Germany's toughness on Greek debt is unseemly, given its own experience with war reparations

Peter Kammerer says with her tough demands on Greece, Angela Merkel has apparently forgotten her country's experience of crippling war reparations

PUBLISHED : Monday, 20 July, 2015, 2:29pm
UPDATED : Monday, 20 July, 2015, 2:40pm

Germany got what it wanted in talks to force Greece to pay back its debts. In return, though, the strong-arm tactics of Chancellor Angela Merkel and her negotiating team have split Europe and damaged the reputation of what had arguably been the continent's most respected nation.

The manner in which the country dealt with its wartime past won plaudits; its apologies for atrocities are a model that others can admire. Yet that was ignored as the German leader put politics first.

It didn't have to be that way. Merkel could have sided with France and Italy and gone easier on the Greeks. Knowing that Greece owed an amount it may never be able to repay, she could have opted for a waiving of looming repayments for a year or more, even cancellation of a proportion of the amount.

Instead, she chose a strategy of deepening austerity that has already made life miserable for the Greek population. The dislike of Germany for the Nazi regime's invasion and occupation during the second world war has never gone away there; now the "do as we say or else" approach has, for some, downgraded it to hatred.

Thomas Piketty contended that Germany had never fully paid its external debt from the two world wars, yet had other nations pay up.

It is a disconcerting feeling for me, the son of a German father. Despite Germany's heartfelt apologies for starting a war that claimed more than 20 million lives, six million of them Jews, the country is still the butt of jokes and snide insinuations. The war seems to come up each time Merkel holds a press conference.

I endured teasing as a child at school in Australia, and had to deal with the fallout of giving my version of history as taught to me by my father. He was still convinced when he died in 1993 that dictator Adolf Hitler had fled to Argentina at the end of the war rather than taken his own life, as the Allied victors contended. My teachers and fellow students had disregarded my "other side" of the conflict, experienced by my father; the hardship of living in Munich amid bombing raids, with a soldier father imprisoned in France and forced to be a member of Hitler's youth movement.

But it goes beyond that into the realms of irony, according to Thomas Piketty, the Frenchman whose book, Capital in the Twenty-First Century, has made him one of the world's most influential economists. In an interview earlier this month with the German newspaper Die Zeit, he contended that Germany had never fully paid its external debt from the two world wars, yet had other nations pay up, as with after the Franco-Prussian war of 1870, when it demanded - and received - massive reparations from France.

"When I hear the Germans say that they maintain a very moral stance about debt and strongly believe that debts should be repaid, then I think, 'What a huge joke'," he said. "Germany has never repaid its debts. It has no standing to lecture others."

Piketty is not strictly correct; in October 2010, Germany made its final first world war reparations payment, £60 million (HK$725 million) in interest. Payments had been dramatically reduced from the figure demanded by the Treaty of Versailles in 1919 after Germany lost - an amount so damaging that it had caused the rise of Hitler and another war. That experience taught the second world war victors to try a different strategy: trials and reparations took the form of seized assets, mostly machinery and factories.

Merkel should have had Germany's past in mind as she was negotiating with Greece's prime minister, Alexis Tsipras. Germans have gone online in increasing numbers to apologise for her behaviour. She should go a step further by making a personal apology to Greeks and then ensuring that further demands for repayments will be eased, softened and even waived. This is, after all, also about reputations.

Peter Kammerer is a senior writer at the Post