The Stresemann Golden Years

Dancing on a volcano

In August 1923 Gustav Stresemann became chancellor of a Germany in which a loaf of bread cost 200,000 million marks, French troops occupied the Ruhr, and communists and Nazis were both planning to seize power. He held the office for a hundred days, then served as foreign minister until his death. By 1928 Germany was producing as much as it had in 1913, had a seat on the Council of the League of Nations, and had just given the Nazis 2.6 per cent of the vote. He did it with a new currency, an American loan, and a policy of fulfilment: paying the reparations Germany hated, in order to get the terms of Versailles softened one at a time. The Dawes Plan of 1924, the Locarno treaties of 1925, the League in 1926 and the Young Plan of 1929 were the steps. Historians call the period the Golden Years. Stresemann did not. In 1928 he said that Germany was dancing on a volcano, because the recovery rested on short-term American money that could be recalled at any time. He died on 3 October 1929. The Wall Street Crash came three weeks later. The exam asks why Germany recovered, what his achievements abroad did at home, and how far the years were really golden. This module gives you the dated evidence for all three.

Five words the examiners use

Each definition ends with the moment it mattered, because a bare definition earns nothing in a 12-mark answer.

The steps of recovery, in order

Put these six events in the order they happened.

• The Rentenmark replaces the worthless mark and hyperinflation stops
• The Dawes Plan reschedules reparations and brings the first American loan
• Germany accepts its western borders at Locarno
• Germany joins the League of Nations with a permanent seat on the Council
• Germany signs the Kellogg-Briand Pact renouncing war
• The Young Plan cuts reparations, and Stresemann dies weeks before the Wall Street Crash

Why did the German economy recover after 1923?

In November 1923 the mark was worthless. By 1928 German industry had regained its pre-war output. Which explanation best accounts for the recovery?

• The Rentenmark of November 1923 ended hyperinflation and restored confidence in money; the Dawes Plan of 1924 made reparations payable and brought an 800 million mark loan that reopened American lending, so that around 25,000 million marks flowed in over five years and were invested in factories, housing and public works; the French left the Ruhr in 1925, restoring German coal and steel; and German industry rationalised itself, with cartels and new machinery raising output to 1913 levels by 1928.
• The Allies cancelled reparations in 1924.
• Germany rearmed and the armaments industry drove growth.
• Germany regained its colonies and their raw materials.

Golden, or gilded?

The 16-mark judgement on this bullet asks how far the recovery was real. Have both columns ready, with the figures, and notice that the weak points were all visible before 1929.

Question 1: inference from a source

Source A: from a speech by Gustav Stresemann to the Reichstag in 1928, arguing for continued cooperation with the Allies. A student infers that Stresemann believed the recovery was fragile. Tap the TWO details that support that inference most directly.

• The economic position is only flourishing on the surface. Germany is in fact dancing on a volcano.
• Our seat on the Council of the League has given Germany back her voice among the great powers.
• If the short-term credits are called in, a large section of our economy would collapse.
• Locarno has secured peace on the Rhine for a generation.
• The young people of Germany must be won for the republic, or they will be won by its enemies.

Achievements abroad, effects at home

Select the THREE statements that correctly link something Stresemann achieved abroad to an effect inside Germany.

• The Dawes Plan of 1924 got France out of the Ruhr in 1925 and opened the door to American loans, which paid for the housing and public works that gave the republic its prosperity.
• Locarno in 1925 and the League seat in 1926 restored German standing, which took the sting out of the nationalist claim that the republic was the creature of Versailles and helped the moderate parties in the 1928 election.
• The Young Plan of 1929 cut reparations, but the referendum campaign Hugenberg ran against it gave Hitler national publicity and the money of the press barons for the first time.
• Locarno guaranteed the borders with Poland, so the nationalists had nothing left to complain about.
• Joining the League allowed Germany to rebuild its army to 500,000 men.
• Kellogg-Briand in 1928 ended reparations.

Two interpretations of the Golden Years

Question 3 gives you two interpretations and asks how they differ, why, and how far you agree. The two below were written for this module to show the shape of the argument; the exam will print real historians. Interpretation 1. The years 1924 to 1929 were a genuine recovery. Stresemann stabilised the currency, brought Germany back into the family of nations at Locarno and Geneva, and presided over a return to full industrial output and rising wages. The republic was never more secure than in 1928, when the parties that supported it won a clear majority and the Nazis were reduced to a fringe. Interpretation 2. The recovery was a facade built on American credit. Reparations were paid with borrowed dollars, unemployment never fell below a million, farming was in depression from 1927, and the middle class had lost everything in 1923. The republic survived because the money kept coming; when it stopped in 1929, the weaknesses the Golden Years had hidden reappeared within months. Question 3(c) asks why they differ. The answer is emphasis and evidence: Interpretation 1 measures the years against 1923 and looks at output, diplomacy and votes; Interpretation 2 measures them against 1930 and looks at where the money came from and who it missed. Both are true; they weigh different things. This meant that a historian who wants to explain the fall of the republic reads the years as gilded, while one who wants to explain why it lasted reads them as golden.

