Germany was completely devastated after World War I. The people of Germany had to deal with the long-term effects of the Treaty of Versailles. The people of Germany were exhausted after the war and had felt like they had been humiliated and destroyed. In many ways Germany was worse off after the war than during the war. Inflation was out of control and people were literally starving to death in Germany years after the war ended.

The effects of the Treaty of Versailles crushed Germany’s economy after World War I. Germany lost land they needed to grow food, boats they needed to bring in raw supplies from abroad and the government could not afford to pay back reparations promised to the Allied nations.

Although Germany had once been an agricultural powerhouse in Europe their economy became more industrial and they were unable to feed their own population without importing goods. Forty million Germans needed the potato and wheat crops that were grown in the East part of Germany that was now under Allied control. Germany could not import food because they had lost their merchant marine vessels. Germany also needed from materials including coal that they could no longer import. Many citizens could not find work and the German currency was devalued to the point that it became worthless. Inflation was so bad at one point in 1923 that prices were being marked up by 20% every day.

The economic crisis in Germany led to significant changes in the daily life of Germans. Many people in Germany were forced into prostitution or illegal activities because they had no choices. Many families were tossed onto the streets and had to bake to survive. Because German money was worthless foreigners found that they could live like kings in Germany during this time period. Foreign travelers came in and snatched up German antiquities and treasures for almost nothing. Barter became the new system of currency. People traded butter for services and shoe factory workers were paid in shoes.

The United States tried to stabilize the German economy with the Dawes plan from 1924 to 1929. The Dawes plan was a series of loans from foreign investors including the United States meant to soften the burden of war reparation payments. The Great Depression in the United States affected Germany as well because now their economy is dependent upon the US economy flourishing. The Dawes plan worked until the United States economy and the stock market collapsed. After the stock market collapsed Germany’s industrial output fell by 40% and unemployment was at 40%.

 

Total war impacted every aspect of life in Europe by the end of World War I. The government took control of economies and rationed civilian goods. During total war all citizens in the warring countries even those far removed from the battlefields were involved in the war effort. The government needed more men in more supplies to continue the war effort. The government expanded powers set up price controls rationed foods took over transportation and the free market system was put aside. During the Paris peace conference France, Britain and the United States each had different motivations and desires. Georges Clemenceau was the premiere of France and they wanted revenge and security against Germany. France wanted Germany stripped of weapons and wanted them to pay reparations to cover the cost of the war. France also wanted a new country called Rhineland as a buffer state between them and Germany. David Lloyd George the Prime Minister of Great Britain wanted to make the Germans pay for the war. Woodrow Wilson had a more idealistic desire. He thought World War I was a war against militarism and he wanted a United Nations with political independence so big and small nations could have international cooperation.

The Treaty of Versailles was five separate peace settlements with Germany, Austria, Hungary, Bulgaria and Turkey. The treaty with Germany was the most important. Article 231, the war guilt clause, said that Germany and Austria were responsible for starting the war. Article 231 said that Germany had to pay reparations for all damages that the Allied governments had sustained as a result of the war. The Germans also did not like the territorial provisions. Germany had to reduce its army to 100,000 men. Germany had to cut back its Navy and eliminate the Air Force completely. Alsace and Lorraine were given back to France. Sections of Eastern Germany were awarded to a new Polish state. There was a demilitarized zone stripped of weapons along the Rhine River. The Austro-Hungarian empire disappeared.

Nation states came from the lands include Finland, Latvia, Estonia, Lithuania, Poland, Czechoslovakia, Austria and Hungary. On May 15, 1919 the Germans sent a reply to tell their version of what will happen because of the Treaty of Versailles. Germany said that it has transformed from an agricultural to an industrial state and now could not feed 40 million inhabitants if it has to give up its merchant marine vessels. Germany says if it loses its territory in the East that they will lose 21% of their wheat and potato production. They need raw materials and coal as well they fear they will lose a third of the production of the coalfields and that what little coal they do get they have to give to the allies. With the loss of the colonies and merchant fleet there will no longer be a position to import raw materials from abroad. Germany believes that it industries would be extinct. They will not be able to feed their people. Germany feels that many of their citizens will move away. 1,750,000 people were killed in 1 million were killed as a result of of the blockade that made their people starve. Germany feels that this will happen again and millions more will die.

John Maynard Keynes wrote a book about the economic consequences of the peace agreement that Germany signed. His book outlined the economic collapse that Germany would eventually go through after World War I. Keynes felt that Germany was to industrialized and did not have enough land to produce food for their people. He predicted that Germany would never be able to comply with the harsh terms imposed on them by the treaty. He believed that the entire country would fall into financial collapse. He believed that Germany economic collapse would cause political repercussions all throughout Europe and all over the world. Germany simply could not afford war reparations at that level. He was an outspoken critic of the Treaty of Versailles. He would be eventually proven correct. Germany did not pay back their war reparations and their country did fall into an economic depression. It would be easy to believe that the cause of World War II was caused by the harsh punishment put against Germany after World War I. There are no simple answers.