3a: Reacting To Economic Changes, 1918-32 Flashcards
What factors led to the growing economic crisis of 1918-23?
- Debt accumulated during war
- Burden of reparations
- Loss of income due to territory
- Post war unemployment, reducing tax and meaning there was greater government welfare spending
How great was Germany’s war debt in 1919?
They had borrowed almost 150 billion RM from 1914-18. Led to inflation during the war (prices rose by 200%). Borrowed based on assumption that they would win the war.
How much were reparation, when were they set and by which organisation?
$6.6 billion, set by the Inter-Allied Reparations Commission in 1921
Which territory losses led to the greatest economic loss?
The Saar and lace Lorraine, which were rich in raw materials.
How much did coal production decline by after the war and how much of Germany’s iron ore deposits were lost?
15% and over half, making the economy less profitable.
Why was there a global economic slump?
France and Britain also had high debt so there was less trade. All powers dealing with demobilisation.
How many soldiers left the army in 1919?
6 million (led to women workers being sacked).
What was unemployment in 1919?
1.1 million people (7% of the workforce)
How much had unemployment dropped by by late 1919 and also 1922 and why?
By around 50%
Unemployment was only 12,000 by 1922
By 1919, wages were less than half of what they had been pre-war, so companies could employ more people.
When did inflation start?
1921, after the government started to pay back reparations. They printed money to buy foreign currency, which flooded the economy.
Why did German negotiations for a ‘payment Holliday’ damage the economy?
International investors lost faith in the German economy as it didn’t look strong enough to repay debts.
Ho many French troops occupied the Ruhr and why?
Germany failed to make its payment, so France sent 60,000 troops.
What response did the government have to French occupation?
They ordered passive resistance, but this led to hyperinflation as France were prepared to occupy the territory indefinitely.
What was the exchange rate of the German mark against the dollar in July 1914 and the November 1923?
4.2
200 billion
How much did bread prices (1kg) increase during November 1923?
From 78 billion to 233 billion marks
How were savings and debt affected?
Savings were wiped it whereas debt could be paid of instantly. Therefore, the working class who often had savings which set them apart from the working class lost out. This led to them losing faith in democracy.
What was Stresseman’s policy of fulfilment?
Planned to end French occupation by meeting their terms. Short term, miner returned to work and in the long term Germany would pay reparations. Recognised the situation had led to international sympathy for Germany, which resulted in a 1924 agreement that the French should withdraw in 1925.
Which areas did Stresemann introduced spending cuts?
- Cut pay of civil service (up to 50%)
- Drastically cut benefits
When did Schacht and Stresemann introduced the Rentenmark?
October 1923, which was successful as the value remained stable.
When was the Reichmark introduced?
1924, pegged to the value of gold.
Why was Stresemann criticised?
The right saw the policy of fulfilment as a betrayal of Germany, and the left opposed the cuts to benefits. Resigned as chancellor before end of 1923, however, policies had been successful.
Which are the ‘golden years’ of Weimar Germany?
1924-28
What role did Stresemann have during the ‘golden years’?
Foreign minister
