Stresemann and stability, 1924 - 1929

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  • Stresemann and stability, 1924 - 1929
    • What did Stresemann achieve as Chancellor?
      • He called off passive resistance in the Ruhr as costs were unbearable.
      • He replaced the worthless mark and introduced the Reichmark (first known as the Rentenmark)
      • He protected the Republic from threats from the extreme right and left.
    • Stresemann's foreign policy and aims.
      • Dawes Plan, 1924
        • Reparations between Germany and the Allies. Germany agreed to still pay the reparation fees but with a return with the reduction in the amount payable each year.
          • Part of the deal was that French Forces would end their occupation in the Ruhr.
          • Germany received $200 million loan from the USA to restart reparation payments
      • Locarno Pact, 1925
        • France and Germany agreed to not change by force again.
          • France promised not to repeat the occupation of the Ruhr, (Germany gave up Alsace Lorraine in return).
          • Germany would now be allowed to be admitted into the League of Nations.
          • However no agreements were made about Germany's Eastern borders with Austria, Poland and Czechoslovakia.
      • Young Plan, 1929
        • An agreement between Germany and the Allies about reparations, which replaced the 'Young Plan' and would be the final settlement of the reparation issue.
          • Germany's total reparations liability reduced by two thirds from £6,600 million to £1,850 million.
          • The Allies agreed to remove forces from the Rhineland 5 years early, so Stresemann could declare that Germany was now free of occupying powers.
    • Was the later 1920's a booming economy?
      • Hyperinflation was gone and Germany was no longer globally isolated.
      • The economy grew, industrial output was reaching returning to pre-war levels in 1928.
      • The influx of capital enabled businesses and companies to upgrade their plant and machinery and local councils to finance vast house-building schemes.
      • Germany was heavily dependent on foreign investments and loans, which could be withdrawn leaving Germany financially crippled.
      • World food prices were low in 1920's which affected farmers. Farmers went seriously into debt and incomes suffered.
      • Public spending was higher than the government's income from taxation, the budget deficit was mainly borrowing which couldn't be sustained indefinitely.
    • Was Germany politically stable in the later 1920's?
      • There was heavy losses from the extreme right wing parties where nationalists only gained 14% of the vote and Nazis 2%.
      • The Weimar Republic was still very fragile. One reason was that middle class people felt that working class people were treated more fairly than them.
      • The Republic still had strong support from the working class as government-house building and the 'Unemployment Insurance Act', 1927, benefited the working class.
      • Extremist threat didn't wither away. The communists and the Nazis, under Ernst Thallman, started street riots, effecting the political system.


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