Theme #2- The 1920s and

the Search For Post War

Stability

How to Enforce the Treaty of Versailles?

• The Treaty of Versailles was neither harsh enough nor lenient enough (from the perspective of the WWI victors). Huh? – Germany’s future power was not permanently crippled

• Not returned to an HRE

– But Germany was left in a mood for vengeance

• The one thing that could prevent a German resurgance a unified alliance of France, Britain, and the U.S – However, the Victorious Powers Drifted Apart– America returned to isolationism

(cont.)– Britain and France had different views on how

vigorously to enforce the Treaty of Versailles• French wanted vigorous enforcement for security • the British needed Germany markets so they wanted a German

recovery – willing to overlook German attempts to breach treaty

– John Maynard Keynes (British economist) agreed- making a world power poor hurts all economies (The Economic Consequences of the Peace)

– Strange post-war debt issue Britain and France have to pay back the U.S for war debts they want Germany to pay them so they can pay the U.S. Germany can’t come up with the money

– Crumbling of British- French friendship… • Traditional enemies & the two have issues over Middle Eastern

mandates

European Debts to the United States

European Debts to the United States

The German Interwar Point of View

The German Interwar Point of View Lost—but not forgotten country.

Into the heart You are to dig yourself these words as into stone: that which we have lost may not be truly lost!

Inter War Years from a German Perspective

The Ruhr Valley Invasion

– Germans reneged on their debts..• partly because they couldn’t pay, partially because they

didn’t want to pay

– The French invaded the Ruhr valley• … rich in coal

– Standoff… • Germans passively resisted because anything they produced

was confiscated by the French as reparation payments…

• the French put a moderate siege on the Germans in the Ruhr

– Weimar gov’t printed money to support its striking workers

• What else could it do?

• hyperinflation

(cont.)

– French invasion was unpopular, and Poincare (French Prime Minister) eventually backed off in return for a weak German promise to pay ‘in theory’ after a re-tabulation of debts

– The U.S. stepped in with the Dawes Plan to get Germany back on its feet (loaned them money).

• There is a strange circular flow here… Americans pay the Germans, so that… they repay the French, so that… they repay the Americans.

• In effect, the U.S. is forgiving war loans.

The French Occupation of the Ruhr

The French Occupation of the Ruhr

The GermanMark

The GermanMark

The German MarkThe German Mark

The Dawes Plan (1924)The Dawes Plan (1924)

The Late ’20s Seemed Hopeful • Dawes Plan was Fairly Effective• German economy started to recover

– radical groups marginalized • Communists and Nazi radical revolutions in Germany found little

widespread support

• Hitler’s Beer Hall Putsch – writes Mein Kampf in prison

– treaties were signed swearing off war permanently. • Locarno Pact- Settled continuing post Treaty of Versailles border

disputes peacefully

• Kellog Briand Pact- forbid the use of war as a diplomatic tool

– Moderate socialists were in power in France and England • Labour party replaced liberal party as the #2 in England under

Ramsay McDonald

• Southern Ireland was granted full autonomy

Hitler in Landesberg PrisonHitler in Landesberg Prison

Mein Kampf [My Struggle]Mein Kampf [My Struggle]

Response to Kellogg-Briand Pact- Do You Get It?

• Theme #3 – Hope Fails in the 1930s

The Great Depression • American Stock market bubble

– Buying ‘on margin’– Prices seemed to be high because people were throwing money

in the stock market, but the values of companies and the actual investments in capital and growth weren’t that high

– Interesting tie in to current economic crisis • Cascading Impact, First in the U.S. and then in the World

– People bought less, businesses make less money, people lose their jobs, people buy less… vicious cycle

– Poor people start to pull money out of banks, which means the banks have less to loan. New businesses can’t be started because there’s no money for banks to loan out.

– Bank Runs – Since America had become the center of the world financially, a

shortage in money in American banks ‘exports’ the Great Depression to the world

The Great Depression [1929-1941]

The Great Depression [1929-1941]

Paris in 1930Paris in 1930

London in 1930London in 1930

• Attempts to solve the problem – Protectionism – Drop the gold standard – Why weren’t these effective?

Whose to Blame for the G.D.? • Text blames…

– A Lack of international financial police (England had just lost this role by being weakened in WWI and the U.S. was too new and not ready to step up to this role)

– Lack of countercyclical Keynsian spending by gov’ts

• Our gov. uses Keynsian economics now…

• We (U.S.) recently printed 1 TRILLION dollars to ‘prime the pump’ of our economy

The Great Depression in the U.S.• U.S. got it worst

– Hoover did little – Replaced by FDR, who pushed the New Deal– Socialism wasn’t popular in the U.S., so FDR had to walk a fine

line• two parts:

– gov’t employs people directly (WPA- Works Progress Administration) – direct government interference in the economy- price fixing, etc. (NRA-

National Recovery Administration ) – The former was a success, the latter was not

– Long term impact of the New Deal on the United States • Some permanent gov’t interference in American economy… social security,

unemployment benefits• decrease in class gap (welfare state)

• The huge government spending of WWII completely ended the depression in the U.S. and added support to the argument that FDR didn’t do enough and that Keynesian economics is correct

The Great Depression [1929-1941]

The Great Depression [1929-1941]

The G.D. in Other Countries • Scandinavia

– had the best success fighting the depression with moderate socialism, in which all classes accepted high taxes in return for high government spending and public works

– Intriguing middle ground between cold hearted capitalism and stifling Communism/Fascism

