french-belgian occupation of the ruhr (causes of the hyperinflation crisis)

what did chancellor konstantin fehrenbach (1920-1921) do when faced with the treaty of versailles?

refused to sign the document and resigned

who replaced fehrenbach and how did they react to the treaty?

• joseph wirth (1921-1922)

• signed the treaty→ payments began soon after with government adopting policy of fulfilment

what did the reparations commission do in january 1922?

january 1922 - reparation commission postponed payments due in january and february

• recognised financial difficulties germany was facing

what did germany do in july 1922?

• germany asked for the suspension of payments for the rest of the year

what did germany do in november 1922 in regards to reparations?

• asked for a loan and to be released form reparations payments for 3-4 years

  • denied by the french

why did the french deny the november 1922 request for a loan and temporary release from reparations payments?

• the french were suspicious

• still needed money to finance reconstruction

• had to repay american loans

• wanted revenge against germany

• believed germany were exaggerating their economic difficulties to avoid repayments → their request was refused

what happened to germany’s reparations payments by the end of 1922?

• fallen behind severely with payments to france in the form of coal → some leniency in the start at realisation germany didn’t have full means to pay outright in gold, some goods used too

what was the ruhr? what was its main output?

• area within the demilitarised rhineland → main industrial region of germany

• responsible for producing 85% of germany’s coal

timeline leading up to the invasion of the ruhr

• january 1922 - reparation commission postponed payments due in january and February

• july 1922 - germany asked for the suspension of payments for the rest of the year

• november 1922 - germany asked for a loan and to be released from reparations payments for 3-4 years. the french refused their requests

• end of 1922 - germany fell severely behind with reparations payments in the form of coal

when did the french send troops into the ruhr?

9th january 1923

how many men did the french send to occupy the ruhr?

60,000 men (initially)

what did the french do in the ruhr as 1923 progressed?

• increased forces to 100,000 men

• took control of mines, factories, steelworks and railways

• took control of shops

• set up machine gun posts in the streets and maintained dominant military presence → established martial law

  occupation resented by german public

what was the name of the chancellor who replaced joseph wirth?

wilhelm cuno

who was wilhelm cuno and why was he selected to be chancellor after the resignation of wirth?

• lawyer and businessman with no specific party allegiances → would be unaffected by turbulent coalition government

• believed that his business experience would deliver germany during difficult economic times

what situation did wilhelm cuno find germany in?

• germany couldn’t use military force to stop the french

• military power restricted due to reductions imposed by the treaty of versailles → only 100,000 troops etc

what did chancellor cuno implement to oppose the french occupation of the ruhr?

• active choice made by the government

• stopped payment of reparations

• ordered a policy of passive resistance → non-cooperation by all people in the ruhr

• guaranteed pay of the striking workers’ wages

• germany army worked secretly with local armed civilian groups to commit acts of sabotage e.g. blowing up railways (non-peaceful proof of resistance)

how can cuno’s policy of passive resistance be described?

peaceful non-compliance and refusal to work

how did the french respond to cuno’s policy of passive resistance?

• expelled 15,000 people from the ruhr

• shot 132 people → including a 7 year old boy

• brought french workers to operate the railways and extract coal to ship to france

how was the german coal output from the ruhr affected, in comparison to pre-occupation levels?

1/5 0f pre occupation levels

1/3 of average monthly deliveries (may 1923)

how was the germany economy affected by the occupation of the ruhr?

• taxation revenue lost due to closed businesses

• paying for the wages of striking workers had drained government finances

• germany had to use up reserves of limited foreign currency to import coal from abroad

• caused shortages in goods e.g. coal and steel → caused development of inflation

how much did the ruhr crisis cost germany?

twice as much as the annual reparations bill

how did the german government deal with the economic crisis?

printed more money instead of raising taxes

how was the government able to keep printing off money?

had 200 printing presses printing money constantly, with reckless abandon

how did the price of 1 loaf of bread change between 1914 and november 1923?

1914 - 1 mark

november 1923 - 100 billion marks

how much household revenue was spent on food alone during november 1923?

90%