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Notes on Economic Warfare

Throughout the 20th century, humanity witnessed the dawn of a radically new era in politics, society, and the economy, marked by total mobilization for war. This period saw the need to employ the entire production capacity and all societal resources in waging a total-scale war, especially between 1914 and 1917. During these critical years, France experienced an exponential increase in the workforce employed in war industries, rising from 50,000 to an impressive 1.7 million. Concurrently, there was a twenty-fold increase in munitions production in just three years, symbolizing the transition to industrialized warfare.

Another crucial aspect of this shift was the introduction of aerial warfare, with the use of aircraft in combat, marking a new phase in warfare tactics. The first aerial bombardment on Paris on August 30, 1914, was a clear example of this new tactic. In 1915, the conflict further escalated with Germany’s use of toxic gases, including mustard gas, known as iprite, introduced in 1917. This was another step toward the brutality of modern warfare. Additionally, the entry of submarines represented another significant development in the mechanization of war.

The mobilization for war extended beyond military aspects and permeated every facet of society. Citizens from all walks of life contributed to the war effort, through taxation, working in munitions factories, or direct participation in combat. The state played an increasingly invasive role in economic life, coordinating all national activities to support the goal of victory. Parallel to this, propaganda became an omnipresent tool, profoundly influencing public opinion through the media. Newspapers and other communication means were used to praise the actions of the national army and denigrate the enemy, creating an environment of information control and censorship accompanied by news manipulation.

During the critical period of World War II, there was an unprecedented level of economic mobilization on both Axis and Allied sides. This period was characterized by extreme measures such as rationing, stringent control over imports, significant tax increases, and direct state intervention in the economy to steer it entirely towards the war effort, including the crackdown on excessive industrial war profits.

In 1942 and 1943, the Soviet Union reached extraordinary levels of war production, manufacturing 2000 tanks and 3000 aircraft each month, reflecting the nation’s massive commitment to the war. Simultaneously, about ten million workers were reassigned to tasks directly linked to the so-called great patriotic war.

In Germany, Albert Speer, the then Minister of State for Armaments and Munitions, was crucial in transforming the Reich’s economy into a system entirely dedicated to war in 1942. He established a limited Planning Council tasked with allocating resources and raw materials, and under his guidance, armaments production in 1944 tripled from previous figures.

Across the Atlantic, the United States demonstrated an equally impressive manufacturing feat, producing 95,000 combat aircraft in just the year 1944, showcasing their massive industrial capacity and strong commitment to the conflict. These actions reflect the intensity and scale of economic mobilization during one of the most critical periods in world history.

Despite the extensive mobilization observed during World War II, this phenomenon does not validate the Marxist interpretation of history that identifies war as the ultimate expression of capitalism’s contradictions. This view is challenged by the analyses of historians like Serge Berstein and Pierre Milza, who provided a new perspective on the role of the economy in large-scale military conflicts.

According to Berstein and Milza, World War II highlighted the critical importance of the economy in both the preparation and conduct and the conclusion of a major military conflict. They argue that the concept of “economy” in this context should be divided into two main categories: the first, termed “economic warfare,” refers to the efforts of the countries involved in using the economy as a direct tool of war, through actions like blockades and bombings of industrial targets to weaken the enemy; the second, known as “war economy,” focuses on the internal strategies adopted by countries to finance and support the war effort. This includes measures like the conversion of industries into armaments factories, ensuring the production of essential goods, mobilizing human resources for military and civilian needs, and implementing policies to maintain the national economy during times of conflict.

This distinction is crucial for understanding the economic dynamics of war and dispels the myth that war is merely a product of capitalist tensions. Instead, it suggests that war and the economy are intimately interconnected in complex and multifaceted ways, influencing each other’s strategies and outcomes.

First, it is important to recognize that economic warfare in the historical sense, as defined by Berstein and Milza, did not have as decisive an impact as one might think. In fact, the economic strategies adopted by both the Allies and the Axis, which exceeded conventional tactics like aerial bombings and blockades, and aimed at controlling resources and trade relations with neutral nations, did not yield significant results. On the contrary, the effectiveness with which nations managed their economies during wartime determined the outcome of the conflict, as evidenced by the Allies’victory.

Moreover, the war was conceived as an irrational political objective, aiming to annihilate the opponent for reasons that transcend mere competition, entering the realms of ideology and ontology, that is, the very nature of being. This perspective reduced the economy to a mere tool in service of war, forcing nations to improvise and adapt as the conflict evolved, often in unpredictable ways. Each country, at the outset of the war, had devised an economic strategy based on their initial resources and expectations, but faced with the reality of prolonged conflict, they found themselves compelled to radically revise and modify their plans. A notable example is Germany, which initially planned for a short war, but found itself mobilizing all its resources in the face of the tenacious resistance of the Soviet Union from the winter of 1941-1942.

