Chapter Three

The Case Against a Thirty Years War: the Restoration of Europe

The arguments summarised in the previous chapter, if accepted in their entirety, lead to the conclusion that the instability of Europe after 1919 rendered the outbreak of another war almost inevitable. But, however powerful they appear, they have been widely questioned, qualified, or indeed rejected outright. It is impossible to squeeze out of our history the people and events ‘between the wars’, as though they were nothing more than the ghostly inhabitants of an extended half-time interval. Not even the most fatalistic observer would claim to trace a wholly predestined line from the situation of 1919 to that of 1939–41, leaving no liberty of choice whatsoever to the statesmen and peoples of the inter-war years. At the very least, it remains to be explained how it was that a war of some sort, inherently probable from 1919 onwards, became the specific conflicts which overtook Europe between 1939 and 1941. But it is possible to take the challenge to the ‘Thirty Years War’ thesis further than that.

Signs of hope: Locarno, economic recovery and the League of Nations

In the late 1920s it appeared to contemporaries in western Europe that peace was at length returning to the troubled Continent. The errors which were by that time widely perceived in the 1919 settlement were thought to be not beyond remedy, and steps were taken to put some of them right, notably by changes in the method and extent of reparations payments, and by admitting Germany to a place in the normal working of European relations. It was also hoped that the instability of the Continent could be remedied, on the one hand by the resurrection of something like the nineteenth-century ‘Concert of Europe’, an informal grouping of the great powers to provide a guiding influence in international affairs, and on the other by the development of the League of Nations. In practice these two devices often overlapped, because the great European powers were also the most influential members of the League. Finally, it appeared also that the economic and social disruption left by the war had been overcome: currencies were stabilised, industrial production reached and passed the levels of 1913, threats of revolution diminished, and the new states settled down. It was not outrageously optimistic to think that things were looking up.

The symbol of this change in European affairs was the Treaty of Locarno, and the group of political and economic agreements that preceded and followed it. Austen Chamberlain, the British Foreign Secretary, who played a considerable part in the achievement of the Locarno agreements, said afterwards that they marked ‘the real dividing-line between the years of war and the years of peace’; and this verdict commanded widespread agreement at the time. The Treaty of Locarno itself was rather a limited measure to bear this heavy symbolic weight. Signed in London on 1 December 1925, after being initialled at the Swiss resort of Locarno on 16 October, it embodied the acceptance of the Franco-German and Belgian—German frontiers by the three states concerned, with an outside guarantee of those frontiers by Britain and Italy. The same acceptance and guarantee applied to the demilitarised zone in the Rhineland, which was imposed on Germany by the Treaty of Versailles. Under this extremely important provision, Germany was forbidden to maintain troops or construct fortifications in an area which included the whole of the left bank of the Rhine and a zone 50 kilometres wide on the right bank; and in the Locarno Treaty the German government freely accepted this limitation, which it previously regarded as only a part of the diktat of Versailles.

Though limited, these terms were important in themselves, as confirming the territorial settlement in western Europe on a freely negotiated basis. They were also important for what they represented. An important gain from the French point of view was the British guarantee of their frontier with Germany, which was something the British had avoided giving ever since 1919, when the proposed Anglo-American guarantee that was intended to accompany the Treaty of Versailles was allowed to lapse. This reassurance to France, which contributed to a sense of security, was the counterpart of the other main theme of this agreement, which was Franco-German reconciliation. Looking to the future, this seemed the crucial aspect of the whole affair. The formal political treaty did not stand alone. It was buttressed by an association, perhaps amounting to friendship, between the French and German Foreign Ministers, Aristide Briand and Gustav Stresemann. The diplomatic relationship was accompanied by the activities of various private bodies, for example the Franco-German Committee, which originated with a small group of writers, politicians, and businessmen; and the Action Catholique de la Jeunesse Française, which threw itself into the work of reconciliation with German Catholics. In economic terms, French and German industrialists (with others from Belgium and Luxemburg) signed in September 1926 an agreement for an iron and steel cartel, regulating annual production and its division between the countries concerned. It was a time of hope in Franco-German relations.

