Challenges and recovery: the impact of economic problems,

1923-1929By the end of this lesson you should able to:•To understand the causes and effects of the hyperinflation of 1923•To explain the importance of the Munich Putsch of 1923

The Ruhr Crisis1923

The Ruhr Why did France invade the Ruhr in 1923?

What did the German workers do as a result?

Who would be most damaged, France or Germany?

The Ruhr Crisis – why?

• The German government had been unable to make its first reparation payment in 1922 (Treaty of Versailles).

• The consequence of this was the French marched into the Ruhr hoping to get payment in kind.

How did Germany react?

•Germany could not fight back militarily.

•So the workers chose passive resistance, going on strike and refusing to work for the French.

What were the effects of the invasion?

• It united the German people against the French invaders.

• The Weimar Republic’s popularity increased for a short time.

• BUT it had disastrous consequences for the German economy.

• The government printed more money to pay the strikers which increased inflation.

• The strike meant fewer goods were made and this made inflation worse.

RESULT:HYPERINFLATION!!!

Hyperinflation 1923 What is hyperinflation?

•When a government prints too much paper money it loses its value quickly.

•Hyperinflation is when prices rise very high very quickly.

•Money soon became worthless.

LOOK AT THESE IMAGES – WHAT ARE THEY DOING WITH THE BANK NOTES?

What caused hyperinflation?WW1

German gov print more

money to pay for war

Passive resistance:Worker strike

Nothing being produced.

Weimar Republic:Shortages and

Reparations:Print more money

Strikers spend money quickly

Prices rise

Strikers need payingPrint more money

As prices rise more money is

printedPrices rise

and so on…

French occupationof the Ruhr

Who do youthink gets the blame

for the economic disaster?

RESULT OF HYPERINFLATION:Prices rose dramatically

E.g. in 1921 a loaf of bread cost 4 marks(old German money) by 1923 it cost

201 000 000 000marks!

Women waiting in line in Berlin, in hopes of buying

sub-standard meat, 1923.

By 1923 money was uselessIt had lost its value.

During the inflation years, people who had saved their money in banks or were living on pensions or disability checks found themselves bankrupt. Those with jobs found that their salary increases could not possibly keep up with the almost instantaneous rise in prices. Artist George Grosz described what shopping was like in those days.

‘Lingering at the [shop] window was a luxury because shopping had to be done immediately. Even an additional minute meant an increase in price. One had to buy quickly because a rabbit, for example, might cost two million marks more by the time it took to walk into the store. A few million marks meant nothing, really. It was just that it meant more lugging. The packages of money needed to buy the smallest item had long since become too heavy for trouser pockets. They weighed many pounds. . . . People had to start carting their money around in wagons and knapsacks. I used a knapsack.’

The effect of hyperinflation• Remember not everyone was

affected there were winners and losers.LOSERS WINNERS

People with savings in the bank. Some people had saved all their lives only to find their savings would only buy them a loaf of bread.Old people on fixed pensions found they could not afford what they needed.Many small businesses collapsed because normal trade became impossible.

People who had borrowed money now found it easy to pay off their debts. If they had borrowed 10 000 marks they could now pay it off with one bank note.Farmers benefitted from price rises.The very wealthy who had land were largely protected from the worse effects.

Still unsure about hyperinflation?

Click on this link:

•http://www.youtube.com/watch?v=WI1i5yhwOz8

Why did Hitler carry out The Munich Putsch 1923

• Hitler and the Nazi’s took advantage of the chaos caused by the Ruhr crisis and staged a revolt in Munich.

• It failed and Hitler was arrested.

Reasons for the Munich Putsch

Hitler wanted to overthrow the WR

Discontent in Germany

The Rise of theNazi party.

Influence of MussoliniItalian dictator.

Bavarian leaders – had been plotting

against gov – Hitler thought theywould support him.

How had Hitler become leader?

Hitler had become leader of the NSDAP (Nazis) in 1921.He had created an identity for the party.He showed a talent for public speaking.He created the 25 point plan.He formed the SA (BROWNSHIRTS)http://www.youtube.com/watch?v=_Q-6H4xOUrs

The Nazi Party

Change Hitler made

Purpose

Change name to National Socialist German Workers Party (NSDAP)

Designed the swastika flag

Set up SA (brown shirts)

Came up with 25 point programme

Bought a newspaper:

Munich Observer

Hitler at a rally in 1934 – you can see how effective the Swastika symbol was to become.

Was the Munich Putsch a failure?

• In November 1923 Hitler and the Nazis felt the time was right to stage their uprising and try to take over the government.

• They under estimated the support they would receive.

• The putsch failed and led to Hitler’s trial and imprisonment.

What happened to

Hitler and the

Nazi Party after

the Munich Putsch?

It could be argued that it was not a failure after all.

Hitler could have been executed for treason but was given a 5 year sentence of which he

served 9 months. He spent his time in prison writing Mein

Kampf (My Struggle) and reconsidering his tactics.

He realised the only way to power was to be voted in democratically, then destroy

democracy.

Hitler in prison

Hitler’s book written in prison; ‘My Struggle’

What changes to the Party did Hitler make after his release from Prison?

• Reforms party after it had been banned

• Creates the SS to be his personal bodyguard

• Sets up Party offices nationally• Gains financial support from

industrialists• Increases party membership to over

100,000 by 1928

Most importantly Hitler changes the Nazi party from a

revolutionary group to a political party seeking peoples

votes even though he despised democracy

Summary

Problems faced by the Weimar Republic 1919 to

1923

Treaty of Versailles

‘Stab in the back’Spartacists Revolt 1919

Kapp Putsch 1920

Weimar Constitution – PR and Article 48

Poor support for Government and democracy

Ruhr Crisis 1923

Hyperinflation 1923

Economic problems, food shortages etc

Signing of Armistice 1918

‘Nov Criminals’

Munich (Beer Hall) Putsch 1923

End of WW1

Germany

surrenders

New German gov

(democracy)

Spartacist revolt (Communists)

Treaty

Of Versailles signed

Kapp Putsch

(right wing revolt)

Reparations set at £6.6 billion

Germans fall behind with reparations

German

gov

resigns

French occupy the Ruhr

Ruhr workers strike

Stresemann becomes Chancellor

Stresemann calls off strike

Dawes Plan

Hitler revolt

(Munich/Beer Hall Putsch)

New currency –Rentenmark

1920 1921 1923 19241919 1922

The Weimar Republic – the first 6 years

HYPERINFLATION

Where’s the mistakeEach have these statements need correcting. Write down the corrected statement.

1.The French invaded the Ruhr in 1923 in revenge for WW1.

2.Inflation had not been a problem until the Ruhr Crisis.

3.One result of hyperinflation was that the government printed more money.

4.The Nazi Party were blamed for the hyperinflation crisis.

Create a power point…

…about the Munich (Beer Hall Putsch)

Include:

•Reasons for the putsch

•What actually happened

•The consequences of the putsch for the Nazis and Germany.