Germany- the recovery 1924-29 Flashcards
When did Gustav Stresemann come into power?
-1923
What was the great coalition government?
-helped solve the problem of hyperinflation and brought important improvements in the economy
What was introduced in November 1923?
-the new currency, the Rentenmark
What was the value of the Rentenmark based on?
- Germany’s industrial and agricultural worth
- He promised to exchange the notes for shares if the currency failed which increased confidence
What were introduced in 1924?
- a new independent bank called the Reichsbank
- the Reichmark, the new permanent currency
What did Stresemann believe about Germany’s economy?
- Germany should accept the Treaty of Versailles to improve foreign relations
- wanted to negotiate better terms for Germany
What were the key points of the Dawes plan?
- US loaned Germany 800 million gold marks
- reparations payments were lowered to 1,000 million marks for the first 5 years and then increased to 2,500 million
- allies agreed to review the payment rate over time, to take in Germany’s economy and ability to pay
- French agreed to withdraw troops from the Ruhr
- allies were given some control of the Reichsbank and railways in Germany
In the Dawes plan, how much money did the US loan Germany?
-800 million Gold marks
What were reparations lowered to due to the Dawes plan?
- 1,000 million marks for the first 5 years
- 2,500 million after
What were the effects of the Dawes plan?
- some Germans thought that Germany was accepting the blame for the war by agreeing to continue with reparation payments
- helped restore Germany’s economy and led to further loans from the USA
How much money did the USA loan Germany over the next 6 years?
-25 billion marks in loans
How was Germany’s economy after 1924?
- recovered significantly and there was more investment in Germany from other countries (USA) which went to boosting industry and building factories
- industrial output doubled in the years 1923-29
- wages rose + cost of living went down + standard up
- confidence in economy restored, government built new roads, schools and public buildings
What laws were introduced in 1927?
- allowed people to claim unemployment benefit
- ‘labour exchanges set up to help people still unemployed find work
What were the risks of Germany relying on loans?
-if world economy had problems Germany’s economy would collapse again
When was the Dawes plan introduced?
-1924
When was the young plan introduced?
-1929
What did the young plan do?
- reduced total reparations bill to $8 billion
- payments were to be made over 59 years, ($473 million per year)
- Germany was only obliged to pay 1/3 of the annual sum each year and pay the rest if they could afford
When did the French agree to leave the Rhineland?
-June 1930
Who created a petition against the young plan?
- Alfred Hugenberg
- managed to get 4 million signatures but only 14% voted against it at the referendum on Dec 1929
Why did the young plan not work?
- in 1929=the wall street crash and America could not afford to loan any more money
- in 1931, Germany economy crashed
When did Hitler come to power?
-1933
What did Stresemann do to strengthen Germany’s power and wealth?
-diplomacy, improved relations with Britain and France by ending passive resistance in the Ruhr in 1923
When did Germany sign the Locarno pact?
-1925
Who did the Locarno pact involve? (6 countries)
-Germany, France, Britain, Belgium, Czech, Poland
What did the Locarno pact involve?(3)
- Germany agreed to accept it’s new Western borders and all countries agreed to avoid military accept in self defence
- Germany agreed that Alsace Lorraine would be French and the French agreed not to occupy the Ruhr
- everyone agreed Germany’s eastern borders could be settled by peaceful means.
What did Stresemann say about the Locarno pact?
- a victory because it made peace in Europe more likely
- said Germany was now being treated like an equal rather than being ordered around by European countries
When did Germany join the league of nations?
-1926
What was the Kellogg Briand pact?
How many countries joined the Kellogg Briand pact in 1928?
-62 countries, including France, US and Germany
What did the kellogg Briand pact show in terms of Germany?
- it was included among the main powers once again
- clear that the Weimar republic was respected, stable state
How did Stresemann gain confidence when the Rentenmark was introduced?
-promised to exchange the notes for shares in German land or industry if the currency failed
What was the foreign policy of Stresemann?
-to restore Germany’s power and prosperity using Locarno pact
2 effects on Germany on Stresemann’s work to reorganise reparation payments.
- Germany recovered significantly
- Germany was open to risks if there were problems with world economy
- strengthened relations in Europe
