“It is also worthy of note that he warned in 1920 (In “The Economic Consequences of the Peace”) about imposing the punitive Treaty of Versailles on Germany. He was dead on about that and universally ignored.”
Wow, that’s a radical revision of history. Actually, all the best people listened to him. Aside from the General Theory, it was easily his most famous book. Because everyone believed it at the time, it has warped public opinion to this day, thus explaining your post.
He was also dead wrong. As we all know, Germany never repaid its war debts. So how could said debts have ruined them? They didn’t. Germany ruined itself. It was bankrupted in foolish attempt to avoid doing paying up.
Granted, France played a big role in said bankruptcy by vigorously enforcing the treaty. There are better ways to squeeze money out of an economy. Grow it, for one. Ultimately, though, Germany was only one of many countries sliding into depression in the 20s. It was unique in experiencing the horrors of hyperinflation, but that was nobody’s fault but it’s own.
Had Germany been dealt a true Carthaginian peace, it wouldn’t have been in a position to bankrupt itself so horribly. Unconditional surrender worked after WWII, didn’t it? That’s what was missing. The compromise peace of Versaille allowed them to preserve their pride, and pride is all one needs to ruin oneself.
Keynes opinions at the Peace Conference had little or no impact on the Peace Treaty it created. What “public opinion” did it warp? It certainly did not warp the conference away from a treaty containing the seeds of future conflict.
Germany tried to handle the debts throughout the twenties and inflating its way out of them ruined its currency and caused enormous hardships. This problem was repeatedly address through international conferences and American loan programs.
Keynes was 100% correct in declaring these debts were impossible for Germany to pay. But they provided the extremists a convenient target for the cause of Germany misery. And they precluded your solution of growing the economy to handle reasonable debt. It would have been similar to the the Soviets looting the East Germans preventing the economy there from growing much.
Peace came before a complete collapse so the situation was on the surface not the same as 1945 when the country was reduced to heaps of ruins occupied by conquering armies. Now it appears to me that a collapse would have occurred within a matter of weeks but it was not apparent from the military standpoint. The “Stab in the Back” was a plausible reason to the soldiers in the trenches many of whom later made up the followers of Hitler.