Although relationships between countries blossomed, many political and economic problems remained. The Great Depression marked a turning point between countries, ending the Locarno Honeymoon and destroying hope of peace. The depression began in the 1930s before Hitler came to power in 1933.
Some claim that this was a result of the Wall Street Crash which happened on the 24th October 1929 where 13 million shares were dumped on the New York Stock exhange. As a result, 5000 banks and 32,000 businesses were bankrupt by 1933. Unemployment rose from 1.5 million to 12.8 million; many people's wages sliced by a half.
Due to America being the world's biggest foreign trader, the depression spread across Europe and the rest of the world. Germany was affected the most by the depression because their loans came from America, who were having the financial difficulty.
The depression had political effects: a rise of support for extreme fascism and communism and governments became very unstable.
The Manchuria Crisis (1)
Japan had been a rapidly modernising and expanding nation since she had opened herself to European powers. By 1914, Japan had power over a few surrounding nations, including some of Manchuria owned by China.
The Japanese, since the 1850s, had hated the western powers as they had always disregarded her: from the Treaty of Versailles, with the image of the treatment of the Germans, to the League of Nations, with direct insults to them from the outcome of the naval treaties.
The Japanese had made an alliance with Britain in 1902, but was undermined by the Versailles settlement and the Washington Naval Agreement. The Washington Naval Agreement highlighted to the Japanese that they were seen as inferior to the main powers, and that their economy was under stress from the rising population and inconsistent support.
The Japanese were affected by the Great Depression as their main source of foreign trade relied on silk exports from America. Their deprived economy surged a demand for conquest.
The Manchuria Crisis (2)
In 1931, Japan wanted to expand onto the mainland of China because they were scared of a resurgent China that had just achieved its own Republic. The Manchuria Crisis began when Japan blew up their own railroads in Manchuria and blamed the Chinese. They then stormed Manchuria and claimed it as their own: "Manchukus". The League did nothing to help but condemn Japan after hearing the claim from China.
An inquiry was set up by Lord Lytton who issued a report in 1933 saying that Japan's attack was unjustified. Sir John Simon (MP) said in the House of Commons (1933) that he "(thinks himself as) enough of a pacifist to take the view that however we handle the matter, (he does not) intend (his) own country to get into trouble about it".
Eventually the Ten Year Rule was scrapped and the 1933 "Defence Requirements Committee" was set up.
USSR, Britain and communism
Although Britain had support from Russia against Germany and through the 1907 Triple Entente, Russia had descended into madness and revolution in 1917 where the Bolksheviks won the country.
The USSR's and Britain's relationship was broken because the USSR was communist, Britain had opposed the violence of the Russian civil war and the USSR refused to repay 2.8 billion of debt to Britian. Other reasons include the crushed impressions of Britain to Russia when the British sent troops to Arkangel to oppose the Bolsheviks and the injustice of Stalin's show trials in the 1930s (R v Metro-Vickers).
However, some politicians like Lloyd George were pretty cognizant that excluding Russia could be a major problem, and a trade was recovered between the two countries. Additionally, the left-wing of the British admired Russia's social policy.
The Rise of Hitler (1)
Hitler became Chancellor of Germany on 30th January 1933, and his ascend to power was due to his economic and social policy during the depression.
Before the depression in May 1928, the Nazi party was the 8th largest with 2.6% of the vote. However, in September 1930, this rose to 18.3% which made them the second largest party. They then became the largest party in July 1932 with 37% of the vote. They remained the largest party for a few more elections spending a long term in power.
Hitler established an "Enabling Act" which allowed him to create any laws he wanted. This act foretold that Germany would be a dictatorship. His power soon became unquestionable and omnipotent.
Hitler wrote of his views in Mein Kampf (1924) which was a personal manifesto for the future of Germany. However, many of his actions contradicted what was said in this book. One of the most blatant contradictions was the idea of an alliance with Britain, and we evidence that Hitler really disliked Britain.
