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First World War officially ends on Sunday

Post  Manahuna on 01.10.10 18:52

The First World War will officially end on Sunday when Germany pays off
the last of the enormous debt which was set by the Allies 92 years ago.


The final £60 million instalment is part of a £22 billion debt imposed for starting one of the bloodiest conflicts in history will be cleared on what will also be the 20th anniversary of German reunification.

The Allied victors - primarily Britain, France and America set the reparations in 1919's Treaty of Versailles - a peace agreement - as both compensation and punishment for waging the four year war, which left 10 million soldiers dead, and European towns and cities devastated.

Germany's Federal Office for Central Services and Unresolved Property Issues said that the bond issued to pay remaining debts stemming from 'The War To End All Wars' will be written off on 3 October.

Germany's best-selling daily newspaper, Bild, said: "On Sunday the last bill is due and the First World War finally, financially at least, terminates for Germany."

The initial sum agreed upon for war damages in 1919 was 226 billion Reichsmarks, but was later reduced to 132 billion, £22 billion at the time.

However, the bill would have been settled much earlier had Adolf Hitler not refused to pay the reparations during his dictatorship. The bill was also frozen again when West and East Germany split, and renewed again after reunification in 1990.

Most of the war reparations go to private individuals, pension funds and corporations holding debenture bonds.

http://uk.news.yahoo.com/38/20100929/twl-first-world-war-officially-ends-on-s-6ae0455.html
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Re: First World War officially ends on Sunday

Post  Manahuna on 01.10.10 18:54

Why does Germany still owe money for World War I?

According to Bild magazine, World War I will finally end this weekend when Germany pays off the last instalment of the interest it owes on loans it took out in the 1930s to pay £22-billion in reparations to the allied powers. The sum would, of course, have been paid off much earlier were it not for Adolf Hitler, who exploited public resentment at the economic crisis caused by said reparations to a) refuse to pay them, and b) kick off a whole other war -- leading to a whole other load of reparations. But news that Germany was still paying reparations from 1919 in 2010 does rather prompt the question: what for?

The idea isn't new, of course: Rome exacted punitive indemnities from Carthage after the Punic wars in the second century BC. But there has long been a feeling that the practice might be unfair: the people who end up paying are rarely those responsible. There are few more eloquent examples of the injustice of reparations than Haiti, which has never recovered from having to compensate France for the loss of slaves and property after independence in 1804. At one stage this absorbed 80% of Haiti's budget, and the interest on the foreign loans Haiti took out to meet the bill was not paid off until 1947, by which time its economy was pretty much shot.

Mainly, though, it's now understood that bankrupting a beaten country won't necessarily achieve the desired result. Partly in recognition of this, Germany's second world war reparations were exacted, in theory at least, in machinery, movable goods and know-how rather than money, and shared economic development was prioritised over punishment.

In a further advance, the UN Compensation Commission, set up after the Gulf war, decreed that Iraq's reparations for the invasion of Kuwait should not be expressed in a cash sum but limited to 30% of its revenues under the oil-for-food programme, with concrete claims from actual people prioritised over abstract ones from governments and companies.

That's sensible, because otherwise reparations can get out of hand: in 2007, a disgruntled American founded the International Coalition for British Reparations, demanding £31-trillion from Britain as "the greatest criminal nation on earth ... responsible for such atrocities as genocide, the industrial revolution and global misrule (but particulary in the Middle East), as well as atrocious inventions such as machine guns, slums, child labour and concentration camps," from the time of the Crusades to the second Iraq war. - guardian.co.uk

© Guardian News and Media 2010
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