Warnings From Weimar Why Bargaining With Authoritarians Fails Daniel Ziblatt August 28, 2025 DANIEL ZIBLATT is Professor of Government and Director of the Minda de Gunzburg Center for European Studies at Harvard University. He is the author of Conservative Parties and the Birth of Democracy and a co-author of How Democracies Die.
On March 23, 1933, inside a dimly lit chamber filled with the stale scent of cigar smoke, Ludwig Kaas tried to convince himself he was making the right decision. A Catholic priest and the leader of Germany’s establishment Center Party, he stood at a crossroads. For several years, his party had sought to block Adolf Hitler’s rise. But in 1932, Hitler’s National Socialists (Nazis) became the largest force in parliament, and in January 1933, Hitler became chancellor. As he moved to consolidate power, the Center Party had become the last remaining obstacle to his bid for total control over Germany.
Hitler had introduced the Enabling Act, which would allow him and his cabinet sweeping powers to rule by decree, thereby dismantling democracy at its core. The act needed a two-thirds majority to pass. The Social Democrats—the only other significant group of parliamentarians that still fundamentally supported democracy—were too few to stop it alone. If the Center Party also resisted, it could block the act’s passage.
But Kaas hesitated. He feared what would happen if his party defied the Nazis. Would it survive? Could democracy endure if his party resisted? Hitler’s storm troopers had already begun arresting political opponents. Kaas convinced himself that his best option was to cooperate—to work within the new reality rather than be crushed by it. “We must preserve our soul,” he told his colleagues, “but a rejection of the Enabling Act will result in unpleasant consequences for our party.” The act passed, 444 to 94, opening the path to Hitler’s dictatorship.
This episode illustrates the dangerous logic of abdication: the belief that, faced with a rising threat to democracy, surrender is strategy, cooperating with an autocrat is survival, and sparing oneself or one’s party from immediate punishment is worth opening the door to long-term authoritarian rule. Kaas was not alone in this kind of thinking. In the years leading up to that moment, three catastrophic miscalculations—each rooted in short-term maneuvering and self-justification—paved the way for Hitler’s ascent.
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Today, this chapter of the Weimar Republic’s history should be revisited. At a moment in which democracy is backsliding in places as varied as Hungary, India, Turkey, and the United States, it is a reminder that democracy often erodes slowly at first, via the gradual surrender of those entrusted to defend it. But with each concession, autocrats become bolder, defenses grow weaker, and reversal becomes harder. Responses that, early on, can feel pragmatic—waiting it out, remaining silent, cutting a deal—only embolden autocrats, leading ultimately to the demise of democracy itself.
FATAL TRANSACTIONS The fateful decisions that doomed the Weimar Republic were made in the aftermath of World War I, shortly after the birth of a new democracy in Germany. The Weimar constitution, drafted in 1919 under the influence of luminaries such as the legal scholar Hugo Preuss and the sociologist Max Weber, enshrined civil liberties, expanded rights for women, and established labor protections. Building on wins secured by an already robust civil society, a broad and confident coalition of progressive forces, liberals, Social Democrats, and the Catholic Center Party established Germany’s post–World War I republic.
Yet this republic was also fragile. It was roiled by rampant political violence, frequent political assassinations, and street fights between communists and fascists, both of whom rejected the new regime. Still, after three turbulent years of hyperinflation and political unrest, by 1924 the Weimar Republic had entered a period of relative stability.
Beginning in 1929, however, the crash of the U.S. stock market hit Germany, triggering a catastrophic economic downturn and mass unemployment. The Communist Party and the Nazis gained ground in elections. This made it difficult for the German parliamentary system to form governments, and country’s president had to resort to installing new chancellors at the head of parliament without parliamentary backing—an extraordinary measure. The resulting policy gridlock enhanced the Nazis’ appeal.
The German conservative establishment granted Hitler legitimacy. But the Great Depression alone did not doom the Weimar Republic. Many other embattled republics in Europe and North America survived this era of economic and political turmoil, including two other new European republics, Czechoslovakia and Finland. What mattered most were not just the shocks themselves but German leaders’ responses to them—choices that shaped the republic’s fate.
