Western Democracies Stumble Chapter 13 Section 2

Party Struggles in Britain Labour party Promotes gradual move toward socialism Become stronger than Liberal party Liberals Traditionally middle-class bussinessmen Begin supporting conservatives Conservatives end up dominating the 1920s Represent upper-class, professionals, and farmers

Party Struggles in Britain 1926 – General strike lasts 9 days and involves over 3 million people Conservatives pass legislation limiting power of workers to strike

Irish Independence Easter Rising (1916) Irish revolt against British rule Quickly suppressed, but stirred support for Irish cause Parliament fails to pass bill for Irish home rule (again) in 1919 Irish Republican Army (IRA) begin guerilla war 1922—Irish and British moderates reach agreement

Irish Independence Most of Ireland becomes Irish Free State Northern counties remain under British control Religious division Britain is Protestant (Church of England) Most of Ireland Catholic, except northern counties IRA and others fight division

France Many parties differ on many issues, especially on how to collect reparation money from Germany Quickly changing coalitions create problems

United States Fear of radicals and the Bolshevik Revolution set off “Red Scare” (1919-1920) Immigrants flooded into America from war torn Eastern Europe Congress passes laws limiting immigration from Europe and Asia

France Builds Maginot Line Massive fortifications to prevent another German invasion Strengthens military and seeks alliances with Soviet Union and others Insists on strict enforcement of treaty to keep Germany (and German economy) weak

Britain Wanted to relax treaty Feared weak Germany would make France and USSR too powerful

Peace Locarno treaties – settle disputed borders Kellog-Briand Pact Germany joins League of Nations, later USSR (but not US) Kellog-Briand Pact Signed by almost every independent nation Promised to “renounce war as an instrument of national policy.” Disarmament US, UK, France, Japan, and others agreed to limit size of navies (but not armies) 429

Postwar Economics Britain and France owe U.S. huge war debts Both rely on German reparations to pay debt to U.S. U.S. Economy booms Loans and investments back European recovery, especially in Germany

Great Depression Overproduction Demand for raw material and food skyrocketed during war, fell after Technology allowed factories to produce more, faster As demand slowed, factories cut back on production and workers

Great Depression Prices on Stock Exchange at all-time high Investors used “risky methods” to acquire stocks Federal Reserve raised interest rates (1928 and 1929)

Great Depression In October 1929 the Stock Market crashed Wiped out fortunes of many investors 1931 Federal reserve raised interest rates again with disastrous results People bought and invested less Businesses and banks closed Created a spiral downward

Depression Spreads U.S. banks stopped making loans abroad and demanded payment of foreign loans Without U.S. investment money, Germany could not afford o pay reparations Without German reparations, France and Britain could not pay loans Created spiral downward

Depression Spreads To protect economy against foreign competition, U.S. and others impose tariffs U.S. imposes highest tariff in its history (Smoot-Hawley Tariff) Other nations do the same Foreign trade plummets around the world 430

Democracies React Britain France provides some unemployment benefits, but no decisive action 1 in 4 unemployed France Leftists unite under Leon Blum’s Popular Front Passes some social legislation, but not enough Strikes soon bring his government down

Democracies React U.S. Hoover Franklin D. Roosevelt believes government should not interfere in private business Franklin D. Roosevelt Elected in 1932 Proposes New Deal – massive package of economic and social programs

Democracies React New Deal New laws regulate stock market and protect bank deposits Aid to farmers Government programs create jobs Social Security system provide pensions for elderly and others

Dust Bowl Hits especially hard in 1934 in the Plains Destroyed crops, land, and equipment Thousands lost land, moved to West Coast 433

Loss of Faith in Democracy Depression fertile ground for extremists promising radical solutions