‘Insane blackmail’ or ‘historical responsibility’? Greece demands WW2 reparations from Germany

From RT

August 18, 2016

Does Germany still owe Greece billions of euros in compensation for Nazi crimes in World War Two, or should bygones be bygones since Berlin has anyway given Athens billions as part of benefits and bailout measures?

“Greece and its people will not forget the slaughter and war crimes of the Nazi army and demand tangible recognition by the German government. Greece will do whatever is necessary, mainly at a diplomatic level, and if necessary, at a legal [level],” Prime Minister Alexis Tsipras said earlier this week, during a visit to Kommeno to commemorate the victims of the 1943 massacre in the northwestern village, where Nazi troops killed 317 civilians.

RT sat down with political theorist Marina Prentoulis, member of Syriza, and Eike Hamer, a political commentator from Germany, to discuss whether Greece can really claim the money 70 years after the war.

Marina Prentoulis agrees it’s been a long time, but insists that one has to remember that “crimes against humanity never expire.”

Reparation – Germany’s historical responsibility for Nazi occupation 

“The people of Greece will always have to live with the memories of the Nazi occupation. I would like to say that [on August 17] in 1944 we had a very dark anniversary for Greece – the anniversary of Kokkinia, a place in the western Athens, where the same day many years ago 20,000 people were gathered at the local square – 350 of them were executed, and 800 of them were taken hostages, and they were tortured by the Nazi army and the Gestapo,” she said.

Eike Hamer argues, though, that the issue of fairness here is not the point, as “there is hardly any other country that has got as much money from Germany as Greece.”  He recalled that back in 1960, West Germany paid 115 million deutsche marks to Greece as compensation for Nazi war crimes. Now the main point is to “live together again in peace and with respect to each other,” he says.

That won’t be possible if one side “comes with old stories [over and over] again to blackmail the other one and to demand any money or whatever from them,” Hamer says. “We’re comrades in the EU, and this is insane to make a break through the population, by demanding such insane things.”

Prentoulis agrees that living in peace is crucial, but, she insists, “this is why we have a historical responsibility to the people of Europe to recognize how Greece was devastated by the Nazi occupation.”

As for the 1960 payment, she said, “it was only a fraction of the money that they were supposed to give to Greece.”

“And now it is time to recognize that as comrades and for the good of the whole of Europe in order to be able to put this story in history and remember the horrific things that happened to Greece with not wanting to do anything like that again in the future; for peace and prosperity of Europe,” said Prentoulis.

No other country in the world pays Greece as much as Germany 

Since the 1960 compensation, Hamer argues, Greece has enjoyed advantages worth “a couple of hundred billion” euros. He referred to low interest rates, European – “mainly German” – aid and other indirect payments, including advantages Greece received because of having “many contracts” with Germany.

“There is no other country in the world paying Greece that much as Germany through the EU, through other things,” he said.

“It is funny that you can pay Greece as much money as you want and the elites divide this money amongst each other, take the money away, move to London, or whatever. Now, when the people are left behind from their own elites, they are demanding more money from Germany,” Hamer said, adding that “this is not fair.”

Prentoulis insists that it’s Greece that is being treated unfairly.

“Greece is getting one of the worst treatments across the Eurozone,” she said adding that economic issues and war reparation payment should be differentiated.

“But if you want to talk about the situation in Greece now, I have to remind you again about the 1953 London Debt Agreement, when a lot of countries, including Greece, decided to cut the debt of the German state by half and connect their repayment with a prosperity of the German state. This was an act of good will from the people of Europe,” she said.

Greece, however, is being treated differently now, says Prentoulis.

“The Greek people have been totally brought to the knees, once again because of austerity, because of the decisions of the conservative government of the EU, including the German one, and they are going on suffering since the crisis of 2008. You remember what happened with the Greek negotiations, and the whole Europe has been witnessing that,” she said.

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.


