The Deluge

by Adam Tooze

  Francesca looked forward. The future and the new were her greatest sources of solace. Since 2009 in New Haven, Annie Wareck and Iain York have for me given a new meaning to the idea of friendship. They and their wonderful sons, Zev, Malachai and Levi, have brightened and warmed our time beyond measure.

  Becky Conekin supported me in finishing this book, as I was proud to support her in finishing her own brilliant work on Lee Miller. This reciprocity sustained us in almost twenty years of being together. I hope that one day she can feel as proud as I do of what we accomplished.

  This book is dedicated to our darling daughter Edie, who was and is the light of my life.

  New Haven, November 2013

  Introduction

  The Deluge: The Remaking of World Order

  On Christmas Morning 1915, David Lloyd George, the erstwhile radical liberal, now Minister of Munitions, rose to face a restless crowd of Glaswegian trade unionists. He had come to demand a further round of recruits for the war effort and his message was suitably apocalyptic. The war, he warned them, was remaking the world. ‘It is the deluge, it is a convulsion of Nature . . . bringing unheard-of changes in the social and industrial fabric. It is a cyclone which is tearing up by the roots the ornamental plants of modern society . . . It is an earthquake which is upheaving the very rocks of European life. It is one of those seismic disturbances in which nations leap forward or fall backward generations in a single bound.’1 Within four months his words were echoed from the other side of the battle-lines by the German Chancellor Theodore von Bethmann Hollweg. On 5 April 1916, six weeks into the terrible battle of Verdun, he confronted the Reichstag with the stark truth. There was no way back. ‘After such dramatic events history knows no status quo.’2 The violence of the Great War had become transformative. By 1918, World War I had shattered the old empires of Eurasia – Tsarist, Habsburg and Ottoman. China was convulsed by civil war. By the early 1920s the maps of eastern Europe and the Middle East had been redrawn. But dramatic and contentious as they were, these visible changes acquired their full significance from the fact that they were coupled to another deeper, but less conspicuous shift. A new order emerged from the Great War that promised, above the bickering and nationalist grandstanding of the new states, fundamentally to restructure relations between the great powers – Britain, France, Italy, Japan, Germany, Russia and the United States. It took geostrategic and historical imagination to comprehend the scale and significance of this power transition. The new order that was in the making was defined in large part by the absent presence of its most defining element – the new power of the United States. But on those endowed with such vision, the prospect of this tectonic shift exerted an almost obsessive fascination.

  Over the winter of 1928–9, ten years after the Great War had ended, three such contemporaries – Winston Churchill, Adolf Hitler and Leon Trotsky – all had occasion to look back on what had happened. On New Year’s Day 1929 Churchill, then serving as Chancellor of the Exchequer in the Conservative government of Stanley Baldwin, found time to finish The Aftermath, the concluding volume of his epic history of World War I, The World Crisis. For those familiar with Churchill’s later histories of World War II, this last volume comes as a surprise. Whereas after 1945 Churchill would coin the phrase ‘a second Thirty Years War’ to describe the long-running battle with Germany as a single historical unit, in 1929 he struck a very different note.3 Churchill looked forward to the future, not in a spirit of grim resignation, but with considerable optimism. Out of the violence of the Great War it seemed that a new international order had emerged. A global peace had been built on two great regional treaties: the European Peace Pact initialed at Locarno in October 1925 (signed in London in December) and the Pacific Treaties signed at the Washington Naval Conference over the winter of 1921–2. These were, Churchill, wrote, ‘twin pyramids of peace rising solid and unshakable . . . commanding the allegiance of the leading nations of the world and of all their fleets and armies’. These agreements gave substance to the peace that had been left unfinished at Versailles in 1919. They filled out the blank check that was the League of Nations. ‘The histories may be searched,’ Churchill remarked, ‘for a parallel for such an undertaking.’ ‘Hope,’ he wrote, ‘now rested on a surer foundation . . . The period of repulsion from the horrors of war will be long-lasting; and in this blessed interval the great nations may take their forward steps to world organization with the conviction that the difficulties they have yet to master will not be greater than those they have already overcome.’4

