Impact Of The Reparations Flashcards
What was the political impact of the treaty? ( 5 )
1) Reparations Commison said Germany had to pay 132 billion gold marks (£6.6 billion)
2) 1921 - German gov had 6 days to sign
3) Fehrenbachs cabinet resigned and was replaced by one led by Joseph Wirth
4) First payment made not long after signing - no alternative and new gov signed unwillingly
5) Policy of Fulfilment - cooperation
Who was Joseph Wirth?
Schoolteacher
Entered politics as a member of the centre party
Minister of finance in 1920
Became chancellor in 1921
What was the political impact of the treaty? ( 4 actual ones )
1) Jan 1922 Reparations Commission granted a postponement of the Jan and Feb instalments because Germany was in financial trouble
2) July 1922 German gov asked for suspension of payments for one year
3) November 1922 German gov asked for loan of 500 million gold marks and to be released from reparations for 3-4 years in the hopes of stabilising the economy.
4) The suspicious French refused. Disagreements led to the Ruhr being occupied in an attempt to extract payment by force.
What was the Economic Impact? ( 5 )
Gold - gold reserves were inadequate for the scale of reparations
Coal - lost part of its coal reserves in the treaty
Manufactured goods - Allied manufacturers believed it was a threat to their business
Exports - Allies hindered export trade by confiscating the merchant fleet and imposing high tariffs on imports of German goods
The govs response - print more money which made inflation worse and caused mark to fall further
Who was John Maynard Keynes?
English economist who said 2 billion was a safe maximum figure of Germany’s capacity to payb
