# AP World History: Modern - Post-WWI Economy & The Great Depression: Your Ultimate Study Guide 🚀 Hey there, future AP World History champ! Let's dive into the economic rollercoaster of the post-WWI era and the Great Depression. This guide is designed to be your go-to resource, especially the night before the exam. We'll make sure everything clicks, so you feel confident and ready to ace it! ## 🌍 Post-WWI Economic Landscape: Treaty of Versailles & Its Aftermath ### The Treaty of Versailles (1919) 📜 * **What was it?** A peace treaty that officially ended WWI, but also laid the groundwork for future conflict. * **Key Players:** The victorious Allied powers (primarily France, Britain, and the U.S.) * **Goal:** To punish Germany and prevent future wars (Spoiler: It didn't quite work out that way!) The Treaty of Versailles is a **major turning point** that directly led to the rise of extremist ideologies and WWII. Understanding its terms is crucial! ### Terms of the Treaty: * **Territorial Losses:** * Germany lost all colonies. * Sudetenland went to Czechoslovakia. * Polish Corridor split Germany, giving Poland access to the sea. * Demilitarized Rhineland zone. * **Reparations:** * Germany had to pay massive war debts (132 billion gold marks). * Crippled the German economy. * **Military Restrictions:** * Limited size of the German military. * Banned production of certain weapons. * Disarmament of the German navy. * **War Guilt Clause (Article 231):** * Germany was solely blamed for WWI. * Fueled resentment and nationalism in Germany. ![](https://zupay.blob.core.windows.net/resources/files/0baca4f69800419293b4c75aa2870acd_f9aa96_4195.jpg?alt=media&token=b987fcb4-8ceb-4787-91ba-b6a72e9c1cd0) ###### Treaty of Versailles. Image courtesy of ThoughtCo Think of the Treaty of Versailles as a **'Versailles Vise'** squeezing Germany: **T**erritory, **R**eparations, **M**ilitary, **G**uilt. (TRMG) ### Immediate Post-War Economic Issues: * **Weakened Europe:** * Inflation and massive debts. * Dependence on loans from the U.S. * Loss of overseas investments. * **Vicious Cycle of Debt:** * Allied powers needed German reparations to repay their debts. * Germany took loans from the U.S. to pay reparations. * This created a fragile and unsustainable system. 💡 Don't just memorize the terms of the treaty! Understand **how** these terms created economic instability and resentment. ## 📉 The Great Depression: A Global Economic Meltdown ### The Perfect Storm of Economic Disaster * **Debt Crisis:** The interconnected web of debt from WWI was unsustainable. 🕸️ * **Overproduction:** * Industrialization led to a surplus of goods. * Reduced demand, causing factories to slow down. * Unemployment rates skyrocketed. * **Stock Market Crash (1929):** * The U.S. stock market plummeted, triggering a global crisis. * Banks and businesses failed, leading to mass unemployment. ![](https://zupay.blob.core.windows.net/resources/files/0baca4f69800419293b4c75aa2870acd_0f762a_2000.gif?355) ###### Practice analyzing this political cartoon like it is a document on a DBQ! ###### Source: Dust Bowl Political Cartoon ###### If you can't analyze it, check out the link above for a W.A.V.E.S. analysis. The Great Depression wasn't just an American problem; it was a global event due to interconnected economies. ### How Industrialization Changed Production: | **Industrial Products Replaced by Industrialization Before** | **Industrial Products Replaced by Industrialization After** | | --- | --- | | Natural rubber | Reclaimed rubber | | Coal | Oil | | Cotton | Synthetic materials | When analyzing political cartoons or documents, always consider the **HIPP** (Historical Context, Intended Audience, Purpose, Point of View). ## 🏛️ Government Intervention in the Economy: New Approaches ### Abandoning Laissez-Faire * The Great Depression forced governments to abandon the idea of a completely free market. * Active government intervention became the new norm. ### Keynesian Economics: The U.S. Response * **Key Idea:** Governments should actively stimulate the economy through spending and public works projects. * **New Deal (FDR):** * Massive government spending to create jobs and boost consumer spending. * Social welfare programs and reforms. * Helped end the Great Depression (along with WWII spending). Remember **Keynes** by thinking: **K**eynesian = **K**overnment **K**ontrol (government intervention). ### Communism in the Soviet Union * **Background:** After the Russian Civil War, communism took hold. * **New Economic Policy (NEP - Lenin):** * State control of major industries, banks, and businesses. * **Five-Year Plans (Stalin):** * Focus on industrialization (steel and machinery). * Collectivized agriculture (shared farm units). * Production quotas and harsh punishments for failure. ![](https://zupay.blob.core.windows.net/resources/files/0baca4f69800419293b4c75aa2870acd_591f00_1123.jpg?alt=media&token=0c7df95f-5da6-4aca-9be8-e1e79434356f) ###### Promoting the Five-Year Plans. Image courtesy of Wikipedia ### Fascism in Italy * **Corporatism:** * State control over private companies and industries. * National council to resolve disputes. * Aimed to unite the interests of the state, workers, and employers. ### Forms of Government Intervention: A Quick Comparison | **Country** | **Style** | **How?** | | --- | --- | --- | |

