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Chapter 27 hyperinflation- a runaway inflation where prices increase astronomically George Grosz painted “The Pillars of Society” (shown) showing postwar Germany inflation: doubled in Britain, America, Germany, Canada, Japan; tripled in France, Sweden; quadrupled in Italy; hyperinflation in Germany hyperinflation in Germany was caused by the government printing money to pay for war, pay miners who used to work in now-French-occupied Ruhr before World War I, east-central Europe was divided among the Ottoman, Habsburg, Russian, and German empires; divided into new independent states after World War I Estonia, Latvia, Lithuania- Baltic states Czechoslovakia- carved out of former Habsburg lands Yugoslavia- pieced together from a patchwork of territories Three Reasons Why New States Didn’t Work 1) honoring rights of nationalities was difficult; ex. in Czechoslovakia, Czechs dominated Slovaks and Germans although Czechs were minority 2) east-central Europe was agricultural, big nations could profit, borders made little economic sense; ex. Danube River basin was profitable under the Habsburg Empire 3) creating new economic units was hard for inexperienced new nations Let’s Keep Fighting Poland vs. Russia (6 months 1920-1921) Poland wants to reclaim the Ukraine lands and become the size it was a century ago; Bolsheviks beat up Poland in return and (like always) try to start revolution; French come to aid of Poles and the Treaty of Riga is signed 1921, giving Poland much of the territory it wanted new states cried and wanted each other’s lands, Hungary especially; big nations weren’t happy either, Germany wanted the “corridor”- Polish land between Germany and East Prussia, Russia wasn’t happy with losing land, etc etc; new nations were supposed to be barrier between Russia and Germany Germany Germans happily established the Weimar Republic, named for the city its constitution had been written in, included voting rights for women Alsace and Lorraine returned to France, Rhineland became demilitarized zone, Saar district was under League of Nations and its coal mines went to France Germans wanted to be a great power again, wanted liberation of the Rhineland, return of the Saar, and recovery of the corridor and Silesia from Poland Germany signed the Treaty of Rapallo 1922 with Russia in hopes of economic gains, Gustav StresemanN assumed direction of the German Foreign Ministry worked toward foreign support and revision of the peace settlements StresemanN of Germany, Aristide Briand of France, and Austen Chamberlain of Britain agreed to the Locarno Treaty at Locarno, Switzerland; Germany, France and Belgium promised never to go to war with each other, Britain and Italy guaranteed their borders; StresemanN still wanted Polish lands, secretly rearmed against the Treaty of Versailles France let’s compare: France had less population (40 million to Germany’s 60), lower industrial production than Germany, was devastated by war, unlike Germany; France had best-equipped military, Germany was disarmed U.S. and Britain wouldn’t make long-term alliance with France, so France allied Poland and the Little Entente- Czechoslovakia, Romania, Yugoslavia without allies: 1923 France willing to enforce the Treaty of Versailles itself, invaded Ruhr as part of reparations payment, America and Britain condemned use of force with allies: 1924-1925 France withdrew from Ruhr and partially from Rhineland, agreed to lower reparations payments, rejected the use of force, promoted German economic recovery Maginot Line- late 1920s defensive fortifications constructed by France on border of France and Germany United States Britain and France needed U.S. help to control Germany if it regained power U.S. wouldn’t join League of Nations, signed separate peace treaty with Germany after WWI, all because wanted to be mediator in Europe and avoid political and military obligations League of Nations couldn’t last without machinery or U.S. support, hopes for its success collapsed in 1931 when it failed to deal with crisis of Japanese aggression against Manchuria Kellogg-Briand Pact- signed by 23 nations 1928, renounced war; devised by U.S. Secretary of State Frank B. Kellogg and French foreign minister Aristide Briand Money, Loans, Etc. France and Great Britain owed money to United States; United States wouldn’t forgive loans or take less valuable money; Britain, France, Belgium relied on reparations from Germany, calculated on the damage they inflicted; postwar Reparations Commission determined Germany owed 132 billion gold marks ($33 billion), paid in annually 2 billion marks and 26% value of exports 1924 reparations would hurt Germany, no reparations would hurt France; Germany printed money to repay and the mark collapsed; British and Americans decided to intervene, American banker Charles G. Dawes along with international finance experts devised the Dawes Plan to end inflation by giving Germany a more modest schedule and a loan from the United States United States made high tariffs to protect domestic trade, but stopped European nations from selling to the US and getting money to pay 1929 American businessman and chairman