Economic and Social Issues: 1918 - 24

Question 1

Why was the economy so bad after the war?

Answer 1

• Adjusting from a wartime to a peacetime economy took time
• Some companies (e.g. Krupp) had moved over to arms and munitions supply
• Economic capacity had been worn down by the war effort and investment was needed to rebuild it

Question 2

How did natural crises affect Germany?

Answer 2

• The winter of 1918 was harsh
• The British blockade of German ports continued until 1919.
• Food shortages led to rising prices, which led to an increase in poverty. This continued during the Ruhr crisis
• The influenza pandemic caused greater casualties than the war, worsened by poor standards of living

Question 3

How did the loss of Territories contribute towards a bad economy?

Answer 3

• Losing territories led to reduced production in raw materials and markets for German goods

Question 4

What was the sum of reparations after the war?

Answer 4

• The sum was fixed in 1921 at £6.6 billion
• Payments were to be made in gold or in kind (goods, raw materials)

Question 5

Why was Government Expenditure rising?

Answer 5

• The republic brought in welfare benefits and had to pay widows’ and veterans’ pensions, compensating war victims
• It also paid compensation to people who lost land in the Treaty and gave loans to help industry

Question 6

Why did the Government print more money?

Answer 6

• Germany was already in debt because of war expenditure
• It soon exhausted its gold reserves, and had to buy goods and raw materials to meet reparations payments
• To meet these expenditures, they printed more money

Question 7

Why was printing more money a huge problem?

Answer 7

• Printing more money leads to inflation because the currency loses value and more money is demanded for goods Marks soon lost value quickly
• In 1918 there were 8.9 marks to $1, in 1920 there were 14, in 1921 there were 64.9
• The fall in value accelerated in 1922. Then there were 191.8 marks to $1, but this became 17792 the following year.

Question 8

Why did the French want to occupy the Ruhr?

Answer 8

• Germany couldn’t pay France and Belgium their reparations
• They were dissatisfied and wanted to seize what they saw as theirs from the German economy

Question 9

What happened during the Occupation of the Ruhr?

Answer 9

• French and Belgian troops invaded the Ruhr on 11 January
• They took control of all factories, mines, steelworks and railways there
• On the 19th, the German government ordered passive resistance, refusing to produce or transport goods
• Communications were cut and economic activity halted
• The occupiers shot 132 Germans and removed 150,000 from the Ruhr for refusing to obey orders

Question 10

How did the French occupation of the Ruhr impact Germany?

Answer 10

• France and Belgium invaded the Ruhr, an industrial region in Germany, because they had fallen behind on reparations
• The German government ordered the workers to stop working
• With no income from there, hyperinflation got worse as the government printed more money to pay unemployment and welfare benefits

Question 11

Who lost during Hyperinflation?

Answer 11

• Money lost all value, so cash savings and fixed incomes became worthless
• This affected mainly the middle class and landlords

Question 12

Who won during Hyperinflation?

Answer 12

• People who held foreign money because their purchasing power soared
• People with fixed rents
• Borrowers because the value of loans plummeted. Hugo Stinnes used this to buy competitors and other firms and, by 1924, he owned 20% of German industries

Question 13

How was German currency stabilised?

Answer 13

• Stresemann called off passive resistance in September 1923
• The new currency was the Rentenmark, introduced that November. It was readily accepted
• 1T marks were swapped for 1 Rentenmark, so hyperinflation ended

Question 14

What caused the end of the Ruhr crisis?

Answer 14

• When Stresemann ended passive resistance, the French and Belgians eventually left the Ruhr
• The invasion led to considerable political unrest and social hardship in Germany

Question 15

What Healthcare provisions were provided in 1918 - 24?

Answer 15

• Healthcare provisions were usually taken care of by the Lander
• Since all Germans could vote, welfare for the working classes became more important
• The government extended health insurance in 1919 to different social groups, such as the disabled or women without their own income

Question 16

What provisions were provided for children in 1918 - 24?

Answer 16

• The Imperial Youth Welfare Act (1922) stated that all children had the right to an education
• Lander had to set up youth offices for child protection
• There were lots of voluntary youth groups. Its membership was between 5 - 6 million
• Many groups for boys became more militaristic
• Churches and political parties also set up groups, which increased social divisions

Question 17

What did Welfare Benefits include in 1918 - 24?

Answer 17

• The government set a maximum working week of 48 hours in 1919
• They also restricted all Lander to support wounded veterans, widows and orphans
• During the Ruhr crisis, a regular assistance programme provided unemployment benefits
• Unemployment rose as the economy readjusted to peacetime, but there was no mass unemployment