1. Inter-War Years ( )

2. Most countries showed signs of economic recovery by mid-1920s
Yet recovery was only too fragile
European economy was dependent on reparations paid by Germany and Austria as well as the flow of US funds to Europe
Once the US withdrew its funds & loans due to economic crisis back home, world financial system collapsed
The Great Depression

3. Great Depression: The US
There were signs of economic hardships before especially across peripheral countries
US played the anchorage role in the world economy after WWI due to its post-war economic boom
Investors in the US started to invest in risky ventures and stocks
Many people borrowed from brokers/banks and mortgaged their homes
Stock market crash in October, 1929 after a wave of panic selling on the New York Stock Exchange
Great Depression: The US

4. Great Depression: The US
By 1932, industrial production had fallen half of its 1929 levels
National income had dropped by approximately half
44% of US banks went out of business and deposits of millions of people had disappeared
Due to US’s role in post- WWI recovery, crisis in the US had a domino effect across the globe
Great Depression: The US

5. The Great Depression: Germany
Britain and France’s post- WWI economic recovery was largely financed by reparation money paid by Germany & Austria
German share of this money was especially high
Banks in Germany & Austria took most of their loans from the US
US banks called those loans back and refused extending short term loans in order to raise money
Germany hit especially hard

6. The Great Depression: Germany
Precipitous economic decline in Germany by 1932
35% Unemployment
50% decline in industrial production
Discontentment with the Weimer Republic
Rise of National Socialism after 1929
Hitler assumed power as chancellor in 1933
Germany became a single- party dictatorship

7. The Great Depression: the Domino Effect
Being an exporter of manufactured goods, Japan was hit hard
Exporters of raw materials were also influenced very negatively from depression such as countries in Latin America, Asia, and Africa
Between 1929 and 1932, world production declined by 38 percent and trade dropped by more than 66 percent

8. Great Depression: Consequences
Destruction of international financial and commercial networks of capitalist economies
Resort to economic nationalism through inward- looking, protectionist economic measures
Deepening of post-WWI pessimism
Marriage, childbearing and divorce rates declined, while suicide rates rose: mass human suffering
Rise of totalitarianism

9. Totalitarianism Stalin’s Soviet Union (1924-1953)
Hitler’s Germany ( )

10. Stalin’s Soviet Union (1924-1953)
A Georgian by birth, a Russian nationalist by conviction
Adopted surname “Stalin” meant “man of steel”
By 1928, became the unchallenged leader
Initiated First Five Years Plan
Centralization of the entire national economy was the alternative to market capitalism
Stalin’s Soviet Union ( )

11. USSR
Growth of industry
Collectivization of agriculture

12. Stalin: “One death is a tragedy. A million is a statistic.”

13. Hitler’s Fascist Alternative
Fascism emerged in Europe as a political ideology between two world wars
Mostly the middle classes and rural populations were attracted to ideology
Put emphasis on glorious objectives; national community as a unique ethnic or racial group; and a strong leader
Hitler’s Fascist Alternative

14. Germany under Hitler’s Rule

15. Germany under Hitler’s Rule
Once Nazi power was consolidated, racist ideology was put into practice
Nationalism based on “pure” German “race”
Policies designed to boost birthrates
Compulsory sterilization
Discrimination against Jews and gypsies

16. Mussolini’s Fascist Regime
Indeed fascist movement grew first in Italy
Ineffective political leadership; economic hardships; and disappointment with WWI settlements were influential in its rise
Mussolini was initially a socialist
Later turned to nationalism, demanded suppression of socialists, and strong leadership

17. Italy under Mussolini’s Rule
Between 1925 and 1931, Italy turned into a one-party dictatorship
In 1926, Mussolini seized total power and became the dictator
He became Il Duce (the leader)
Other parties were outlawed
Political dissents silenced
As Mussolini established good relations with Hitler, anti-Semitic laws started to be issued by 1938
Italy under Mussolini’s Rule