The country’s conservative establishment made the first mistake. In the late 1920s, the mainstream right-wing party, the German National People’s Party, was struggling. Its leader, Alfred Hugenberg, was a powerful businessman and media mogul, but he lacked charisma and mass appeal. As he watched Hitler’s Nazi movement gain popularity in state and national elections in the late 1920s, Hugenberg saw an opportunity—not to stop Hitler, but to use him.
Hugenberg recruited the Nazis into a campaign to undo Germany’s obligation to pay World War I reparations. He hoped that their fervor would help reinvigorate the conservative cause. A 1929 referendum attempting to rally the German public behind annulling the debt—and classifying politicians who agreed to pay it as traitors—failed, but the partnership changed everything. It elevated the Nazis from a band of fringe extremists to a political force that had been granted legitimacy by one of Germany’s most influential political figures.
Hugenberg’s miscalculations did not end there. In 1931, he hosted a major right-wing rally in the spa town of Bad Harzburg, inviting Hitler to stand alongside Germany’s nationalist elite. The idea was to present a united conservative front. Instead, Hitler stole the spotlight. His paramilitary forces marched through the streets in a show of discipline and power as Hugenberg faded into the background. By 1933, Hugenberg had realized the full scale of his mistake. He reportedly told a fellow conservative: “I have committed the greatest stupidity of my life; I have allied myself with the greatest demagogue in human history.” But by then it was far too late. At a pivotal moment, Hugenberg had given Hitler what he needed most: respectability.
A PREVENTABLE DEATH The German political establishment’s next miscalculation was even graver: elevating Hitler to power outright. By 1932, Germany’s parliament remained paralyzed. No governing majority could be formed. Conservatives were desperate to establish a stable government that excluded the Social Democrats and Communists, but they lacked the numbers to govern alone. President Paul von Hindenburg, an aging war hero, continued to cycle through chancellors, unable to find anyone who could command the support of a majority of parliamentarians or contain Germany’s deepening economic crisis. Then former Chancellor Franz von Papen made a bold suggestion: offer the chancellorship to Hitler—but surround him with conservative ministers who could control him.
Von Papen was confident that Hitler could be kept on a leash. “Don’t worry,” he told his right-wing colleagues. “Within two months, we’ll have pushed Hitler so far into a corner he’ll squeal.” In January 1933, Hindenburg signed on to the plan, believing that Hitler would remain a figurehead.
The opposite happened. Hitler immediately began consolidating power, sidelining his handlers and dismantling the opposition by arresting leading figures such as the former Prussian minister of the interior and other Social Democratic and Communist Party members of parliament. The Nazi Party was not the choice of a majority of Germans—about two-thirds of Germans had voted against it in the 1932 national elections—and Hitler’s violent moves to seize more influence caused a new atmosphere of intense fear to grip the country. The gamble that antidemocrats could be tamed if they were granted power had failed spectacularly.
German politicians believed they could bargain away democracy’s protections. The February 1933 Reichstag fire, which did so much damage to the parliament building that it temporarily forced the body to hold sessions in the Kroll Opera House a few blocks away, provided the perfect pretext for repression. Hitler’s new government blamed communists for the blaze, also claiming to have proof that they were stockpiling explosives. The Nazi-led government launched mass arrests, and Hitler immediately promulgated the Reichstag Fire Decree, a draconian measure restricting freedom of the press and assembly and allowing the police to detain suspects indefinitely without a trial.
