Business and Politics in Europe. 1900-1970: Essays in Honour of Alice Teichova

Published by EH.NET (October 2004)

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Terry Gourvish, editor, Business and Politics in Europe. 1900-1970: Essays in Honour of Alice Teichova. Cambridge: Cambridge University Press, 2003. xii + 345 pp. $70 (cloth), ISBN: 0-521-82344-7.

Reviewed for EH.NET by Maurice Kirby, Department of Economics, University of Lancaster.

This Festschrift presents fourteen essays in honor of the academic career of Alice Teichova, one of the most outstanding scholars of the interaction between business and politics in the modern generation. Teichova has enjoyed a distinguished academic career in Britain and Europe on account of the “seamless vein of her writings,” embracing the evolution of industrial structures in central and eastern Europe, the development of multinational enterprise and universal banking, and issues of economic integration and nationality. As Terry Gourvish comments in his introduction, Teichova has fulfilled a three-fold academic duty. In the first instance, she has brought personal experience to bear on her analyses of economic and business history themes in the context of Nazism and Communism. Secondly, her distinguished record of publications has marked her out as one of the few truly international scholars of economic history in the modern period, and finally, she has fulfilled the honorable task of promoting and disseminating the fruits of her research via an ongoing program of seminars, the convening of conferences and the creation of a scholarly network of like-minded researchers, both young and old. All of this adds up to an admirable academic record with the individual concerned thoroughly deserving of collegiate celebration.

For EH.NET readers, the key question is whether or not the Festschrift is an adequate recognition of these achievements. In this respect, the answer is an unequivocal yes but in more than one sense. In the first instance, Gourvish has assembled a truly international list of contributors. Secondly, the issues addressed are all close to Teichova’s heart insofar as they conform closely to the themes that have defined her academic career. Finally, all of the contributions can be read with intellectual profit.

In organizational terms, the book is divided into four sections, the first dealing with “the business-politics paradigm,” the second with banking finance, the third with business and politics in the National Socialist period and the final section with the business community and the state.

In section one, the geographical coverage ranges over Sweden, Austria and Ireland. Thus, Haken Lindgren provides an analysis of the “Swedish model” of political economy in the 1930s, demonstrating that a period of industrial conflict was gradually replaced by an employer-worker consensus characterized by “power sharing” and “social engineering.” This “middle way,” sustained into the 1970s and supported by a political environment dominated by labor-dominated governments, began to break down in that decade as economic crisis exposed structural weaknesses in Swedish industry thereby undermining the very essence of the “middle way.” Herbert Matis, drawing inspiration from Teichova’s path-breaking study of The Economic Background to Munich, deals with the factors which led to the German invasion of Austria in 1938. As he reveals, the Anschluss was facilitated substantially by the endemic weakness of the Austrian economy and the inability of government to resolve the dual problems of inflation and unemployment. Restrictive economic policies encouraged political and social tensions so that by the end of the 1930s the country was highly susceptible to a German takeover. Philip Ollerenshaw’s essay on Ireland in the 1920s highlights further the interplay between political and economic factors as determinants of national destiny. His focus is on partition and the creation of the Free State in 1922 and in this respect he places much emphasis on the impact of the Catholic-Protestant divide on the business community, north and south. In Protestant Ulster, businessmen wished to sustain the link with the United Kingdom on the grounds of economic interest and thus gave their support, both monetary and material, to the militant forces of unionism. In the Catholic south, however, the business community feared that partition would lead to marginalization in a mainly rural economy and therefore supported Dominion status for the island of Ireland. The fact of partition led to heightened commercial uncertainty as Republicans promoted blacklists and whitelists of firms recommended for boycott or trade.

