1.3 Economicand Social Problems In Germany 1919-24

Question 1

How did Germany fund WW1?

Answer 1

-increased borrowing
-printing more money

Question 2

How did Britain fund WW1

Answer 2

-higher taxes
-government borrowing

Question 3

What did the German methods of printing money and borrowing money lead to?

Answer 3

-the currency of the mark falling and government debt growing

Question 4

Why was the German war strategy dependent on?

Answer 4

The fact they would win the war recoup losses by annexing the industrial areas of its defeated enemies and forcing them to pay heavy reparations

-defeat for Germany meant this method couldn’t be utilised and they had to pay reparations as well as deal with the loss of ket industrial areas

Question 5

What was the debt the Weimar Republic was faced with in 1919?

Answer 5

1.44 billion marks

Question 6

What are the two ways government debt can be reduced and why didn’t the Weimar Republic do these methods?

Answer 6

1. Increases taxes
2. Reduce public spending

The Weimar Republic was to politically unstable,

1. Risk alienating support and anti-republic parties can claim taxes are being used to pay reparations
2. Welfare benefits and civil servants had to be paid as the government was to fragile

Question 7

When was unemployment really low?

Answer 7

1921

Question 8

Between 1918 and 1919 prices….

Answer 8

Doubled

Question 9

Between 1919 and 1920 prices

Answer 9

Quadrupled

Question 10

Why did the Weimar government allow inflation to increase from 198-1920?

Answer 10

1920 coalition led by Konstantin Fehrenbach was dominated by the centre party who supported many powerful German industrialists (they benefited from inflation by taking short-term loans from the central bank to expand their business)

Question 11

Why were the reparations not affected by inflation?

Answer 11

They were paid in goods such as gold which remained stable

Question 12

How did inflation lessen the governments burden of debt?

Answer 12

The payments due were worth less as the value decreases, German politicians allowed it to continue unchecked

Question 13

What were the unemployment rates in Germany and Britain(shows benefits of inflation)

Answer 13

Britain: 17%
Germany: 1.8%

Question 14

When did inflation become hyperinflation?

Answer 14

1923

Question 15

The treaty of Versailles was a key reason for hyperinflation,why?

Answer 15

Germany required to pay reparations but the fixed amount had not been decided

-Reparations commission set up to determine damage caused by German forces in allied countries

-132 billion gold marks paid annual instalments

German government given ultimatum of 6 days to accept -caused political crisis in Germany

Question 16

What was the reparations commissions job and what was their conclusion?

Answer 16

Reparations commission set up to determine damage caused by German forces in allied countries

-132 billion gold marks paid annual instalments

Question 17

What did the German cabinet do when faced with the reparations ultimatum in 1921?

Answer 17

Resigned in what they viewed as excessively harsh terms

Question 18

Who was the chancellor of the new government that replaced the 1920 coalition led by Konstantin Fehrenbach ?

Answer 18

Joseph Wirth

Question 19

Who was the chancellor of the 1920 coalition?

Answer 19

Konstantin Fehrenbach

Question 20

What did Joseph Wirth do with the reparations ultimatum?

Answer 20

Accepted it grudgingly (start of the policy of fulfilment)

Question 21

What was the policy of fulfilment?

Answer 21

Fulfilling the conditions of the treaty of Versailles in the hope that a revised payment would be made by the allies in the future as the current amount was beyond their capacity

Question 22

What is a piece of evidence that the payments were beyond Germany’s capacity?(3)

Answer 22

The Reparations committee granted a postponement in payments of January and February 1922

-July 1922 Germany ask for further suspension of payments

November 1922 Germany take a loan of 500 million gold marks (realised from obligations for 3/4 years to stabilise currency)

Question 23

Why did the French and Belgian take over the Ruhr in 1923?

Answer 23

The reparations from Germany had stopped

-attempt to extract payment by force

Question 24

How did the Burden of reparations make the situation worse?(3)

Answer 24

Made repayment of government debt (build up from the war) much harder

-germanys gold reserves inadequate for the scale of reparations that had to be made In gold

-Germany had lost its coal areas in treaty of Versailles(made coal aspects difficult)

Question 25

What was another possible method of repayment that wasn’t undergone?