of the board of General Electric, Owen D. Young, and American bankers devised the Young Plan which would initially transfer $100 million to Germany United States began to leave loans to other nation and invest at home Economy Goes Ka-boom October 1929 United States stock market crashes, setting off the Great Depression depression- “severe downturn marked by sharp declines in income and production as buying and selling slow down to a crawl crash occurred because of excessive U.S. loans to others and sudden investment at home peak of depression 1932, one/four American workers without a job, one/three banks closed affected other nations, especially when the Smoot-Hawley Tariff Act was passed to create an impenetrable tariff fortress against imports gold poured into U.S. banks, Herbert Hoover supported a moratorium on payment of reparations and war debts, leading to the collapse of Britain as world’s greatest financial center Attempted Recovery the gold standard leaves international economy and never returns major nations of Europe and the U.S. meet at Lausanne, Switzerland 1932; depression showed no sign of stopping, got rid of reparations and war debts Britain- Labour cabinet resigned, new cabinet composed to deal with emergency United States- Democrats replaced republicans 1932 with election of Franklin D. Roosevelt Russia’s Issues Lenin’s successor Joseph Stalin “obliged the Soviet people to achieve in a single generation” “what it had taken the West a century and a half to accomplish” Lenin, following Karl Marx, led a revolution to allow the people to rule, at the end the Bolsheviks were ruling famine an epidemic 1921-1922 killed more than the Great War and civil war combined governing system: the Central Committee of the Communist party decided “fundamental questions of policy, international, and domestic”, but the Politburo, seven-man inner circle of the Central Committee, held the reins of power three members of the Politburo: Leon Trotsky (brilliant), Nikolai Bukharin (popular), and Joseph Stalin (political) Leon Trotsky, commissar of war at the time, favored militarization of labor; Lenin favored a proletarian democracy and independent unions controversy was resolved at the Tenth Party Congress 1921 when Lenin chose something in the middle, a “temporary retreat” from Communist goals this New Economic Policy (NEP) allowed peasants to have private trade in their own terms as long as they provided a fixed portion of their yield to the state Bukharin wanted to industrialize a poverty-stricken nation- peasants would control their own surpluses and profits would be used for industrial development 1924 tax in cash replaced tax in kind, therefore government worked through commercial agents instead of directly with peasants 1927 peasants held back grain, Bolshevik leaders feared conspiracy led by Britain, lowered the cost of grain, hurting the peasantry Lenin died, Joseph Stalin tried to prevent peasants from disposing of their grain surpluses; peasants rioted Trotsky was expelled 1927, found refuge in Mexico 1929, assassinated by Stalin 1940 Bukharin was arrested in 1937, tried and executed for treason Iosif Vissarionovich Dzhugashvili chose his revolutionary name “Stalin” which means “steel”; ruled Soviet Union 1928-1953 was born in Georgia, son of a shoemaker who wanted him to also be a shoemaker, mother secretly gave him schooling, learned about revolutionary socialist politics, joined the underground Marxist movement and followed Lenin after October Revolution of 1917, was people’s commissar for nationalities, then general secretary of the Central Committee of the Communist party bolstered his reputation, and Lenin’s after he died; eliminated enemies and advertised himself Five Year Plans First Stalin’s Five Year Plans squeezed profits out of agriculture and increased industrial production between 300 and 600 percent; other nations didn’t join in socialism, worked on Soviet Union only First Five Year Plan- used agricultural profits to industrialize quickly, put everyone to work in 1929, after grain crisis of 1928, Stalin used collectivization: confiscated all farms and establishing state-run farms; also deported the kulaks- wealthy peasants, means “the tight-fisted” 25 million peasant families were miserable, 5 million peasants died between 1929 and 1932 Outside Russia Lenin had believed that other nations would follow and become socialist as well, didn’t happen, so Stalin looked for alliances instead, made Treaty of Rapallo with Germany 1921, and all other major countries instead of the United States by 1924, cooperated at a worlddisarmament conference in Geneva the Communist International, or Comintern, was based in Moscow and had representatives in 37 countries by 1920 to support communism Bukharin and Stalin had supported the Comintern, then Stalin in 1929 believed capitalist nations were on the verge of revolution, broke ties between communists and democratic socialists to prepare Second Second Five Year Plan- reduced dependence on imports; Soviet Union was heavily industrialized and urbanized, stricter discipline was enforced between 1934 and 1938, Stalin had 300,000 people killed and seven million put into labor