Opposed to economic or Marxist interpretations of history and conflicts, the two world wars stem from an extreme interpretation of Carl Schmitt’s analysis, which stated that politics is based on the distinction between friend and enemy. The statements of General Ludendorff, the architect of the concept of total war during the First World War and author on this theme, are enlightening in this regard. In 1935, he wrote that the changed character of war and politics necessitated a revision of the relationship between these and military strategy. He argued that von Clausewitz’s theories were outdated and that war and politics should serve the preservation of the race, asserting that politics is subordinate to war.

This way of thinking characterized the conflicts of 1914-1918 and 1939-1945 as examples of radicalization of the denial of the other, highlighting that total war, which requires the deployment of all social, industrial, and financial resources, cannot be understood outside of a nationalist, fascist, and totalitarian logic. Ludendorff, with his theory of total war, fit into this view, as did Stalin, who replaced the concept of race with that of class, adopting nationalist rhetoric in 1941 to incite the Russians to fight against the Nazis. In these cases, a distorted political will emerges, based on the pursuit of military power and the annihilation of the other, exploiting the economy and social structures for nihilistic and destructive ends.

The First World War (1914-1918) cast doubt on the very concept of devotion to the nation and fighting for an ideal. This is because values can often hide false ideologies, and modern society increasingly values every human life above any political construct, such as the state or democracy. Clausewitz’s famous statement that war is merely the continuation of politics by other means seemed apt until the outbreak of the Great War, which marked the beginning of a different era in armed conflicts between nations. This war quickly turned into a radical confrontation that transcended traditional lines, erasing the difference between combatants and civilians, and laying bare the horror of large-scale destruction of people and cultural values.

Initially seen as a brief conflict, the war revealed itself to be a long and disastrous stalemate from its early months. In the first year alone, over 350,000 French soldiers died on the battlefield. In 1915, the number of fallen rose to 320,000, many of whom perished in often futile and desperate attacks. This period in history profoundly marked European civilization, both in human and economic terms.

Reflecting on the reality faced by soldiers during the First World War, one can perceive the intensity and horror of this conflict that lasted four years. Emerging from the trenches, which had quickly replaced the initial phase of mobile warfare, soldiers found themselves confronted with relentless bombardment, trapped in barbed wire obstacles, and often struck down by enemy machine-gun fire. After gaining a few meters of ground, they were forced to confront new enemy defensive lines.

To fully grasp the severity of the period between 1914 and 1918, it is crucial to consider the devastating human losses. Over 8 million people died, and another 6 million were left disabled, including many with permanent facial injuries (“gueules cassées”), becoming a lasting symbol of the conflict. The war also left 4 million widows and 8 million orphans. France was particularly affected, with 1.3 million dead and missing, representing about 10% of its male working force. Analyzing annually, French losses were enormous: 360,000 in 1914, 320,000 in 1915, 270,000 in 1916, 145,000 in 1917, and 250,000 in 1918, to which must be added one million disabled. The high mortality due to poor sanitary conditions, food shortages, and the 1918 Spanish flu epidemic should not be overlooked.

Material losses were also immense. Large areas such as northern and eastern France, Belgium, the Netherlands, northeastern Italy, Serbia, Romania, and European Russia suffered massive destruction. The ruins of homes, infrastructure, and industrial plants extended as far as the eye could see. Many agricultural lands became unusable. Economically , France lost 30% of its merchant fleet, and Britain lost 20%, highlighting the devastating impact of the conflict on a national scale.

The post-war economic situation proved to be extremely grave, with public debts skyrocketing to unprecedented levels. At the beginning of the conflict in 1914, France’s national debt amounted to 33.5 billion gold francs, but by 1919 it had soared alarmingly to 219 billion. Similarly, Germany’s debt grew from 6 billion to 169 billion, while the United Kingdom’s increased from 17.6 billion to 196.6 billion. To meet the financial demands of the war, European nations accumulated considerable debts, especially towards the United States, with France’s foreign debt reaching 33 billion gold francs by 1919.

