How the Drive for Autarchy Caused WWII
“Once you have a China that’s truly independent, where will that bring US-China relations? Is it betting on the short-run too much at the expense of the long-run?”
In light of “Liberation Day,” we’re taking this show out from the archives — about 1930’s trade policy and the dangerous search for national self-sufficiency with Nick Mulder, where we discussed his book, The Economic Weapon. (You can listen to part one here.)
In this episode, we’re going to get into the juicy stuff around the late 1930s, the leadup to World War II, and interesting parallels that you might see today with what the US is doing with respect to China, trade and technology.
We address:
Why countries yearn for autarchy aka rohstoff freiheit, “raw materials freedom”
Why states start wars because of “temporal claustrophobia,” and what it has to do with Japan ultimately siding with the Axis;
Parallels between the “ABCD circle” (America, Britain, China, Dutch East Indies) and the semiconductor export controls today;
Why having an empire was a liability for Britain;
What sanctions had to do with the Czechoslovaks — even with a larger army — falling to the Nazis.
Have a listen on Spotify or iTunes.
Sanctionomics
Jordan Schneider: So, Mussolini invades Ethiopia, the the League of Nations lowers the economic boom on him, but too slowly to make him lose the war.
Watching the world really economically squeeze a middling power focued minds in Nazi Germany and Imperial Japan.
What was the reaction that you saw in the sources of the leading Axis powers as they saw Italy struggling under the weight of global economic sanctions?
Nick Mulder: Italy is put under sanctions about a month after it invades Ethiopia — so November 1935. And what you can see from that point onward in discussions — in Nazi Germany particularly, but also in Japan in the months and years following that — is an increasing focus on what sanctions would mean for them.
In German, in fact, this already precedes the sanctions against Italy. Of course, they had been exposed to a particularly nasty blockade in World War I — they have that memory; the Nazi ideology is very concerned with food security. So they have plenty of reasons to be focused on that.
In Germany — which at that time also was operating really on a shoestring amount of foreign exchange reserves — this was very worrisome. Germany, of course, was engaged in one of the largest armament efforts ever seen in a capitalist economy in peacetime, as Adam Tooze shows in Wages of Destruction. And their external dependence was massive: n order to run all those steel industries, all the energy, the coal, the oil — you need to import it. And interestingly, because of the Great Depression, imports of these commodities had actually become cheaper because there had been a huge commodity downturn.
So you think that the Great Depression causes trade to collapse and the sanctions will no longer work. Actually, the opposite is true for a number of key commodities. The commodity downturn is so severe that it becomes extremely cheap to source oil, coal, iron ore, textiles, raw inputs for a variety of industries, scrap metal from abroad.
So that is the weak Achilles’ heel that Nazi Germany and Japan (with a very similar industrial structure) both have — and that is what they choose to then start protecting.
And in Germany, there’s a really direct effect of the League’s sanctions against Italy on [Germany’s] thinking. The main body that’s in charge of national defense planning — it’s called the Reich Defense Council (Reichsverteidungsrat) — gets together in early December 1935. And it has all the key people there: Hjalmar Schacht (the Reichsbank chairman and Finance Minister), the heads of the General Staff and planners, [Alfred] Jodl, [Wilhelm] Keitel; and soon, in the spring of 1936, Hitler joins them, too. And at each of those meetings they emphasize, “We need to look at what’s happening to Italy, we need blockade resilience, and we need to figure out how we move not just from a kind of trade-commercial protectionism, but to an economic model that is immune to sanctions.” And what they mean by that: it’s immune to having raw material imports severed; they call that rohstoff freiheit, or “raw materials freedom” — they have total autonomy because they have all the raw materials they need for war.
That becomes the aim of their planning going forward, and the main thing that it manifests in is the famous Four Year Plan that is announced in the spring of 1936 — while the League’s sanctions against Italy are still in effect. And it’s then given a particularly powerful head: Hermann Göring becomes the head of the organization running that, and they have a goal: “within eighteen months we want to be independent in terms of fuel from the rest of the world economy, and within four years we want to be totally ready for an aggressive war of conquest.”
Jordan Schneider: What’s the difference between autarchy and autarky?
Nick Mulder: Yeah — so we spell it different ways. Some people write it with a k — that’s the most common. But you also see it sometimes with ch. And there’s an interesting etymological difference between them.
The older version is autarchy, which comes from autos — so it means to rule oneself, to be independent, to be in command of oneself in one’s own position. And that basically just means that you have autonomy, political or otherwise.
