Crisis of Democracy in the West 1919 - 1939

1. Crisis of Democracy in the West1919 - 1939 The Western Democracies Section 1

2. The catastrophe of World War I shattered the optimism that had grown in the West since the Enlightenment. • Despair gripped survivors on both sides as they added up the staggering costs of the war. • Especially among the democracies, economic and political crises only added to the growing pessimism of the 1920s and 1930s.

3. Postwar Issues • In 1919, three western democracies – Great 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. • Underlying Problems: Beneath the surface, however, postwar Europe faced grave problems.

4. The most pressing issues were finding jobs for returning veterans and rebuilding war-ravaged lands. • Many nations faced huge debts. Economic problems fed social unrest and made radical ideas more popular. • The Russian Revolution unleashed fears of the spread of communism. Some people saw socialism as the answer to hardships. Others embraced nationalist political movements. Many Europeans were dissatisfied with the peace settlement, especially in Germany and various ethnic groups in Eastern Europe.

5. The Pursuit of Peace: During the 1920s, diplomats worked hard for peace. In 1925 representatives from seven European nations signed a series of treaties at Locarno, Switzerland. • They settled Germany’s border disputes with France, Belgium, Czechoslovakia, and Poland. A New York Times headline stated, “France and Germany Ban war Forever.” • This “Spirit of Locarno” was echoed in the Kellogg-Briand Pact of 1928. Almost every independent nation signed it, promising to “renounce war as an instrument of national policy.”

6. In this optimistic spirit, the great powers pursued disarmament, the reduction of armed forces and weapons. • The United States, Britain, France, Japan, and other nations signed treaties to reduce the size of their navies. However, they failed to agree on limiting the size of their armies. • People around the world put great hopes in the League of Nations. From its headquarters in Geneva, Switzerland, it encouraged cooperation and tried to get members to stop aggression. In 1926, after signing the Locarno agreements, Germany joined the League. Later, the Soviet Union was admitted.

7. Recovery and Depression • During the 1920s, Europe made a shaky recovery. Economies returned to peacetime manufacturing and trade. Veterans gradually found jobs. Middle-class families generally enjoyed a rising standard of living, with money to buy new products, such as cars, refrigerators, and radios. • The United States emerged from the war as the world’s leading economic power. American banks and businesses controlled a global network of trade and finance. American loans and investments backed the recovery in Europe. As long as the American economy was healthy, the global economy remained relatively prosperous.

8. A Dangerous Imbalance: • Both the American and world economy had weak spots. One major problem was overproduction, a condition in which production of goods exceeds the demand for them. • The war had increased demand for raw materials from Latin America, Africa, and Asia. Improved technology and farming methods led to higher output. • After the war, the demand for raw materials dwindled and prices fell. Consumers benefited from lower prices, but farmers, miners, and other suppliers of raw materials suffered hardships.

9. At the same time, industrial workers won higher wages, which raised the price of manufactured goods. • Because farmers’ earnings had fallen, they could afford fewer manufactured goods. • Despite the slowing demand, factories kept pouring out goods. This imbalance, combined with other problems, undermined industrial economies. By the late 1920s, conditions were ripe for disaster.

10. Crash and Collapse: • In the United States, stock prices soared. Eager investors acquired stocks through margin buying, paying part of the cost and borrowing the rest from brokers. • In the autumn of 1929, jitters about the economy caused brokers to call in these loans. Investors who were unable to pay were forced to sell their stocks. • Stock prices crashed, wiping out the fortunes of many investors.

11. The stock market crash triggered the Great Depression of the 1930s, a painful time of economic collapse. • The crash created financial turmoil in the industrial world as American banks stopped making loans abroad and demanded repayment of foreign loans. • In the United States and elsewhere, banks failed and businesses closed, throwing millions out of work.

12. The cycle sprang steadily downward. The jobless could not afford to buy goods, so more factories had to close, which increased the number of unemployed even more. • In once-prosperous Western cities, people slept on park benches and lined up to eat in charity soup kitchens. • Global Impact: As the depression dragged on, many people lost faith in the ability of democratic governments to solve problems. Right-wing extremists played on themes of intense nationalism, the failure of democracy, the virtues of authoritarian rule, and the need to rearm.

