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The Economic Consequences of the Peace (1919) was written by John Maynard Keynes. Keynes attended the Versailles Conference as a delegate of the British Treasury and argued for a much more generous peace. It was a bestseller throughout the world and was critical in establishing a general opinion that the Versailles Treaty was a "Carthaginian peace". It helped to consolidate American public opinion against the treaty and involvement in the League of Nations. The perception by much of the British public that Germany had been treated unfairly in turn was a crucial factor in public support for appeasement. The success of the book established Keynes' reputation as a leading economist especially on the left. When Keynes was a key player in establishing the Bretton Woods system in 1944, he remembered the lessons from Versailles as well as the Great Depression. The Marshall Plan after Second World War is a similar system to that proposed by Keynes in The Economic Consequences of the Peace.… (more)
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Keynes also shows that essential parts of the treaty were not grounded in fact. The restrictions and reparations placed on Germany were counterproductive and self-defeating. Depriving Germany of the necessary coal, ships and rolling stock of its railways crippled the economic recovery. The failure of the Allies (and especially the US) to net the internal war debt obligations meant that the weakest nations were plagued with high interest payments. Keynes also advocated for a sort of Marshall plan which surely would have helped Europe recover. Written in shocked frustration about a clearly unworkable treaty, this lean booklet is a fast and concise read that offers lessons what happens when burdens are placed upon third parties without those parties' involvement in the negotiations. Today's efforts to make the PIIGS pay for the bankers' mistakes run into the same calamities that Keynes foresaw in 1919.
This is one of those classics which have permeated modern thought so thoroughly that you feel as though you've read it already. The Treaty of Versailles was Bad. It focused too much on Reparations and Economic Sanctions and
Keynes tells it clearly. If the rest of his stuff is this lucid, I'll be mighty impressed.
The last of the reparations, by the way, were only paid off two years ago (2010).