The Golden Era under Stresemann 1924-29



- The chancellor, Gustav Stresemann, was able to start the "Golden Era" by ending the economic crisis that had resulted from for example hyperinflation (because of money being printed) and the French occupation of the Ruhr after Germany failed to pay reparations to France and Belgium

- Stresemann called off passive resistance in the Ruhr and promised to continue to pay reparations

- He appointed the expert financier Hjalmar Schlacht to the Reichsbank

- The old (now worthless) currency was replaced by a new stable currency, the Reichsbank

- Government expenditure was cut sharply in order to reduce the deficit; 70 000 civil servants were sacked

- He persuaded the Allies to hold an international conference to consider Germany's economic plight -> the Dawes Plan; reduced the amount of reparations Germany had to pay each month and stated that Germany should receive a loan of 800 million marks from the US

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How far was there economic recovery?

- The economic recovery gave the impression that the Weimar economy was in a healthy state;

-  Living standards rose because of risign wages
- New industries such as chemicals, car and aeroplane were introduced
- German exports rose by 40 per cent
- Buildings such as schools and sport facilities were built

- However, there were signs of weaknesses in the Weimar economy;

- Unemployment never fell below 1.3 million, economic growth was uneven and declined in 1926 -> imports exceeded exports
- The professional middle classes had been bankrupted by the inflation and didn't benefit from the "boom" because their wages never rose
- Farmers continued to be hit with a worldwide agricultural depression -> a global grain surplus leading to a price slump -> many were in debt leading to an increase in bankruptcies
- The government continued to run a deficit despite the higher taxes

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How far was there political stability?

- The Golden Era saw a much calmer time in politics;

- There were no attempted coups and no assassinations of key political figures
- Elections indicated a swing back to parties of the middle ground -> allowed the formation of a "Grand Coalition" under Hermann Müller (the leader of the SDP) -> the support of 60% of the Reichstag which indicated stable democratic politics

- However, the weaknesses of Weimar politics remained very apparent during the Golden Era:

- There were seven governments during this period -> instability
- The different parties struggles to cooperate -> they put their self-interest before a stable government
- The parties were often divided internally -> impossible to hold the coalitions together for any substantial length of time or to allow any long-term planning
- Minor issues, such as which flag to use, could bring about the fall of the government
- The political struggle caused ordinary Germans to look at politics in dismay and contempt which discredited the political system

- In 1925 the presidental elections were held -> it was assumed that Ebert would be re-elected but he died in February 1925 which brough about many candidates -> those who lacked confidence in the Weimar Republic successfully elected the war hero General Hindenburg -> partially usuccessful since the presidental place was now in the hands of a military general who was inexperienced in the ways of democracy and surrounded by army officers 

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What were the achievements of Stresemann?

- Stresemann's positions as foreign minister during the whole of the Golden Era brought with it continuity

- Even though Stresemann was a nationalist and wanted to restore Germany's position he recognized that it was wiser to play by the rules of the Allied to improve relations with France and Britain which would allow Germany to pressure the Allied to revise the treaty

- Stresemann's policy gained several successes:

- Locarno Pact, 1925: Stresemann guaranteed Germany's western borders -> reassured France and improved relations between Germany and France slightly -> some withdrawal of Allied forces from Germany
- League of Nations, 1926: Germany was accepted into the League and given great power status on the League council with veto power
- The Treaty of Berlin, 1926: renewed the previous Treaty of Rapallo (1922) with the USSR ensuring good relations between the two -> pressure on the West to improve its relations with Germany to prevent Germany moving closer to the USSR)
- The Young Plan: the US agreed to give Germany further loans and to reduce its scheme of repayments to spread the cost over the next 50 years -> the remaining Allied forces left Germany
- By 1929 Germany had restored its position as an accepted power on the international stage and improved its relations with France and Britain conciderably

- However, many attacked Stresemann for accepting Versailles and opposed Germany joining the "elite group" of the League

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