Embassy of Mongolia confirms demand from Kiev for reparations

From Fort Russ

Translated by Ollie Richardson for Fort Russ
1st March, 2016
Batu Khan on the throne of the Golden Horde
The press attaché of the Embassy of Russia in Mongolia, Lhagvasuren Namsrai, has confirmed the information about the country’s Parliament receiving an official letter from the Verkhovna Rada of Ukraine with the requirement to pay compensation for the destruction of Kiev by the troops of Batu Khan.
“The Verkhovna Rada of Ukraine wrote an official letter to the State Great Khural (our Parliament) that said in the thirteenth century Batu Khan (Golden Horde, the grandson of Genghis Khan) organized the genocide of the Ukrainian people. Ukrainians demand the payment of compensation. Both Russian and Mongolian websites have written about it”, said Namsrai on the 29th February in an interview with radio station “Vesti FM”.
“Then our correspondent asked our Chairman of the State Great Hural: the letter is factual? And our Chairman of the State Great Hural replied that, generally, in the history of the Middle ages it was the Kievan Rus, the Ukrainian State did not exist then. But if the Verkhovna Rada writes all the names of the Ukrainian citizens who died as a result of genocide, and their families, we will be ready to pay”, — said the press attaché.
As a reminder, in May of 2015, the TV channels “Ren TV”, “Star” and several other news agencies reported that the Verkhovna Rada of Ukraine adopted the resolution “On the genocide of the Ukrainian people in the 13th century by the criminal regime of the Mongol Empire” and sent to the Mongolian authorities the requirement to pay compensation for the destruction of Kiev. Meanwhile some agencies reported the announcement as a prank.
The Chairman of the Khural, Zandaahuugiyn Enkhbold, called the resolution of the Ukrainian Parliament “a propaganda cliche of Ukraine concerning Mongolia”. “The world did not know and never heard about any Ukrainian nation, especially in the era of the heirs of the Great Temujin, he said. — Millions of dead Ukrainians in the thirteenth century is the fruit of an unhealthy imagination of Ukrainian deputies”.
Enkhbold added that “Mongolia is ready to pay damages in the capture of Kiev by Batu Khan, but only to the victims or their families”. “We look forward to announcing the full list of victims”, — said the Chairman of the Khural.

War Reparations and Germany’s 1952 Debt Reduction Plan

This is in addition to the huge sums that Germany owes Greece.

Posted on Global Research
Committee for the Abolition of Third World Debt
5 March 2015
by Oscar Ugarteche

The largest debt problems in terms of GDP faced in financial history have belonged either to the United States or to European Governments. Large debt problems in developing and emerging nations have usually stemmed out of a drop in GDP size due to a fall in export earnings and a rise in interest rates. The reason is that creditors stop lending at a certain point and start restructuring existing debt which leads to debt growth but it is not really new lending. In major nations, lending goes on as the strategic reason for borrowing has normally been justified: a war. As a result, the leading debt reduction and innovative management schemes are related to these.

Contrary to the impression generated by extensive works on the Latin American and African debt, it is the under researched European and US historical debt that must be looked into in order to understand some historical solution patterns to debt problems. Current European very high debt levels (over 90% of GDP) are due partially to accumulated current account deficits of over 3% of GDP for over a decade plus the cost of bank rescues in 2009-2010 plus some countercyclical policy costs. Greece has additional debt due to major infrastructure works. It entered the Euro with a high debt level (around 100% of GDP) but the total GDP amount shrunk 33.3% from 55,318 million euros to 36,866 million euros in constant terms between 2007 and 2013 as a result of austerity policies. |1| If GDP had remained stagnant, the index would be 131% and not 174.9% and rising.

Historically the debt that arose from the Confederate States of the United States was not recognised by the US Federal Government and was subject to complicated negotiations with British private bondholders until the late 1920’s when it was finally agreed that it would not be repaid. (Corporation of Foreign Bondholders, First Annual Report of the Council, London, February, 1904 and Fifty Seventh Annual of the Council, London, 1930) What was agreed finally in the League of Nations was that State debts have always to be guaranteed by the National Governments in order for creditors to be able to collect their debts.