The Treaty of Locarno was accompanied by other agreements. There was a series of arbitration treaties between Germany on the one hand and France, Belgium, Czechoslovakia, and Poland on the other, laying down that certain types of dispute between the signatories should be submitted to outside arbitration. There were also treaties of mutual guarantee between France on the one hand and Poland and Czechoslovakia on the other, which were intended to close, at least partially, the obvious gap left by Locarno, which was that it concerned only western Europe.

Locarno and its accompanying agreements, and the spirit of reconciliation which flourished with them, were only possible because in the previous year a partial settlement of the reparation problem had been reached. In 1923, with the French occupation of the Ruhr to enforce payment upon Germany, this had seemed scarcely feasible — France was firmly embarked on the course of imposing reparations, not negotiating about them. But in October of that year the French government accepted a British proposal to set up a committee of experts to consider the problem. This committee, set up by agreement between the British, French, Belgian, Italian, American, and German governments, was to consider (supposedly from a purely technical standpoint) means of balancing the German budget, stabilising the German currency, and fixing both an achievable level of reparation payments and means by which they might be made and secured. The chairman of the committee was an American banker, and Director of the US Bureau of the Budget, Charles G. Dawes; and its recommendations, made early in 1924, came to be known as the Dawes Plan. A vital recommendation was for the stabilisation of the German currency, at the rate of 20 Reichsmarks to the pound sterling, controlled by the creation of a new bank of issue, independent of the German government and run by a body of which half had to be non-Germans. The committee then went on to deal with reparation payments. It left the total unchanged, but recommended a new scheme of annual payments starting at 1,000 million gold marks in the first year, rising to 2,500 million in the fifth and thereafter. Some variation in the annual payments was provided for in case of sharp movements in the price of gold or severe transfer problems. Payment of reparations was to be ensured by the appropriation of certain indirect taxes and bonds for the state railways for that purpose; and a Reparations Agency, including Allied representatives, was to be set up to control these arrangements. A foreign loan of 800 million marks was to be raised, partly to back the new currency, and partly to help with the payment of the first annual instalment under the new reparations scheme.

The Dawes Plan was accepted by the French government in April 1924, which was a vital first step, because the whole scheme was contingent upon French withdrawal from the Ruhr; and then by an international conference in London in July and August. The loan was raised without difficulty in October, rather more than half in the USA and a quarter in Britain, with the rest in a number of west European countries. Germany then made reparation payments regularly under the terms of the Dawes Plan. In February 1929 a new committee, under the chairmanship of another American banker, Owen D. Young, was set up to work out a definitive settlement of the reparations question. Its report, presented to the governments concerned in June, recommended a reduction of about a quarter in the total of reparations, with a rising scale of annual payments to be completed by 1988 — the first mention of a final date. The Reparations Agency was to be withdrawn, and foreign surveillance of German finances brought to an end. The proposals were accepted by the various governments; and a German payment under the new arrangement was made in May 1930.

These agreements were not in any final sense a settlement of the reparations problem. Paying reparations at all was still unwelcome to Germany; and there was still a strain on the German balance of payments. However, it was shown that in certain circumstances reparations could be paid, and indeed that they were compatible with a general recovery in European commerce and industry. In France, the index of industrial production passed the level of 1913 in 1924; in Germany, in 1926. In both countries, production continued to be high (though with some fluctuations) in the late 1920s, a tendency which was shared by nearly all European countries, eastern as well as western. Trade between France and Germany grew rapidly: French imports from Germany increased by 60 per cent between 1926 and 1930, including large quantities of coal, iron and steel, chemical products, and machine tools. French industrial growth in the period was closely linked to German production — at the time, another sign of Franco-German co-operation.¹

