To What Extent Did Banks Have An Influence Over WWI Starting?

The Volt

I've seen loads of videos about this online. Families like the Rockerfellers and the De Rothschilds apparently funding both sides etc.

I'd love to hear some informed opinions on this.

hivizman

Here's an extract from Niall Ferguson's The Pity of War (Allen Lane, 1998 - pp. 32-33):

Superficially, there is reason to think that capitalist interests stood to gain from war. The arms industry in particular could hardly fail to win huge contracts in the event of a major conflagration. The British branch of the Rothschilds' bank, which epitomized for Marxists and anti-Semites alike the malign power of international capital, had financial links with the Maxim-Nordenfelt company, whose machine gun was famously cited by Hilaire Belloc as the key to European hegemony, and helped finance its takeover by Vickers Brothers in 1897. The Austrian Rothschilds also had an interest in the arms industry: their Witkowitz ironworks was an important supplier of iron and steel to the Austrian navy and later of bullets to the Austrian army.
. . .
Inconveniently for Marxist theory, however, there is scarcely any evidence that these interests made businessmen want a major European war. In London the overwhelming majority of bankers were appalled at the prospect, not least because war threatened to bankrupt most if not all of the major acceptance houses engaged in financing international trade. The Rothschilds strove vainly to avert an Anglo-German conflict, and for their pains were accused by the foreign editor of The Times, Henry Wickham Steed, of 'a dirty German-Jewish international financial attempt to bully us into advocating neutrality'.

Ferguson goes on to give other evidence, and concludes:

The Marxist interpretation of the war's origins can therefore be consigned to the rubbish bin of history, along with the regimes which most avidly fostered it.

Possibly Ferguson, as the historian of the Rothschilds (see his book The World's Banker: The History of the House of Rothschild (Weidenfeld & Nicolson 1998)), has an incentive to go soft on them, but he is a highly respected historian so his views count for something.

The Volt

Cheers man I think I understand =]

Shutuplaura

I'd go along with Ferguson about the start of the war. I can't remember if he had anything to say about the entry of the US into the war. The US was a major creditor to the allies and if they lost the war this money would have been very difficult to get from them. There was a feeling amung some in the US - and not just socialists and the IWW that the war was in large part entered to make the world safe for JP Morgans loans.

I'm attracted to the idea myself - the US was heavily pro allied from the start and some of the reasons it cited for supporting ther allies over Germany were dubious at best.
For example, the U boat blockade was condemned but the fact this was a reprisal against a more effective (and lethal) blockade of German by the Royal Navy was ignored. Pro war legislators wanted to fight Germany because the germans were trying to stop trade with Britain, the British had stopped American trade with Germany as some anti war senators pointed out.

hivizman

I've found this in a book by Hew Strachan Financing the First World War (Oxford University Press, 2004):

On 1 April 1917 Britain's cash in the United States was all but exhausted. In New York, against an overdraft of $358 million and a weekly spend of $75 million Britain had $490 million in securities and $87 million in gold. At home the Bank of England and the joint stock banks could command a reserve of £114 million in gold. But just at the point when the exhaustion of Britain's finances was about to cut the Entente's Atlantic trade Germany declared unrestricted U-boat warfare, with the intention of achieving the same result. The effect was finally to precipitate the United States's entry into the war."

The USA declared war on Germany on 6 April 1917.

I don't know whether the financial situation was a direct cause, but it certainly can't be ruled out. There's a history of JP Morgan by Ron Chernow The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance, and I'll see if I can check it out.