  These, unsurprisingly, were not the terms in which either Hitler or Trotsky would capture their vision of history ten years after the war. In 1928 the war veteran and failed-putschist-turned-politician, Adolf Hitler, as well as contesting and losing a general election, was negotiating with his publishers over a follow-up to his first book, Mein Kampf. The second was intended to collect his speeches and writings since 1924. But since his book sales in 1928 were as disappointing as his electoral performance, Hitler’s manuscript never went to press. It has come down to us as his ‘Second Book’ (‘Zweites Buch’).5 Leon Trotsky for his part had time to write and reflect, because after losing his struggle with Stalin, he had been deported first to Kazakhstan and then in February 1929 to Turkey, from where he continued his running commentary on the revolution that had taken such a disastrous turn since the death of Lenin in 1924.6 Churchill, Trotsky and Hitler make for an incongruous, not to say antipathetic, grouping. To some it will seem provocative even to place them in the same conversation. Certainly they were not each other’s equal as writers, politicians, intellectuals or moral personalities. All the more striking is the way in which at the end of the 1920s their interpretations of world politics complemented each other.

  Hitler and Trotsky recognized the same reality that Churchill did. They too believed that World War I had opened a new phase of ‘world organization’. But whereas Churchill took this new reality as cause for celebration, for a communist revolutionary like Trotsky or a national socialist such as Hitler it threatened nothing less than historical oblivion. Superficially, the peace settlements of 1919 might seem to advance the logic of sovereign self-determination that originated in European history in the late Middle Ages. In the nineteenth century this had inspired the formation of new nation states in the Balkans and the unification of Italy and Germany. It had now climaxed in the break-up of the Ottoman, Russian and Habsburg empires. But although sovereignty was multiplied, its content was hollowed out.7 The Great War weakened all the European combatants irreversibly, even the strongest amongst them and even the victors. In 1919 the French Republic may have celebrated its triumph over Germany at Versailles, in the palace of the Sun King, but this could not disguise the fact that World War I confirmed the end of France’s claim to be a power of global rank. For the smaller nation states created over the previous century, the experience of the war was even more traumatic. Between 1914 and 1919, Belgium, Bulgaria, Romania, Hungary and Serbia had all faced national extinction as the fortunes of war swung back and forth. In 1900 the Kaiser had brashly claimed a place on the world stage. Twenty years later Germany was reduced to squabbling with Poland over the boundaries of Silesia, a dispute overseen by a Japanese viscount. Rather than the subject, Germany had become the object of Weltpolitik. Italy had joined the war on the winning side, but despite solemn promises by its allies, the peace reinforced its sense of second-class status. If there was a European victor it was Britain, hence Churchill’s rather sunny assessment. However, Britain had prevailed not as a European power but as the head of a global empire. To contemporaries the sense that the British Empire had done relatively less badly out of the war only confirmed the conclusion that the age of European power had come to an end. In an age of world power, Europe’s position in political, military and economic terms was irreversibly provincialized.8

  The one nation that emerged apparently unscathed and vastly more powerful from the war was the United States.
Indeed, so overwhelming was its pre-eminence that it seemed to raise once more the question that had been expelled from the history of Europe in the seventeenth century. Was the United States the universal, world-encompassing empire similar to that which the Catholic Habsburgs had once threatened to establish? The question would haunt the century that followed.9 By the mid-1920s it seemed to Trotsky that ‘Balkanized Europe’ found ‘herself in the same position with respect to the US’ that the countries of south-eastern Europe had once occupied in relation to Paris and London in the pre-war period.10 They had the trappings of sovereignty but not its substance. Unless the political leaders of Europe could shake their populations out of their usual ‘political thoughtlessness’, Hitler warned in 1928, the ‘threatened global hegemony of the North American continent’ would reduce them all to the status of Switzerland or Holland.11 From the vantage point of Whitehall, Churchill had felt the force of this point not as a speculative historical vision, but as a practical reality of power. As we shall see, Britain’s governments in the 1920s again and again found themselves confronting the painful fact that the United States was a power unlike any other. It had emerged, quite suddenly, as a novel kind of ‘super-state’, exercising a veto over the financial and security concerns of the other major states of the world.

