While governments in other parts of the world struggle to put down military rebellions, Germany, the IMF and the rest of the Eurozone establishment moved decisively to put down Greece’s economic rebellion against the austerity regimen the creditor nations and institutions.

Now comes the hard part.  Will Germany treat Greece the way the US treated Germany after World War II, helping Greece rebuild its economy so it need not again finance itself with credit it cannot repay?  Or will it—as it has so far–treat Greece as Germany was treated after World War I, as a defeated enemy which must not only repay its debt but suffer for its sins?

The hard line Germany has taken on Greek debt repayment is “more than a little hypocritical,” says French economist Thomas Piketty.  “Germany is really the single best example of a country that, throughout its history, has never repaid its external debt,“ Piketty says in an interview with the German newspaper Die Zeit, translated and reported in Slate.  “However, it has frequently made other nations pay up, such as after the Franco-Prussian War of 1870.”

But there is more wrong with Germany’s hard line than hypocrisy.   It violates the axiom attributed to Einstein that doing the same thing repeatedly and expecting different results is a definition of insanity.  (It also violates the more sensible version of the axiom: that doing the same thing repeatedly and expecting different results is a recipe for frustration and futility.)  We’ve been down this road before—the forked road that proceeds from the vanquishing of a defeated nation by a powerful adversary.  We have taken the right road and the wrong.  We have a good idea where each of them leads.

We know where the road from Versailles, the road from World War I, led the world.  The Versailles treaty imposed ruinous reparations on Germany–reparations that a devastated Germany could never pay and never did.  Its overseas colonies were taken, not to be granted independence but to be given to victorious colonial powers Britain and France.   The road that started in Versailles led to hyper-inflation, National Socialism, rearmament, the Holocaust and World War II.  Math teacher/song-satirist Tom Lehrer captured the process perfectly:

Once all the Germans were warlike and mean,
But that couldn’t happen again.
We taught them a lesson in nineteen eighteen,
And they’ve hardly bothered us since then.

The world took a different path after World War II—the war for which the policies followed after the last war had helped set the stage.  Once again there were voices calling for a defeated Germany to be crushed so it could never wage war again.  Secretary of the Treasury Henry Morgenthau called for Germany to “not only be stripped of all presently existing industries but so weakened and controlled that it cannot in the foreseeable future become an industrial area.”

And in fact, for six years after VE Day, that was the direction that US policy took.

But by 1951, President Truman, at the urging of military leaders led by Gens. George C. Marshall and Lucius D. Clay, reversed course, issuing a directive that “[a]n orderly, prosperous Europe requires the economic contributions of a stable and productive Germany.”  Germany was even made a beneficiary of the Marshall Plan.*

Unlike the path followed after World War I, post-World War II policies led to a strong, prosperous, and not only friendly but supportive Europe so unified that today, the threat of Greece’s leaving the Eurozone raises alarms.  As well it should, given the long history of intra-European conflict that preceded post-World War II unification.  This aspect of the Greek debt crisis—and of near-miss debt crises in countries like Ireland and Italy—is often lost in analyses: that what is at stake is not economic policy alone, but a framework that has required the countries of Europe to work together.

The Greek economy needs to be made sustainable.  But how that happens makes a difference.  Germany has the resources to treat Greece the way the US treated Germany after World War II, to help Greece rebuild its economy.  It also has the power to squeeze Greece like over-ripe fruit and collect what it is owed as it drips out.  Squeezing Greece until the pips squeak risks fostering the resentment that squeezing Germany incurred after World War I. That is a road best not taken again.

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