A Canadian financial journalist named Terence Corcoran has published an important yet flawed article on the economic impact of the First World War. The article is grounded in extensive reading of the scholarly secondary sources, including many of the books I’ve used as textbooks when teaching global economic history. His article includes some snazzy graphs as well (see below). I’m really glad that someone in bringing this research to the attention of the broader public.
I wish that Mr. Corcoran had included some information about the failure of most European business leaders to do more to try to prevent this terrible conflict from starting in the first place. His article shows that the First World War had all sorts of negative consequences for business. However, he overlooks the evidence that business leaders in Europe were, in a sense, the authors of their own misfortune in that only few of them did anything to stop the drift to war during the diplomatic crisis that followed the assassination in Sarajevo. It’s true that a few bankers and other business leaders in various European countries lobbied their respective national governments to de-escalate the situation and find a peaceful solution. Unfortunately, most business leaders remained silent. Then when war broke out, they “patriotically” supported the decision of their countries to declare war. They certainly didn’t stage any tax strikes. It’s a shame that Mr. Corcoran didn’t say more about the failure of business leaders to stand up for their own interests. Their moral cowardice (i.e., willingness to go along with the patriotic mob mentality) had massive consequences for humanity as a whole.