Autarky actually comes from the verb arkhein, which is to suffice or to subsist. And that means that you could actually survive off of your own resources. So that’s a narrower definition.
And the interesting thing at the time (one of the famous Italian economists, Luigi Einaudi, notes this): some states that try and become autarkic — actually have access to all the resources that they need within their own territory — lose the ability to have full independence, because they need to engage in policies that are so radical that they effectively close off lots of options for themselves politically. And that’s actually what I think ends up happening in the 1930s: the road to full self-sufficiency is a road that goes through conquest. And that ends up accelerating this war — that had already been in the air was already very possible — but it ends up bringing on a kind of war that is particularly virulent and aggressive and even genocidal, I would argue, because of some of these dynamics.
Jordan Schneider: Let’s talk a little bit about import substitution and the role of German industry in not only becoming self-sufficient by conquering other people’s lands that had coal and cotton, but also changing the way that they consumed those raw materials in order to make themselves more self-sufficient.
Nick Mulder: Yes — there’s a number of schemes that they launched in order to become self-sufficient, and some of them had already been pioneered in World War I and in the 1920s.
So World War I has this big scientific breakthrough that today still powers a lot of global agriculture and sustains a huge part of the world population: the synthetic fixation of nitrogen, which allows you to make fertilizer using simply oxygen. And it means that you no longer need to use saltpeter and some nitrates that you get out of the ground. You can actually use atmospheric components. That’s one thing.
The other thing is fuel hydrogenation. And IG Farben, which becomes infamous for creating Zyklon B — the gas used in the Holocaust — also is one of the main huge German chemical corporations that pioneers a technique for turning coal into oil. [Coal and oil are] both forms of carbon energy, but coal is a lot harder — it’s kind of as if you imagine (even for people who don’t do chemistry) that you add a ton of water to coal, and you put it under an enormous amount of pressure, and you heat it and actually you get something approximating some sort of oily substance; you don’t need to refine it. It’s extremely energy intensive, very wasteful, and very inefficient — so you need an enormous amount of feedstock and fuel in order to get this reaction going. But it is possible for countries that have only coal to turn it into gasoline and a variety of other things, particularly aviation fuels, through fuel hydrogenation.
So that’s the technology that the Nazis hope is going to make them ultimately independent of imports of oil. And as the League of Nations considers this sanctions measure — extending the sanctions against Italy with an embargo on oil imports — [that technology] becomes very important.
The Japanese also take [hydrogenation technology] over. IG Farben — the chemical corporation in Nazi Germany that is accelerating this with huge subsidies from the Nazi government — also sends people to Japan. And in Manchuria and North Korea, the Japanese have access to huge coal reservoirs, so they build a number of plants — both the Imperial Japanese navy and the Imperial Japanese army have their own competing fuel-hydrogenation projects.
And apparently, the North Korean regime today still has some of these plants in the same places that the Japanese Navy built them in the 1930s; and North Korea has massive coal reserves. So there’s speculation that Kim Jong-un might be able to make it through a full fuel embargo by using, basically, Nazi-era technology.
Jordan Schneider: Wild.
Nick Mulder: The other really wild thing, by the way, is that the main postwar user of fuel hydrogenation is apartheid South Africa. They, too, have the same thing: massive coal reserves. They get put under an oil embargo, and they use [hydrogenation] in order to circumvent that [embargo], partially. And today, actually, the largest fuel hydrogenation plot is in South Africa, owned by the South African state-owned company Sasol. So this is a really interesting afterlife with technology.
Economic Asphyxiation and Pearl Harbor
Jordan Schneider: You started taking us to East Asia, so let’s stay there. How does Imperial Japan’s thinking change post-Ethiopia?
Nick Mulder: Japan is — even more than Italy, I would say — a country that is really on the fence for a long time about what its posture toward the West should be. And this is the general thing that I try to emphasize in the book about the interwar period: the war with Nazi Germany was, to some degree, probably inevitable at some point (it was just in the nature of the Nazi regime that they were going to try and use violence); but the fact that Mussolini ended up fighting on the side of the fascists was already less necessary; the fact that Japan sided with the Axis is even more remarkable.
And there was a much bigger split within Japan about who the opponent should be. It’s equally imaginable that they would have gone to war against the Soviet Union and remained on the side of the Western allies, Britain and the United States, who they rightly saw as much bigger adversaries.
