Impact of the Great Depression on Germany

Impact of the Great Depression on Germany

• The Great Depression was a severe worldwide economic depression sparked by the stock market crash of 1929 in the New York Stock Exchange.
• Although the Depression affected almost every country, it hit Germany particularly badly, because Germany was dependent on loans and investments from the US.
• Thus, when the US suddenly recalled the loans and deposits from German banks, Germany suffered an economic crisis, which in turn caused a social crisis.
• Factories closed down, millions lost their jobs, the government also had to make cuts to social services, poverty, homelessness and even starvation were commonplace.
• By 1932, 6 million people, or one-third of the working population, were unemployed.
• The Depression also led to a political crisis as the coalition government in power at the time could not decide what course of action to take.
• The only way action could be taken was when the President used his emergency powers.
• However, President Paul von Hindenburg was a right-wing nationalist who did not really care for democracy. People were angry and wanted more decisive action.
• There was a decline in support for parties with moderate opinions and a rise in support for more extreme parties like the Communist Party and Nazi Party.