The key theme of section two is the relationship between banking and financial regulation by the state. Ginette Kurgan emphasizes that the banking interest enjoyed considerable political influence in Belgium at least until the mid-1930s when the impact of deflationary policies helped to undermine confidence in bankers as “macroeconomic managers.” Thereafter, banking reform became a major political preoccupation, propelled further after 1945 by the links between bankers and the German occupiers. Philip Cottrell, in a paper grounded in archival research at the Bank of England, examines the attempts to promote international monetary stability in Central and Eastern Europe in the aftermath of the Treaty of Versailles. The key theme is the mounting rivalry between the Bank of England and the Bank of France as both institutions sought to influence the process of monetary reconstruction, notably in Romania after the stabilizing of the franc in 1926. As Cottrell demonstrates, rivalry threatened central bank cooperation as well as major infrastructure projects requiring loan finance. The final paper in this section, by Lucy Newton, analyzes the interplay between government, banks and industry in interwar Britain as portrayed in the contemporary trade press and, more especially, the Bankers Magazine. Her conclusions lend support to those revisionist historians who have argued that the clearing banks were by no means uninterested in supporting domestic industry, both financially and in terms of industrial reconstruction. The truly conservative forces in relation to industrial modernization were reactionary business leaders and timid governments, both Conservative and Labor.

Section three contains four papers devoted to business and political relations in Nazi Germany. The first paper, by Richard Overy, provides a scholarly reassessment of the relationship between business and the state as portrayed in the existing historiography. Dismissing “extreme” analyses, Overy offers the judicious conclusion, that the “New Economic Order” was reactive and that there was a significant element of policy continuity across the divide of 1933. He does, however, concede that Hitler presided over a racist and corrupt command economy. The second paper is a collective effort by Dieter Ziegler, Harald Wixforth and Jorg Oterloh. It examines the process of “Aryanization” in Germany, Austria and the Sudetenland in the 1930s whereby the exclusion of Jews from the civil service and professions was followed by indirect pressures on Jewish businesses, and after 1938, by rioting, looting and confiscation. Surprisingly, the evidence amassed confirms that the assault on Jewish business interests was initially tentative in Germany, at least until 1938, whereas in the other territories exclusion was relatively rapid. Peter Berger’s focus is on Austria where he assesses the role of the Dutch humanitarian, Frank van Gheel Gildemeester, in facilitating the emigration of Austrian Jews after the Anschluss. Gidermeester’s role is viewed as ambivalent: on the one hand his organization enabled 30,000 Jews to escape in 1938-39, but on the other he is portrayed as a racketeer, albeit with philanthropic tendencies. The final chapter in this section deals with the relationship between the German airline, Deutsche Lufthansa, and the state between 1926 and 1941. For Peter Lyth there can be no doubt that the inception of the Nazi regime was of profound benefit to the airline notwithstanding the fact that other governments supported their airline companies in their capacity as “techno-nationalist flag carriers.” In the case of Lufthansa, it grew to be Europe’s largest airline with its R&D capability linked to the aircraft procurement needs of the Luftwaffe.

The final section, addressing the theme of the business community and the state, contains three chapters dealing with differing national experiences. The first, by Gertrude Enderle-Burcel, analyzes the relationship between Austrian governments and the business community with particular reference to the “corporatist” regime of 1934-38. As a sectional interest Austrian industry was fragmented and disunited with little influence over the conduct of economic policy. Thus, demands for export subsidies and cartel legislation made little headway even though businessmen in general lent their support to Austrian fascism in advance of the Anschluss. In a wide-ranging paper Margarita Dritsas provides an informed commentary on the evolving relationship between Greek business elites and the state from the late nineteenth century onwards. Over the succeeding decades there was a discernable trend towards increased business involvement in government with a notable acceleration after the First World War. After 1945, the Greek economy was well on the path towards “entrepreneurial” rather than “developmental” status. Finally, Christoph Boyer presents a case study of the fluctuating fortunes of the German Siemens company’s subsidiary, Elektrotechna, in Czechoslovakia in the 1930s. With a production and sales policy directed towards the telephone market, the company operated in a political environment hostile towards foreign enterprise and exacerbated by the inauguration of Nazi rule in Germany. Although Elektrotechna was 51 percent Czech owned, its viability was threatened by the State Defense Act of 1936 which restricted state contracts in strategic industries to domestic companies. With a market edge rooted in superior technology, the company survived with its position bolstered considerably by the Munich Agreement and the resulting German annexation of the Sudetenland.

Festschrifts have the potential to embarrass the recipient if they receive hostile reviews. In this case, Alice Teichova need not worry. Her Festshrift is an extremely good example of the genre: she has been well and truly honored.

Maurice Kirby is Professor of Economic History in the Management School at the University of Lancaster. Volume 1 of his sponsored history of operations research as a quantitative aid to managerial decision-making was published in 2003 by Imperial College Press.

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