Answer 25

Manufactured goods,allies did not accept as it was a threat to their jobs and businesses

Question 26

How did the allies cripple Germanys ability to get foreign currency for payments?

Answer 26

-Entire German merchant fleet was confiscated and there was high tariffs on German in ported goods (response to this from German government was printing more money which made the situation worse)

Question 27

By the end of 1922 what had Germany seriously fallen behind in?

Answer 27

Repayment to France in the form of coal

Question 28

What did the failure of coal payments lead to in the end of 1922?

Answer 28

French and Belgians together to spend 60,000 men to occult Ruhr industrial area in January 1923 to force the Germans to comply with the treaty

Question 29

What was the aim of the invasion of the Ruhr in 1923?

Answer 29

Seize the areas coal steel manufactured goods and reparations, these troops occupied the whole area and the numbers went up to 100,000

Took control of all mines, factories, steelworks and railways(demanded food from shops and set up machine gun posts in the streets

Question 30

What was the Ruhr?

Answer 30

Heavily industrialised area of western Germany, it generated 85% of German coal and had many large iron and steel works

Question 31

What was Germany’s response to the invasion of the Ruhr?

Answer 31

Stopping all reparation payments and adopting a policy of passive resistance

Question 32

What was the policy of passive resistance?

Answer 32

No one living in the area would cooperate with French authorities

Question 33

What did the German parimilary groups actually do?

Answer 33

Blew up railways, sank barges and destroyed bridges in order to disrupt the French

Question 34

What did the French do in response to the action of German paramilitary groups in the Ruhr?

Answer 34

Set up military courts and punished mine owners and civil servants who wouldn’t comply with their authority (150,000 Germans expelled from area)+132 Germans shot

Question 35

Desc the French failing to extract these resources from the Ruhr?

Answer 35

Despite getting the French to extract the resources in may 1923 monthly deliveries were a third of what they were in 1922 (output in Ruhr fell to 1/5 pre occupational output)

Question 36

What were the four economic effects of the occupation of the Ruhr and passive resistance?(4)

Answer 36

-paying wages of workers for passive resistance(further drain on government finances)

-loss of tax revenue from the workers and businesses that become unemployed

-Germany has to import coal and pay for it from the limited foreign currency reserves in their country

-shortages pushed the prices of goods up

(Combination of all this resulted in twice the reparations payments-led to hyperinflation)

Question 37

During hyperinflation how would workers collect their wages?

Answer 37

Wheelbarrows and shopping baskets

Question 38

What led to a break down in law and order in some areas?

Answer 38

Rising food prices and and suppliers hoarding supplies in anticipation for higher prices in the future (led to food riots and looting of shops)

Question 39

What did people do to gain vital supplies?

Answer 39

Bartered possessions

Question 40

Number of marks per dollar In 1914

Answer 40

4.2

Question 41

Number of marks per dollar
Jan 1919
Jan 1920
Jan 1923

Answer 41

1919: 8.9
1920: 64.8
1923: 17,972

Question 42

Marks per dollar
July 1923
August 1923
September 1923

Answer 42

July: 353,412
August: 4,620,455
September. 98,860,000

Question 43

Marks per dollar
October 1923
November 1923

Answer 43

October: 25.2 billion
November: 4.2 trillion

Question 44

What and when were the 4 laws passed to reform the welfare system and employment rights?

Answer 44

1919: max working day to 8 hours

1919: state health insurance system limited to workers in employment (was extended to wives daughters and disabled)

1919: aid of war veterans incapable of working and war widows and orphans from the war

1922, national youth welfare act:all local authorities required to set up youth offices with responsibility for child protection and all children have a right to an education

However this put pressure on government funds and contributed to the hyperinflation crisis

Question 45

Winners or hyperinflation (6)

Answer 45

-those with debts and morgages

-black marketeers

-enterprising business people who took out loans and paid them back quickly

-paying fixed rents on property

-people owning foreign exchange

-farmers

Question 46

Losers or hyperinflation (7)

Answer 46

-pensioners

-landlords with fixed rents

-people who had lent out war bonds to government

-unemployed

-small business

-sick

-those reliant on savings

Question 47

5 key events that led to the crisis

Answer 47

1. Economic impact of the war
2. Treaty of Versailles
3. Weimar government response
4. French invasion of Ruhr
5. Weimar government response