Stresemann's Strategy for Weimar Recovery

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  • Stresemann's Strategy for Weimar Recovery
    • The Dawes Plan, 1924
      • What happened?
        • Reparations were temporarily reduced to £50 million per year
        • US banks agreed to give loans to German industry. They loaned $25 billion between 1924 and 1930
      • Stresemann called off German workers' passive resistance in the Ruhr. As a result, the French agreed to leave the Ruhr.
      • Successes
        • Industrial output doubled between 1923 and 1928, passing pre-WW1 levels
        • Employment, trade and income from taxation increased
      • Failures
        • The extreme political parties were furious that Germany had again agreed to pay reparations
        • The fragile economic recovery depended on American loans
    • The Locarno Pact, 1925
      • 1 December 1925
      • What happened?
        • Germany accepted its new 1919 border  with France, and France promised peace with Germany
        • Germany and the Allies agreed that the Rhineland would be permanently demilitarised
        • Talks were opened about German membership in the League of Nations
      • Successes
        • War in Europe was less likely. Stresemann was given the Nobel Peace Prize in 1926
        • Germany was being treated as equal. Increased confidence in the Weimar Republic
  • The value of the Rentenmark was tied to the price of gold and was backed up by German industrial plants and agricultural land.
    • Therefore, the currency had real value and as a result, people trusted it.
      • German money was now trusted at home and abroad, hyperinflation was at an end!
        • It was renamed the Reichsmark and was backed up by Germany's gold reserves.
  • Charles G. Dawes, an American banker, had been asked by the Allies to resolve Germany's non-payment of reparations
    • What happened?
      • Reparations were temporarily reduced to £50 million per year
      • US banks agreed to give loans to German industry. They loaned $25 billion between 1924 and 1930
  • What did it do?
    • Reduced the total reparations debt from £6.6 billion to £2 billion
    • The Young Plan, 1929
      • Economic Policies
      • Further progress with reparations
      • Headed by American banker, Owen Young
      • Successes
        • Increased confidence in the Weimar Republic from the public
        • The French leave the Rhineland in 1930
    • Germany was given a further 59 years to pay
  • Enraged extremist parties
    • Adolf Hitler said extending the length of payments was "passing on the penalty to the unborn"
    • What did it do?
      • Reduced the total reparations debt from £6.6 billion to £2 billion
      • The Young Plan, 1929
        • Economic Policies
        • Further progress with reparations
        • Headed by American banker, Owen Young
        • Successes
          • Increased confidence in the Weimar Republic from the public
          • The French leave the Rhineland in 1930
      • Germany was given a further 59 years to pay
  • Lower reparation payments meant lower taxes on the German public
    • Lower taxes increased public's spending power and disposable income
  • Failures
    • The payments now stretched out until 1988
    • The annual payments were still £50 million
  • Unlike the Treaty of Versailles, it was agreed by Germany on equal terms
    • Not imposed
    • The Locarno Pact, 1925
      • 1 December 1925
      • What happened?
        • Germany accepted its new 1919 border  with France, and France promised peace with Germany
        • Germany and the Allies agreed that the Rhineland would be permanently demilitarised
        • Talks were opened about German membership in the League of Nations
      • Successes
        • War in Europe was less likely. Stresemann was given the Nobel Peace Prize in 1926
        • Germany was being treated as equal. Increased confidence in the Weimar Republic
  • Failures
    • Some extreme parties resented that the Versailles borders had been confirmed
  • Failures
    • To some extreme parties the League was a symbol of the Treaty of the Versailles so they wanted nothing to do with it
    • The League of Nations,1926
      • Foreign Policies
      • September 1926 - Stresemann persuaded other great powers to accept Germany as a member
        • Germany was placed on the League of Nations Council
      • Successes
        • Increased confidence in the Weimar Republic from the public
  • What did it promise?
    • States would not use war to achieve foreign policy aims
    • Kellogg-Briand Pact, 1928
      • Foreign Policies
      • August 1928 - Germany and 61 other countries signed the pact
  • Successes
    • Unlike the Treaty of Versailles, it showed that Germany was now included, not dictated
    • A sign that the Weimar Republic was a respected, stable state
    • Increased confidence in the Weimar Republic from the public
    • Kellogg-Briand Pact, 1928
      • August 1928 - Germany and 61 other countries signed the pact
  • Failures
    • Did nothing to remove the terms of the Treaty of Versailles so Germany didn't grow any stronger. As a result, extreme parties were angered.

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