Summary 2: 1919-1923/4 Flashcards
(36 cards)
What was the legacy of the Kaiser Reich ?
- war had been financed by borrowing and printing money (meant govt. debt grew and value of the mark fell)
- Germany relied on winning and using reparations to repay the costs of the war
- Cost of war: national debt in 1913; 5,000 million marks - in 1919 144,000 million marks
- Inflation: 1920 the mark was worth 10% of its 1914 value
- reperations
What was the cost of the war ?
- national debt in 1913; 5,000 million marks
- in 1919 144,000 million marks
How did the Weimar constitution chose to deal with the financial consequences of the war ?
- decided they could not risks further unpopularity and so refused to raise taxes of cut spending so carried on borrowing and adding to debts and inflation
- most significantly this led to more inflation (1918-1919: prices doubled) and (1919-1920: prices quadrupled)
What were the benefits of the rising inflation ?
- industrialists benefitted by taking out short term loans (by the time they had to pay back the loan the value of the money borrowed had significantly fallen)
- the burden of govt debt was also lessened by inflation
What where the terms of reparations made in 1921 ?
a total of £6.6bn or 132 marks to be paid in annual instalments
What was the political impact of reparations ?
- the govt resigned rather than signed the treaty
- the new govt under Wirth saw no alternative than accepting the terms (first payment was the beginning of the policy of fulfilment)
- by Jan 1922 Germany asking for 1st postponement then again in July
- by nov 22 Germany asking for loan to help pay obligations causing France to become increasing suspicious
What was the economic impact of reparations ?
- reparations added to existing economic problems (DID NOT CREATE THEM ALL)
- harder for govt to pay off debts
- payments in coal difficult as TofV had taken reserves and Saar areas
- Merchant fleet had been confiscated by Allies so difficult to earn money through exports
- Govt resorted to printing more money (adding to inflationary pressure)
What happened during the Ruhr occupation 1923?
- Jan 23: French and Belgium forces occupied the Ruhr after Germany missed a reparation payment
- up to 100,000 men occupied German soil/factories/mines/steelwork and railways
- Germany military response impossible so govt of Wilhem Cuno ordered passive resistance and the German workers in the Ruhr went on strike - this stopped the French seizing coal and steel (briefly uniting the Germans in resisting foreign invaders)
- however put huge pressure on the Germany economy as the govt promised to keep paying German workers
- french response escalated eg.military courts and violent police confrontations
What were the economics effects of the Ruhr occupation ?
- paying workers further drained govt resources
- tax revenue lost from business in the Ruhr
- Germany had to import coal (draining valuable foreign currency reserves)
- shortage of goods added to inflations as prices rose
❗️the combined cost was x2 that of annual reparations - the new constitution had established the right for germans to work or receive welfare, crisis meant more germans needed welfare and more money had to be printed
How did the Ruhr crisis impact hyper inflation ?
- govt had to pay strikers and compensate for lost tax revenue therefore had to print more money which caused inflation to accelerate into out of control hyperinflation
- by aug 1923, the german mark was virtually valueless which meant the prices of goods rose every day
- people collected salaries in wheelbarrows and spent it immediately (as it would buy them much less tomorrow)
- food started to run out as people hoarded it in anticipation of higher prices
What were the underlying causes of hyperinflation ?
- inflation did not start in 1923, it had grown into a serious problem since 1914 and so Germany made no provision for a long drawn out war. Kaiser did not raise taxes to pay for the war (maintain popular support) and therefore massive sums of money were borrowed through war bonds and increasing national debt
- there was an assumption that the Germans would win and so be able to charge the losers high reparations to pay off their debts
- ❗️the new Weimar Government was faced with financial mess which would need to be tackled by cutting expenditure or raising taxes- neither option was attractive as it would alienate support for the new republic, instead they opted to pursue a policy of DEFICIENT FINANCING (funding govt spending by more borrowing)
- 🔔therefore, reparations seen as a contributory factor and not a primary cause
Who were the winners from hyperinflation ?
- black marketeers
- those with debt: could pay of their loans/mortgages with inflated worthless money)
- entrepreneurs: took out new loans to establish a business and easily pay it off with worthless money later
- big businessmen: could buy small bankrupt businesses for later
- owners of foreign exchange: kept its value
- famers: coped well as they could produce food and barter (avoid using money)
Who were the losers of hyperinflation ?
- pensioners: (living off a fixed income) lost out bcs their incomes bought less
- workers: wages did not keep pace with prices + hyperinflation meant businesses cut back on workers ❗️by end of 1923 only 30% of workforce employed
- those with wages and salaries saw their incomes erode
- middle classes (Mittlestand): were badly hit as their hard earned savings became worthless = their faith in the new democracy was badly shaken (if not lost!)
- increased cases of malnutrition and dietary diseases like rickets reported in children
Did hyperinflation pave the way for the collapse of the WR ?