Economic progress was accompanied by the stabilisation of the major west European currencies. In Germany, this was a matter of replacement rather than stabilisation. In November 1923, at the height of the hyperinflation, a new currency, the Rentenmark, was introduced, based on the security of land and buildings. For a time it circulated alongside the old mark; then in August 1924, with the backing of the Dawes loan, a new Reichsmark was introduced to replace the old currency, at the rate of one new Reichsmark to 1 million millions of the old. This registered the acceptance of the obliteration of all holdings in the old currency; but it was a fresh start, and in the following years prices held steady. Austria and Hungary also had to introduce new currencies after rampant inflation. In Britain, the pound sterling was stabilised with the return to the gold standard in 1925 at the pre-war level, which placed the pound at an exchange rate of US$ 4.86. This decision was later criticised, notably because it overvalued the pound by about 10 per cent in terms of its actual purchasing power compared with the dollar, and so made British exports over-expensive and condemned governments to rigid financial policies in order to maintain sterling at its overvalued rate. At the time, it was regarded as an essential step (psychological as much as anything else) towards the restoration of pre-war stability. Its main object was to restore stability to rates of exchange, and so to promote international trade, on which Britain was heavily dependent. In France, the franc, which had fallen seriously in terms of the pound sterling (touching 243 francs to the pound in July 1926), recovered sharply when Poincaré became Premier, and stabilised by the end of 1926 at 124 to the pound. France returned to the gold standard in 1928, fixing the new value of the franc at 65.5 milligrams of gold, as against 290 milligrams for the pre-war franc.² All this, and especially the concern with the gold standard, later came to appear very rigid and old-fashioned; but at the time it represented an attempt to get back to the well-tried mechanism of the pre-1914 system, and even more to the confidence which had sustained it.

One of the agreements reached at Locarno in 1925 was that Germany should be admitted to the League of Nations and become a permanent member of its Council. This focused attention on another great sign of hope in the 1930s: the apparently firm rooting and strong flowering of the League. Founded in 1919 under the combined impulse of Lord Robert Cecil and President Wilson, the League suffered an early blow when it was rejected by the USA in 1920, and it was viewed with suspicion by most practitioners of the old diplomacy, who saw it, at best, as being no more than a fifth wheel on a carriage. But despite set-backs and doubts, the League began to flourish. The annual meetings of the Assembly, at which all member states were represented, allowed the smaller countries an active role in world diplomacy, an opportunity seized with zeal and success by (for example) Beneš of Czechoslovakia, Branting of Sweden, and Hymans of Belgium. The Council of the League, with its permanent membership made up of great powers (Britain, France, Italy, and Japan), acted as a successor to the old Concert of Europe. The Covenant bound all member states to submit disputes to the League before resorting to force, and so held out the opportunity of avoiding war. It also offered the prospect of stability, in that Article 10 bound all members to respect the territorial integrity and independence of others; and of peaceful change, because Article 19 held out the possibility of revising treaties which had become inapplicable.

The League settled well to its work of international administration, supplying High Commissioners for the Saar and Danzig, providing a channel for loans to Austria and Hungary, and furnishing various humanitarian services for the world at large. It began work (though with painful slowness) on the problems of disarmament. In 1926 the Council scored a success in settling a border incident between Bulgaria and Greece which had threatened to develop into war. With Germany's admission to membership in 1926, the League escaped the stigma of being merely a ‘League of victors’. By 1928 every European state except the USSR was a member, and nearly every Foreign Minister attended its sessions. Notably, in the post-Locarno period, Briand, Stresemann, and Austen Chamberlain made a point of meeting at Geneva. In the late 1920s the League was at the height of its prestige, and a beacon of hope in international affairs.

Balance sheet: achievements and flaws

All these achievements of the late 1920s had their flaws, some of which were potentially dangerous. The Locarno agreements contained serious faults and contradictions. Some were immediately apparent, certainly to those whom they affected most nearly. The treaties distinguished between Germany's western frontiers, which were voluntarily accepted by Germany and guaranteed by outside powers, and her eastern borders, which were not. The implication, which was not lost on the Poles, was that some frontiers were more firmly established than others. Other faults were temporarily concealed. By the treaties, Britain publicly guaranteed the Franco-German and Belgian—German frontiers, but she took no steps to ensure that this guarantee could be fulfilled: there was no military commitment nor planning for the defence of any of the territories involved. David Dutton, in his biography of Austen Chamberlain, has pointed out that Locarno ‘represented the limit and extremity of British involvement in European affairs’.³ Most serious of all, the agreements merely disguised a profound difference of approach between France and Germany. It was true that both Briand and Stresemann spoke the language of reconciliation; but each hoped to reconcile the other to something different. Briand wanted to reconcile Germany to the acceptance of the Versailles settlement; Stresemann wanted to reconcile France to its revision. It must be doubted whether so fundamental a contradiction could have been glossed over for long.

