Economic developments (1924-28) Flashcards
What was the ‘Golden Age’ of the Weimar Republic?
the years 1924-1928 when Germany’s economy boomed and cultural life flourished; the true extent of this ‘golden age’ is debated
Who replaced Cuno in August 1923?
Gustav Stresemann and his ‘great coalition’ which included parties from the left and right for the first time
Who was Gustav Stresemann?
- leader of the DVP
- monarchist at heart but started working with republican parties
- Chancellor in Grand Coalition of 1923
- responsible for introduction of new currency and ending hyperinflation
- only Chancellor for 103 days
- foreign minister from 1923 to 1929
What was Stresemann able to achieve by the time he left office in November 1923?
- stabilisation of currency
- control of inflation rates
- attempts to overthrow republic from left and right had failed
How did Stresemann control inflation?
- end of passive resistance: in September 1923; highly unpopular and led to Beer Hall Putsch but there was no other choice; it helped reduce govt expenditure as govt don’t have to pay workers anymore
- issuing new currency: in November 1923; called the Retenmark; exchanged for old Reichsmark; govt controlled amount of money in circulation to prevent inflation; value of new currency soon established; under Hjalmar Schacht
- balancing the budget: cut expenditure and raised taxes; salaries cut and around 300000 civil servants made redundant; meant govt debt started to fall
How many companies went bankrupt in 1923 and 1924?
- 1923: 233 companies went bankrupt
- 1924: over 6000
What was the Dawes Plan?
- Nov 1923: Stresemann asked the Allies’ Reparations Committee to set up committee of financial experts to address Germany’s reparation concerns
- American banker Charles Dawes was committee’s chairman
Dawes’ Plan terms: - total reparations figure remained £6.6 billion
- amount paid each year reduced until 1929
- Germany should receive a loan of 800 million marks from USA
What did Stresemann and right-wing groups think of the Dawes Plan?
- Stresemann didn’t believe in the plan but accepted to receive foreign loans
- right wing parties e.g DNVP and Nazis attacked policy of compromise as they believed that Germany should just defy unjust terms of the ToV
When was the Dawes Plan accepted by Germany and the Allies?
July 1924
What benefits did the Dawes Plan bring to Germany?
- Allies accepted Germany’s problems with payment of reparations was real
- loans granted so Germany could invest in new machinery, factories etc and kickstart the economy
When did the French leave the Ruhr?
between 1924 and 1925
To what extent did industries experience economic recovery?
- industrial output grew after 1924 but didn’t reach 1913 levels until 1929
- investment in new machinery and factories were falling by 1929
- companies formed cartels; by 1925, there were around 3000 cartels, including 90% of Germany’s coal and steel
- after 1925, introduced tariffs on imports
- car industry developed but cars were still too expensive for the average German
What was the effect of massive population growth and how was this dealt with?
- caused an acute housing shortage
- working class city accommodation was overcrowded and unsanitary
- state initiatives to provide affordable homes began
- 1925: over 170000 home built
- 1926: over 200000 more
What happened to the number of strikes during these years?
declined partly due to compulsory arbitration for settling disputes
living standards increased for German workers especially those backed by powerful trade unions
What happened to unemployment during these years?
- was still an issue
- 1925: 1 million
- March 1926: over 3 million
- unemployment rates started to fall after that
