Introduction

The purpose of this chapter is to contest the conventional wisdom that reparations were responsible for the rise of Hitler. As with the subject of this symposium, this wisdom is owed in part to Keynes's writings, or rather to a very literal interpretation of Economic Consequences of the Peace. Instead I argue that the economic chaos and severe social hardship of Germany through the 1920s and at the start of the 1930s were primarily the result of a hardline imposition of orthodox monetary and fiscal policies.

At face value reparations were severely punitive, but in terms of actual economic impact, cash payments were of far less importance than usually imagined. They were instead important politically, first as a means to the imposition of the orthodox policies, and, subsequently, as a device for right wing, nationalist forces.

The assessment is underpinned by a broader view of global and national economic policy that follows G. L. J. Tily's Keynes Betrayed (2007), in particular drawing a sharp distinction between liberal financial arrangements under private authority and managed systems under public authority.