But one of the things that ends up derailing the Japanese liberals’ (so to speak) or the more pro-Western camp’s plans is the war in China. They, of course, are partially themselves to blame for this, because Japan has already invaded Manchuria with a false-flag operation — in 1931, the Manchukuo Imperial Army becomes a sort of state within a state that ends up undermining the central government and essentially running its own foreign policy.
But by the time it’s 1937 or so — we’re now in the immediate aftermath of the Ethiopia sanctions — the Japanese state is in a situation where it still could go either way. And what ultimately ends up happening is that one camp of its officers in China ends up in a fight with Chiang Kai-shek and the Nationalists. And actually, it seems now (according to most historians of China) that the Nationalists, too, were actually kind of pining for a confrontation at that point: in 1931 China didn’t want war — but in 1937 the calculation seems to have been, on the part of some people in the KMT ruling elite, that Japan was going to get stronger every year; if they were going to fight Japan, better do it now than later.
So interestingly, you can see a whole number of countries and groups in the spirit have this sense of “temporal claustrophobia” (a term from Chris Clark in his book Sleepwalkers). And it’s not just the Japanese and the Germans — it’s also the Chinese, actually, that want to have a confrontation with Japan sooner rather than later. So that ends up triggering a war in 1937 that is arguably the start of World War II, because it directly carries on into the Second World War.
So that complicates the picture dramatically, and it ends up triggering a slow drift, essentially, of Japan into an anti-Western alliance — because the West ends up siding with the Chinese resistance, because of course, [the West wants] to make sure that Japan doesn’t take over China entirely.
Jordan Schneider: “Temporal claustrophobia” — what’s your take? The causes of World War II are multivariate, and your book is front and center of my mind. So I’m curious: thinking back, in the final moments when Japan is thinking about starting Pearl Harbor, when Hitler is thinking about invading Poland and then invading the Soviet Union — this very human fear that even if our odds are bad now, they’re going to keep getting worse, seems very clear. And instead of reevaluating whether or not you want to play the game that gave you these bad odds in the first place, you decide to take the plunge and roll the iron dice, as the case may be.
Let’s talk about what the US ended up doing after 1937, as we get into 1939, 1940, and 1941 when it comes to economic sanctions on Japan.
Nick Mulder: The US has already been considering economic sanctions on Japan since 1931, since the original invasion of Manchuria and the creation of Manchukuo. But at that time, Herbert Hoover is the president, and he holds back on it. It takes quite a while into the [Franklin Delano] Roosevelt administration, really Roosevelt’s second term, before he decides to start getting tougher on Japan — and he has his famous Quarantine Speech in the fall of 1937.
And after that there are a number of incidents. By the summer of 1938, he for the first time begins to call on American companies to institute what he calls “moral embargoes” — voluntary restrictions by American firms. One of the reasons that he’s doing this is because there are Neutrality Acts in effect, which make it impossible for the US president to discriminate by cutting off trade with one country that’s party to a conflict and not with the other; the Neutrality Acts actually obliged the US government to break off arms trade with both parties to a conflict. So this is very tricky for Roosevelt — he has to negotiate these neutrality acts. And if he declares there is a war going on in East Asia, then China also loses access to American arms. So this is why he needs to first go through the private sector and try and have them do it voluntarily.
Now, at some point, they find ways around it. And by 1939, world war has broken out in Europe, too, with the invasion of Poland, and that makes it a lot easier. And that summer, Japan keeps pushing further and further, not just in northern China against British diplomatic presence, but also into Indochina.
And the other thing is that Japan at that point is even more dependent on US trade and on US exports of these commodities than it was in 1935 and 1936 — because the British empire is totally focused on producing for its own war effort, because it’s fighting against the Nazis and it has prioritized its own colonies. So the British empire goes into essentially full economic lockdown mode; Japan can’t really trade that much with them anymore. So Burma, India — those markets become a lot more difficult to access. So [Japan] becomes more and more dependent on trade with the US.
And then Roosevelt steadily ratchets up the pressure in 1940: he lets his commercial treaty expire, so trade becomes more onerous between the US and Japan. And by the summer of 1940 — after the Nazis have taken over all of Europe, and Japan also pushes into Indochina and is now trying to take over French colonial possessions there, because Paris has fallen to the Nazis — he decides it’s really time to start putting a limit on this. He begins to openly restrict a lot of iron-ore and scrap-metal shipments to Japan.