It also appeared in retrospect that the economic recovery of Europe was excessively dependent on American loans (see Table 3.1). The Dawes loan of 1924, which was oversubscribed in New York, was the start of a considerable flow of lending by American investors to Germany (especially to the firms of Krupps and Thyssen, and to German municipalities), and later to other European countries. In the Dawes years (1924–29), German borrowing from abroad always far exceeded her reparation payments. Hence a curious cycle of payments developed: Germany borrowed from the USA; which helped her to pay reparations to France, Britain, and Italy; and in turn these countries made payments on their war debts to the USA. When the source of American loans dried up with the stock market crash in 1929, this cycle was broken at its starting point; and with the calling in of short-term American loans, an important element in the German economic recovery was removed.

The extravagant hopes invested in the League of Nations by Western liberals and socialists, and by aspiring small states, were probably always greater than that organisation could be expected to fulfil. It was easy to exaggerate the success over Greece and Bulgaria, and ignore the League's failure to deal with the Polish—Lithuanian conflict over Vilna. The basic problem presented to the League by the absence of the USA and the Soviet Union had not been resolved. There was a dangerous element of euphoria in the atmosphere of Geneva.

All this may be granted. But does it mean that all the hopes which followed the Dawes—Locarno agreements were illusory? Surely not. The case must remain hypothetical; but it is perfectly conceivable that, without the stock market crash in America in 1929, American support for the European financial system would not have been so abruptly removed, and the system might have adjusted itself gradually to a lesser dependence on US loans. It was first the great crash, and then the even greater world depression that it signalled, that cut off the hopes of recovery in their prime. All over Europe, the British Empire, and the USA, the depression had the effect of driving states (or groups of states) in upon themselves, to try to find salvation in some form of self-sufficiency. Similarly, the political contradictions underlying the Locarno agreements were real; but there was a reasonable chance that they could be resolved, as long as Germany moved towards the revision of Versailles with prudence, and with limited objectives. Britain would have accepted such movement readily and France reluctantly; but the result would have been the same. Locarno at least opened the way for Germany to resume her place as a partner in the European Concert; and after that, perhaps, by stages, to her former predominance, without encountering determined — still less armed — opposition.

In this hypothesis, then, it was the great depression which destroyed a situation offering a real chance of evolution towards a stable European peace. The depression wrecked all the gains in terms of economic stabilisation, prosperity, and material progress secured since 1924. It provoked over much of Europe a flight towards political extremes which plunged the Continent into ideological strife, and various forms of economic nationalism which generated constant friction. Above all, by destroying German prosperity and rendering 6 million Germans unemployed, it played a crucial part in the rise of Hitler to power. That, in the eyes of many, was the fatal event, the conjuring up of the demon king. In Churchill's words: ‘… into that void after a pause there strode a maniac of ferocious genius, the repository and expression of the most virulent hatreds that have ever corroded the human breast — Corporal Hitler’.⁴ It then requires only one link to complete the chain: the depression brought Hitler, and Hitler brought the war. For many, like the French historian Maurice Baumont, the link presents no difficulty: ‘the origins of the war of 1939 go back essentially to the insatiable appetites of Adolf Hitler’.⁵

A rival hypothesis to that of a Thirty Years War thus takes shape. Instead of the continuation of the First World War, arising almost inevitably out of the effects of that war and the instability of the peace settlement, there appears the outline of a successful European recovery, cut off in its prime by the great depression and its dreadful consequence, the advent of Hitler. These two broad interpretations have bred many variations, advanced with varying degrees of sharpness, and sometimes venom. Before pursuing the discussion, it may be helpful to look at some other aspects of the historical debate on the origins of the Second World War in Europe.

References

1. Carlo M. Cipolla (ed.), Fontana Economic History of Europe, vol. 6, part 2 (London 1976), tables on pp. 687ff.; La France et L'Allemagne 1932–1936: Communications présentées au Colloque franco-allemand tenu à Paris … du 10 au 12 mars 1977 (Paris 1980), p. 279.

2. Philippe Bernard, La fin d'un monde, 1914–1929 (Paris 1975), pp. 139–141.

3. David Dutton, Austen Chamberlain: Gentleman in Politics (Bolton 1985), p. 259.

4. W. S. Churchill, The Second World War, vol. I (London 1948), p. 9.

5. Maurice Baumont, The Origins of the Second World War (New Haven, Conn. 1978), p. 3.