Summary of Nicholas Mulder's The Economic Weapon

Everest Media

Description

Please note: This is a companion version & not the original book.
Sample Book Insights:
#1 The blockade of Germany was a transnational economic enterprise that gathered intelligence, produced knowledge, and developed policy instruments to enforce the isolation of Germany.
#2 The Allied blockade was one of the most consequential experiments in global economic governance of the twentieth century. It launched the Allies on a voyage of discovery, which led to the control of raw materials and the development of financial blockade.
#3 Manganese is a chunky, silver-gray metal found in lumps and arteries in the earth’s crust. It has long been known to have the capacity to harden iron objects. In nineteenth-century Central Europe, blacksmiths used small amounts of manganese when smelting pig iron in their furnaces to produce a tougher, shiny product called Spiegeleisen.
#4 The needs of German steel producers drove considerable manganese imports. The transport infrastructure was poor, and the Russian manganese mines at Chiatura were a hotbed of revolutionary agitation.

Sujets

• Economic history

Informations

• Publié par: Everest Media LLC
• Date de parution: 07 avril 2022
• Nombre de lectures: 0
• EAN13: 9781669381402
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Insights on Nicholas Mulder's The Economic Weapon
Contents Insights from Chapter 1 Insights from Chapter 2 Insights from Chapter 3
Insights from Chapter 1

#1

The blockade of Germany was a transnational economic enterprise that gathered intelligence, produced knowledge, and developed policy instruments to enforce the isolation of Germany.

#2

The Allied blockade was one of the most consequential experiments in global economic governance of the twentieth century. It launched the Allies on a voyage of discovery, which led to the control of raw materials and the development of financial blockade.

#3

Manganese is a chunky, silver-gray metal found in lumps and arteries in the earth’s crust. It has long been known to have the capacity to harden iron objects. In nineteenth-century Central Europe, blacksmiths used small amounts of manganese when smelting pig iron in their furnaces to produce a tougher, shiny product called Spiegeleisen.

#4

The needs of German steel producers drove considerable manganese imports. The transport infrastructure was poor, and the Russian manganese mines at Chiatura were a hotbed of revolutionary agitation.

#5

The steel company sent orders with desired amounts to its London agent, who matched requirements with the offers of suppliers in the global mining industry concentrated in the British capital. The agent then arranged trade financing by forwarding the order to Deutsche Bank. As the second-largest bank in the world, Deutsche Bank was able to dispense the trade credit through a special Latin American subsidiary.

#6

The material supply chain in minerals trading had a financial counterpart in an international chain of payments. With this prospective payment, Krupp cleared its trade debt to Deutsche Bank.

#7

The Itabira-Krupp manganese contract was a very normal transaction in the highly globalized environment of 1914. The most knowledgeable people involved were the mining company officials and bankers in London, but they had limited control over certain aspects of the trade.

#8

Britain was the center of the global economic system. It was the largest merchant marine in the world, and its shipping companies carried 55 percent of the world’s seaborne trade.

#9

The blockade that did emerge was enforced by the Royal Navy’s surface fleet, but it was handled primarily by the Foreign Office rather than by the Admiralty. The blockade was a system of contraband control, a policy looser than a full legal blockade.

#10

The blockade was a governance system that required continuous diplomacy with neutral countries to manage the conflicts that arose with them. The Trade Clearing House was a section of the Treasury’s War Trade Department, and it scoured all the sources at its disposal to gather information.

#11

The WTD handled all the applications for import and export licenses from merchants who wanted to circumvent the blockade. The activities of the WTD and the TCH produced a stream of information that ended up in front of the Restricting of Enemy Supplies Committee.

#12

The French blockaders’ approach to the blockade differed from that of their British colleagues. They thought that economic pressure against the enemy was impossible without some pecuniary loss to the Entente.

#13

By late 1915, the Entente’s blockaders had not achieved the comprehensive economic isolation of the Germans. In their parliaments and press, the Entente governments were being accused of lacking the determination to prosecute the war effectively.

