impact of and response to the Great Depression, 1929-32

Question 1

what was the great depression?

Answer 1

in 1929, the US economy collapsed and US banks not only stopped renewing short term foreign lending but also called in loans from abroad. all the countries were it was lending to were hit hard and in similar ways.

Question 2

what did the great depression cause?

Answer 2

• businesses sell fewer goods; lay of staff
• unemployment rises; people have less to spend
• suppliers and suppliers cannot pay of debt
• workers cannot pay rent
• bankruptcies, banks closed as loans not paid back.

Question 3

how did the great depression impact Germany’s economy?

Answer 3

• industrial production fell; slowly at first and then rapidly. by the end of 1932 it was about half its 1928 levels.
• unemployment rose in the same period and wages fell by 20-30%.

Question 4

why did the government struggle to deal with depression.

Answer 4

the government failed to cope with the depression because it could not make decisions or act quickly, and president Hindenburg was resistant to more government by emergency decree.

Question 5

what did Bruning suggest in 1930 that was rejected by the Reichstag?

Answer 5

he suggested cuts in government spending especially on social welfare, wage cuts and higher taxes.

Question 6

what did Hindenburg do in July 1930 after the Reichstag rejected brunings suggestions?

Answer 6

Hindenburg, who agreed with brunings policies, and went back to government by decree in order to put brunings policies into practice.

Question 7

were brunings policies a success?

Answer 7

• his policies brought deflation, but avoided devaluing the currency.
• one of the benefits were that as Germany’s depression deepened other countries knew Germany wouldn’t be able to meet any reparation payments and even loans.

Question 8

what did the international agreement at Hoover Moratorium conclude on 1st July 1931?

Answer 8

the agreement suspended the need for Germany to pay back loans or to pay interest on them for a year.

Question 9

what were the consequences of Brunings policies?

Answer 9

• his policies in the years 1930-32 did not work
• they deepened the recession.
• industrial production fell, prices fell and exports fell, all by around 50%
• unemployment rose to its highest level ever in 1932 at 29.9%.

Question 10

who replaced Bruning in may 1932?

Answer 10

Von Papen

Question 11

what did Von Papen aim to do?

Answer 11

he introduced some tax concessions and subsidies for businesses that created some new jobs and produced some economic improvement.

Question 12

how effective was the Reich commissioner for employment?

Answer 12

• he drew up a list of public works to be financed by the Government in order to create employment.
• he was given a budget of RM500 million but he had not put anything into effect before the Nazis came to power.

Question 13

why was it difficult for the Weimar Government to improve economic conditions.

Answer 13

• coalitions government had failed
• government was increasingly by decree, made the Weimar government look like a failure.
• the policies imposed by the government were hard on the German people and did not seem to be working making this system of government very unpopular.