• Britain – got it relatively easy because it replaced foreign markets with new products

on the domestic market (I’m just repeating the text… this seems pretty vague to me)

• France – got it hard because its recession was deep and politics were becoming

increasingly polarized, leading to a rapid turnover of governments – The lefties in France managed to bond together in the Popular Front and win

an election– Their attempt at New-Deal-esque reform was only partially successful…

partly sabotaged by Conservatives in polar climate

The Great Depression Helped the Nazis (and other Totalitarians)

Hitler Promised…

•To put Germans back to work

•To ignore the Treaty of Versailles

•To regain German Honor

=

Hansen Name __________________AP Euro The Search for Interwar Stability and Its Failure (Interwar Years Themes #2 and #3)

The 1920s and the Search for Post-War Stability• How to Enforce the Treaty of Versailles?

– The Treaty of Versailles was neither ___________ nor _____________________(from the perspective of the __________________________). Huh?

• Germany’s future power was ________________ ________________________________________

– Not returned to __________________• But Germany was left in _____________________

– The one thing that could prevent a German resurgence a ______________________ of France, Britain, and the U.S

– However, the Victorious Powers _______________• America returned to _____________________• Britain and France had different views on how

__________________________ the Treaty of Versailles• French wanted vigorous enforcement for ________• the British needed Germany __________ so they

wanted a German recovery – willing to overlook German _______________________________

– John Maynard Keynes (British economist) agreed- making a world power poor ______ ______________________ (The Economic Consequences of the Peace)

– Strange post-war debt issue Britain and France have to pay back ________ for war debts they want ______ to pay them so they can pay the U.S. Germany ________ ______________________________________________

– Crumbling of British- French ___________… • Traditional enemies & the two have issues over

__________________________________

•

• Ruhr Valley Invasion– Germans _________________ on their debts..

• partly because they couldn’t pay, partially because they __________________________

– The French invaded the Ruhr valley• … rich ____________

– Standoff… • Germans passively resisted because anything

they produced ________________________ _______________as reparation payments…

• the French put a ____________________ on the Germans in the Ruhr

– Weimar gov’t ___________________ to support its striking workers

• What else could it do? • ________________________

– French invasion was unpopular, and Poincare (French Prime Minister) eventually backed off in return for a weak German promise to ____________________ after a re-tabulation of debts

– The U.S. stepped in with the _______________ _____________________ to get Germany back on its feet (loaned them money).

• There is a strange circular flow here… Americans pay the Germans, so that… they repay the French, so that… they repay _____________________________.

• In effect, the U.S. is ____________________ • The Late 1920s Seemed More Hopeful

– Dawes Plan was _______________________________– German economy started to _____________

• radical groups ____________________– Communists and Nazi radical revolutions

in Germany found ________________ ________________________________

– Hitler’s _________________________ – writes __________________ in prison

– treaties were signed _____________________ permanently. • ______________________ - Settled continuing post Treaty

of Versailles border disputes peacefully • _______________________________- forbid the use of war

as a diplomatic tool– Moderate socialists were in power in France and England

• Labour party replaced liberal party ______________ in England under Ramsay McDonald

• Southern Ireland was _________________________Hope Fails in the 1930s - The Great Depression

– American _________________________________• Buying ___________________________• Prices seemed to be high because people were throwing

money in the stock market, but the ___________ of companies and their ___________________________ ____________________________weren’t that high

• Interesting tie in to _____________ economic crisis – Cascading Impact, First in the U.S. and then ______________

• People bought less, businesses make less money, people lose their jobs, people buy less… _________________

• Poor people start to ____________________________, which means the banks have ___________________. New businesses can’t be started because there’s no ___________________________________to loan out.

• _______________________• Since America had become the center of the world

financially, a shortage in money in American banks _____________________________________________

• Attempts to solve the problem – Protectionism – Drop the gold standard – Why weren’t these effective? _________________________

_________________________________________ • Who’s to Blame for the Great Depression?

– Text blames… • A Lack of __________________________________

___________ (England had just lost this role by being weakened in WWI and the __________________ ___________and not ready to step up to this role)

• Lack of _____________________________________

– Our gov. uses Keynsian economics now…– We (U.S. – 2008) recently printed _____

______________________ dollars to ‘prime the pump’ of our economy

• The Great Depression in the U.S. – U.S. got it ____________

• _________________ did little • Replaced by FDR, who pushed ________________• ____________ wasn’t popular in the U.S., so FDR had to

walk a fine line– two parts:

» gov’t ______________________ (WPA- Works Progress Administration)

» _______________________ _________________________ in the economy- price fixing, etc. (NRA- National Recovery Administration )

» The former was a success, _______ ____________________________

• Long term impact of the New Deal on the United States – Some __________________________ in

American economy… social security, unemployment benefits

– decrease in ___________ (welfare state) – The huge government spending _________ completely ended the

depression in the U.S. and added support to the argument that FDR didn’t do enough and that _________ _______________________ is correct

• The Great Depression in other countries – Scandinavia

• ____________________________ fighting the depression with moderate socialism, in which all classes _______________________________ in return for high government spending and public works

• Intriguing middle ground between ___________ capitalism and ________________ Communism/Fascism

– Britain • got it relatively easy because it replaced foreign markets

with new products on the domestic market (I’m just repeating the text… this seems pretty vague to me)

– France (no more room!) – The Great Depression helped Totalitarians! (No more room!)