So these are actually the first full discriminatory economic sanctions. He’s targeting Japan openly. He’s trying to throttle this key raw material, making sure they just cannot produce enough to sustain their war in East Asia. And in the summer of 1941, the situation had escalated further still because Lend-Lease has gone into effect — so the US is now also bankrolling the war effort of the British Empire, of Chiang Kai-shek of the Nationalists, and of a number of other countries. And [Lend-Lease] actually needs to prioritize raw materials for [the US].
So part of the story of economic sanctions against Japan that end up triggering the Japanese attack is that the US cannot simultaneously mobilize its own war industry and keep exporting at the same rate with Japan — there’s just a limited amount of North American raw materials. And this, then, means that even if there hadn’t been really severe restrictions, Japan would have seen some dip in what it would have been able to obtain from the US.
But what Roosevelt ends up doing: he puts restrictions in place in July 1941, and then he leaves on a trip to meet Churchill on this big cruiser where they draft the Atlantic Charter together in August 1941. And while he’s away, Dean Acheson and [Henry] Morgenthau (at the Treasury) actually end up — on their own initiative — wrapping up and increasing the sanctions, making them very hard to take off. They freeze all Japanese foreign assets. The US has not declared war on Japan at all — so these are actions where they openly target Japan’s foreign financial reserves. And they cut off oil supplies — and that’s really the thing that sort of sets the final stage of the temporal claustrophobia in motion.
Jordan Schneider: So let’s play the counterfactual game. There are two fantastic books on this: Eri Hotta’s Japan 1941 and Michael Barnhart’s Japan Prepares for Total War, both of whom hint at the idea that perhaps America could have nudged Japan to go invade the Soviet Union instead by not putting on these sanctions.
I’m curious if you think there was a way in which these sanctions could have been rolled out more deftly, giving Japan more of an exit ramp than they felt they had.
Nick Mulder: I think it’s a very interesting suggestion that they could have pushed them toward invading the Soviets — but ultimately I don’t think it would have made a difference, and it wouldn’t have been a feasible solution for the Japanese leadership. And here’s why.
The core commodity that they are extremely anxious about is oil. They have none of it on the Japanese aisles. They have some technology to turn Korean and Manchurian coal into oil, but it’s still not the full amount they need. And what they really can do: they can import from the US, they can import from Mexico, and then there are a number of other places like Iran, Venezuela — those are the main producers in the world. And finally, there’s only one that’s within a reasonable distance of their own territory: the Dutch East Indies.
And the key factor, I would argue (and not just because I’m Dutch), is the fact that this oil embargo is a three-country embargo — it’s a British-American-Dutch embargo. So that is important because the Japanese have simultaneously been negotiating with the Dutch East Indies over preferential access to oil production from Indonesia — and that would have given them maybe as much as 60% of the entire Dutch East Indies’ oil production, which would have taken care of their basic needs.
But the two important things that happen: one is that the Dutch East Indies government is by that time isolated, because the Netherlands has already fallen to the Nazis; the actual Dutch government is in exile in London. So that means, essentially, the Dutch don’t have a lot of independence anymore because they’re now hosted by Churchill — effectively, the Anglo-American leaders can determine what the Dutch do. The second thing is that the Japanese are so desperate for commercial expansion that they end up over-egging the demands they make to the Dutch East Indies government — and the trade treaty goes nowhere; they don’t get that access. And that ultimately is what makes them realize, “Look, this is an encirclement.” It’s an ABCD encirclement, as the Japanese nationalists call it: America, Britain, China, and the Dutch East Indies — that’s the box that they think that they’re in.
And it bears a really interesting parallel with the current [chip export controls]: I’m not saying we’re in the same situation yet, but the current restrictions on chips (including ASML and the Japanese) are an American-Dutch-Japanese-English embargo, now against China. So Japan and China have just switched roles here — the other three countries are actually the same.
Jordan Schneider: What was the Dutch political economy? How are they thinking about managing their negotiations with Japan in 1940, 1941?
Nick Mulder: They are traditionally neutral, and they have been trying to play that role for a long time. They didn’t participate in World War I. They had no desire to enter World War II. They weren’t really planning to enter on the side of the Franco-British Expeditionary Force. They would have opened their territory if there was a need to, but they were trying to do what Switzerland, and Denmark, and the Scandinavian countries were doing — but those also got invaded by Hitler, so Switzerland is really the only one to get away safely.
And so this traditional Dutch idea of neutrality was already under threat — and this is what ends up pushing them into joining the Anglo-American oil embargo.