  Mapping the emergence of this new order of power is the central aim of this book. It requires a particular effort because of the peculiar way in which America’s power manifested itself. In the early twentieth century, America’s leaders were not committed to asserting themselves as a military power, beyond the ocean highways. Their sway was often exercised indirectly and in the form of a latent, potential force rather than an immediate, evident presence. But it was nonetheless real. Tracing the ways in which the world came to terms with America’s new centrality, through the struggle to shape a new order, will be the central preoccupation of this book. It was a struggle that was always multidimensional – economic, military and political. It was one that began during the war itself and stretched beyond it into the 1920s. Getting this history right matters because we need to understand the origins of the Pax Americana that still defines our world today. It is crucial too, however, to understanding the huge second spasm of the ‘second Thirty Years War’ that Churchill would look back upon from 1945.12 The spectacular escalation of violence unleashed in the 1930s and the 1940s was a testament to the kind of force that the insurgents believed themselves to be up against. It was precisely the looming potential, the future dominance of American capitalist democracy, that was the common factor impelling Hitler, Stalin, the Italian Fascists and their Japanese counterparts to such radical action. Their enemies were often invisible and intangible. They ascribed to them conspiratorial intentions that enveloped the world in a malign web of influence. Much of this was manifestly unhinged. But if we are to understand the way in which the ultra-violent politics of the interwar period was incubated in World War I and its aftermath, we need to take this dialectic of order and insurgency seriously. We grasp movements like fascism or Soviet communism only very partially if we normalize them as familiar expressions of the racist, imperialist mainstream of modern European history, or if we tell their story backwards from the dizzying moment in 1940–42, when they rampaged victoriously through Europe and Asia and the future seemed to belong to them. Whatever comforting, domesticated fantasies their followers may have projected onto them, the leaders of Fascist Italy, National Socialist Germany, Imperial Japan and the Soviet Union all saw themselves as radical insurgents against an oppressive and powerful world order. For all the braggadocio of the 1930s their basic view of the Western Powers was not that they were weak, but that they were lazy and hypocritical. Behind a veneer of morality and panglossian optimism the Western Powers disguised the massive force that had crushed Imperial Germany and that threatened to enshrine a permanent status quo. To forestall that oppressive vision of an end of history would require an unprecedented effort. It would be accompanied by terrible risks.13 This was the terrifying lesson that the insurgents derived from the story of world politics between 1916 and 1931, the story recounted in this book.

  I

  What were the essential elements underpinning this new order that seemed so oppressive to its potential enemies? By common agreement the new order had three major facets – moral authority backed by military power and economic supremacy.

  The Great War may have begun in the eyes of many participants as a clash of empires, a classic great power war, but it ended as something far more morally and politically charged – a crusading victory for a coalition that proclaimed itself the champion of a new world order.14 With an American president in the lead, the ‘war to end all wars’ was fought and won to uphold the rule of international law and to put down autocracy and militarism. As one Japanese observer remarked: ‘Germany’s surrender has challenged militarism and bureaucratism from the roots. As a natural consequence, politics based on the people, reflecting the will of the people, namely democracy (minponshugi), has, like a race to heaven, conquered the thought of the entire world.’15 The image that Churchill chose to describe the new order was telling – ‘twin pyramids of peace rising solid and unshakable’. Pyramids are nothing if not massive monuments to the fusion of spiritual and material power. For Churchill, they provided a striking analogue to the grandiose ways in which contemporaries conceived of their project of civilizing international power. Trotsky characteristically cast the scene in rather less exalted terms. If it was true that domestic politics and international relations would no longer be separate, as far as he was concerned, both could be reduced to a single logic. The ‘entire political life’, even of states like France, Italy and Germany, down to ‘the shifts of parties and governments will be determined in the last analysis by the will of American capitalism . . .’16 With his usual sardonic humour, Trotsky evoked, not the awesome solemnity of the pyramids, but the incongruous spectacle of Chicago meat-packers, provincial senators and manufacturers of condensed milk lecturing a Prime Minister of France, a British Foreign Secretary or an Italian dictator about the virtues of disarmament and world peace. These were the uncouth heralds of America’s drive toward ‘world hegemony’ with its internationalist ethos of peace, progress and profit.17