- inflation of 1923 was not the occasion of Weimar’s demise, but it did leave a deep and lasting psychological scar, particularly among the middle classes
- when another economic crisis hit Germany in the early 1930’s many could not forgive the WR for a second failure (just 7 years after 1923)
What were the problems of a coalition government ?
1) Germany had a wide array of political parties = a problem for the new WR as govts needed to command a majority in the Reichstag, with the PR voting system and so many parties it was virtually impossible for one party to gain a majority of seats and coalition govts were inevitable
2) coalitions of different parties were likely to be unstable particularly with the challenges facing the WR. If govt parties disagreed then the coalition would fail = short lived coalItions (often perceived as weak)
3) forming a STABLE coalition was increasingly difficult as more hostility to the WR and political extremism grew (more parties anti-democratic/ anti-republic) so refused to take part in the coalition which meant centre parties found it increasingly difficult to reach an agreement with various parties to create a govt
❗️Feb 1919-Nov 1923 = 10 coalitions govts: continuity difficult + confidence in democracy undermined
What was support for democracy like in the Jan 1919 election ?
- notable support for centre parties (KPD and NSDAP non-existent)
- ❗️led to 3 centrist coalition governments all led by SPD (❗️largest party but only 38% of the vote), all coalitions had majority support
What was support for democracy like in the June 1920 election ?
🔔Election on 6th June, just before TofV signed
- ❗️SPD still largest party (but reduced vote 38% to 21.7%)
- all other centre parties (DDP/Z/BVP) see their vote decline
- ❗️parties on extreme left see rise in vote (KPD 0% to 2.1%/ USPD 7.6% to 17.9%)
- ❗️parties on extreme right see rise in vote (DNVP 10.3% to 15.1%) - NSDAP not yet participating
- ❗️June 1920-May 1924 (next election): 5 different coalition govts (all ix of centre parties) only ONE has majority support
What was support for democracy like in the May 1924 election ?
🔔 effects of hyperinflation crisis + Munich Putsch can be seen
- decline in support for democratic parties
- Nazis become noticeable ❗️(6.5%)
- extremist vote rises (KPD,DNVP,NSDAP) to over 40% of the vote
🔔 early years of the WR were marred by considerable political unrest that threatened to destabilise the new republic
What threats from the left did the WR face ?
- Jan 1919 the Spartacists (led by Liebknecht and Luxemburg) attempted a revolt in Berlin, the SPD govt frightened by the threat of communism and so moved quickly to crush the threat using the REICHSWEHR (army) and the Freikorps + leaders murdered
- LW uprisings were crushed by the army in Berlin and Munich in spring 1919
- more serious challenge came when soviet republic was established in Bavaria in April 1919, again Ebert used army + Freikorps to remove the threat
Who were the LW parties ?
- SPD (Social Democrats)- committed to democracy
- KPD (Communists)- anti-democratic + wanted a communist revolt
- USPD (Independent Social Democrats)- wanted a more socialist society than the SPD but within a democratic frame work
- collapse of USPD in 1920 led to members joining either the SPD or KPD, which removed any middle ground so the
How serious was the threat from the left ?
✅ create a revolutionary threat in the aftermath of the war, which warranted action
✅ Soviet style republic declared in Bavaria and the uprising in the Ruhr in 1923 were evidence of the danger of the ‘Red Threat’
❌ only 10-15% of the electorate supported such extreme LW views
❌ the KPD had neither strong leadership or a clear strategy and their level of electoral support was extremely low (2% before 1924)
❌ threat exaggerated by RW propaganda
❌ left was ideologically and tactically divided
❌ the ablest leaders (Luxemburg & Liebknecht) were removed by Freikorps
❌ by summer 1919 the best chance of establishing communism in Germany had gone and LW unrest never seriously challenged govt control
🔔 By itself it was never enough to collapse the Weimar government but its very existence took away 1/3rd of working class support from Weimar democracy
Why can the use of the Freikorps to crush the Left be seen as a political mistake ?
- some historians have argued that Ebert had to use the old elite (army/Freikorps) to crush the Left in order to save democracy
- others suggested he overestimated the threat of the Left and underestimated the threat of the right and so made a mistake
🔔 some LW Germans never forgave Ebert for his actions (would have impact later as split the LW meaning govts had less power as had less majority/ left unwilling to work with each other)
Who idea was the Kapp Putsch ?
- 1920
- General Ludendorf & Wolfgang Kapp formed ‘The National Association’ in 1919 to raise support for their views, wanted to restore the monarchy (Kapp in particular)
- backed by General von Luttwitz, leader of the Freikorps
- easy to gain support as military restrictions were being imposed and the ‘stab in the back’ theory circulated
What was the Kapp Putsch ?
- March 1920 Luttwitz called on Ebert to resign, when he refused, the Freikorps marched into Berlin and proclaimed Kapp Chancellor
- some army generals refused to crush the revolt and so the govt fled to Stuttgart