The topic has been prominent during the last years, not at least because of the conjunction of the issue of war reparations and the current debt crisis. My opening remarks are based on a fundamental premise: The current debate on guilt and debts between Germany and Greece seriously affects the founding contract of European integration. After 1945, Germany’s neighbours, most of them had suffered under Nazi occupation, accepted the economic and political resurgence of the Federal Republic. While this was not accepted without trouble, it was based on the assumption of a fundamental trade-off: Germany’s prosperity would also strengthen the well-being of their neighbours. This founding contract was renewed at the very occasion of German reunification and it was framed into a common currency. Yet, at the moment we are going through a crisis of this founding contract, since the balance between the well-being of Germany and their neighbours seems to be deeply disturbed. My argument is that the German-Greek-Guilt-and-Debt-Crisis is part of this bigger issue. In my following remarks, I will first recall some basic information which we need to discuss the case. In a second step, I will draw some conclusions and offer some suggestions to kick off the debate.
For a long time--and maybe until today--the greater part of the German public has not been aware of the vast destruction and the horrors which 3 ½ years of German occupation had inflicted upon Greece during the Second World War. Without going into the details, I will only briefly summarize the results: Due to systematic plundering of Greek economy and of widespread killing of civilians and finally also due to the tactic of scorched earth during the retreat of the Wehrmacht in 1945, both Greek economy and infrastructure were totally destroyed. The surviving Greek population was in a horrible condition, mostly due to years-long malnutrition. Not to forget another lasting heritage of German occupation: For several years, a bitter civil-war raged in Greece, which rooted very much in German attempts to weaken resistance by fuelling internal conflicts within Greek society. In brackets: This division of Greek society later also contributed to the weakness of Greek attempts to claim reparations from Germany.
Greece was part of the Allied nations who tried to settle their reparation claims against Germany at the Paris Reparations Conference in 1946. In the immediate post-war-situation, it was widely acknowledged that the destructions afflicted by Germany and the German capacity to pay were highly disproportionate. All claimants could only expect to receive a minor share, and so while Greece had presented in Paris a bill of 7.2 billion USD, they only received a share of 25 million USD. Fourteen years later, in 1960, Greece received another 115 million DM from Germany, which were to be allocated to individual victims of Nazi persecution. The latter agreement was the result of the collective initiative of 12 Western countries who in the late 1950s had urged the Federal Republic to compensate individual Nazi victims coming from these countries. However, except from these two instances of multilateral action, Greece tried to receive further reparations from Germany using a bilateral approach, which turned out to be a dead-end. To put it into a nutshell: German diplomacy made use of the asymmetrical power relations between these two countries to block any Greek reparation claims. The major change over the decades was that initially German diplomacy argued that Greek claims came to early. For that, Bonn hinted to the London Debt Settlement of 1952 which blocked all claims resulting from the war until the day of a final reparation settlement in the context of German reunification. At that time, it was expected that this day would never come. When the unexpected event took place anyway, in 1990 the Two-Plus-Four-Treaty between the two German Governments and the four victorious powers consciously excluded the issue of reparations. Since then, German diplomacy no longer declined Greek claims for reparations because they were considered as too early, but because they were too late. Until today, there exists a diplomatic stalemate, even more, since the issue has been conflated with the current debt crisis.
So, what are my conclusions and suggestions?
First: We need to be aware of the historical changes which took place in the realm of war reparations. As historian Jörg Fisch has shown, since the Treaty of Versailles reparations have changed their nature. They are no longer considered as expressing the right of the victor but as an expression of a moral claim. However, there is a problem with this modern idea because it is based on the assumption that the aggressor will always loose the war. This certainly has been the case with Germany in the Second World War, but looking for example on the two other occupying powers in Greece – Italy and Bulgaria – makes the picture already more complicated. For some time in the post-cold-war-world there were strong expectations that the old Westphalian system of sovereign nations would give way to a human-rights oriented global domestic policy. Individual Greek victims and their heirs – the catchword is Distomo – even seemed to be able to defeat the stronghold of traditional national sovereignty, i.e. the principle of state immunity. After successful law suits against Germany in several national courts in Greece and Italy, in 2012 these individual reparation claims were finally stopped by the International Court of Justice in Den Haag. The ICJ reconfirmed the principle of state immunity, while at the same time strongly recommending a political solution for the problem. Not much has happened since then.
