Fulfilment Crises and Allied Disunity

Did the Germans deliberately allow inflation to ruin their currency in 1922–23 to evade reparations? Many at the time believed, and others since then still hold that was the case — that the German authorities and business interests contrived a fraudulent bankruptcy to demonstrate incapacity to pay, coupled with a cry for foreign loans and help to lift the burden of reparations from the German people. The charge against the authorities — of risking financial bankruptcy to sabotage reparations — was disputed, and the ensuing debate shows no sign of abating. Allied disunity and German recalcitrance over reparations and disarmament led to the Franco-Belgian occupation of the Ruhr and the passive resistance it provoked — events referred to by some historians as the renewal of war between France and Germany by economic means. The financing of the passive resistance campaign in Germany through the printing presses destroyed the mark and the political chaos threatened to break up the Reich. These events are described and interpreted, keeping a balance, by placing the events in their economic and political contexts. In the end, though, it was the Ruhr occupation that made possible the 1924 Dawes Plan for a reparations settlement under the informal auspices of the United States — a settlement (financed by American money) that ushered in a five-year period of economic prosperity for Germany.