Post war economy Flashcards
Why were Germany suffering financially after the war
War was a lot to finance, had an economic recovery plan but only if they had won, lack of post war military sales and now had a high reparation bill
How was the war financed
Increased borrowing and money printing
What happened as a result of increased borrowing and money printing
Debt grew and the currency value decreased
How much were Germany expected to pay in reparations
132 billion gold marks
What were the 2 things that the government could do to reduce their debt
Increase taxes or reduce spending
What would be the issue if the government raised taxes
Risked losing support for the new republic, oppositions would claim he tax money would be used to pay the oppositions
What were the negatives of inflation
Prices of goods increased, people were taking short term loans out and not having to pay the full amount back and all changed but the reparations amount
Who became chancellor in 1920
Fehrenbach
What was Fehrenbach the first person to do
Lead a cabinet that did not include the SPD
What were some positives of inflation
Unemployment was low and investment was encouraged
What percentage of the population was unemployed in 1921
1.8%
What did the reparations committee conclude about Germanys reparation payments
They were to be paid in annual instalments and then gave the government had 6 days to sign
Who replaced Fehrenbach as chancellor and when
Wirth, 1921
What was the policy of fulfilment that was introduced by Wirth
Just do what the allies ask and cause no trouble, work out better in the long run
What did the reparations commission grant in January 1922
Postponement of the January and February instalments as there was financial trouble in Germany
What suspension id the German government ask for in July 1922 for reparations
To not pay for the rest of the year to stable themselves
In November 1922, how much did Germany ask for in a loan
500 million gold marks
How long did Germany want to be released from reparations for
3-4 years in the hopes of stabilising the economy
Who refused Germanys request of halting reparations
Germany as they were suspicious
What did France do after rejecting Germanys plan to halt all reparation payments
Them along this Belgian forces occupied the Ruhr, which was an industrial area of Germany, in attempt to extract payment by force
What did Germany use to pay reparations
Gold (not enough however), coal (a lot of coal reserves were lost in the treaty) and manufactured goods (allied manufacturers believed it to be a threat to their business)
What happened to German exports
The allies imposed high tariffs on German goods so not as many people will buy them, therefore having no to little support for German businesses
