History Lessons

Whenever there's a looming crisis or a war, politicians and commentators are keen to say they have learned the lessons of history, like schoolchildren being checked on their homework assignments. With the Euro about as stable as an overloaded Filipino ferry with a drunk captain in a typhoon, it is vital we are told, that politicians do not repeat the mistakes of the past. They certainly seem to have taken that message to heart, by making a completely new series of errors and blunders that will keep at least one sector of the economy booming: books on financial collapses. Robert Peston, Michael Lewis and Gillian Tett can rest easy, that follow-up title is pretty much going to write itself.

Tasty, but not worth the grief

But the real problem with learning the lessons of history is that you have to agree what that lesson is supposed to be. Sometimes, there is a relatively straightforward principle from the past that everyone can agree on such as: 'Do not invade Afghanistan'. But even that simple mantra is not quite correct. Invading Afghanistan is the easy part; the difficult part is trying to govern a group of armed, religious maniacs  who hold grudges for centuries. A more helpful motto for any outside force might be: 'Invade Afghanistan; leave Afghanistan quickly. Yes, it's got stunning scenery, the food is simply delicious but you could say the same about Turkey, which has a much better developed tourist infrastructure. Besides, you read The Kite Runner, what more do you want? '.

When anyone talks about learning from the past, they are really telling you how they think the world should be. Facts and figures are surprisingly plastic; they mould themselves well to any point of view. In the current Euro meltdown, the Germans political class is obsessed by the spectre of hyperinflation, which they think led to the rise of Hitler, which means they fervently opposed to any monetising of the Euro area debt.

Deja vu?

Unfortunately, as is so often the case, the Germans are brilliant when it comes to car-making, machine tools and suburban trams but hopeless when it comes to politics or indeed learning anything useful from their own history, unless forced to do so at the point of a gun by total defeat and military occupation.  The Nazi party vote only skyrocketed in 1931, during the Great Depression, where the German Chancellor along with many other leaders turned a recession into a depression by forcing through harsh austerity measures during a slowdown. Unemployment soared, production crashed, all to defend sound money. Does that sound familiar?

The other lesson that the German government seems singly unwilling to learn is that the rest of Europe does not appreciate being bossed around by sanctimonious Teutons, indeed we fought several wars on this very point. They  still do not fundamentally accept that the rest of the world is not the same as the good Burgers of Frankfurt or Munich and no matter how many Italian or Greek governments are deposed, they are not going to suddenly turn German.

But let's make this a constructive post as dear readers there are perhaps a handful of lessons from history that we  probably all agree on:

1. Beware of anyone trying to teach you the lessons of history, especially if they have a beard, e.g. Karl Marx.

2. Do not invade Afghanistan (see 2nd para).

3. Beware of Greeks bearing government bonds.

4. The Germans like telling people what to do; the British hate being told what to do. This never ends well. (See WW1 and WW2 for reference).