The Ruhr Crisis IB 20 th Century Topics

Causes ► The French Fear of Security § US and British Isolation § Growing sympathy for Germany in Britain

Causes ► Reparations § 132 Billion Gold Marks (33 Billion dollars est. ) § French wanted them paid ►Owed money to the US ►Wanted revenge on Germany § Britain was ambivalent to reparations ►Needed to pay the US too, but didn’t want to collapse Germany ►Fear of German isolation

Some Background on the Ruhr ► The Ruhr Valley was the Industrial Center of Germany ► Coal and Steel Production ► Lumber

The Trigger ► Germany fails to deliver lumber ► France declares Germany in default of reparation payments § January 11, 1923: Belgian and French Troops invade the Ruhr § German workers went on strike

1923 French Soldiers in the Ruhr Area

Results ► In retaliation, Germany orders a strike and prints money to pay the strikers (goes into hyperinflation) In economics, hyperinflation is inflation that is very high or "out of control". ► Fear Germany would become communist ► Middle Class in Germany wiped out ► The whole incident was humiliating and causes Germans to lose faith in their government

German Hyperinflation ► In economics, hyperinflation is inflation that is very high or "out of control". ► Germany went through its worst inflation in 1923. In 1922, the highest denomination was 50, 000 Mark. ► By 1923, the highest denomination was 100, 000, 000 Mark. ► In December 1923 the exchange rate was 4, 200, 000, 000 Marks to 1 US dollar.

Ruhr Valley French troops occupying the Ruhr Valley. Rough treatment of Germans by black colonial French troops led to German resentment and humiliation

Locarno Treaty ► Gustav - Stressemann German foreign minister Stop resistance in Ruhr Germany agree to To. V Short Term effective ease tensions Died in 1929 along with GD Long term German/France still issues

Locarno Treaty ► 1925 ► Germany accept borders of Belgium and France ► Germany join LON ► Short term – Step toward German/France reconciliation, German grow economically ► Long Term – Eastern borders not protected

Other Results of Treaty ► Optimism ► Peace ► Germany supervision of disarmamment stopped in 1927 ► Treaty of Rapallo still current ► Eastern border of Germany left unprotected ► LON still weak

The Dawes Plan (1924) Causes 1. The Ruhr Crisis & Hyper Inflation The Plan 1. Made loans available to Germany 2. Froze payments for two years 3. Lowered payments Result 1. Persuades France to withdraw troops 2. Germany could make payments 3. Germany adopts the policy of fulfillment

Dawes Plan Results ► Brought peace 1924 -1929 ► When US hit GD economy fell and so did Germany’s ► The loan tied their economies together