Circular historyJan 6th, 2009 | By Ian Poulton | Category: International
“If you can’t read the book, read the review”, Mr Buchanan would urge the history class.
Of course, we never listened. There were discos and girlfriends and pints of real ale to be considered; all of them far more interesting than reviews of books about the French Revolution or Edwardian England.
Mr Buchanan would be saying now, “I told you so, and if you had read the books that I had told you to read, you would understand what is now happening.”
A passionate opponent of Fascism through his memories of the Second World War, he would now be worried at the signs of the times.
Last Saturday’s Financial Times carried the sort of review Mr Buchanan would have recommended. Niall Ferguson’s review of Liaquat Ahamed’s Lords of Finance prompts the thought that perhaps one should go beyond reading the review, and actually buy the book.
Ahamed’s ‘lords of finance’ are the major central bankers of the inter-war years, Émile Moreau, governor of the Banque de France; Montagu Norman, governor of the Bank of England; Hjalmar Schacht, president of the German Reichsbank; and Benjamin Strong, governor of the Federal Reserve Bank of New York.
The story begins with the financial crisis at the end of July 1914 (something which was never mentioned in the history classes, it cannot have have helped trust or confidence in those final days before the outbreak of the Great War) and traces the story of its characters through to the 1930s.
Any Junior Certificate history student would be able to tell you that the bankers failed in their mission. The massive speculation on the New York Stock Exchange in 1928 led to the Crash of 1929 and the 1930s became the era of the Great Depression.
Ahamed quotes from a letter of Montagu Norman in the summer of 1931,
Unless drastic measures are taken to save it, the capitalist system throughout the civilised world will be wrecked within a year.”
Norman’s vision of a cataclysmic end to capitalism in 1932 remains unfulfilled, but the experiences of those years in Europe prepared the way for the darkest chapter in the history of the world as National Socialism took hold in Germany.
Niall Ferguson expresses the hope that “the modern-day Lords of Finance will co-operate to better effect”.
Perhaps they will, or perhaps the damage has already been done.
Roosevelt’s New Deal in the United States did not prevent the downward slide of Europe. Is looking West to the incoming Obama administration for salvation likely to be of more avail than setting one’s hopes on Roosevelt in the 1930s?
A surge in nationalism is already discernible across Europe, if the bankers get it wrong, that surge could become a flood. The European Parliament elections in the summer are likely to become a focus for a huge wave of discontent, mistrust and anger.
Lords of Finance is about us being here before. If we know where we are; we can have some idea of where we are going. Time to find a copy.