Federal Republic of Germany
Bundesrepublik Deutschland

Germany in the 1920s is a land in flux. The Great War has irrevocably changed the country. The abdication of the kaiser in November 1918 has resulted in a republic, known as the Weimar Republic since it initially met in the town of that name. The losses, both financial and human, caused by the war have been enormous. A humiliating peace settlement has been imposed by the Allies, with no German representation at the peace talks, resulting in considerable losses of land in Europe, complete loss of all overseas territories, huge reductions in the army and navy and complete abolition of the air force (particularly humiliating to such a militaristically inclined people), and the imposition of massive reparation payments to the Allies and their associates.

During the early years of the 1920s, Friedrich Ebert's moderate coalition government struggles to impose control over a fragmented, resentful and discontented population. In actual fact, Ebert would have preferred to establish a constitutional monarchy, but circumstances have made this impossible. Localised revolutions and rebellions are widespread, with both the communists and the right-wing veterans' organisations, the Freikorps, struggling for dominance. In March 1920 the Kapp Putsch actually manages to briefly establish a right-wing regime in Berlin, although the workers, police and army soon expel it. A similar attempt in the southern state of Bavaria is successful, however.

By far the biggest problem in Germany in the early 1920s is inflation. Germany's huge reparation debts are crippling, and the country struggles to meet its obligations. In 1923, tired of continual German defaults in payment, France and Belgium send troops to occupy Germany's industrial heartland, the Ruhr Valley. Losing control of their own industry, the Germans grow ever more resentful and ever poorer. Inflation begins to escalate as the mark devalues rapidly. Soon the value is changing by the minute. The currency finally collapses on 15 November 1923, by which time there are about 4,200,000,000 marks to the dollar. In Munich, a little-known party, the National Socialist German Workers' Party (NSDAP), takes advantage of the crisis to attempt a coup. It fails, but it does bring the party leader, an Austrian war veteran named Adolf Hitler, to the attention of the German public. Finally, the Government manages to restabilise the currency and agrees to make concessions to the Allies, ending the Ruhr occupation and rescheduling reparation payments.

After 1924, Germany sees a marked recovery in fortunes. Prosperity increases and life begins to look good again. Ebert dies in 1925 and is replaced by the war hero Field Marshal Paul von Hindenburg. The foreign minister from 1924 to 1929, Gustav Stresemann, sees little point in trying to escape the dictats of Versailles, believing (no doubt correctly) that Germany will gain more by obeying them. In the 1928 Reichstag elections, the extremist parties on both right and left take only 13 per cent of the vote. The Young Plan of 1929 proposes a heavy reduction in German reparation payments. German art and literature flourishes under Weimar, even during the bad times prior to 1924, Berlin becomes one of the world's most vibrant and most decadent cities, and the latter part of the decade can almost be seen as a German 'Renaissance'.

The good times are only temporary however. Germany is badly affected by the Wall Street Crash of October 1929 as American financiers, who have invested heavily in Germany, begin withdrawing their capital from the country. Within a few years, as the Depression sets in, the Nazis will have consolidated their power and Hitler will be chancellor of Germany. The consequences will be far-reaching and truly world-shattering.