February 12, 2015
Germany would do everything to avoid paying the Greek claim, out of fear of setting a precedent. But the Greek case could prove to be unique. More and more voices say that Greece has a good case, legally and politically, and that it should not back down.
Greece claims that it has never been repaid for a loan of 476 million Reichsmarks that the Greek National Bank was forced to hand to Nazi Germany interest-free during the war.
The Syriza government claims that Germany owes Greece over €150 billion. Historians and economists give lower figures. Without interest, today it would amount to $14 billion, and with interest at 3% over 66 years, that would come to at least $95 billion, wrote Tim Worstall in Forbes. Albrecht Ritschl, an economic historian at the London School of Economics, puts the figure at €11-€13 billion.
For many years Germany has successfully avoided paying these obligations, claiming that is should not assume obligations for the entire debt, since it represented only Western Germany. And the 1990 German reunification treaty (signed between the two Germanys, the USSR, France, Britain and the UK) makes no mention of wartimes debts. Therefore, the German government claims that the issue is dead. But experts say that before an international court, this argument would not hold up.
A court solution is hardly the preferred choice of the Syriza government, which needs the money fast. But other international players are also in favour of a settlement that would benefit Greece.
The US is reportedly concerned that a protracted stand-off between Athens and Brussels could lead to the country’s departure from the EU and a rapprochement with Russia. American Jewish lobbyists, experienced in obtaining reparations from Germany, reportedly would be prepared to give Tsipras a helping hand.
Photograph courtesy of Wikimedia. Published under a Creative Commons license.Heard in Europe