand against Germany in 1919 and throughout the 1920s
> was wielded by France.
The heavy hand was actually that of the USA whose government insisted,
throughout the 1920's and into the 1930's on the full repayment by
France, Britain and the smaller European states of the inter ally war
debts which had no reflection in European productive capacity (though the
first war, through these loans, did provide a giant stimulus to the
expansion of North American industry and agriculture). During the 1920's
the US weilded these debts to weaken Europe in much the same way that
Europe, North America and Japan use dollar claims to cripple the South

While the US denied any connection between the inter ally war debts and
reparations, the European states, lacking the means to pay their debts to
the US (since the US restricted European industry's access to the North
American markets, and hence denied Europe the dollars with which to pay
these debts), could only squeeze Germany by way of reparations to meet the
demands of the US. Being itself locked out of the North American markets,
Germany in turn was forced to borrow dollars from Wall Street private
banks in order to pay its reparations to the rest of Europe -- which then
recycled these dollars to pay the inter ally war loans owed to the US

This circular flow of funds and the corresponding growth of paper debts
with no basis in production lead to the growing pyramidisation of private
and public finance worldwide, a structure which collapsed in 1929-32.\

See Michael Hudson's: "super imperialism: the origin and fundamentals of
US world dominance".\


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