Hubris

My Last (Well, Perhaps Not Quite Last) Column on World War I

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. . . Britain agreed, at least initially, to look the other way if Austria-Hungary temporarily occupied Belgrade . . . .”—By Sanford Rose

Dolors & Sense

By Sanford Rose

Tisza: An unwelcome moderation.
Tisza: An unwelcome moderation.

Sanford Rose

KISSIMMEE Florida—(Weekly Hubris)—5/22/2014—Since the centennial of World War I approaches (July-August, 1914), I thought I’d do a summary of the viewpoints and culpability of the principal parties.

David Lloyd George, who became Britain’s prime minister two years into the war, argued that the major countries “slithered” into the conflict, and there is evidence to support that viewpoint.

Germany did not want a war–certainly not a major one. It wanted to punish Serbia, to be sure. But what the kaiser envisioned was a limited “police action.” Interestingly, Britain agreed, at least initially, to look the other way if Austria-Hungary temporarily occupied Belgrade as a surety for its demands that Serbia punish the assassins of the Austrian archduke and also curb anti-Austrian propaganda.

Austria-Hungary was a moribund state that presided over ten nationalities. Austria’s major problem was Hungary, its co-equal (and often more than co-equal) partner in the so-called Dual Monarchy. The Hungarian magnates oppressed their minorities (mostly Croats and Rumanians) with a singular disregard for their inevitable disaffection. Had it not been for this attitude, the Dual Monarchy might have proved marginally viable.

Still, Hungary had no desire to go to war over the assassination of an Austrian archduke who hated Hungarians. Its leader, Istvan Tisza, tried to slow the march toward war.

Ironically, this moderation made matters much worse. Had Austria-Hungary acted with celerity to occupy Belgrade in support of punitive demands that were both limited and well-publicized, as the German kaiser wanted, the world would have been presented with a fait accompli, acceptable, as noted, to the British, before Russia had a chance to announce its mobilization.

Russia ostensibly elected to mobilize in support of Serbia. But that was just a charade. Russia hoped that war would allow her to seize the Turkish Straits and thus protect her agricultural exports. When Turkey closed the Straits a few years earlier for just a couple of weeks, during the Italo-Turkish War, Russia’s exports were sufficiently disrupted to jeopardize the funding of vitally needed industrial imports.

France, in the person of its president, Raymond Poincaré, goaded Russia into action. Poincaré was a most remarkable man, perhaps the ablest European politician since Bismarck. But he was also a committed revanchist, eager to harness his country’s “national awakening” to his life’s goal of retaking the provinces of Alsace and his native Lorraine, which had been detached by Germany after the Franco-Prussian War in 1871.

Once Russia began mobilizing, global war was inevitable. The announcement of Russian mobilization triggered German mobilization, and German mobilization triggered the infamous Schlieffen Plan. This required Germany to defeat France before taking the field against Russia, which allegedly could not complete its mobilization, even with a head start, before either France or Germany.

Well, I thought this would be the last column, but there’s much more to be said.

When I was writing articles on banking some twenty years ago, I overheard one banker ask another whether he had read Rose’s last article. The reply shot back: “I hope so.”

I trust that readers of this series do not share these sentiments.

Sanford Rose, of New Jersey and Florida, served as Associate Editor of Fortune Magazine from 1968 till 1972; Vice President of Chase Manhattan Bank in 1972; Senior Editor of Fortune between 1972 and 1979; and Associate Editor, Financial Editor and Senior Columnist of American Banker newspaper between 1979 and 1991. From 1991 till 2001, Rose worked as a consultant in the banking industry and a professional ghost writer in the field of finance. He has also taught as an adjunct professor of banking at Columbia University and an adjunct instructor of economics at New York University. He states that he left gainful employment in 2001 to concentrate on gain-less investing. (A lifelong photo-phobe, Rose also claims that the head shot accompanying his Weekly Hubris columns is not his own, but belongs, instead, to a skilled woodworker residing in South Carolina.)

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