The Economic State of the Weimar Republic

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To begin, Germany was in a state of massive economic turmoil after the war, which created problems which Hitler offered solutions to, thus the German economic state was responsible to Hitler’s rise.

In the Ruhr, the French had ordered the reparation commision for Germany to produce and send timber and nearly 2.4 million tonnes of coal monthly (Davidson, 152), which resulted in workers conducting a strike as they refused to work for the french, putting “enormous pressure on the German economy” (Williamson, 151), as to government lost money in the workers and in tax revenue. So, the government decided to print money. This was a cause of hyperinflation of the German mark, and by 1923, one US dollar was about equal to 4.2 trillion German marks (Craig, 450).

This was the cause of many public riots and strikes in the cities of Germany, and created resentment in the people for the Weimar Republic as the hyperinflation had destroyed millions in savings, pension provisions, war bonds, and insurance annuities. Senior civil servants threatened the government to end inflation or “the war against all will begin in the city and the reich will thus fall apart.” (Maier, 372). For these senior citizens, Hitler had, in the 16th point of the 25 point programme, a demand for “expansion on a large scale of old age welfare,” which led to appeal in his party, leading to their support of Hitler.

The failure of compensation from the government also had a huge impact on “The elite in the bureaucracy, judiciary, big business, and the officer corps [who] longed to turn the clock back to 1914 and hated the Weimar Republic” (Williamson, 177). In another perspective, the inflation of the mark did not have an effect on the German economy for too long, as the economy began to recover as the 1920’s went on, due to the new temporary currency of the rentenmark.

Also, industrialists in Germany also had a different perspective, as they were able to expand their factories and then pay off loans in a depreciating currency (Williamson, 152), which shows the historical concept of perspective. However, the stress put on the citizens of Germany continued to grow. Next, the massive unemployment in Germany from 1928 onward also was a failure of the Weimar Republic leading to the rise of Hitler. Due to the great depression, unemployment in Germany rose to a number never seen before. In 1932, unemployment rose to six million, and almost “one worker in three were officially registered as unemployed, and in such industrial areas as the Ruhr and Silisia the proportion was even higher” (Williamson, 178).

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This meant that many skilled workers had to accept salary cuts, unskilled work, or part time work to keep their livelihood. These terrible conditions drew the attraction of workers to the smaller more radical parties such as Hitler’s Nazi party, whose policies, such as the 7th point of the 25 point programme, stated, “We demand that the state be charged first with providing the opportunity for a livelihood and way of life for the citizens”. In addition, Germany also underwent a huge collapse in production after the WWI. Following the degradation of the German mark, the industrial production of Germany in 1923 was only 46% of its level in 1913 before the war. This is particularly bad for employers.

The need to increase production and exports became a huge factor after this fall of industrial production, as now the “Employers, particularly in the heavy industries in the Ruhr, […] increasingly began to favour an authoritarian government” (Williamson, 160). Hitler’s Nazi Party was an appealing option for these employers in the face of a collapse in production as they wanted to expand their businesses. On the contrary perspective, Historian K. Borchardt in Perspectives on Modern German Economic History and Policy observes that industrial production, from 1927 onward, began to rise past the level in 1913. These statistics show that the collapse of industrial production was a temporary issue, so this would not contribute to Hitler’s rise. However, the impact the collapse had on employers and businesses was not a temporary issue, as the great depression would bring about further chaos to the Weimar republic. The great depression also had the effect of crashing many major and important banks in the Weimar republic.

After the great depression, the German banks were put into danger because of the collapse of industrial production leading to withdrawals of foreign investments. This resulted in 1931, when the Kreditanstalt crashed, which “immediately triggered a large-scale withdrawal of deposits from the German banks from their customers, who feared a similar collapse” (Williamson, 178). Many other banks like the Darmstadter und Nationalbank had crashed as well, and stopped all payments. However, another perspective could say that the crash of the German banking system was in fact prevented by the Weimar government, who immediately invested 1 billion marks into the system.

The banking crashes were stopped; however, the fear of the people was not eliminated. The German people were fearful of more banks crashing, and in addition, the chancellor, Bruning, had adopted a deflation policy, involving reducing production costs by 20% by cutting the salaries of state employers and wage freezes, thus stimulating German exports. This however was not effective due to foreign protective tariffs, and led to further impoverishment as Bruning became known as the ‘hunger chancellor’.

This, as put by Kershaw, was a decision of “breathtaking irresponsibility” (Kershaw, 324), which allowed Hitler to become an appealing party, as his propaganda minister, Goebbels, organised rallies and meetings everywhere criticising democracy as it splits communities, and to give people a solution, Hitler and authoritarian rule. So, due to the poor German economic state after the war and into the great depression, Hitler was able to capitalise on the specific needs and insecurities of various groups like industrial workers, seniors, employers, etc., because of the economic turmoil in Germany, and through his policies, and was able to spread his message across the country with his propaganda like rallies and posters stating that he is the solution to the devastated Germany, leading to his rise in power.

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