Some 98 years ago, or more accurately, in July 1914, the German High Command, on the eve of the outbreak of World War I, knew things were not going to plan. They knew that Germany’s most significant ally, Austria-Hungary, had dire problems. Since the Napoleonic Wars of the early 19th Century, Austrian military power was in serious decline. The rate of internal industrialisation was ponderous, infrastructure was antiquated, bureaucracy was stifling and the military was by and large becoming a constabulary whose primary function was to rein in and eliminate challenges to the Hapsburg monarchy be they from radical Slavic nationalists, militant anarchists or utopian republicans. Indeed, the German High Command said that their alliance with Austria-Hungary was akin to being ‘fettered to a corpse’. But long-standing cultural ties between Berlin and Vienna (as well as blatant strategic necessity) meant that Berlin had to shore-up Austria militarily by giving it the means to prosecute modern war. German officers trained Austrian officers in the use of new German technologies and in new modes of fighting. It was a military ‘bailout’. But it came too late to have a decisive influence over events and the scale of modernising imperial Austrian forces proved too much in spite of German economic and military efficiency. The end result – German and Austrian defeat – the break-up of the German overseas empire and the Austrian Empire erased from the map of Europe.
Seventy-three years ago, 1939, the Fascist Kingdom of Italy joined the ‘Pact of Steel’ with Germany. Again, Germany faced the prospect of either going it alone in its quest to dominate Europe, or, having at least the prospect of one significant European partner. The problem with Fascist Italy was that in spite of the progress toward industrialisation and some notable international technological milestones, Italy’s economy was largely agrarian. Its industries, concentrated in the country’s north, could not scale-up to meet NAZI aspirations for Europe. Rome, labouring under the constraint of local inefficiencies, patchy infrastructure and the struggle to integrate the culturally different industrial north with the rural south while at the same time undertaking a major imperial expansion overseas, was too much. In spite of a generous German military and economic ‘bail-out’, Fascist Italy, considered the soft under-belly of Occupied Europe, collapsed in 1943. Germany’s bailout to save its Italian ally failed as did NAZI ambitions in 1945.
In 2012, Germany, an economic superpower, is again being asked to bailout a weak ally – ‘the Eurozone’. The Eurozone has a host of structural deficiencies that cannot be easily remedied without turning the EU monetary union into a gigantic sovereign bloc, overriding deeply held concepts of nationalism and ethnic and cultural chauvinism. The reality of this construct would see German money, German influence and German interest dominate this bloc. Fear of Germany and its influence may unleash centrifugal forces that will gradually tear the EU apart and with it the dream of a ‘United States of Europe’ in spite of any number of German-derived bailouts.
Historically, Germany’s bailout of its allies has come at a great cost to the German people and we should not be surprised if this historic pattern will play out again in the German-EU context.
By Dr. John Bruni, Director SAGE International
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