United States
Most of W. Europe

| Keynesian economics |

More spending = better economy
Jobs provided to workers
Unemployment reduced

| |

Soviet Russia
China

| Communism (a form of socialism) |

Public controls means of production
Collectivization
Production quotas every five years
Negative repercussions if requirements are not met

| | Italy | Fascism |

The state controls the means of production
Nation > individual

| Government responses to the Great Depression are a **high-value topic**. Be ready to compare and contrast different approaches (Keynesian, Communism, Fascism). ## 🎯 Final Exam Focus ### Top Priority Topics: * **Treaty of Versailles:** Its terms, consequences, and impact on Germany and Europe. * **Causes of the Great Depression:** Debt crisis, overproduction, stock market crash. * **Government Intervention:** Keynesian economics, communism, fascism, and their impact. ### Common Question Types: * **Multiple Choice Questions (MCQs):** Focus on cause-and-effect relationships, comparisons, and key terms. * **Short Answer Questions (SAQs):** Practice concise answers with specific evidence. * **Free Response Questions (FRQs):** Be prepared to write analytical essays with thesis statements and supporting evidence. ### Last-Minute Tips: * **Time Management:** Don't spend too long on any one question. Move on and come back if needed. * **Common Pitfalls:** * Not providing specific evidence. * Failing to connect events to broader themes. * Misunderstanding the prompt. * **Strategies:** * Read the questions carefully and underline key terms. * Plan your essays before writing. * Use the HIPP strategy when analyzing documents. ## 📝 Practice Questions ### Multiple Choice Questions 1. Which of the following was NOT a major provision of the Treaty of Versailles? (A) The establishment of the League of Nations (B) The creation of a demilitarized zone in the Rhineland (C) The division of Austria-Hungary into new nations (D) The imposition of heavy reparations on Germany 2. The Great Depression was primarily caused by: (A) The rise of communism in Russia (B) The end of World War I (C) Overproduction and stock market crash (D) The failure of the League of Nations 3. Which economic theory advocated for government intervention to stimulate the economy during the Great Depression? (A) Laissez-faire capitalism (B) Keynesian economics (C) Mercantilism (D) Communism ### Free Response Question **Analyze the causes of the Great Depression and evaluate the effectiveness of government responses in addressing the crisis.** **Scoring Breakdown:** * **Thesis (1 point):** Presents a historically defensible thesis that addresses the causes of the Great Depression and the effectiveness of government responses. * **Contextualization (1 point):** Describes the broader historical context of the period, such as the economic impact of World War I and the Treaty of Versailles. * **Evidence (2 points):** Provides specific historical evidence to support the analysis of the causes of the Great Depression (e.g., debt crisis, overproduction, stock market crash) and the effectiveness of government responses (e.g., the New Deal, Five-Year Plans, corporatism). * **Analysis and Reasoning (2 points):** Analyzes the causes of the Great Depression and evaluates the effectiveness of government responses, explaining the connections between the evidence and the argument. Demonstrates an understanding of the complexities and nuances of the period. * **Synthesis (1 point):** Extends the argument by connecting it to a different historical context, such as the economic policies of the 1970s or the 2008 financial crisis, or by exploring an alternative perspective. You've got this! Remember, you're not just memorizing facts; you're understanding the story of history. Go out there and show that exam what you're made of! 💪

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Economy in the Interwar Period

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