The issue of domestic policy also played a major role in the political and economic instability; by 1922 the new Weimer government had failed to manage Germany’s debt situation correctly, and was thus on course for hyperinflation – the total debt since 1919 had tripled to 469 billion gold marks, forcing the Weimer government to ask for a pause in reparations to allow time for recovery. This failed, and France instead increased demands to 60% of the dyestuff industry. As part of their domestic policy, the Weimer government simply responded by printing even larger sums of money to pay off their reparations, which cemented Germany’s course to hyperinflation. As such, Germany was placed into economic turmoil as the Allies assumed that Germany had defaulted on their reparations, resulting in the French occupation of the Ruhr. Instead of encouraging German industry, the government enacted the policy of ‘passive resistance’; workers were encouraged to strike to defy the will of their French occupiers, while the government shouldered even greater debt by promising to pay the workers their wages. This was a significant failure of domestic policy, and the German economy, now facing both French hostility and economic downturn was essentially crippled. The political implications were also clear – the government faced increasingly hostile opinion for the mismanagement of the economy. Instead of pacifying opposition to domestic policy, the government ordered that one sector of the Freikorps should disband, an order that was defied by their leader, who instead organised a march onto Berlin and the later Kapp Putsch. Most notably the weakness of domestic policy was revealed in this instance; the Weimer government ordered the central army to supress the march, only to have its orders refused by the army, and served as proof of the political instability that existed, where the government had little control. While domestic policy was a key failure, it is not as important as the underlying Treaty of Versailles due to the fact that many of the economic problems and social unrest were created by the treaty, and arguably no matter how successful domestic policy was Germany would always be economically strained by the treaty, at unease socially.
The political spectrum was also being increasingly widened, as the Weimer government began to face threats from both the far left and right wing. From the left-wing, a series of strikes were enacted in 1919, at a detrimental effect to the economic stability of Germany. Peace was only restored by the use of force, which caused further political rifts as there were numerous deaths in the clashes between the strikers and the army. The new Spartacist movement also proved to be another political opponent, with numerous protests that served to increase hatred for the pre-existing government. Again, the Weimer republic simply responded by using the Freikorps to violently supress any revolts, although eventually concessions were also made, such as the eight hour working day. There was also numerous right-wing opposition, which was responsible for the formation of the ‘stab in the back myth’ as well as the eventual labelling of the government as the ‘November Criminals’. The later Kapp Putsch also resulted from this political divide, followed by the more significant Munich Putsch which resulted in the increased popularity of the Nazi party headed by Hitler. Overall, while political opponents did not have an overly detrimental effect on the Germany economy, it notably put the Weimer government to the test on numerous occasions. While this would have numerous political implications later, it was not as significant in the short term compared to the failure in domestic policy due to the fact that the revolts were easily suppressed by the army and Freikorps.
The Weimer constitution also displayed inherent weakness; the democratic system advocated proportional representation, and this can be seen as one of the sources of political dissent, as there was never a single party that held the majority of power. This also allowed extremist views to form within the government, and while the Weimer republic was ultimately democratic, arguably a lack of control over the media and dissident groups encouraged further political instability. Article 48 of the constitution also proved to be controversial, as it in effect allowed the chancellor to use ‘emergency powers’ when required, which would in effect allow economic policy to be overruled. While this factor was an inherent weakness, it is overall the least important as demonstrated by the use of the army to crush dissent, and the fact that Article 48 was only enacted during times of crisis such as the Munich Putsch, and even so arguably within reason.
Overall, it is clear that the Treaty of Versailles was the key cause of political and economic instability. Initially crippling the German economy, it also served to suppress any attempts for recovery, especially with the later French occupation of the Ruhr under the treaty. While the government’s domestic response to the treaty was a general failure such as the policy of passive resistance, it is clear that without the treaty, the government would have been able to deal with the economic implications much more effectively. The Treaty of Versailles can also be seen to be the root cause of the political divide within Germany, such as the right-wing groups forming the ‘stab in the back myth’ while left-wing groups enacted numerous strikes that further crippled the economy. The Weimer constitution remained an inherent weakness, but remains the least significant as the government proved that extremist views could be quashed in the short-term. Therefore, it is clear that the Treaty of Versailles is mainly responsible for the economic and political instability in the years1919-23.
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