The Impact Of Reparations On The German Economy

Second, the reparations of the Versailles Treaty further stalled Germanys attempt at a Democracy by critically maiming its economy. Germany,

It is a reasonable conclusion that to Hitler, the restoration of Germany and the damning of the Treaty of Versailles, specifically returning Germany’s right to be an equal in the world society, are linked. In a speech givin at Dusseldorf Hitler even went as far as promising to withdraw the signature that indicted Germany for starting World War One. Here Hitler also draws the comparison to returning German pride with reinstating the military heritage taken in the Treaty of Versailles. These pairings that Hitler chose to address shows the direct influence that Hitler felt the Treaty of Versailles had on weakening the German people and causing a separation from their heritage after 1919. These ideas of Hitler were not unfounded. He claimed in his speech at Munich 1922 that Germans were burdened at the end of World War I with an 8 million mark debt of their own, and the debt of the other allied countries, with similar sentiment in other speeches . The actual treaty confirms this by showing a 10+ billion mark reparations clause in section 232 right after the War Guilt Clause . A scholar by the name of Graham Darby claims that the treaty of Versailles is not the primary cause of the economic downturn and therefore not a primary influence on Hitler’s economic policy. The data however, points to one crucial fact that Mr. Darby neglects to mention in his article, the Dawes Plan. The Dawes plan was enacted during 1924 and

In Document C, it states that Germany “will make compensation for all damage done to the civilian population of the Allied and Associated Powers and to their property during the period of the belligerency.” They were making Germany pay an impossible amount of money, and only gave Germany thirty years to pay it off. In 1929, the reduced amount was 20 billion, 112 billion gold marks and the value in 2010 US Dollars is 341 billion. This made Germany so bitter because they were held responsible for the WWII and were made to pay back so much money, which later on will make Germany go into

One of the terms that Germany had to meet was A large debt in gold for reparations to the other countries, Which was 132 billion gold marks (Doc C). Although they had to pay off reparations to other counties they did not have to rebuild bridges, roads, schools, and business as did their other allies. Germany had to suspend payments due to the Great Depression in 1931 also

The Treaty of Versailles blamed Germany for the losses France experienced in World War I. The treaty required Germany to pay for these losses. Germany was required to pay France 132 billion marks in reparations. This fine was excessive in order to show that Germany was weak and to further weaken the German government. This caused inflation. The German government inflated the amount of money so much that it became so worthless that people used

Consequently the Treaty of Versailles helped to cause the Economic depression, in Germany. Meaning that the treaty and the economic depression were both linked together strongly, because the treaty told Germany to pay reparation bills, around £6600 million to the

The Treaty of Versailles was a truly cruel document and expressed a large dislike for Germany. The document had a myriad of demands and if they weren 't met, then extortion was used to achieve goals. The treaty caused many hardships such as limiting the army down to almost nothing, stopped the building of large ships and took away submarines completely. Also, Great Britain and France collected money for all the damage the war had caused. To pay its war debts the country borrowed money from America, but soon after it stopped when the Great Depression began.2 In result, Germany had it 's very depression that was so severe the money ended up having almost little to no worth.

It led to economic problems and a lack of food or jobs. These in turn

The Treaty of Versailles was signed on June 28th 1919 by the Germans in order to obtain world peace. However, this agreement seemed to only provoke the nation. According to the clauses of the document, Germany would have to pay for all damages caused by the war and they even had to claim full responsibility for initiating the war, often referred to as the War Guilt Clause. The German population also felt resentment with the government for giving away so much land to the various countries that had won the war. Around the time of the treaty, Adolf Hitler of the National Socialist German Workers’ Party was getting much attention because of his promising ideas to reduce unemployment which was a crisis that was caused by the depression of

A third factor linking the Treaty of Versailles and the start of World War II was paying for reparations. Germany had to pay an enormous amount of money after the war as “compensation for all damage done” (Doc C). Told to pay what was worth 367 billion US dollars in 2010, the Germans were angry and humiliated. They payed very little, even after the amount was reduced. Once Hitler came to power all reparation payments stopped, and Germany only paid 2 billion marks in total (Doc C). The Germans were angry that they had to pay such reparations, and in economic trouble after paying so

Germany emerged from World War I with huge debts incurred to finance a costly war for almost five years. The treasury was empty, the currency was losing value, and Germany needed to pay its war debts and the huge reparations bill imposed on it by the Treaty of Versailles, which officially ended the war. The treaty also deprived Germany of territory, natural resources, and even ships, trains, and factory equipment. Germany’s population was undernourished and contained many widows, orphans, and disabled veterans living in poverty. The new German government struggled to deal with these crises, which had produced a serious hyperinflation.

How significant was the Treaty of Versailles to Germany? This is the question that has been posed to us for our first analytical history essay. I will go into depth about my opinions on both the long-term and short-term effects of the Treaty of Versailles. I believe that the Treaty had a powerful impact on Germany- it practically ruined their economy, and gave the Germans all the more reason to hate the Allies, eventually contributing to the beginning of World War 2. Although the Allies had a right to demand certain things from Germany (as they were the instigators of the war), they should have been more lenient and taken Germany’s poor economic situation into account. The war was a mistake on the part of the German government, but it was the people who payed the price. I have taken into account Germany’s loss of territory, the war guilt, the economical effects of the Treaty, and the armaments and discussed them in this essay.

This was because they expected for Germany to recover quickly. The Young plan was also introduced in 1929 which gave a set amount to pay over limited period of time this also failed. But Germany attitude toward this negative right wing parties in Germany saw this as another handover to the war guilt that Germany was to accept.

Their military was downsized to the maximum of 100,000. All weapons that remained from World War I were to be scrapped in efforts of disarming Germany. Submarines and aircraft were banned completely in Germany and only 36 ships were allowed to serve as the German Navy (Goldstien, Dillion, p.124,1988). Under the conditions of the treaty, Germany was also responsible for an estimate of 6.6 million dollars-worth of war reparations (Goldstien, Dillion, p.130,1988). In result of the high war reparations, Germany suffered great economic depression. Due to depression, the high rates of unemployment and severe inflation caused the people of Germany to become resentful toward the Treaty of Versailles deeming it’s terms too harsh. During these times of economic difficulty and doubt all throughout Europe, people were hopeful for leaders that were capable of reversing the severity of the current conditions.

An economic failure in the result to the treaty was hyperinflation. It occurred due to the given amount of reparation payments, which were up in the multiple millions. The war had left the German economy disastrous already, and inflation was rising quickly. The banks started to print more bank notes to solve the problem. The harsh effect, however, was that the money became worthless, as less goods were there to be sold, and so heavy inflation followed. Germany could only pay its first reparation with its industrial products (a prime source for employment, and exports, thus the stability of the economy.) so when Germany declared they couldn't pay the second instalment, the French invaded the Ruhr, the main source of industrial activity for Germany. The government's response was to encourage strikes; this only led two to things; less German produce, with workers still needing to be paid. In attempt to correct this, government printed even more bank notes. Heavy inflation soared to hyperinflation. The middle class saw their savings being brought to no value, right through to the workers not being able to buy a loaf of bread. This shows a chain of failures from the republic- it contributed to the commencement of hyperinflation, and therefore the invasion of the Ruhr- loss of industrial economy. Generally,