It was this climate of emergency following the Reichstag fire that allowed Hitler to propose the Enabling Act. Kaas and his fellow Center Party leaders debated it for hours, torn between principle and self-preservation. Some urged resistance, warning that Hitler’s power must be checked. But most feared the consequences of defiance. Still others clung to the hope that by cooperating, they might influence Hitler from within—perhaps by helping weaken their Social Democrat rivals or by carving out protections for Center Party or Catholic leaders. In the final vote, all 73 Center Party parliamentarians capitulated, justifying their surrender as a necessary evil
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Menu America’s Coming Crash Will Washington’s Debt Addiction Spark the Next Global Crisis? Kenneth S. Rogoff September/October 2025 Published on August 19, 2025
Daniel Downey KENNETH S. ROGOFF is Professor of Economics at Harvard University and a Senior Fellow at the Council on Foreign Relations. He was Chief Economist at the International Monetary Fund from 2001 to 2003 and is the author of Our Dollar, Your Problem: An Insider’s View of Seven Turbulent Decades of Global Finance, and the Road Ahead.
More by Kenneth S. Rogoff Listen Share & Download Print Save For much of the past quarter century, the rest of the world has looked in wonder at the United States’ ability to borrow its way out of trouble. Again and again, under both Democratic and Republican administrations, the government has used debt more vigorously than almost any other country to fight wars, global recessions, pandemics, and financial crises. Even as U.S. public debt rapidly climbed from one plateau to the next—net debt is now nearing 100 percent of national income—creditors at home and abroad showed no signs of debt fatigue. For years after the 2008–9 global financial crisis, interest rates on Treasury debt were ultralow, and a great many economists came to believe that they would remain so into the distant future. Thus, running government deficits—fresh borrowing—seemed a veritable free lunch. Even though debt-to-income levels jumped radically after each crisis, there was no apparent need to save up for the next one. Given the dollar’s reputation as the world’s premier safe and liquid asset, global bond market investors would always be happy to digest another huge pile of dollar debt, especially in a crisis situation in which uncertainty was high and safe assets were in short supply.
The past few years have cast serious doubt on those assumptions. For starters, bond markets have become far less submissive, and long-term interest rates have risen sharply on ten- and 30-year U.S. Treasury bonds. For a big debtor like the United States—the gross U.S. debt is now nearly $37 trillion, roughly as large as that of all the other major advanced economies combined—these higher rates can really hurt. When the average rate paid rises by one percent, that translates to $370 billion more in annual interest payments the government must make. In fiscal year 2024, the United States spent $850 billion on defense—more than any other country—but it spent an even larger sum, $880 billion, on interest payments. As of May 2025, all the major credit-rating agencies had downgraded U.S. debt, and there is a growing perception among banks and foreign governments that hold trillions of dollars in U.S. debt that the country’s fiscal policy may be going off the rails. The increasing unlikelihood that the ultralow borrowing rates of the 2010s will come back any time soon has made the situation all the more dangerous.
There is no magic fix. U.S. President Donald Trump’s efforts to place the blame for high rates on the Federal Reserve Board are deeply misleading. The Federal Reserve controls the overnight borrowing rate, but longer-term rates are set by vast global markets. If the Fed sets the overnight rate too low and markets expect inflation to rise, long-term rates will also rise. After all, unexpectedly high inflation is effectively a form of partial default, since investors get repaid in dollars whose purchasing power has been debased; if they come to expect high inflation, they will naturally require a higher return to compensate. One of the main reasons governments have an independent central bank is precisely to reassure investors that inflation will remain tame and thereby keep long-term interest rates low. If the Trump administration (or any other administration) moves to undermine the Fed’s independence, that would ultimately raise government borrowing costs, not lower them.
Skepticism about the safety of holding Treasury debt has led to related doubts about the U.S. dollar. For decades, the dollar’s status as the global reserve currency has conferred lower interest rates on U.S. borrowing, reducing them by perhaps one-half to one percent. But with the United States taking on such extraordinary levels of debt, the dollar no longer looks unassailable, particularly amid other uncertainty about U.S. policy. In the near term, global central banks and foreign investors may decide to limit their total holdings of U.S. dollars. Over the medium and longer term, the dollar could lose market share to the Chinese yuan, the euro, and even cryptocurrency. Either way, foreign demand for U.S. debt will shrink, putting further upward pressure on U.S. interest rates and making the math of digging out of the debt hole still more daunting.
