"The answer is simple and relates to the fact that Morgenthau was writing a piece of wartime propaganda with the expressly stated purpose of mobilising support for President Wilson's war effort. He consciously down played the close relationships he enjoyed with the Young Turk leadership throughout his sojourn in Constantinople and sacrificed truth for the greater good of helping to generate anti-Turkish sentiment which would transform itself into pro-war sentiment."
Unfortunately the American public opinion during that time was based on such sources as the services of Dragaman (translators) between the officials of the Ottoman Empire and the American Ambassador. And these dragaman were not Ottoman Turks but Ottoman Armenians and Ottoman Greeks both were in conflict with the Ottoman Empire. Ambassador Morgenthau used two of them, two Armenians, namely Hagop S. Andonian (personal secretary) and Arshag K. Schmavonian (legal assistant). The printed copy however went through severe war time propaganda editing by the US Secretary of State, Robert Lensing and Pulitzer award winning author, Burton J. Hendrick.
One of the most dramatic incidents and the diversion of the facts were about the life insurance benefits of the deceased Armenian insurers of an American Insurance company. The book claims that Talaat, the Ottoman Interior Minister, made a request to him that the Ambassador should help to facilitate payment the insurance benefits to the Ottoman Treasury, as there were no heirs to the insurers! However, Dr. Lowry proved that after reading the actual dated letters, the request of the Ottoman Minister was to stop the American Insurance Company from transferring their capital funds from Ottoman Empire to France, and thereby preserving sufficient capitalization for any benefits claims. Such diversion of the facts is extremely dangerous.
It is therefore an important document about the wartime journalism and subsequent unfortunate diversions of the facts to base Armenian claims of 1915. We could only be grateful to Dr. Lowry that he shed light into the story with his review of the original letters stored in FDR Library and in the National Achieves.
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So government is needed; no rules or safety; no lasting wealth. However, for an economy to survive, you need the four "i's": information, innovation, investment and incentives. If the government prevents free flow of information about preferences and true costs, or stifles innovation, or ties up investment, or throttles incentives, its economic boom will go bust. So government can create a climate supporting the four i's, but needs to do so without imposing on itself insupportable burdens on its fallible shoulders. Jay points out the global economy has not buoyed all ships, and even in developed countries that are thriving, the poor in these countries are doing worse as they are forced to compete in a worldwide labor market.
Is there reason for optimism that the world can continue its economic growth? Jay has a chilling comment. For the rich, (us?), to go on their merry way, the rich (we?) will have to provide "...effective political machinery for obtaining the assent and compliance of billions of people to the rules of the game under which they are expected to play and that, however successful, will leave many of them poor and some of them destitute" (P. 310). Otherwise the waltz, 1,2,3, could lead to 3 of a colossal, global failure.
The book courageously sloshes through immense economic content, and it is well worth the effort. If you want a better idea of how wealth is created and what supports its continuance, this is a book for you.
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