War expenditures forced the involved nations to significantly increase the amount of money in circulation, far exceeding sustainable levels relative to the central banks’ reserves, leading to substantial inflation. This was exacerbated by the gap between insufficient production and the needs of the population. As a result, for example, prices in France quadrupled between 1914 and 1918. This economic dynamic led to a drastic devaluation of European currencies and made their conversion to gold impossible. By December 1919, the British pound had lost 10% of its value, and the French franc had plummeted by 50%; the German mark suffered an even more drastic collapse, losing almost 90% of its value.

In this context of severe financial instability, states faced escalating expenses, not only for war funding but also for supporting war victims, reconstruction costs, and other post-war burdens. Europe, once the world’s financial center, found itself in a debtor position, further strengthening the United States’ position as the continent’s main creditor and holder of half of the world’s gold reserves. The United States, consequently, took on a dominant role in global economic development, becoming the primary financier of developing countries that could no longer rely on European resources.

The 20th century in Europe was marked by an era of intense violence, a legacy from which the continent has not fully recovered. Human nature, inherently averse to brutality, found in the First World War a turning point. The 1920s began to reflect on a Europe that seemed almost self-destructive in the trenches. However, the interpretation of the events of 1914-1918 is not so straightforward: this war brought with it a more complex and difficult lesson to accept.

The Great War created a new type of man, a warrior driven by primal instincts. In an era when Progress was intended to distance us from violence, considered a characteristic of pre-Enlightenment religious ages, a transformed man emerged from the Treaty of Versailles. This figure, marked by experiences of combat, death, and brutality, carried vivid memories of the faces of comrades waiting under steel helmets moments before an assault. This experience profoundly altered their perception of life in peacetime, unlike those who had not directly experienced these harsh and precarious realities.

Many of these men returned from the trenches deeply traumatized by the violence they had endured and inflicted. Some turned to pacifism or revolutionary activism, while others prepared for future conflicts. But all emerged radically changed, accustomed, despite themselves, to a culture based on direct confrontation, coercion, and conflict. This change helps explain the political climate of the 1920s and 1930s.

World War II represented an unparalleled breakpoint in the history of warfare, a conflict that broke all chains and reached the extremes theorized by Clausewitz. The war approached the concept of self-annihilation of humanity, manifesting its purest form in the absolute rejection of the Other, tragically symbolized by the Holocaust and the Nazis’ systematic elimination of the Jews.

After 1945, Europe, especially with the gradual disappearance from the political scene of those who had lived through the two world wars, embarked on a path aimed at eradicating the roots of violence. In this process, the nationalist mentality was systematically dismantled. While this can be seen as progress on one hand, it also led to the loss of fundamental elements of national sentiment in many Western European countries, with France at the forefront.

In this context, General de Gaulle’s interventions in the 1960s can be seen more as momentary reactions than as a true awakening or rebirth. De Gaulle opposed what he rightly perceived as a harmful trend, but in the end, this trend proved itself. What we can now understand is that European elites tend to a post-nationalist vision, sometimes refusing to recognize global dynamics where powers like the United States, China, and Russia continue to pursue nationalist, hegemonic, or dominating strategies, both at regional and global levels.

Europe, in its desire to detach itself from history, has shown reluctance to accept the reality of brutal geopolitical and economic power relations. This attitude is reflected in French economic intelligence policy over the past twenty years. The very idea of sovereignty, often labeled as retrograde or even dangerously antiprogressive, reveals a certain intellectual and psychological tension. In a period when a united Europe against global challenges would make a lot of sense, this stance appears particularly contradictory.

Ultimately, we are confronted with an irrational opposition to the concept of political and military power. In France, this attitude manifests itself in a particularly evident duality of behavior among political leaders. On one hand, they must cautiously handle an institutional and cultural legacy that dissuades them from completely abandoning ambitions of a powerful and influential European pole; on the other hand, they seem to deliberately sabotage any serious attempt to form a concrete and sustainable response to the American and Chinese plans for economic and cultural dominance.

This contradiction is clearly evident in how European leaders address the issue of the extraterritoriality of American law, a topic thoroughly discussed in Ali Laïdi’s latest work. One wonders how such a gap can exist in minds otherwise accustomed to administrative excellence. The explanation lies in their tendency to detach from end goals to excessively focus on processes, in a sort of forward escape that becomes a hypnotic reference point.

The aim of conforming to the principles of good governance and fair decision sharing within European institutions satisfies the desire to appear as model students in the technocratic bureaucracy class. Faced with uncertainties about motivations or goals, the tendency is to focus exclusively on the “how” rather than the “why,” an approach that risks overlooking the broader and more significant challenges Europe faces in the global context.

