Economy in the Interwar Period

Emily Wilson
8 min read
#AP World History: Modern - Post-WWI Economy & The Great Depression: Your Ultimate Study Guide π
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!
#π Post-WWI Economic Landscape: Treaty of Versailles & Its Aftermath
#The Treaty of Versailles (1919) π
- 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.
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War Guilt Clause (Article 231):
- Germany was solely blamed for WWI.
- Fueled resentment and nationalism in Germany.
#Treaty of Versailles. Image courtesy of ThoughtCo
Think of the Treaty of Versailles as a 'Versailles Vise' squeezing Germany: Territory, Reparations, Military, Guilt. (TRMG)
#Immediate Post-War Economic Issues:
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Weakened Europe:
- Inflation and massive debts.
- Dependence on loans from the U.S.
- Loss of overseas investments.
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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. π‘
Don't just memorize ...

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