camps in what’s known as the Great Purge; all opponents, were labeled class enemies, the most popular, those who worked with him in the Bolshevik revolution, were put on show trials, where they were intimidated, tortured, and forced to confess to false accusations; prevented internal accusations although Germany posed a problem; slowed industrialization by killing qualified personnel Women Soviet women participated in the revolution; Lenin denounced housework; after October Revolution of 1917, established equality within marriage; 1920 abortion legalized; right to vote in 1917 women had maternity leaves and nursing breaks by law, were therefore hired last and fired first; divorce left financial responsibility to mother birthrates plummeted in 1930s, 1936- couldn’t end first pregnancy, 1940s banned abortions under Stalin, women had a full-time job and worked hard at home Fascist Italy fascism- dictatorship by a charismatic leader, promised lotsa things, from fasces- bundle of rods with ax head carried by magistrates of the Roman Empire; practiced in England, Hungary, Spain, and France, but most importantly in Italy nazism- National Socialism, German variant, Italians were unhappy with peace settlements, recent electoral system created chaos, lack of coherent political programs, Fascist party under Benito Mussolini entered politics Mussolini socialist, arrested for Socialist activities and placed under state surveillance, volunteered to fight in WWI, promoted to corporal, injured during firing practice, returned as editor of his newspaper to promote war Il Populo d’Italia (“The People of Italy”) Mussolini wanted to be to Italy what Lenin was to Russia; identified bolshevism, communism, and big businessism, socialism, Catholicism, and unions as enemies preferred to be called Il Duce (“the leader”) near civil war in early 1920s between Italian Communists and Fascists in the streets unemployment and inflation allowed the March on Rome to take place on October 28, 1922 when Fascism and Mussolini took over Italy squadristi – armed bands of Fascist thugs – attacked enemies of Fascism Socialist critic of Fascist violence, Giacomo Matteotti, was murdered, resulting in threatening protests Mussolini responded by silencing enemies and free press, creating secret police, etc. Big Businnesses and the Church Fascists gave industrialists a position of privilege in exchange for support, ensured dominance of capital and labor Italy didn’t do well during Great Depression Mussolini technically supported corporatism- a system of economic self-rule by interest groups; gave Mussolini controlling interests over key industries Mussolini, an atheist, raised the “Roman Question” by depriving the pope of his territories in Rome; became a problem, so Mussolini agreed with Pope Pius XI on the Lateran Treaty and the Concordat, granted the pope territory around St. Peter’s Basilica and the Vatican, protected the role of Catholicism in education and marriage laws Beating Up the Little Guys Mussolini’s popularity plummeted after failing to initiate effective social programs, started beating nations up to gain support Italy conquered Ottoman-controlled Libya in 1911 Mussolini invaded poor little Ethiopia on 1935, proclaimed it an Italian territory; League of Nations couldn’t stop him; Britain and France expressed disapproval; Mussolini had no friends, so he took Hitler, Italy allied Germany as the Rome-Berlin Axis 1936, agreed to offer each other military support offensively or defensively in the Pact of Steel 1939 Albania made agreements with Italy and became financially and militarily dependent 1933, Mussolini invaded and annexed it in order to catch up with Hitler annexing Czechoslovakia 1939 Nazi Germany Germans didn’t like reparations, promoted inflation which went out of control Weimar Republic experienced growth after the war, social welfare grew scaring businessmen people didn’t like parliamentary democracy, became ineffective, Heinrich Bruning, chancellor 1930-1932 tried to override the constitution, was forced to resign Hitler Adolf Hitler- saw weakness of Weimar Republic, promised a way out of economic hardships Stalin born in George, Hitler born in Austria father was a customs agent on Austrian side of border with Germany was denied admission to architecture school, volunteered in Germany army, was wounded and gassed, received Iron Cross for bravery twice believed Germany didn’t lose the war but was backstabbed, wanted Nazi regime attempted to take power, failed, known as the Beef Hall Putsch 1923, went to jail for 9 months of a 5-year sentence, wrote his autobiography Mein Kamf (“My Struggle”), found he needs to take control legally became chancellor of Germany in 1933 after Bruning, Nazi party was growing German President Paul von Hindenburg invited Hitler to create a government, Hitler persuaded them to make emergency laws against Communists, which took away freedoms and ultimately gave Hitler and the Nazis complete power Empire Hitler called his empire the Third Reich (1- medieval German empire, 2- Bismarck’s empire) SA – Sturmabteilung – storm troopers – Ernst Rohm – Brownshirts – beat up political opponents and executing terrorist operations, were 