This course of action addresses a fundamental dilemma for contemporary European elites: the tendency to shy away from actively considering the future of the continent and from developing innovative strategies to enhance its power. This is a challenging and potentially risky political decision that requires a high degree of creativity and strong commitment. It means re-evaluating the very foundations of power, including the nature and tools of influence, which go beyond traditional models of rayonnement, and considering the transformations of coercion in the international context.

Such a doctrinal shift necessitates a radical overhaul in how we acquire strategic knowledge, both in the public sector and in the training of our future economic leaders. This implies a profound renewal of the hierarchical architecture within our organizations, both public and private. Although the outcome of such a process could be extremely beneficial and stimulate creative energy, there are concerns about its effects within the administrative elite and in prestigious academic institutions, such as business and engineering schools. These changes could disrupt traditional structures and challenge established norms.

In summary, post-war Europe embarked on a complex path, attempting to distance itself from nationalism and the violence that largely influenced its history during the 20th century. However, this effort has led to a sort of identity and power crisis, with the continent’s elites struggling to balance the lessons of the past with current challenges. While the urgency of adopting a new perspective and a renewed approach to power and influence is clear, the path to achieving it remains uncertain and fraught with both internal and external obstacles.

These obstacles reflect the complexity of Europe’s historical and political situation in the 21st century. Internally, the continent faces challenges related to its cultural, political, and economic diversity. Issues such as European integration, balancing national sovereignty with transnational cooperation, and managing economic crises and migration movements are some of the key problems for the European Union. These challenges are further complicated by the rising tide of populism and the emergence of political movements that challenge the Union’s fundamental principles and future direction.

In this context, the need for a more united and strategic Europe is pressing. However, achieving such unity requires overcoming internal obstacles and sharing a common vision for the future. This involves not only a critical analysis and adaptability to global changes but also the ability to redefine a European identity that is inclusive, resilient, and proactive on the global stage.

Europe must therefore navigate between respecting its past and meeting the needs of the present, seeking to build a future that recognizes historical mistakes while also being bold and innovative in its approach. This requires a balance between preserving the fundamental values that have guided its formation and adopting new and dynamic strategies to meet the challenges of the 21st century. The challenge for Europe is to reaffirm its identity and role in a rapidly changing world while maintaining its commitment to peace, democracy, and international cooperation, the pillars of its post-war reconstruction.

Externally, Europe finds itself in an increasingly intricate and competitive geopolitical context. The emergence of powers like China, coupled with Russia’s growing assertiveness and a sometimes tense transatlantic relationship with the United States, creates significant challenges for Europe’s position and influence in the world. Additionally, managing regional crises, international terrorism, climate change issues, and energy security concerns require coordinated and strategic action from Europe.

Faced with this scenario, the necessity for a more cohesive and strategic Europe is imperative. Yet, realizing such unity entails overcoming internal difficulties and fostering a shared vision for the future. This requires not only a critical analysis and adaptability to global shifts but also the ability to reframe a European identity that is inclusive, resilient, and proactive on the global stage.

Europe, therefore, must balance respecting its past with addressing the needs of the present, striving to build a future that acknowledges historical errors while also being courageous and innovative in its approach. This necessitates a balance between preserving the fundamental values that have shaped its formation and embracing new and dynamic strategies to meet the challenges of the 21st century. Ultimately, the challenge for Europe is to reassert its identity and role in a rapidly evolving world while continuing to uphold its commitment to peace, democracy, and international cooperation, which have been the cornerstones of its post-war reconstruction.

Externally, Europe is situated in a complex and competitive geopolitical landscape. The rising influence of powers such as China, along with Russia’s renewed assertiveness and the often strained transatlantic relations with the United States, pose significant challenges to Europe’s stance and influence globally. Additionally, the management of regional crises, international terrorism, climate change, and energy security issues demand a coordinated and strategic approach from Europe.

In this environment, the imperative for a more united and strategic Europe is clear. However, achieving such unity requires overcoming internal hurdles and embracing a shared vision of the future. This means not only critically analyzing and adapting to global changes but also redefining a European identity that is inclusive, resilient, and proactive on the world stage.

Europe must thus navigate between honoring its past and addressing the demands of the present, aiming to construct a future that not only acknowledges historical mistakes but is also brave and innovative in approach. This involves striking a balance between maintaining the foundational values that have guided its establishment and adopting fresh, dynamic strategies responsive to the challenges of the 21st century. In essence, Europe’s challenge is to reaffirm its identity and role in a swiftly changing world while continuing its commitment to peace, democracy, and international cooperation, the pillars of its reconstruction following the ravages of war.

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