How significant was the French invasion of the Ruhr in 1923? Causes Events Consequences At the time (short term)… Long term…

Towards the end of 1922, Germany failed to make a reparations payment The French and Belgians reacted by invading the industrial heartland of Germany, the Ruhr (on the border with France) The Belgians and French intended to take the value of the missing reparation payment in goods produced in the Ruhr Germany had spent a lot of money on World War One. After the war, Britain and France took away their valuable raw materials such as coal and iron in order to make Germany weak The League of Nations did not respond, help Germany or punish France and Belgium In response, the German government ordered a policy of passive resistance and German workers went on strike Production in the Ruhr fell/went down and the French and Belgians could not take the goods they wanted The German government still had to pay their workers and meet other bills, so they printed more banknotes The German government paid its bills by printing more banknotes but having more notes money in circulation meant that prices rose As prices in Germany rose, workers demanded more wages, this made goods more expensive to produce and buy, therefore workers demanded even more wages. This became a vicious cycle and led to hyperinflation

In December 1921 a loaf of bread cost just under 4 marks In December 1921 a loaf of bread cost just under 4 marks. In September 1923, a loaf of bread cost 1.5 million marks Because of hyperinflation, paper money became practically worthless and people had to start paying bills in goods i.e. bread and eggs Foreign goods became so expensive that few Germans could afford them. Peoples savings became worthless and could not even buy a person groceries for a week Peoples living standards fell because everything was more expensive than they could possibly afford. Many people could not afford to eat properly and hunger was common Foreigners and people in debt benefitted because they could easily pay back debts of thousands with a weeks wages and visitors got lots of money for very little of their own The situation was very serious. Thousands of Germans became poor and homeless. There was a danger that law and order might break down The Nazis, led by Hitler, decided to try and overthrow the government during hyperinflation. In 1923, the staged the Munich Putsch. They failed but it showed that people were unhappy with the government and the situation in Germany It looked as though the German Weimar government would collapse because Germanys economy was in ruins. Gustav Stresemann became Chancellor in August 1923 and created a new currency called the Rentenmark. He reduced government spending and ended hyperinflation In 1924, the USA loaned Germany money with the Dawes Plan. Germany received 800 million gold marks and reparations were reduced and Germany was given longer to pay them. This helped Stresemann to bring back political and economic stability. Stresemann dealt with the threats from the Communists and Nazis. Key members of the Munich Putsch were arrested and put in prison. In 1925, Stresemann signed the Locarno Pact to respect borders with Belgium and France. In 1926, Stresemann got Germany to join the League of Nations. This helped to build good relations with other countries. In 1928, Stresemann signed the Kellogg-Briand Pact against the use of war in foreign policy. Germany was beginning to be accepted back into the international community. In 1929 the Young Plan gave Germany even longer to pay reparations. Everything was going well until the Wall Street Crash in 1929, when the USA recalled all of its loans – including Germanys