Download - GLOBAL DEPRESSION 1919-1939
GLOBAL DEPRESSION1919-1939
Turmoil of Versailles
• Border disputes in Eastern Europe cause resentment.
• U.S. does not ratify T.of V. and is not part of the League of Nations
• The League is powerless to intervene in international disputes
Turmoil…
• High inflation and unemployment – factories and banks close
• Mark becomes worthless – by Nov. 1923 4.2 TRILLION Marks = $1.00 U.S.• Germany unable to pay reparations – 30%
of work force unemployed (6 mil.)• France occupies the German Ruhr Valley –
collect payment by using factories & mines
The Worthless German MarkWeimer Republic 1923
The Dawes Plan 1924
• An International commission produces a new plan for reparations.
• Reduced reparations & coordinated Germany’s annual payments
• U.S. loans $200 mil. for German recovery
• Opens door to heavy American investments in Europe
Charles Dawes• Chairman of Commission
The Treaty of Lacarno
• “Peace” between Germany & France – guaranteed Germany’s western borders
• 1926 Germany joins League of Nations
• 1928 The Kellogg-Briand Pact – 63 nations sign an accord to “renounce war as an instrument of national policy” (no consequence for violating pact).
Aristide Briand (Fr.) Austin Chamberlain (G.B.) & Gustav Stressmann (Germ)
The Treaty of Lacarno
Stock Market Crash 1929• Mid 1920’s – prices fall because of overproduction (i.e. -
wheat)• International financial crisis: The U.S. loaned money to
Germany to pay reparations to G.B. & France opening the door for American investors
• Investors begin to pull money out of Europe to play in the booming U.S. stock market
• October 1929 – U.S. Stock Market CrashesInvestors pull more money out of Europe – European banks
crash
The Great Depression
• U.S. Pres. Franklin Roosevelt (FDR) signs the “New Deal” – Active government intervention creating a Public works (CREATES JOBS) program – Roads, Dams, Bridges, Flood Control (Tennessee Valley Authority)
• Social legislation – begins social welfare• 1935 – Social Security Act – old age
pension & unemployment insurance
European Depression
• Millions out of work (G.B. – 25%, Germany – 40%)
• In response governments take a stronger role in regulating economies
• Marxism/Communism become more popular• Masses turn to political leaders who promise
simple solutions in exchange for dictatorial power
Fascism Emphasizes
• Loyalty & Obedience• Punish those responsible• Struggle or be doomed• Propaganda & censorship• Mass rallies• Promises to save economy• Restore national pride• Uniforms, salutes, symbols• Loose individuality for state