'The mind thus turned loose, thus emancipated from facts, took unexpected directions...'- John T. Flynn
'One of the funny things about the situation...' Alexander Chancellor began a sentence, speaking of the war in Iraq, 'is the way the Germans have come through this...
'They took the same position as the French - they didn't want to get involved. But the American press focused on the French as traitors and cowards...and hardly mentioned the Germans.''
The Germans occupy a special place in recent world history.
'Give a German a gun and he heads for France,' was a common expression in the last century.
'The Hun is either at your throat or at your feet,' was another.
People wondered what it was about the Germans that had made them so ready to go to war...and so willing to go along with ghastly deeds on a national scale. Was it something in their blood, in their culture...or in their water?
Now, of course, the Hun has been tamed; the Kraut has become a pacifist. America urges him to join the war against Iraq, but he demurs; he has had his fill of war.
And so the question is more puzzling than ever. Has his blood changed? His Kultur? Or his economy?
We raise the question after beginning a marvelous little book by John T. Flynn, 'As We Go Marching,' written during WWII.
Flynn argues that fascism had no particular connection to the Germans themselves...nor was there anything in the Teuton spirit that made them especially susceptible. Instead, he points out that the creed was largely developed by an Italian opportunist, Benito Mussolini. It was the fat Italian who figured out the main parts - including the glorious theatrical elements. The Germans merely added their own corruptions and attached a peculiarly vicious policy of persecuting, and later exterminating, Jews.
But it is Flynn's description of the economic circumstances in Italy in the late 19th and early 20th centuries - the fertile soil in which fascism took root and flourished - that caught our attention.
Italy went to war, in the month of September, 1911, against Turkey. The war was over 12 months later and soon forgotten by everyone.
But the impulse that drove the Italians to war in the first place...and led to their next move...was the focus of Flynn's attention:
'The vengeance of the Italian spirit upon Fate was not appeased. Instead, the appetite for glory was whetted. And once more glory did its work upon the budget. But once more peace - dreadful and realistic peace - peace the bill collector, heavy with her old problems - was back in Rome. The deficits were larger. The debt was greater...the various economic planners were more relentless than ever in their determination to subject the capitalist system to control.'
Perhaps they should have lowered interest rates. Or pressured China to raise its currency. Any policy initiative, no matter how absurd, could be considered. As Flynn puts it: 'Out of Italy [as out of America currently] had gone definitely any important party committed to the theory that the economic system should be free.'
Italy had dug herself into a deep hole of debt. Between 1859 - when the centralized Italian state came into being - and 1925, the government ran deficits more than twice as often as it ran surpluses. Politicians, who depended upon giving away other people's money, found themselves with little left to give away.'
'All the old evils were growing in malignance,' writes Flynn. 'The national debt was rising ominously. The army, navy, and social services were absorbing half the revenues of the nation. Italy was the most heavily taxed nation in proportion to her wealth in Europe.'
Of course, there followed many episodes of financial risorgimento and many pledges to put the books in order. None of it stuck for long. Italian politicians were soon making promises again.
When grand promises must be fulfilled, debt creeps higher...and so does the resistance of taxpayers and lenders, especially from conservative groups.'
'Hence it becomes increasingly difficult to go on spending in the presence of persisting deficits and rising debt,' writes Flynn. 'Some form of spending must be found that will command the support of conservative groups. Political leaders, embarrassed by their subsidies to the poor, soon learned that one of the easiest ways to spend money is on military establishments and armaments, because it commands the support of the groups most opposed to spending.'
Military spending gives an economy the false impression of growth and prosperity. People are put to work building expensive military hardware. Assembly lines roll and smoke stacks smoke. Plus, the spending goes into the domestic economy. Americans, for example, may buy their gee-gaws from China, but their tanks are homemade. '
Military adventures not only seem to stimulate the domestic economy; they also goose up popular support for government. Soon, 'it was a time for greatness...' as Flynn describes the approach of war. War, Giovanni Papini raved, was 'the great anvil of fire and blood on which strong peoples are hammered.'
The romantic appeal of war...and the political pull of military spending...the economic delusion...the polished brass and boots...it was all too much to resist. Despite a disastrous experience in WWI, under Mussolini's leadership, even the fun-loving Italians were soon marching around like popinjays and getting out maps of Abysinnia.'
Even Americans were impressed. 'He is something new and vital in the sluggish old veins of European politics,' said Sol Bloom, then chairman of the House Foreign Relations Committee in 1926. 'It will be a great thing not only for Italy but for all of us if he succeeds.'
In investments, as in war, an early defeat is often more rewarding than a later one. Fortunately for the Italians, the African campaign was a fiasco. In a few years, Mussolini was hanging from a meat hook and Italians went back to making shoes, handbags and pasta.
P.S. Mussolini was the perfect fascist. Like America's leading neo-cons, he was really a leftist...who saw an opportunity. And also like America's neo-cons, he was an admirer of Machiavelli, who believed that the ruler 'must suppose all men bad and exploit the evil qualities in their nature whenever suitable occasion offers.'