Golden Twenties and Decline

November 1923. The Stresemann administration introduced a new currency, the Rentenmark, later Reichsmark, and drastically cut down expenses and raised taxes. And yet, the stability of the currency was the first ray of hope at the end of the year of crisis 1923.

The short recovery

After the Weimar Republic had survived the year of crisis 1923, it was granted a short time of economic recovery and political stability. An international committee worked out a plan for the reparations to be paid by Germany, it is referred to as Dawes Plan after its American chairman Charles G. Dawes. Germany was obliged to pay enormous sums every year that should increase in 1928, that way the interests of the Allied were covered. But it also took a bit of pressure of the Weimar Republic, Germany was granted large foreign loans and the Allies' right on sanctions was limited. Moreover, the French eventually accepted the Dawes Plan and withdrew from the occupied areas in July and August 1925. That way, German economy gradually recovered and in 1928 reached the production level of 1913. Also a lot was done for people: Unemployment insurance, 8 hour days, better protection for working youngsters and mothers, paid vacation, new flats to live in and education benefits, employees' councils to represent employees' interests.

Briand and Stresemann

As to foreign policy, these years are marked by Aristide Briand on the French and Gustav Stresemann on the German side. Both strove for understanding instead of eternal enmity. In October 1925, the Treaty of Locarno was concluded by which Germany recognized its borders with France and Belgium according to the Treaty of Versailles, voluntarily relinquished Alsace-Lorraine and accepted that the Rhineland would remain a demilitarized area forever. Britain, Italy and Belgium would assist France should German troops march into the demilitarized Rhineland. In turn, Germany regained freedom of action, was protected against French attacks on the Rhine and Ruhr area and could look forward to be accepted into the community of nations soon again. In July 1925, the French troops began to withdraw from the Ruhr Area.

Swing to the Right

Reichspräsident Friedrich Ebert died in 1925. Field Marshal Hindenburg, a supporter of the monarchy and candidate of the political Right, won the elections and became Reichspräsident. He swore an oath on the Weimar Constitution and remained loyal to it until the end. For many people and particularly the Reichswehr troops, Hindenburg became a "Substitute Emperor", because he stood for the conservative, national tradition, and with him on top they could arrange with the Republic although they rejected parliamentarian democracy. Yet, Hindenburg was already 78 years old when he took up his new office.

The following years brought some political recovery and some stability, a period of uneven prosperity. In 1926, Germany joined the "League of Nations". The same year, Briand and Stresemann were together awarded with the Nobel peace prize. In 1930, the last Allied troops left Germany, five years earlier than stipulated in the Treaty of Versailles, as an answer to the policy of reconciliation under the Stresemann administration. Yet, not all people in Germany and France were ready for a policy of understanding, both Briand and Stresemann were grimly criticized in their countries. Shortly after, Briand was replaced by the hardliner Poincaré. In the German general elections for the Reichstag of 1928, the Deutschnationale Volkspartei (DNVP, German National People's Party) emerged as second strongest faction in the Reichstag, after a campaign against the Treaty of Locarno.

World Economic Crisis

Flash film: 1929-1933

In Germany, the economic recovery of the years 1924-1929 had been possible thanks to foreign loans. But on October 25, 1929, a stock exchange crash in New York widened into a world economic crises and global depression that caused high unemployment in industrial countries, bank failure and collapse of credit. In Germany, the depression led to economic collapse, mass unemployment and pauperization. The acting grand coalition under Chancellor Hermann Müller (SPD) broke apart in March 1930. It was the last parliamentarian democratic administration of the Weimar Republic.

On March 29, 1930, Reichspräsident Hindenburg appointed the finance expert Heinrich Brüning (Center Party) Chancellor. For Brüning, the only way that Germany could survive financially was to drastically cut state expenditures, including cuts in the social sector that would affect people greatly. But he had no majority in the Reichstag, and his plan was turned down. To push it through nonetheless, he submitted it to Reichspräsident Hindenburg who passed it as emergency decree according to article 48 of the Weimar Constitution. Throughout his chancellorship, Brüning ruled by emergency decrees, which meant that the Chancellor depended on the Reichspräsident's trust him, not the Reichstag's, so de facto the parliamentarian democracy had ended. Brüning's chancellorship is referred to as a "presidential cabinet".

The extremists become stronger and stronger, among them Adolf Hitler and National Socialist movement. Hitler’s party, the NSDAP, had promised to reduce unemployment and do something against the Treaty of Versailles with was perceived as shameful. The movement was anti-Semitic, and anti-Communist, and planned to do away with democracy. The Reichstag general elections of September 1930 resulted in an overwhelming victory for the Nazi Party. Now the democratic parties tolerated Brüning's policy, to avoid new elections that would probably bring even more votes for the extremists.

In July 1931, one of the biggest German banks collapsed, and in early 1932 the number of unemployed rose to more than 6,000,000. Brüning struggled to alleviate the burden of reparation payments, and indeed in 1931 the American President Hoover passed a memorandum postponing reparation payments for one year.

In March and April 1932, Hindenburg was re-elected Reichspräsident for a second term. In the second round, it was between him and Hitler, and since only Hindenburg could defeat Hitler, the Center Party, the Social Democrats and other democratic parties had supported him.

Brüning had made mighty enemies, especially among the landowners in the East, many of them having a lot of influence on Hindenburg. On May 30, 1932, he was dismissed - "hundred meters before the finish", as he said himself, because in 1932 the reparations where reduced to a final payment and afterwards let off. Franz von Papen, a staunch Conservative, was appointed Chancellor.

After his dismissal, Brüning spent many years in the United Kingdom and in the USA. He taught political sciences at the Harvard University, and died in 1970 in Norwich, Vermont. Still today, Brüning is a controversial figure.

"Preußenschlag" (Prussian Coup)

Throughout the years of the Weimar Republic, the Free State of Prussia had been a pillar of democracy. Minister President Otto Braun, Minister of Interior Carl Severing and their administrations had fought for democracy until the last moment. In Prussia, The Nazi SA and SS, the right-wing Stahlhelm and other paramilitary extremist groups were banned, and extremists could not get into civil service. However, the Prussian Government had mighty enemies. Under the pretext that it had lost control of public order in Prussia, Chancellor von Papen issued an emergency decree: On July 20, 1932, he unseated the Prussian Government, appointed himself Reich Commissioner for Prussia. Prussia as a state was abolished de facto by the Nazis in 1934 and de jure by the Allies of Word War II in 1947.

Hitler's chancellorship

Von Papen could not win Hitler over and most parties opposed him, so he had the Reichstag dissolved and called for new elections. In the Reichstag general elections of July 1932, the Nazi Party became the largest party, also the Communists had major gains. Together, the anti-democratic parties of the right and left were now able to hold the majority of seats in Parliament. Hitler demanded the chancellorship for himself, but was rejected by Hindenburg in August 1932. Since there still was no majority in the Reichstag for any government, it was dissolved again. The Reichstag general elections of November 1932 resulted in a victory for the Communist Party who became the strongest faction in the Reichstag, whereas the Nazi Party lost votes. Franz von Papen stepped down and was succeeded by General Kurt von Schleicher in December, but Schleicher had no majority either.

On January 30, 1933, pressured by former Chancellor Franz von Papen and other conservatives, President Hindenburg finally appointed Hitler Chancellor. On January 30, 1933, Hitler had been appointed Chancellor. He immediately took measures to achieve his anti-democratic goals.