The government's economic policy had been based on the assumption that it would win the war. The government borrowed vast amounts of money, assuming that it would be able to pay back the loans by imposing reparations on Britain, France and Russia.
War debt:
The scale of German debt was enormous. 1914-1918 the government borrowed almost 150 billion marks (M).
War debt:
During the same period, the government raised around M7 billion or M8 billion in taxes, which was enough to pay the interest on the debt but not enough to start to reduce the debt.
War debt:
Government borrowing during the war led to inflation. Prices rose by 200% from 1914-1918.
Reparations:
TOV forced Germany to pay reparations.
Reparations:
Inter-Allied Reparation Committee of 1921 set the figured of £6,600 million
