(Bergan, 27) Even though the treaty was not the main downfall of Germany's economy, it did push it along a little farther. All of Europe faced economic hardship after a costly war, the germans were not alone. In fact they came out of the war in better shape economically than the winners. (Bergan, 27) They did however lose the fertile area of the Rhineland, had to pay huge reparations to the French and British and lost their ability to defend themselves being limited to a 100,000 man army. (Lecture) The mere thought of losing the war, losing territory and the idea of paying off your rivals after you think you are going to win, will psychologically sap a people. The Treaty of Versailles will be later used as a propaganda tool to galvanize a desperate public.
Once a new government was established it was already set to fail. Coming in with a whole new set of rules, a republic that was not popular to begin with. The Weimar Republic was formed in 1918 with some great achievements in political, cultural, foreign policies and economy, (Bergan,44-45) but it was still seen as imposed on to the German people and it was rejected. It did not help that the government was often in paralyzing standstills and could not get a whole lot done. The political culture was so polarized on extreme levels of left versus right that infighting stalled a lot of progress that other democratic republics enjoyed. (Lecture) They also did not change a lot of members of the old German Kaiser. A lot of these officials who were positioned in the judicial and civil service departments and were not to keen on the new government themselves. Even though the government had negotiated to avoid paying most of the reparations and its economy was recovering, it all came down in 1923 due to the fiscal policies during the war aimed at an attempt to stop France and Belgium from seizing reparations directly from Germany. (Bergan, 45) With hyperinflation decimating the German Mark it caused more stress on the populus and further feeded their hatred for their new government.
