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nydus/The Economic Consequences of the PeacePublic

John Maynard Keynes, a former British Treasury representative at the Paris Peace Conference, outlines his objections to the economic policies established by the Treaty of Versailles. He argues that the terms of the peace agreement threaten the stability of the European economic organization and risk further damaging a system already weakened by war.

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Table of Contents

Reparation

much again as all the other claims added together.

The reader will readily apprehend what a plausible case can be made out for the inclusion of these items of damage, if only on sentimental grounds. It can be pointed out, first of all, that from the point of view of general fairness it is monstrous that a woman whose house is destroyed should be entitled to claim from the enemy whilst a woman whose husband is killed on the field of battle should not be so entitled; or that a farmer deprived of his farm should claim but that a woman deprived of the earning power of her husband should not claim. In fact the case for including Pensions and Separation Allowances largely depends on exploiting the rather arbitrary character of the criterion laid down in the pre-Armistice conditions. Of all the losses caused by war some bear more heavily on individuals and some are more evenly distributed over the community as a whole; but by means of compensations granted by the Government many of the former are in fact converted into the latter. The most logical criterion for a limited claim, falling short of the entire costs of the war, would have been in respect of enemy acts contrary to International engagements or the recognized practices of warfare. But this also would have been very difficult to apply and unduly unfavorable to French interests as compared with Belgium (whose neutrality Germany had guaranteed) and Great Britain (the chief sufferer from illicit acts of submarines).

In any case the appeals to sentiment and fairness outlined above are hollow; for it makes no difference to the recipient of a separation allowance or a pension whether the State which pays them receives compensation on this or on another head, and a recovery by the State out of indemnity receipts is just as much in relief of the general taxpayer as

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