American politician, Charles G. Dawes, developed this plan to stabilize German economy in 1924\n The Ruhr area was to be evacuated by Allied occupation troops.\n Reparation payments would begin at &#x201C;one billion marks the first year, increasing to two and a half billion marks annually after five years" (Merrill 93)\n The Reichsbank would be reorganized under Allied supervision.\n The sources for the reparation money would include transportation, excise, and custom taxes.\n Plan largely centered on American money being pumped into the country.\n
The Weimar Republic Germany 1919-1933
1. Explain impact of Great Depression.2. Identify locations in Eastern Europe and Central Asia.
Today’s Objectives1. Explain impact of Great Depression.2. Identify locations in Eastern Europe and Central Asia.
Legacy of the Treaty ofVersailles for the Germans Limit to size of military (very limited) & war guilt ➞ attack on national pride Loss of overseas colonies & of territories in Europe (Alsace-Lorraine) ➞ loss of income Loss of life and resources from war ➞ economic hardship War reparations ➞ external debt All told ➠ strain on country
Weimar GovernmentFormed at the end of the war to bring a peaceful conclusionto the war ➞ Kaiser outSigned the Treaty of Versailles, under protest (but no choice)SPD - Socialist Democratic party that was ﬁercely anti-Communist in power, though considered a moderate partyAttempted to gather coalition of leaders to governRadical socialists/communists on the left; radicalconservatives in the National Socialist German Worker’sParty (Nazi) on the right
War Reparations1921 - Government charged with £6.6 billionCouldn’t make payments within the ﬁrst twoyears70,000 French and Belgian troops march intothe Ruhr Valley and occupy ➞ take control totake money for reparations
Economic ImpactBy the end of 1923 - the impactto the German economywould be catastrophicIn order to keep up, theWeimar government begins toprint more money. As pricesfor goods rise, the currency isvalued less and less. This isinﬂation.Hyperinﬂation - inﬂation thatis out of control.
A New LeaderGustav Stresemann - appointedChancellor in 1923Effective leader who wouldhelp Germany recover frompanic of hyperinﬂationAgreed to Dawes Plan(reduced reparations to moremanageable amounts)Negotiated Locarno Pact(protected German borders; nofurther Alliance occupation)
Weimar on Path of Recovery?Many indications show that Germanproduction was increasing and was on path tosome recoveryIn October, 1929, though, Stresemann dies fromstroke. Timing couldn’t have been worseShortly after his death - world is rocked byanother event
The Great Depression October 29, 1929 - Black Tuesday - $10 Billion wiped off the value of share prices in one day. Impact would be felt around the world.