In the shoes of Stresemann

Four decisions between 1923 and 1929. Choose what Stresemann actually did, and notice what each choice cost him at home.

• September 1923. You are chancellor. Passive resistance in the Ruhr is bankrupting the state and the mark is worthless. What do you do?
• 1924. You are foreign minister. The Americans offer a plan: pay reparations on a sliding scale, accept Allied supervision of the Reichsbank, and receive an 800 million mark loan. The DNVP calls it a second Versailles. What do you do?
• October 1925. At Locarno the French want a guarantee of the Rhine frontier and the Poles want the same for theirs. What do you sign?
• 1929. The Young Plan will cut reparations by a fifth and end Allied control of German finances, but Hugenberg and Hitler are collecting signatures for a referendum to reject it as slavery. You are ill and have months to live. What do you do?

From cause to consequence

Because the Rentenmark of November 1923 was backed by land and industry and exchanged at a trillion to one, prices stopped rising within _____. Because the Dawes Plan made reparations payable, the _____ agreed to leave the Ruhr in 1925 and American banks began to lend. Because Germany accepted its western borders at _____, it was admitted to the League with a Council seat in 1926. Because the loans were mostly _____, the recovery depended on American confidence. And because that confidence broke in October _____, the weaknesses under the Golden Years surfaced within months of the death of Stresemann.

Weigh the loans

The Dawes Plan of 1924 brought an immediate loan of 800 million marks. Between 1924 and 1929 American loans to Germany totalled about 25,000 million marks. How many times larger were the total loans than that first Dawes loan, to the nearest whole number?

Question 3(b): the main difference

Question 3(b) asks: What is the main difference between the two interpretations on the callout card? Explain your answer using both. Which answer would score all four marks?

• The main difference is that Interpretation 1 sees the recovery as genuine, pointing to the stable currency, full industrial output and the 1928 election, whereas Interpretation 2 sees it as a facade that depended on American credit, pointing to the unemployment, the farming depression and the ruined middle class beneath the figures.
• Interpretation 1 says the recovery was real and gives lots of evidence for it.
• I agree with Interpretation 2 because the loans were short-term and the Crash proved it.
• They differ because one is positive and one is negative about the 1920s.

A 12-mark paragraph, marked

Question 2: Explain why the Weimar Republic recovered in the years 1924 to 1929. One reason the republic recovered was the settlement of reparations through the Dawes Plan of 1924. Under the plan Germany paid 1,000 million marks in the first year, rising to 2,500 million by 1929, and in return received an immediate loan of 800 million marks and a French promise to leave the Ruhr, which was kept in 1925. This meant that Germany regained its main coalfield and its steel industry at the moment American banks, reassured by the plan, began to lend on a large scale, so that around 25,000 million marks arrived over the next five years to be invested in factories, housing and public works. The republic recovered because the Dawes Plan turned the reparations that had wrecked the economy in 1923 into the reason foreign money came in. What earned the marks: a cause named in the first sentence; specific support (the figures, the loan, the Ruhr, 1925, 25,000 million); the link phrase this meant that; and a closing sentence that returns to the question. Two more paragraphs, on the Rentenmark and the end of hyperinflation and on the standing abroad won at Locarno and Geneva, and the answer reaches the top level.

Write the 12-mark answer

Explain why the Weimar Republic recovered in the years 1924 to 1929. You may use the following in your answer: the Rentenmark; the Dawes Plan. You must also use information of your own.

• Support that counts: a date, a figure, a treaty or a name
• Causes of your own: American loans, the Locarno Pact and League membership, or the end of the Ruhr occupation

Question 3(d): how far do you agree?

Question 3(d) asks: How far do you agree with Interpretation 2 about the Golden Years? Use both interpretations and your own knowledge. A student has written the case FOR Interpretation 2. Which is the strongest point to set AGAINST it?

• The dependence on American money is real, but Interpretation 2 reads the years backwards from 1929: at the time, the currency held from 1924, output reached its 1913 level by 1928, real wages rose above pre-war, and in the election of May 1928 the pro-republic parties won a majority while the Nazis took 2.6 per cent, so the recovery was genuine in what it delivered and fragile only in how it was financed, and a judgement should say both.
• Berlin had wonderful nightclubs and cinema in the 1920s.
• Stresemann won the Nobel Peace Prize, so the years must have been golden.
• The Crash was an American event and nothing to do with Germany.