#14

The head of the Ministry of Blockade was Lord Robert Cecil, Viscount Cecil of Chelwood. He was a an inspired choice for the job. He came from the aristocratic inner sanctum of the British political elite, having been born the third son of the Marquess of Salisbury, one of the most powerful Conservative prime ministers of the nineteenth century.

#15

The British blockaders understood their own maturation as the result of a process of learning how to produce actionable knowledge. They developed a more advanced and scientific system of economic warfare, which was driven by one man, William Arnold-Forster.

#16

The WTD used prewar consumption levels to produce quarterly and annual estimates of normal levels of imports by neutral states. Any imports exceeding the established rations would result in an embargo on further trade in those commodities.

#17

By 1916, the blockade had grown to include blacklists, navigation certificates, and preclusive purchasing, which allowed the British to buy supplies from neutral countries and prevent them from being obtained by the enemy.

#18

By August 1916, the French Foreign Ministry had created the Comité R, which was a full department dedicated to the blockade. The French were much more efficient than the British in using manpower, since they only had 53 people working on the blockade compared to 1,880 people working under Cecil at the Ministry of Blockade and the Foreign Office.

#19

The uses and limits of the blockade system become clear if we return to the example of Brazilian manganese shipments to Germany. As blockade administrators tracked minerals, they made substantial advances but also encountered serious problems.

#20

The blockade was a novel concept in the history of the world, and it was defended by Britain. The blockade was a way to exert pressure on the Central Powers without causing excessive risk to the Entente Powers.

#21

The blockade was only the first proposal by a British cabinet official to transpose the blockade into a peacetime mechanism to prevent war. Cecil’s idea would shape long-term plans for an international organization.

#22

The economic weapon could become an impartial instrument of peace, or it could retain its offensive character and aim at the industrial ruin of specific threats, especially Germany. It was difficult to combine these two aims into a single mechanism.

#23

The British blockade policy focused on the interception of physical goods and the seizure of foreign property. But the most dynamic element of the world economy was still the global financial system.

#24

The Finance Section, led by Davies, developed a stamp-authorization scheme for neutral-to-neutral financial transfers through London. The role of banks in greasing the wheels of trade meant that the Finance Section also learned much about commercial goings-on.

#25

The German banking and business in Latin America continued, despite the blockade, and the financial blockaders began to seek ways to prevent the German repatriation of overseas profits. They began to try and stop financial transfers from Argentina and punish the French and Dutch banks that facilitated them.

#26

The entry of the United States into the war in early September 1917 changed the situation. The Allied powers now controlled the world’s three main financial centers, and could mount a more forceful campaign of financial pressure.

#27

The French government had to force the largest bank in France to comply with the law, even though the financial blockade committee did not want to establish permanent controls.

#28

The first four months of World War I were crucial in shaping the economic blockade of the Central Powers. When Germany blocked the Danish Sound and the Ottoman Empire closed the Turkish Straits, Russia lost the main arteries connecting its vast economy to the outside world.

#29

The economic war was extremely important in the final years of the war. The German leadership became fixated on the resources of the Black Sea and Caucasus region, and the Allies used this to maintain the blockade after the Armistice in November 1918.

#30

The Ottoman Empire was a net importer of grain, and the British and French blockade of Anatolia and the Levant devastated the food economy of Greater Syria. It has not received the attention it deserves, especially considering that it likely contributed to as many civilian deaths as the blockade of Central Europe.

#31

The German experience of economic encirclement by blockade produced two broad responses. The first was the call for a return to a liberal legalism. The exclusionary resolutions of the Paris Economic Conference of June 1916 were a perfect target for such arguments.

#32

The more the war seemed inevitable, the more German and Allied war aims became locked in a mutual process of radicalization. Allied economic warfare did not only respond to a fixed set of German goals, but the shifting pressure of the blockade actually shaped those goals as they changed.

#33

The February Revolution in Russia raised the prospect that the largest land army of the Entente would cease to fight in the war. If the eastern pillar of the war effort collapsed, the entire Allied grand strategy for conducting the war would have to be revised.