The Rise of Hitler (2)
In 1920, Drexler, Feder and Hitler crafted a "25 point programme" of their main aims in the Nazi party. Hitler didn't have policies that one would relate to in a manifesto, but he did have ideals that would be associated with him. Some including that the Treaty of Versailles would be completely disregarded, that German people would live in greater Germany and under their own law, that Jews were subhuman and that Germans were members of the Aryan race. Non-German immigration should be stopped and all newspapers would be owned by Germans.
Shortly after Germany started arming herself again under the influence and power of Hitler, politicians started to become a little worried. Winston Churchill (1934) said that "Germany (was) arming fast and no one (was) going to stop her" and he warned of "the day when the means of threatening the heart of the British Empire should pass into the hands of the present rulers of Germany". Additionally, a report was created by the Defence Requirements Committee that stated that "(they) take Germany as the ultimate potential enemy against whom (their) long-range defensive policy must be directed".
The Rise of Hitler (3)
However, many people believed that his policy wouldn't last in office and that he was no major threat. In fact, Simon completly dismissed "Mein Kampf" as another authorative power that will pass and he regarded Hitler as another "Philip II". He made a speech in the House of Commons when the British Ambassador in Berlin sent a dispatch highlighting the role of Nazism in April 1933. Some claim that Mein Kampf was actually left on the side of the Foreign Office and ignored until the growing threat of Hitler, but when Nevile Henderson finished reading it in 1939 he had concluded that Nazism would lose its popularity after the Treaty of Versailles was amended.
Hitler's Actions of 1933-1935 (1)
In October 1933, Hitler left, not only the Disarmament Conference in Geneva but, the League of Nations. Hitler claimed that this was due to an issue of equality/parity. Politicians went crazy after they left because there was no way to negotiate of reach terms without them and they knew that Germany was re-arming secretly. Winston Churchill said that "(their) nearest neighbour Germany (was) arming fast and no one is going to stop her". Sir John Simon agreed with the statement that "she (could) already mobilise an army three times as great as that authorised by the Treaty".
In this moment, the British began/resumed to build the RAF to strength and re-arm, while the French resumed to build on the Marginot Line. The Labour opposition knew that the public didn't want war and didn't expect war, and therefore won a few votes by pressing the government on their act of rearmament (1934): they are "jeopardising the prospects of international disarmament".
Hitler's Actions of 1933-1935 (2)
Hitler also signed the "German Polish Non-Aggression Pact 1934". Poland was seen as Hitler's enemy in Germany, which led to confusion from the public of Germany. However, it did make Hitler seem less agressive and more negotiable. Hitler inspired the "Austrian Putsch 1934", which was a nazi-inspired coup. Hitler didn't intervene, but he didn't aid it either. As a result of this coup, Dollfuss, the Austrian Chancellor, was assassinated. The coup/putsch was unsuccessful because the Italians were strong allies with Austria and sent 100,000 troops to the Austrian border.
German Rearmament 1935 (1)
Hitler broke the Treaty of Versailles officially and publicly in March of 1935 when he announced that Germany had an airforce and the introduction of conscription. Hitler proposed that the army would increase to 5 times its intended size (100,000-->500,000). Conscription went against the terms of the Treaty.
The actions by France and Britain were quite feeble. Britain, France and Italy met in Strese to sign the "Strese Front" in April 1935 as a result of Germany's rearmament. This was an agreement to condemn the actions of Germany. Furthermore, France developed relations with the USSR, a European nation, when they signed a treaty which was deliberated and discussed in May. Europe was also seen to be able to combat Germany when Russia and Czechoslovakia formed the "Russian-Czechoslovakian agreement". All of this is evidence of Europe coming together and trying to combat a future resurgent Germany.
But what does Britain decide to do? They decided to negotiate with the Germans because they did not feel threatened by Hitler. This took form in June 1935, when Britain signed the Anglo-German Naval Agreement without the permission from France and Italy. It said that the Germans could have 35% of the British navy and there would be a parity of submarines. This completely undermined the Strese Front.
German Rearmament 1935 (2)
However, you can defend the Anglo-German Naval Agreement with the fact that it still protected the empire, and that it was the general consensus of the cabinet and the general public. It also made sense that this was a possible conclusion of a failed disarmament conference.