Western Democracies Stumble

1. Western Democracies Stumble

2. In 1919 the three Western Democracies- Britain, France, and the United States- appeared powerful They had ruled the Paris Peace Conference and boosted hopes for democracy among the new nations of Eastern Europe Beneath the surface, however, postwar Europe faced grave problems To make matters worse, many members of the younger generation who might have become the next great leaders had been killed in the War.

3. Postwar Problems Finding Jobs for Veterans Debt Rebuilding Land Spread of Radical Ideas- world wide Russian Revolution vs. Nationalism Lacked strong leadership in Europe

4. Politics in the Postwar World Great Britain U-boats had wreaked havoc on British shipping Debt Factories were out of date Severe unemployment during 20s Workers Strikes

5. Irish Question- When WWI was over the British refused to grant Northern Ireland its independence. Lead to violence in the area that continues today Colonies in Canada, Australia, New Zealand, and South Africa became self governing dominions of the British Common Wealth

6. Foreign policy caused problems with ally France- Treaty of Versailles British leaders wanted to relax the treaty of Versailles on Germany almost immediately after it was signed They feared that if Germany became too weak that France and USSR would become too powerful British leniency toward Germany angered the French and helped push them in opposite directions

7. France creates the Maginot Line The main concern of the French was that Germany would attack them again In order to secure its borders, they built a massive fortification along its border known as the Maginot Line The Maginot Line, was a defensive wall that was made to create a sense of security for the French.

8. France also saught to strengthen its sense of security by allying with the Soviet Union It insisted upon strict enforcement of the Versailles Treaty and complete payment of reparations, hoping to keep the German economy weak.

9. Pursuing Peace In 1925 7 Nations will meet in Lacarno, Switzerland to sign a series of peace treaties United States, France, Japan, Germany are among the nations there Their main objective is to make sure that another World War never happens again (PEACE IS THE GOAL) They expect WWI to be the war to end all wars.

10. As a part of the peace treaties that are signed they: Settle border disputes btw Germany and France, Belgium, Czech and Poland �France and Germany Ban War Forever� Almost every nation in the world signs the Kellog-Briand Pact promising to renounce war as an instrument of national policy Pursued disarmament

11. reduce the size of their navies However they do not agree to limit the size of their armies (need them for self-defense) Finally, all nations put their hope in the League of Nations despite the fact that they will quickly learn (I.e. when Japan invades China) it has no real power without the United States�s membership

12. Post War Economics The war affected economies all over the world, hurting some and helping others Britain and France both owed huge war debts to the United States Both relied on reparation payments from Germany to pay back their loans Meanwhile, the crushing reparations and other conditions hurt Germany�s economy

13. Britain and France Recover Britain faced serious economic problems in the 1920s It was deeply in debt and its factories were out of date Unemployment was severe, wages were low and strikes were frequent

14. France on the other hand recovered fairly rapidly Financial reparations and territories gained from Germany helped Still economics swings did occur and during down times their government was very unstable

15. Despite these problems, Europe made a shaky recovery during the 1920s Economies returned to peacetime manufacturing and trade Veterans gradually found jobs, although unemployment never ceased to be a problem Middle-class families enjoyed a rising standard of living

16. The United States Boom In contrast, the United States emerged from the war the world�s leading economic power In the affluent 1920s, middle-class Americans enjoyed the benefits of capitalism American loans and investments backed the recovery in Europe As long as the American economy prospered, the global economy remained stable

17. Recovery and Collapse The prosperity did not last As Europe is trying to recover from WWI the US Stock Market Crash in 1929 will trigger a Worldwide Depression

18. Causes of the Depression Demand and price for farm good declined after WWI as the United States no longer needed to produce extra food for the war effort Because farmers earned less they bought less which led to overproduction in factories As goods sat on shelves in factories factory owners had to fire people because they were not making enough money to pay them Meanwhile there was a financial crisis brewing on Wall Street

19. Prices on the New York Stock Exchange were at an all time high People eager to make money in the stock market put money into risky companies that had not proven they could make a profit To slow down investment in the stock exchange the Federal Reserve, the central banking system of the United States which regulates the banks, raised interest rates in 1928 and again in 1929. It didn�t work

20. Higher interest rates made people nervous about borrowing money and investing thus hurting the economy In 1929, jitters about the economy caused many people all at once to sell their stock Financial panic set in Stock prices crashed, wiping out the fortunes of many investors thus starting the Great Depression In 1931 the Federal Reserve again increased the interest rate, with an even more disastrous effect

21. As people bought and invested less, businesses closed and banks failed, throwing millions out of work The jobless could not afford to buy goods, so more factories had to close, which in turn increased unemployment People slept on park benches and lined up to eat in the soup kitchens

22. The Depression Spreads Almost immediately American banks stopped making loans abroad and demanded repayment of foreign loans Without support from the US, Germany suffered greatly Now Germany could not make its reparation payments Without reparations from Germany, France and Great Britain could not pay back their loans to the United States Desperate countries tried to protect their economies from foreign competition. US imposed highest tariffs in history and other countries retaliated by doing the same.

23. The Democracies react to the Depression The governments of Britain, France and the United States, like others around the world, tried to find ways to life the Depression None of their methods provided a quick fix, but they did alleviate some of the suffering

24. Britain and France search for solutions In response to the depression, Britain set up a coalition government made up of leaders from all three of its major political parties The government provided some unemployment benefits but failed to take decisive action to improve the economy By 1931, one in every four workers was unemployed

25. The Depression took longer to hurt France than some other countries By the mid-1930s. France was feeling the pinch of decreased production and unemployment In response, several Socialists within the government tried to pass legislation to help workers but it did not work Democracy survived, but the country lacked strong leadership

26. Roosevelt Offers the United States a New Deal When the Depression hit, the president of the United States was Herbert Hoover He did not believe that the government should intervene in private business Even so, as the depression worsened he tried a variety of things to help the economy recover but nothing worked In 1932 the United States elected a new president, Franklin D. Roosevelt

27. FDR argued that the government had to take an active role in combating the Depression He introduced the New Deal, a massive package of economic and social programs Under the New Deal, the federal government became more directly involved in people�s lives than ever before

28. New laws regulated the stock market and protected bank deposits Government programs created jobs and gave aid to farmers A new Social Security system provided pension for the elderly and other benefits As the New Deal programs were being put into effect, a natural disaster hit several central states

29. After years of drought and over farming, huge winds blew across the plains The winds picked up and carried away the topsoil creating a DUST BOWL The storms destroyed crops, land and equipment Thousands of farmers lost their land Many migrated to the cities of the West Coast in search of work and a new life

30. The New Deal failed to end the Depression, although it did ease the suffering for many Still some critics fiercely condemned FDR�s expansion of the role of government The debate about the size and role of government continues to this day

31. As the depression continued people lost faith in democracy and turned to radical solutions Communists gloated over the failure of capitalism Right wing extremists played on themes of intense nationalism, the failure of democracy, the virtues of authoritarian rule and the need to rearm

32. Immediate Effects Vast Unemployment and Misery Growth of Economic Nationalism, with tariffs imposed to protect industries Loss of faith in capitalism and democracy Authoritarian leaders gain support

33. Long Term Effects Nazis take control in Germany Fascist leaders win support in Eastern Europe Governments experiment with social programs People blame scapegoats for economic woes World War II Begins