Recovery under Stresemann Flashcards
(41 cards)
What was Stresemann’s policy of Erfüllungspolitik (fulfilment)?
To fulfil the terms of the Treaty of Versailles to improve relations with the Allied countries and negotiate better terms
What was the name of the bank Stresemann set up in November 1923?
The Rentenbank
What was the name of the new temporary currency introduced by the Rentenbank?
The Rentenmark
How many marks was one Rentenmark worth?
A thousand billion
How many Rentenmarks was the supply limited to?
3,200 million Rentenmarks
What was the value of the Rentenmark linked to?
The price of gold
Who/what backed the Rentenmark, ensuring the currency had real value?
German industrial plants and agricultural land
What happened to the price of the weekly newspaper, Berliner Illustreiter Zeitung, as a result of the introduction of the Rentenmark?
Went from 1 billion marks to 20 pfennigs (0.2 Rentenmarks)
What was the name of the bank that was given control of the Rentenmark in August 1924?
The Reichsbank
What did the Reichsbank rename the Rentenmark?
The Reichsmark
What did the Reichsmark bring an end to?
Hyperinflation
When was the Dawes Plan agreed?
April 1924
What was the aim of the Dawes Plan?
To resolve Germany’s non-payment of reparations
How much were reparations payments reduced to in the Dawes Plan?
£50m per year
How much did US banks agree to loan to German industry between 1924 and 1930, as a result of the Dawes Plan?
$25 billion (800 million marks)
What did the French do in response to the Dawes Plan?
Left the Ruhr
What did the Dawes Plan state about sanctions for non-payment of reparations in the future?
They had to be agreed by all Allies, not France alone
What happened to Germany’s industrial output between 1923 and 1928 as a result of the Dawes Plan?
It doubled (and passed pre-First World War levels)
Why were the extreme political parties opposed to the Dawes Plan?
It meant Germany agreed to pay reparations (giving credibility to the hated Treaty of Versailles)
Why did the Dawes Plan arguably lead to a fragile economic recovery?
It was dependent on American loans, which could be recalled at any time
What two things did the Young Plan do to German reparations?
1) Reduced the total amount from £6.6 billion to £2 billion
2) Gave Germany a further 59 years to pay (until 1988)
What impact did lower reparations payments have on the government?
Allowed them to lower taxes on ordinary Germans, giving them greater spending power
Explain the ‘virtuous cycle’ of economic growth created by the Young Plan
Lower reparations payments = lower taxes = more spending power = German industry makes more money = more jobs available = more spending power etc.
What did Adolf Hitler say about the Young Plan?
It was “passing on the penalty to the unborn”: future generations would pay for the mistakes made by previous ones