And if you also think about it: Shell — which is one of the main oil producers that is not American in this period, and controls most of the Venezuelan and also a lot of the Indonesian oil production — it’s an Anglo-Dutch firm. It was called Royal Dutch Shell for a reason. It’s like Unilever, one of these Anglo-Dutch capitalist enterprises.
So they’re increasingly drifting into the Anglo-American camp and losing this traditional middle position that they had between Britain and Germany.
When Sanctions Actually Work
Jordan Schneider: Can we say FDR had temporal claustrophobia, too, in starting Lend-Lease? Is this a unified theory of everything?
Nick Mulder: It’s an interesting question, and if you read the accounts of people who’ve recently written about this shift in thinking — like Stephen Wertheim in his book Tomorrow, the World — I think that there is a kind of sense that the whole world had changed for FDR after the fall of Paris.
The summer of 1940 is this moment where, for the first time, one of the original three victors of World War I, a beacon of liberalism in the eighteenth, nineteenth, and twentieth centuries, is under the rule of a new kind of totalitarianism — and that’s when even fairly neutralist Americans, for the first time, become amenable to this idea that “Nazism is really a threat to Western civilization,” and they need to do something. And it’s from the summer of 1940 onward that you, I think, start to see in the American elite an increasing preparedness to use these measures.
And the first place where they do it is Franco in Spain. The experience of using coordinated oil sanctions between Britain and the US also starts in that summer. And one of the reasons, I think, that the US goes into the oil sanctions against Japan in the summer of 1941 so blithely is that the oil sanctions in the summer of 1940 against Franco work really well.
They were extremely small. They imposed them for only a few weeks, and then they lifted them again. And they did it just to prove the point that Spain is entirely dependent on American oil: they only have to stop two tanker ships in the Port of Houston (Spain’s entire oil supply can be provided by six vessels a month) — that was enough of a demonstration to show that Franco better not join the Axis.
And it’s the confidence bestowed by that sanctions’ success in the summer of 1940 — a kind of “almost” deterrence, very light usage that issues a clear threat — that, I think, makes [the US] think that they can do the same with Japan.
And of course, racial attitudes play a role here: they just think that the Japanese, ultimately, are easier to manage than the hot-headed Spaniards, and that ultimately they won’t do [something like Pearl Harbor].
But Japan is much further away, and it actually does have a major oil producer right next to it (the Dutch East Indies) that it hopes it can secure. So the main objective of the Japanese campaign in the winter of 1941, 1942 is the Dutch East Indies’ oil fields. There’s a lot of other useful stuff for them, but the general staff is extremely clear that that needs to be the priority. And in order to get there, you need to conquer the Philippines, you need to boot the US naval bases out of that part of Asia — so a lot of these other things become necessary as a way of getting to Sumatra.
Jordan Schneider: The story of Franco being scared off joining the Axis is illustrative of my biggest takeaway from your book: sanctions are great when you go all in. The half measures — say, “Oh, we’ll do this cute thing and have it be financial sanctions,” or, “We’ll just have this nice little escalatory ladder to slowly try to make our adversary realize that we mean business” — don’t work nearly as well as the times where the countries just say, “No, you’re not allowed to import any stuff, and the stuff you’re not going to be allowed to import is going to be the most important thing for your economy, and we won’t let you get it again until you do what we want you to do.”
And there are a number of moments — particularly with Nazi Germany in the mid-1930s — where that really could have stopped rearmament. And we talked last time about Bulgaria, we talked about Paraguay, potentially Japan in 1931 as well: if the pain spigot was turned all the way on early enough, then maybe you end up not having these horrific, world-shattering eventualities of what World War II brought us.
First, am I wrong? And second, what was it about the 1930s that stopped more aggressive economic actions from being taken earlier on as the tides of revanchism ended up ebbing?
Nick Mulder: So to your first question: you are not wrong — but you are right that maximum sanctions are the best only under certain highly specific conditions.
The two particular factors that are key to expanding the success of oil sanctions against Spain in the summer of 1940: [firstly] Franco has just come out of this really grueling civil war — so reconstruction is paramount, and he’s ruling over a devastated society, and he needs all the resources he can get for reconstruction. So [the sanctions] get him and threaten him at a moment of weakness.
Secondly, he has an alternative — the Axis — and he goes to Hitler and asks Hitler what resources Hitler has for him. And of course, Hitler himself is extremely anxious about his access to these things and has nothing to spare, and says, “Sorry, but you’re going to have to fend for yourself and conquer Morocco or something.” So that’s not exactly an attractive proposition. And ultimately that’s one of the reasons why the Axis is a weak alliance — because they cannot meaningfully compensate for each other’s weaknesses. So this is one of the things that makes the situation for Spain and Japan different.