  But however incongruous may have been its form, this moralization and politicization of international affairs was a high-stakes wager. Since the wars of religion in the seventeenth century, conventional understanding of international politics and international law had erected a firewall between foreign policy and domestic politics. Conventional morality and domestic notions of law had no place in the world of great power diplomacy and war. By breaching this wall, the architects of the new ‘world organization’ were quite consciously playing the game of revolutionaries. Indeed, by 1917 the revolutionary purpose was being made more and more explicit. Regime change had become a precondition for armistice negotiations. Versailles assigned war guilt and criminalized the Kaiser. Woodrow Wilson and the Entente had pronounced a death sentence on the Ottoman and Habsburg empires. By the end of the 1920s, as we shall see, ‘aggressive’ war had been outlawed. But, appealing as these liberal precepts might have been, they begged fundamental questions. What gave the victorious powers the right to lay down the law in this way? Did might make right? What wager were they placing on history to bear them out? Could such claims form a durable foundation of an international order? The prospect of war might be terrible to contemplate, but did declaring a perpetual peace imply a profoundly conservative commitment to upholding the status quo, whatever its legitimacy? Churchill could afford to talk in sanguine terms. His nation had long been one of the most successful entrepreneurs of international morality and law. But what if, as a German historian put it in the 1920s, one were to find oneself amongst the disenfranchised, amongst the lower breeds in the new order, as ‘fellaheen’ amidst the pyramids of peace?18

  For true conservatives the only satisfactory answer was to turn back the clock. They de
manded that the liberal train of moralistic international organization should be reversed and international affairs returned to an idealized vision of a Jus Publicum Europaeum in which the family of European sovereigns lived side by side in a non-judgemental, non-hierarchical anarchy.19 But not only was this a mythic history, with little bearing on the reality of international politics in the eighteenth and nineteenth centuries. It ignored the force of Bethmann Hollweg’s message to the Reichstag in the spring of 1916. After this war, there was no way back.20 The true alternatives were starker. One was a new kind of conformity. The other was insurgency, epitomized in the immediate aftermath of the war by Benito Mussolini. In Milan in March 1919 he launched his Fascist Party by denouncing the emerging new order as ‘a solemn “swindle” of the rich’, by which he meant Britain, France and America, ‘against the proletarian nations’, by which he meant Italy, ‘to fix forever the actual conditions of world equilibrium . . .’21 Instead of a reversion to an imaginary ancien régime, he held out the promise of further escalation. What reared its ugly head with this politicization of international affairs was the kind of irreconcilable conflict of values that had made the religious wars of the seventeenth century or the revolutionary struggles at the end of the eighteenth century so lethally violent. Given the horrors of World War I there must either be perpetual peace, or a war even more radical than the last.

  Though the danger of such confrontation was clearly real, the severity of this risk depended not only on the resentments that were stirred up and the ideologies that were pitted against each other. In the end, the risks involved in seeking to create and uphold a new international order depended on the plausibility of the moral order to be imposed, its chance of gaining general acceptance on its own merits, and the force mustered to support it. After 1945 in the global Cold War clash between the United States and the Soviet Union, the world would witness the logic of confrontation taken to its extreme. Two global coalitions, self-confidently proclaiming antagonistic ideologies, each armed with massive arsenals of nuclear weapons, threatened humanity with Mutually Assured Destruction. And there are many historians who want to see in 1918–19 a precursor to the Cold War, with Wilson squaring off against Lenin. But though this analogy may be tempting, it is misleading in that in 1919 there was nothing like the symmetry that prevailed in 1945.22 By November 1918 not only was Germany on its knees, but Russia too. The balance of world politics in 1919 resembled the unipolar moment of 1989 far more than the divided world of 1945. If the idea of reordering the world around a single power bloc and a common set of liberal, ‘Western’ values seemed like a radical historical departure, this is precisely what made the outcome of World War I so dramatic.