1929-32: the great depression

• oct 1929: wall street stock market in usa crashes, sparks international economic crisis, usa can't afford to prop up the german economy any longer
• after wall street crash:

  • germany's economic recovery between 1924-29 was built unstable foundations, biggest problem was it was dependent on usa loans (dawes plan)
  • after wall street, usa could not afford to lend germany money, suspended future payments and wanted some loans back.
• affects on german economy:

  • it collapsed without usa aid, industrial production declined- factories and banks went out of business.
  • mass unemployment- oct 1929 1.6 million out of work, feb 1932 over 6 million.
• 1930-1932:

  mar 1930- weimar republic new chancellor, heinrich bruning, introduced tough economic politics to keep the inflation from rising.

  policies weren't popular: increased cost of imported food to help german agriculture, food price raised, government salaries & pensions reduced, taxes increased, social services cut back, unemployment benefits reduced.

  By 1932, many different sectors of society were discontent with weimar government, high unemployment and reduced benefits, meant government lost some backing from working classes.
• government less democratic:

  bruning economic policies were unpopular, had problems with passing policies in the reichstag.

  began to rely on article 48 of weimar constitution (can pass laws without approval from reichstag)

  asked hindenburg to suspend the constitution so that he can make decisions without parliament approval

  1932: bruning was regularly bypassing parliament to force economic measures through.