From the Editor - April 2011

Berlin is a fascinating city for anyone with an interest in history, a view confirmed by a recent visit there after a long gap. The fount of much of the worst of the 20th century and, in 1989, witness to one of its most stirring events, Berlin has, over the past 20 years, realigned itself both politically and topographically – a city famously divided is slowly reverting to its original, pre-Nazi contours, with the great sights and squares between the Brandenburg Gate and Alexanderplatz its centre once again.

Despite its obvious prosperity, embodied in the shiny corporate glamour of Potsdamer Platz and the gleaming car showrooms of Unter den Linden, parading the fruits of German technological brilliance and global purchasing power – Mercedes, Volkswagen, Audi and foreign acquisitions such as Bugatti and Bentley – Berlin spares the visitor little of its pain in confronting the past.

The Topography of Terror, redesigned and reopened last year, is a case in point. Located next to one of the few remaining fragments of the Berlin Wall, this vast museum is built upon the foundations of what used to be the Gestapo Headquarters in a part of the city once dominated by Hitler’s Chancellery. Across the street stands the monumental complex of Göring’s Air Ministry, the lone survivor from this period, now home to the sober German Finance Ministry. Once within the stark interior of the Topography of Terror the visitor is assaulted with images, testimonies and descriptions of the appalling endeavours of the 1930s and 1940s. It crossed my mind that this brutal self-flagellation is itself born of the same desire for purification, of one kind or another, that gave impetus to National Socialism. But that would be unfair; this excavation of Germany’s past is brilliantly done and its lessons constantly reiterated and acted upon, not least in the Federal Republic’s economic stance.

Modern Germany is a society averse to debt. The visitor from Britain or the US is surprised by how many of Berlin’s shops and restaurants still refuse to take credit cards. Home ownership, the ultimate dream of the Anglo-American model, remains relatively rare. The reasons for this near obsession with ‘sound money’ are outlined in Adam Ferguson’s 1975 study When Money Dies: The Nightmare of the Weimar Hyperinflation, now republished in the light of the recent economic crisis.

Debt, as the Germans know all too well, has consequences. Britain, a deeply indebted country, should pay attention. Funding an expanding welfare state in the absence of the kind of wealth creation provided by Germany’s world class manufacturing base led to the British government’s unfortunate love affair with the cash cow that was the City of London. British governments of all hues have had a similarly well-intentioned desire, though one far from fully funded, to create an expanded university sector providing for many more students than the country can afford. The need to find sources other than the taxpayer has prompted some of Britain’s leading academic institutions to sup with devils. Hence the resignation of Sir Howard Davies as director of the London School of Economics, an institution with an outstanding reputation for modern history. Davies admitted it had been a mistake to accept £300,000 research funding from a foundation controlled by the former LSE student Saif Gaddafi, son of the embattled Libyan despot. This won’t be the last such case, as other paragons of virtue, including the governments of Iran and Saudi Arabia, have forged financial links with Britain’s elite universities. The British public is discovering what the Germans have known for decades: that debt leads to desperation.