Warm Up What do you know about the Great Depression? What help do the unemployed need? Read page 424 and answer the question.

T HE G REAT D EPRESSION

E UROPE A FTER THE W AR Most European countries bankrupt after the war and had to borrow money from the U.S. European global power declined After the war all Europe's absolute monarchies disappeared and there were new democracies BUT, many citizens didn't have experience with democracy so there were frequent changes in government This leads to weak governments and a slow rise in totalitarian leadership

G ERMANY UNDER THE WEIMAR REPUBLIC ( ) Germans didn't like the Weimar government and blamed them for signing the Treaty of Versailles Germany had very high inflation because of two things: o they didn't raise taxes during the war o they printed a ton of money after the war Money becomes worthless in Germany (a loaf of bread cost 2 billion marks by 1923)

G ERMAN I NFLATION

H ELPING G ERMANY Dawes Plan- American aid to Germany that helps economy recover By 1929 German factories are producing pre-war quotas 1925 Germany allowed to join the League of Nations Kellogg-Briand act in 1928 tries to outlaw war forever

T HE G REAT D EPRESSION

W EAKNESSES IN THE U.S. E CONOMY Uneven distribution of wealth (a few rich people and a lot of poor people) Overproduction of manufactured and agricultural goods (poor people can't afford to buy things that are being made, so there is too much) Drop in demand for goods (this hurts businesses)

S TOCK M ARKET C RASH : O CT. 29, 1929 People buy stock they can't really pay for Investors worry that stocks are too high and begin to sell Panic began when prices go down and everyone tries to sell The market crashes

G LOBAL D EPRESSION U.S. demanded payment on loans U.S. puts a high tariff (tax) on foreign goods, which actually hurts the U.S. more World trade drops 65% and unemployment rises Germany and Austria suffer Japan hit hard Latin American countries come into crisis because they lost their export markets

W HAT DOES EVERYONE DO ? Britain elected a National Government (multi-party coalition), which passed protective tariffs and high taxes economy went back up and Britain avoided political extremes France elected a coalition of moderates, Socialist, and Communists, which passed reforms to help workers France keeps democratic government

CONTD. Scandanavia Socialist countries built recovery programs Democracy remained United States Roosevelt created a program called the New Deal New Deal created jobs, created welfare programs, social security New regulations on the stock market Democracy preserved