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Already, the Trump administration has hinted at more drastic actions to deal with mounting debt payments, should gaining control of the Fed not be enough. The so-called Mar-a-Lago Accord, a strategy put forward in November 2024 by Stephen Miran, now head of Trump’s Council of Economic Advisers, suggests that the United States could selectively default on its payments to the foreign central banks and treasuries that hold trillions of U.S. dollars. Whether or not the proposal was ever taken seriously, its very existence has rattled global investors, and it is not likely to be forgotten. A clause proposed for the huge tax and spending bill that was passed by the U.S. Congress in July would have given the president discretion to impose a 20 percent tax on select foreign investors. Although that provision was removed from the final bill, it stands as a warning of what might come if the U.S. government finds itself under budget duress.
With long-term interest rates up sharply, public debt nearing its post–World War II peak, foreign investors becoming more skittish, and politicians showing little appetite for reining in fresh borrowing, the possibility of a once-in-a-century U.S. debt crisis no longer seems far-fetched. Debt and financial crisis tend to occur precisely when a country’s fiscal situation is already precarious, its interest rates are high, its political situation is paralyzed, and a shock catches policymakers on the back foot. The United States already checks the first three boxes; all that is missing is the shock. Even if the country avoids an outright debt crisis, a sharp erosion of confidence in its creditworthiness would have profound consequences. It is urgent for policymakers to recognize how and why these scenarios could unfold and what tools the government has to respond to them. In the long term, a severe debt or, more likely, an inflationary spiral could send the economy into a lost decade, drastically weakening the dollar’s position as the dominant global currency and undermining American power.
THEIR MONEY, OUR GAIN It is crucial to understand that the Trump administration’s economic policies are an accelerant, rather than the fundamental cause, of the United States’ debt problem. The story really begins with President Ronald Reagan in the 1980s, an era of deficit spending in which the U.S. debt-to-GDP ratio was about a third of what it is today. As Vice President Dick Cheney said during the first George W. Bush administration, “Reagan proved deficits don’t matter.” It is an assumption that both parties appear to have taken to heart in the twenty-first century, despite far more worrying debt burdens. In fiscal year 2024, for example, the Biden administration ran a budget deficit of $1.8 trillion, or 6.4 percent of GDP. Except for the global financial crisis and the first year of the pandemic, that was a peacetime record, slightly exceeding the 6.1 percent of the previous year. President Joe Biden’s deficits would have been larger still but for determined resistance from two centrist Democratic senators who bid down some of the administration’s most expansive spending bills.
During his 2024 presidential campaign, Trump pilloried Biden for his administration’s massive deficit spending. Yet in his second term in office, Trump has embraced similarly large deficits—six to seven percent of GDP for the rest of the decade, according to independent forecasts produced by the Congressional Budget Office and the Committee for a Responsible Federal Budget. The latter has projected that, by 2054, the U.S. debt-to-GDP ratio will reach 172 percent—or an even higher 190 percent if the bill’s provisions become permanent. Trump and his economic advisers claim that such forecasts are overly pessimistic—that the projections for growth are far too low and those for interest rates far too high. Higher growth will bring in larger future tax receipts; lower interest rates mean the debt will be less costly to service. If Team Trump is right, both factors will actually lower deficits and tilt the trajectory of debt to income downward. Whereas in January 2025, the CBO projected an annual growth rate of 1.8 percent over the next decade, the administration has put the figure at 2.8 percent. The difference is significant: if the U.S. economy is growing at 1.8 percent annually, it will double in size (and presumably tax revenues) every 39 years. At 2.8 percent, it would double every 25 years. For Trump, assuming that kind of rapid growth has made it easier to finance a lot of budget giveaways.
There is a substantive basis for the Trump administration’s growth projections, although it has little to do with the claimed benefits of the “big, beautiful bill” passed in July. Many prominent technology experts firmly believe that as long as the government stays out of the way, artificial intelligence companies will achieve Artifi