Second: The verdict of the IJC and several other courts has confirmed that reparation claims are rather a political and moral and not a legal issue. However, this is nothing less than a legal comfort zone for Germany. The reparation issue might come back in a situation when a significant group of former war Allies might band together to put it back on the political agenda. And this might be even more effective when the United States might add their weight to such an effort. In the situation after the end of the cold war, the US backed the German position, but in today’s world even such a change might not be unconceivable. In any case, the threat of reopening the restitution issue still might become a useful political weapon. Consequently, from a German perspective it might be wise to look for ways to get rid of this threat by a proactive turn. There are good reasons to believe that the financial dimensions might be significantly more modest and the moral benefits much higher than what we might expect from an Allied initiative from outside.
Third: Greek reparation claims are focused especially on a so—called forced loan of the Greek national bank to Germany in 1942. The sum of 476 million Reichsmark, which is equivalent to approximately 11 billion Euro today, never has been paid back. About the character of the so-called forced loan has evolved a historical controversy which leads to extremely different results. While Hagen Fleischer has been supporting the Greek claim for years, Götz Aly rejected his interpretation. According to Aly, the sum is part of the complex system of the enormous occupation costs which Greece had to carry. A third scholar, Heinz Richter, even argued that rather Greek owed something to Germany. All three scholars refer to the same document which tries to piece together the complex system of financial exploitation and was established by Germany in Greece during the war. I do not want to go into the technical details. But one thing is clear: The core of the dispute is not, whether Germany had inflicted enormous financial damage on Greece during the war. The problem is, whether it is possible to isolate from the whole system of exploitation single elements which seem to have carried the nature of ordinary business transactions amidst the whole system of exploitation and thus take them out of the context of war reparations. And at this point I would agree to Götz Aly that it is not possible to isolate single elements from the whole system of financial exploitation. My own argument is that trying to put the so-called forced loan out of the complex of financial exploitation is a political attempt from Greece to create a claim sui generis which thus might be dealt with bilaterally with Germany outside of the multilateral framework of war reparations. Neither the rationale of the peculiarity of the claim is convincing, nor has the political strategy been successful so far. Maybe the Greece Government should reconsider their strategy.
Fourth: The German rejection of the Greek claims has been shaped by a particular mind set. From 1945 until today, very often we can discern a discursive opposition between honest German mercantile men and sly Levantine dealers. By way of contrast, historian of economy Albrecht Ritschl has argued that after 1945 “Germany was the world’s largest debtor” and at least twice, it was saved by a generous haircut of its debts. Both the London debt settlement of 1952 and the Two-Plus-Four-Agreement of 1990 produced enormous reductions of German debts to the disadvantage of international creditors. Without doubt, one may argue on the diverse nature of debts – war debts and commercial debts. Nevertheless, the German self-attitude towards Greece ignores the fact that “its economic recovery after the Second World War” owed very much “to large-scale debt relief” (Ritschl).
What, then, are possible consequences?
First: We need to end the polemical conjunction between the issues of reparations and debt crisis. This opens the way to look at the German historical guilt towards Greece. Historical guilt also encompasses the issue of war reparations. It does not seem realistic that the road to war reparations will be reopened again. However, Germany should take the matter seriously and break with the tradition to hint to legal obstacles against war reparations. We need a serious step forward and this will mean more than some pieces of cheap symbolic politics. Memory culture often has become a surrogate, as we can see in many cases. Another surrogate is the German-Greek-Future-Fund, which has been established by the German Foreign Office in 2014. This becomes obvious if we make an comparison with the German-Czech-Future-Fund. There are not only substantial differences with respect to financial resources and tasks, but also structural differences: While in the German-Czech-Future-Fund both sides are working on equal footing, the German-Greek-Future-Fund is basically a unilateral endeavour of the German Foreign Office. Having criticised the use of memory culture as surrogate, I will nevertheless argue that culture matters: In the realm of compensation for historical guilt, we always need to be careful about the symbolic nature of actions. Hence, what German diplomacy needs, is also a cultural change: We need to get out of the rhetoric of “liquidation of the consequences of war”.
Second: The German debate of the current debt crisis also needs a cultural change. Debt relief should be no longer be considered as an absolute taboo. This is not just an economic, but also a cultural issue. The role of historians might be to communicate to the German public that German resurgence and wealth after the Second World War is not only the result of German diligence and ingeniosity, but also of the generosity of our neighbours to cut our debts. And before that, thrifty German housewifes or rather their husbands had trampled their neighbour’s gardens and pillaged their pantries. I am not qualified to decide, whether a debt cut in the Greek case does make sense or not from an economic point of view. But what I want to say is that we should use our historical experience to widen the scope of the thinkable, which also means a widening of political options. So I will end with a quote of Heinz von Förster: “Act always in a manner, that the number of your options will be increased.” This might be a good thing for the European future.
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