1. { World between the Wars Great Depression

2.  Define the following terms in your notebook  Textbook, pg. 904-909  Great Depression  Collective Bargaining  Dawes Plan (pg. 905)  Franklin Delano Roosevelt  New Deal Warm-Up

3.  Origins  Set up by Woodrow Wilson to have allies in case of another World War  Maintain peace was the main objective  Problems  U.S. did not join the League of Nations  American public did not support it  Fall  U.S. had no involvement so other countries could not come to agreements; fell apart League of Nations

4.  Reparation payments started in 1921 for Germany  Owed the equivalent of 33 Billion U.S. dollars  Paid the first year; unable to pay after that  France was upset at inability to pay  Took control of German industrial and mining centers  Used labor and control of these centers to extract money Financial Crisis

5.  German workers went on strike, but still demanded salary  Germany printed more money  Led to extreme inflation (rise in prices)  Inflation caused Germany’s currency to become worthless  4.2 Trillion marks=1 U.S. dollar  Leads to Great Depression in Europe and U.S. Financial Crisis cont’d.

6.  Three Main Causes  Downturn in the economies of individual nations  Prices increased rapidly  International financial crisis involving Europe and U.S.  U.S. stock market crash Leading to the Great Depression

7.  U.S. Stock Market was key to Europe’s success after WWI  Allied countries, mainly France and Britain, relied on the money that the U.S. was pumping into their economies Stock Market and Economies

8.  The U.S. Stock Market became a hugely successful business opportunity for investors  Investors started pulling money out of Germany’s economy  Once this happened, an economic domino theory happened in Europe Stock Market and Economies

9.  France and Britain rely on U.S. money in Germany  U.S. pulls money out of Europe  France and Britain can’t support their economy anymore  Slowed trade, industry declines, unemployment increases  Depression in Europe Depression Hits

10.  Governments did not known how to handle the shifting economy  Solution: Stop all foreign trade and lower wages  This only made it worse  Supply and Demand were lowered because of decrease in foreign trade, not enough money was coming in from elsewhere Response to Depression

11.  Increased government activity in the economy  Interest in Marxist ideas (Communism, Fascism, Totalitarianism)  ‘Capitalism would destroy itself’  People were forced to follow radical/dictatorial leaders who wanted reform  Minds were easily swayed due to the publics lack of trust in the government Political Effects

12.  France, Great Britain, and U.S. all came up with new ideas to deal with the depression  France-Collective Bargaining  Right to negotiate hours and wages  Great Britain-Deficit Spending  Fund construction projects to increase jobs  Go into debt to come out of debt New Ideas

13.  U.S.-New Deal  Franklin Delano Roosevelt implemented a public works program  Construction work to create jobs  Welfare system created  Social Security Act  Slowed depression; did not stop it  The Great Depression did not end until the start of World War II New Ideas