2.5 million members while army had 100,000 SS – Schutzstaffel – protection squad – Heinrich Himmler – blackshirts – wore skull and crossbones on their caps, did political policing Hitler and SS purged the SA and executed Rohm, making the SS Hitler’s elite corps Nazi Goals Lebenstraum: living space, first introduced in Mein Kampf, right of German master race to become the world’s greatest empire and exist for thousands of years, superior nations could annex inferior nations rearmament- continued rearming against the Treaty of Versailles as the Weimar Republic had done, withdrew from the League of Nations and the World Disarmament Conference, openly renounced the Treaty of Versailles and announced rearming in 1935, moved troops into demilitarized Rhineland 1936, reversed relation with Soviet Union (Treaty of Rapallo) economic recovery: Hitler didn’t want to be dependent on other nations for imports, began program of autarky- economic self-sufficiency; full employment established 1936, economic power was concentrated on few businesses like chemical giant I. G. Farben; 1936 Hitler introduced Four-Year Plan for rearmament and self-sufficiency, couldn’t produce all its needs, needed to annex nations that could Propaganda, Racism, Culture public: Joseph Goebbels- Nazi party leader appointed to head Hitler’s new Ministry of Propaganda, Leni Riefanstahl (female) made documentary of Nazi rally at Nuremberg called Triumph of the Will, recorded Hitler’s ability to influence the public the young: Hitler Youth- special Nazi youth organization that instilled Nazi values in children; 82% of German boys and girls between 10 and 18 were part of an Nazi organization women: Hitler believed women belonged at home; German Women’s Bureau under Gertrud Scholtz-Klink instructed women in their “proper” duties; encouraged large families; woman began working and serving, however, when war started enemies: communism identified as international Jewish conspiracy to destroy German volk (people); Nazis expelled “asocials”, those deviant in any way including homosexuals; gypsies, homosexuals, criminals, religious offenders, Jews wore insignia identifying them jews: almost immediately (1933) jews were excluded from public employment and higher education; Nuremberg Laws identified Jews, took away citizenships, and forbade marriage between non-Jews and Jews; November 9, 1938- Kristallnacht, “night of broken glass”, synagogues were set afire, books and valuables of Jews confiscated, 91 Jews killed and 20,000 to 30,000 were imprisoned in concentration camps, shops destroyed Democracies France 1936 Leon Blum became premier, was a Socialist, lacked votes to rule with completely Socialist government, established Popular Front- coalition of Left and Center parties intent on economic reforms; strikes swept through France, Popular Front intervened, increased wages, paid vacations, and made collective bargaining, caused reduced productivity France started rearming when Germany rearmed, couldn’t afford Great Britain Ramsay MacDonald- Prime Minister of Britain’s socialist Labour government, was unprepared for 1929 collapse coalition of the three parties- Liberal, Conservative, and Labour – took care of problems, called National Government- centrist, nonpartisan coalition including MacDonald and Stanley Baldwin- Conservative with a background in iron and steal manufacturing National Government got rid of god and devalued the pound; tariffs were established; slowly recovered John Maynard Keynes- urged government spending to stimulate consumer demands Sir Oswald Mosley founded the British Union of Fascists (BUF) consisted of goon squads and bodyguards, developed a corporate model in which interest groups rather than an electorate would be represented in a new kind of parliament; beat up political opponents, Jews, and eastern European émigrés living in London; was outlawed in 1936 National Government did better than the BUF; Spain 1931 became a democratic republic after centuries of Bourbon monarchy 1936 elected a Popular Front government more radical than France’s; social revolution ignited three years of civil war; Republicans and Popular Front defenders vs. Nationalists Spanish Civil War began 1936 with revolt within Spanish army led by General Francisco Franco, who was allied with the Falange- Fascist party in Spain Nationalists led by Franco controlled rural and conservative south and west, Republicans held cities in north and east (Madrid, Valencia, Barcelona) Mussolini and Hitler helped Franco; Germans used Spain as testing grounds for new technology, including aerial bombings; Soviet Union helped the Republic; Britain stayed neutral; France couldn’t help the Popular Front; America volunteered to help Republicans, but Texas Oil Company sold 1.9 million tons of oil to Franco’s insurgents and Ford Motor Company, General Motors, and Studebaker sold them trucks 2,800 Americans headed to Spain’s call for help and aided the Republic; émigrés joined in the International Brigades to defend Madrid; Russia pulled out when France, Britain, and America didn’t help; Madrid fell to nationalists 1939, Franco set up government sending enemies to prison or concentration camps