13. Britain in the Postwar Era • Even before the depression, Britain faced economic problems. The nation was deeply in debt, and factories were out or date. • During the 1920s unemployment was severe, and wages were low. • In 1926, a general strike, or strike by workers in many different industries at the same time, lasted nine days and involved some three million workers.

14. Economics and Politics: • During the 1920s, the Labour Party surpassed the Liberal party in strength. Labour leaders gained support among workers by promoting a gradual move toward socialism. • The middle class, however, firmly backed the Conservative party. After the general strike, Conservatives passed legislation limiting the power of workers to strike. • During the Great Depression, Britain set up a coalition government made up of leaders from all three major political parties. It provided some unemployment benefits, but millions of people suffered great hardships.

15. Irish Independence: • In 1914, you will recall, Parliament passed a home-rule bill that was shelved when the war began. • On Easter 1916, a small a small group of militant Irish nationalists launched a revolt against British rule. • The execution of 15 of the rebel leaders stirred wider support for their cause.

16. When Parliament again failed to grant home rule in 1919, revolution erupted in Ireland. • The Irish Republican Army (IRA) carried on a guerrilla war against the British. • In 1922, moderates in England and Ireland reached an agreement. Most or Ireland became the self-governing Irish Free State. The largely Protestant northern counties (Ulster) remained under British rule. The IRA never accepted the division, and the status of Northern Ireland remained a thorny issue through the end of the century.

17. Commonwealth and Empire: • In 1931, four former colonies – Canada, Australia, New Zealand, and South Africa – became fully self-governing dominions within the newly formed British Commonwealth of Nations. • Despite challenges from nationalists, Britain retained its colonies. Britain worked to improve agriculture and education in its colonies while planning for gradual independence at some uncertain date.

18. Foreign Policy: • Britain’s postwar foreign policy created tensions with its ally France. Almost from the signing of the Treaty of Versailles, British leaders wanted to relax the treaty’s harsh treatment of Germany. • They feared that if Germany became to weak, the Soviet Union would be able to expand, and France might gain too much control on the continent. • Britain’s leniency toward Germany helped push France in the opposite direction.

19. France Pursues Security • Like Britain, France emerged from World War I both a victor and a loser. • Though the French had suffered enormous casualties, their economy recovered fairly rapidly, thanks in part to German reparations and to territories taken from Germany, including Alsace and Lorraine. • Later, the Great Depression didn’t hurt France as much as it did some countries, because its industries were not as centralized in the hands of big business.

20. The Maginot Line: • France’s chief concern after the war was securing its borders against Germany. • France built massive fortifications along its border with Germany. It was called the Maginot Line. • France strengthened its military and sought alliances with other countries, including the Soviet Union. It insisted on complete enforcement of the Versailles Treaty and complete payment of reparations, hoping to keep the German economy weak.

21. Prosperity and Depression in the United States • The United States emerged from World War I in excellent shape, suffering relatively few casualties and little loss of property. • It led the world in industrial and agricultural output. • American money helped finance the European recovery.

22. Postwar Issues: • The United States stayed out of the League of Nations, arguing that membership might lead to involvement in future foreign wars. • However, the United States took a leading role in international diplomacy. It sponsored the Kellogg-Briand Pact, pressed for disarmament, and worked to reduce German reparations. • Fear of radicals and the Bolshevik Revolution in Russia set of a “Red Scare” in 1919 and 1920. Many suspected foreign-born radicals were expelled from the United States and immigration was limited.

23. Boom and Bust: • In the boom years of the 1920s, middle-class Americans stocked their homes with radios, refrigerators, and automobiles. • In 1929 the stock market crash shattered this mood of prosperity. • President Herbert Hoover believed that the government should not intervene in private business matters, and hard times got worse.

24. The New Deal: • In 1932, Americans elected a new President, Franklin D. Roosevelt (FDR). He projected a sense of energy and optimism. • He introduced the New Deal, a massive package of economic and social programs. • Under the New Deal, laws regulated the stock market and protected bank depositors’ savings. Government programs created jobs for the unemployed and gave aid to farmers. A new Social Security system provided old-age pensions and other benefits that major European countries had introduced years earlier.