The outcome of World War I hinged largely on the economic and financial resources that each side commanded. To a considerable extent it depended just on bankers and financiers in Great Britain and the United States. Georges Clemenceau illustrated this by his remark, “War is too serious a matter to entrust to military men.” The United States played an increasing role in supplying the Allies from 1915 until the end of the war and thereby contributed considerably to Germany's defeat in 1918. In the first eighteen months of the war the American banking firm J. P. Morgan & Co. took the lead in shaping America's material and financial aid to the Allies. J. P. Morgan assumed the risk and the responsibility of exploring the hitherto uncharted field of large-scale private financing of European needs at a critical juncture. This venture proved successful in facilitating the unprecedented flow of American resources in support of Allied warfare in Europe. Yet the initiative came back to haunt the banking concern in 1936, when those who had marshaled aid for the Allies in World War I had to face hostile interrogation from the Senate Special Committee Investigating the Munitions Industry, chaired by Senator Gerald P. Nye (R-North Dakota).

This book presents the revised results of a conference convened to discuss the work of the late Erich Angermann (1927-92). The symposium took place at the German Historical Institute (GHI) in Washington, D.C., from June 8 to 10, 1995. We remember Angermann, the senior historian of America in Germany, as the principal figure behind the foundation of the GHI in 1987. He also served as the first chairman of its academic advisory council. During his tenure as professor for American and European history at the University of Cologne, Angermann more than anyone else worked for a revitalization of what he called “Atlantic history.” That conceptual approach, derived from the eighteenth- and nineteenth-century tradition of humanistic historiography, viewed American history as part of an integrated history of North America and Europe. Thus, the concept of Atlantic history comprises the common links between European and American history since the beginning of the European settlement of North America as well as comparative social, cultural, and economic developments on both continents.

Angermann's integrated vision of a common Atlantic history of Europe and America remains important for American as well as European historians. During the last decade the historical communities on both sides of the Atlantic have vigorously debated the notion of complementary and comparable historical developments - or of Atlantic history.

“This is a steel war,” wrote Winston S. Churchill in September 1917. The British minister of munitions emphasized with these words the need for the Allies to supply more material to the war effort. He insisted that America and the Allies would have to exceed German steel production. After the Allied defeat at the Somme in November 1916, British military leaders became inclined toward waging a war of attrition against Germany. This concept required all-out economic mobilization, which in turn constituted an important step toward total war. As the nation that was richest in material resources, money, and men, the United States held the key to this endeavor. Churchill's statement reflected a widespread concern: Could the United States mobilize its economy fast enough to block the Reich's attempt to defeat the Allies in an all-out offensive before the Allies' combined war production brought its defeat?

General Erich Ludendorff s call for an armistice thirteen months later provided a definitive answer to that question. This call resulted largely from the fact that the United States had surpassed Germany's war production. By the fall of 1918 the Allied economic war against Germany had weakened the German army, dispirited its leaders, and demoralized the population of the Reich.

This chapter examines the economic war effort of the United States after it entered the conflict. It assesses Washington's financial contribution to the Allies as well as the flow of American supplies, and it analyzes the difficult choices that confronted the Wilson administration. It likewise examines the problems that the government of the United States, despite little preparation, overcame in providing maximum support to the Allies while preserving America's status as an independent arbiter in the conflict.

The fighting in World War I can be described as a composite military, political, and economic effort on all sides. Superior Allied strength from mid-1917 on and final victory resulted in large part from the successful blockade of Germany. Inter-Allied economic cooperation in the control of shipping and raw materials sustained this combined economic campaign. German economic warfare consisted of the submarine counterblockade, the destruction of industries in German-occupied areas, and the transfer of vital food supplies from those areas to Germany. This, combined with the Bolshevik revolution, brought economic havoc to some of the main grainproducing areas in eastern Europe. As a result, 160 million people in Europe were threatened at the end of the war by starvation on a scale unknown since the early nineteenth century. Even for those not directly facing deprivation of necessary foodstuffs, the impending economic crisis - owing to the termination of war production, the ending of price guarantees, and the threat of postwar inflation - meant an existential threat.

In short, the winding up of the economic war proved to be an arduous task. A new economic and political balance of power in Europe seemed to be the precondition for an enduring peace. The peacemakers in Paris faced a double task: to conclude a viable economic peace and at the same time to deal with the most pressing economic problems caused by the end of the war. Those combined problems of economic peacemaking form the subject of this chapter. In the end, the economic clauses of the Versailles treaty emanated from compromises between the different, if not divergent, economic and political goals of the United States and the European Allies.

This book brings together the proceedings of an international conference on the Treaty of Versailles. The 1919 peace treaty left an enduring mark on twentieth-century historiography. Even now, the reason for the ultimate collapse of the Versailles system remains disputed. A detailed examination of the motives and making of the treaty, as undertaken here, goes a long way toward explaining whether that failure stemmed from inherent weaknesses of the treaty or from postwar revisionism and economic instability. There exists a solid basis for this reevaluation: multiarchival studies that have appeared in the past twenty-five years have minimized national bias, although most have treated a specific national problem or taken a particular national perspective. Furthermore, no effort has been made to produce an international research oriented synthesis.

A group of German and American historians concluded in 1992 that a reassessment of the peace settlement from an international perspective after seventy-five years would therefore be particularly timely. In May 1994 experts from France, Germany, Great Britain, Switzerland, and the United States gathered to reconstruct the making of the treaty by discussing the latest archival evidence and the extant literature. The conference took place under the auspices of the Center for German and European Studies of the University of California at Berkeley and the German Historical Institute in Washington, D.C.