The debt discussion revived after WWI, as the European war was financed locally in each country and internationally by the United States from 1915 onwards. This implied two things: first, the UK borrowed from the United States and onlent to third parties; and secondly the warring countries additionally borrowed directly from the US. At the end of the war this had to be solved somehow in order for those countries to recover growth. This is dealt with in H. Fisk’s The Inter Ally Debts. An Analysis of War and Post War Public Debts. New York, Banker’s Trust, 1924. Germany was not able to float bonds in New York after the War was declared so they only borrowed in Marks and dealt with through hyperinflation that did away with most of its value in 1922-1923.

Another aspect of the German debt was the introduction of reparation payments that although just from an ethical point of view, were extremely large for the economic capacity of the country as Keynes pointed out in his Economic Consequences of the Peace. According to Professor Albrecht Ritschl |2| from the LSE Germany managed to keep afloat borrowing money from the US during the 1920’s. The two largest loans are the Dawes Plan and the Young Plan but there were other loans adding up to 840.7 million dollars in 1939. The Young Plan contained massive debt reduction. Reparations payments were never met in full in the 1920’s and were suspended in 1932. They were reinitiated in 1990 without any readjustment in value after the reunification. The last quota was paid in 2010. |3|

In October 1929, U.S. President Hoover, under pressure from US academia, announced the creation of a Hoover Year that was meant to restructure debts payments due from July 1, 1931 to June 30, 1932, into ten yearly quotas. The mechanism would be in place as long as it was needed. The object was to relieve the UK from its payments to the US and to transfer this benefit on to the other allies that in turn would transfer them to German reparations. This relief was later eschewed by Chancellor Hitler who, after winning the elections, declared a debt cease payment in June 1933.

After WWII, in May 1951 a tripartite commission was formed by the US. UK and France in order to discuss post war and pre war debts. All creditors met in London in July 1951 to see what to do with the German debts and the solution proposed by Germany and widely accepted by the US and UK was that as Germany was divided into two, the debt would have to be divided equally and only 50% of the total public debt would be negotiated. Reparations would not be restored until after reunification. The other half would be left for negotiations also after the reunification, someday.

The Tripartite Commission announced that they were prepared to make important concessions in terms of the amounts and priorities of their claims some referred to post war assistance (1945-1951), making it clear that post war debts were conditioned by satisfactory and equitable agreement on pre-war debt. The amounts owed in 1939 were: 840.7 million dollars, 51.5 million pounds and 2,775.2 million French Francs, to name the debts of the leading three creditors. In 1939 constant US dollars the equivalent would be 206 billion dollars.

This plus the debt to the other 67 countries was reduced first by 50% and then the remaining 50% was reduced by half and made payable over a 25 year period (1953 to 1979). More interestingly, when the German unification finally came about, The German Federal Government demanded that the winning countries (of WWII) do not place a debt burden on the defeated countries, I.E. on East Germany. If they had respected the 1953 London agreement it would have meant recognising the other 50% of the debt and doping something with it. Instead, Germany was given a massive debt reduction in exchange for restoring reparations payments without any adjustment in value.

The German people should be grateful and remember the massive debt reductions and the concessional terms it received in time of need and despair after World War II. No one at the time either in the US, UK nor France, to name the three largest creditors, said “the taxpayers were unwilling to bail out those people.” History serves a purpose and we should all learn from it.

Source : Alainet

Oscar Ugarteche, a Peruvian economist, is the Coordinator of the Observatorio Económico de América Latina (OBELA), IIE-UNAM, Mexico – www.obela.org. Member of the SNI/Conacyt and president of ALAI. His most recent book is Arquitectura Financiera Internacional: una Genealogía de 1850-2008, México DF., IIEC-UNAM, 2014. 392pp. The material presented here uses that source except when stated otherwise.