Mellon vs. Churchill: The Untold Story of Treasury Titans at War

In this gripping debut history, Eicher, a former U.S. Treasury Department credit risk specialist, examines the heated debate over Allied war debt repayment that broke out between U.S. Treasury Secretary Andrew Mellon and British Chancellor of the Exchequer Winston Churchill after WWI. Mellon, one of the richest men in America, believed Allied countries should pay their war debt as agreed, arguing it would help reduce postwar inflation (though Eicher notes that Mellon’s bank in Pittsburgh was deeply involved in financing the war, and he personally had purchased $1 million in war bonds). Churchill, meanwhile, believed that collecting the debt was unethical and boded poorly for America’s future as a global power, and urged for it to be forgiven. Churchill’s party fell out of power and Mellon’s plan triumphed; however, most Allied nations defaulted on their war debts not long after Germany reneged on its reparations payments in 1933. Eicher suggests that the debts caused economic fallout contributing to WWII just as clearly as Germany’s reparations did, and also notes that FDR opted for a differently structured, and more successful, lending system ahead of WWII at Churchill’s behest. Providing an enticing blow-by-blow of the debate, which spilled out into public, Eicher shows how it mixed with discussions about the proposed League of Nations and global unity (“Is the world all one,” or is it possible “to separate the world into little compartments?” one British official mused). It’s a fascinating perspective on the interwar period. (Feb.)