After the Quiz…

1. After the Quiz… • Grab a primary source document booklet • Open to document 28-3 • Read it carefully BY YOURSELF, and try answering the “reading and discussion questions” at the end of the doc.

2. European Economics after WWI 3/6/12

3. Europe in 1919

4. Continental overview • 1920’s = a time of insecurity, a short-lived upswing, and finally a collapse • The huge number of deaths the war caused robbed Europe both of producers and consumers • After the war, the break up of the Austrian-Hungarian empire produced many small countries • different taxes, tariffs and tolls • strangled internal European trade

5. Decrease in World Trade: 1929-1932

6. London Conference • May 1921: Allies met in London to determine reparations • Germany charged $31.5 billion to be paid for at $500 million per year. • Germany shocked, afraid and mad • Prompted loud anti-western response from German army and conservatives

7. German Crisis • Germany paid its reparations in 1921 & 1922 but refused to pay in Jan. 1923. • This resulted in the French invasion of the Ruhr.

8. Ruhr Crisis • France invaded the Ruhr valley, a German industrial area in response to the missed payment. • The United States and Britain did nothing to stop her, although they did protest weakly • German workers responded with “passive resistance” (general strike in the region) throwing the economy into chaos.

9. Ruhr Crisis

10. Inflation • The German mark which had traded at 4 to the dollar in 1914, traded at 64 to the dollar by Jan., 1921. • By November, 1923, it took 800 million marks to make one dollar • The middle class saw the value of their savings wiped out through inflation, and this, plus the defeat and trauma of the war, helped produce acceptance of Nazism.

12. Inflation

13. German Unemployment: 1929-1938

14. Economic Disaster • To support the workers on strike, the German government began printing paper money, but this led to runaway inflation • Sometimes workers were paid twice a day so they could run to the stores to buy things before the prices went up • Spiraling (“Weimar”) inflation (eventually being revalued hourly) wiped out most Germans, especially the middle classes who lost entire lifetimes of savings.

15. German “Revolutions” [1918]

16. Spartacus Uprising • Sparticus League formed 1916 to oppose WWI • Radical socialists/Communist Party, 1/1919 • Led by Rosa Luxemberg and Karl Leibknecht • Opposed the SPD government of Friedrich Ebert in 1918-19.

17. Spartacus, cont. • Jan. 6-15, 1919: Communist General Strike • Put down by militia • Luxemberg and Leibknecht arrested and murdered by counterrevolutionary volunteers • Claimed the 2 had tried to escape • Government depended on army to survive. • Allowed the army and conservatives to use propaganda to claim there was a huge communist threat • Turned people against communists.

18. Sparticist Poster

19. The Spartacist League Rosa Luxemburg[1870-1919]murdered by the Freikorps

20. German Freikorps

21. Economic Recovery • Germany was on the brink of revolution and complete economic collapse • Pres. Ebert appointed Gustav Stresemann to Chancellor in Aug. 1923. • New currency (1 Rettenmark = 1 trillion old marks) • Ordered Ruhr back to work • Crushed extremists • Appealed to US for help against French Occupation

22. Extremism • In response to the problems they faced, conservative extremists began to emerge. • Nov. 9, 1923: Beer Hall Putsch • Hitler and Ludendorff led a coup in Munich • 16 Nazis killed and Hitler and Lud. were arrested. • Ludendorff freed • Hitler served a few months of his 5 year sentence during which he wrote “Mein Kampf”

23. From the German Point of View  Lost—but not forgotten country. • Into the heart You are to dig yourself these words as into stone: Which we have lost may not be truly lost!

24. Economic Recovery • Dawes Plan, 1924 • Negotiated with the US Sec. of the Treasury as the mediator • Lowered reparation payments—based on the German economy • France agreed to leave the Ruhr by 1925 • Eased the financial burden, but many Germs still upset that they lost their wealth. • American banks began lending Germany money privately to pay the reparations, money that Germany then paid to France and Britain, which they then used to buy goods in the United States • Worked ok until the stock market crashed and US banks quit lending money.

25. European Debts to the United States

26. The Dawes Plan (1924)

27. Locarno Agreements • Negotiated Oct. 1925—”Spirit of Conciliation” in Europe • Guaranteed Germany’s W. borders • Britain and Italy given the responsibility of protecting the Rhineland • Germany invited to join the League of Nations • Germany allowed to negotiate her E. borders

28. Kellogg-Briand Pact • 1928: outlawed “war as an instrument of national policy.” • Signed by the US, Japan, and most European nations • Idealistic statement against war that was short lived.

29. Boom and Bust • Young Plan, 1929 • replaced the Dawes plan. • Reduced reparations payments were continued. • Continued Germany’s economic recovery • US Stock Market Crash, Oct. 1929 • Prompted an economic depression in America, followed by an economic depression in Europe by 1930. • 1931: Kreditanstalt(major Austrian bank) crashed, taking with it what remained of the European economy

30. The Young Plan (1930) For three generations, you’ll have to slave away! $26,350,000,000 to be paid over a period of 58½ years.

31. The Great Depression [1929-1941] London in 1930 Paris in 1930