And Japan still has hopes that they can win in China. It’s the classic story of: you are committed to a war that’s not going anywhere; it’s devolved into a guerrilla war; it’s gobbling up ever more resources (like Afghanistan in 2010 or something) — and the Japanese military keeps telling the leadership, “No, but we need one more surge, and then we can win in China.”
And surely they want to go back to peace in East Asia. They don’t want to have to fight the British Empire, the Royal Navy in Singapore, and the US Navy across the Pacific. But they end up being in this war against an opponent that is now receiving steadily more aid from the West — and the spring of 1941 [brought] Lend-Lease, and then it became clear to the Japanese, “Look, the Chinese are going to be in this confrontation for as long as the Allies want them to be. So we need to get to a deal with the Allies. But they now also are not only funding our opponents, but also turning the screws on us. How is this not already a war against us, essentially?” And that accounts for one of these crazy things — that they declare a war, that they actually know that they stand a very small chance of winning and they’re almost certainly going to lose in the long-run. So that’s one aspect.
The other thing you asked about — what are the factors that are holding back tougher sanctions? Part of it has to do with the states in question needing to come up with these sanctions plans on the fly. They have some studies — I used a bunch of them as source material for my book, and they were really interesting to read because they give you great analysis of different import vulnerabilities, and they’re very useful as inside intelligence accounts of the economic history of the 1930s. But they do not always have a good understanding of the world economy. That’s one thing.
They also have large amounts of interest involved in these international, intercontinental sanctions campaigns. And the main trading partners of Japan are the colonies and the dominions of the British Empire — and they actually are not in favor of sanctions on Japan. Australia, Canada, India, New Zealand all have an enormous amount of trade at stake with Japan, because Japan is the only rich, industrialized country in Asia that can buy their exports. So they either trade with Europeans who are now all at war — and then the only other place for them is the Japanese Empire. So for Britain, having an empire is actually a liability. It prevents them from being able to put tougher pressure on Japan early.
Jordan Schneider: Let’s come back to Nazi Germany. Hitler wasn’t doing so incredible when he invaded the Rhineland, right? And plenty of historians have written the hypotheticals of, “If France just decided to fight, then they would have won the war.”
Do you think the same would have happened if the Germans weren’t confronted militarily but in a more aggressive economic fashion in that time period?
Nick Mulder: Yes, I think it would have caused huge problems for the Nazi regime — and so it is an important counterfactual to ask at certain moments what it would have done.
Some of the vulnerabilities were compensated for: Germany got more raw materials from Southeastern Europe and from Eastern Europe, where they got these preferential trade agreements and were able to bully Balkan states into giving up their resources. But they certainly remained very vulnerable.
The other thing is, just militarily, Czechoslovakia could have decided to fight in 1938, and there’s a very good chance that Germany would have lost. The Czechoslovaks had a larger army than Nazi Germany in the fall of 1938, [but] they are persuaded — and actually forced — by Britain and France to dismantle their border defenses and stand down with their army.
And a role, I think, should be accorded to the just Munich crisis — there, too, you already have backup plans for an economic blockade if there is a war that breaks out, but ultimately, the appeasement argument wins. So it’s not even sanctions — it would have been just basic alliance integrity: if they had just upheld the French, particularly their pact with Czechoslovakia and with the Soviet Union, Germany would have faced a three-front conflict, and it would have been over pretty quickly.
In 1939, if France had invaded on the western front when Hitler invaded Poland — same thing. The German General Staff would have probably refused to implement Hitler’s plan.
So there are many, many moments where Hitler rolls the dice, and he keeps winning — but every time he does it again, he has to wager everything he has gained up to then. And that’s the story of the radicalization of Nazi Germany.
Heading to Sanctions School
Jordan Schneider: All right. World War II — it started. How do the Allies take what they’ve learned over the course of implementing sanctions in World War I and through the League of Nations, and do the best that they can to try to cut off the Axis from accessing financing and critical raw materials?
Paid subscribers get access to the second half of our conversation. We discuss:
How the blockade and sanctions regimes of WWI differed from WWII;
The history behind the construction of the United Nations, and how it was tied to calibrating sanctions;
The effect of the nuclear age on the relative morals of sanctions and conventional war;
Parallels between the Cuban Missile Crisis and today’s tech restrictions against China;
What lessons pro-decouplers should learn from this history of sanctions.