The Downfall of Money: Germanys Hyperinflation and the Destruction of the Middle Class by Frederick Taylor
Authors: Frederick Taylor
Tags: History, Germany, Europe, Economics, Finance, Professional & Technical, Business & Money, Money & Monetary Policy, Inflation, Accounting & Finance
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remain in place, if Ebert and Groener had their way. How else was the army to hold together and its soldiers be got home safely and in good order?
One thing was certain. In the brief vacuum that had followed the announcement of the Kaiser’s abdication, the far left had failed to take control. Liebknecht’s call for a socialist republic of Germany and for a world revolution had fallen mostly on deaf ears. The masses had stuck overwhelmingly with their familiar democratic socialist leaders, including the relatively moderate leaders of the Independents, with Ebert at the apex of that new power structure.
By the day after the great transformation, Sunday, 10 November, Berlin was surprisingly calm. The theologian and philosopher Professor Ernst Troeltsch described the scene in the leafy Berlin suburb of Grunewald, where he noticed the solid middle-class burghers taking their usual Sunday strolls in the woods, though with one or two concessions to the new era:
No elegant grooming, a conspicuous ‘citizen’ look. With many, probably deliberately, simply dressed. Everyone somewhat subdued, as you might expect from people whose fate was being decided somewhere far away, but all the same reassured and comfortable that things had gone so well. The trams and the underground railways were running as usual, a sort of pledge that, so far as the immediate necessities of life were concerned, all was in order. On every face was written: Salaries are still being paid. 4
The mixture of relief and apprehension that characterised the great majority of Germans’ attitudes during this interlude – the armistice followed the next day, on Monday, 11 November – seemed to bode well for change. But most Germans, including the leadership of the Social Democratic Party, typified by Friedrich Ebert, did not want too much of it.
The new governing elite wanted enough to give the country’s citizens some more freedom and equality, to brush aside the stuffy authoritarianism of the Empire, and, so far as the outside world was concerned, perhaps to induce a more merciful peace settlement along the lines of President Wilson’s Fourteen Points. And perhaps a little socialism, too. Even before 1914, German industry had already developed along lines that diverged consciously from the free-market, individualist ‘Manchesterism’ of Britain or the USA, and the passions and necessities of war had done much to move the Reich’s economy towards a kind of corporate socialism that was even more peculiarly German. But not so much socialism that ‘Russian conditions’ would be created, for both the prosperous classes and the majority of workers did not want Bolshevism.
The main thing was that the old system seemed both discredited and ruined. The Kaiser, after his apparently panic-stricken flight across the border into Holland, was held in widespread contempt. The generals and the officer class had brought their nation nothing but drawn-out suffering and defeat. Germans had stood together for four years with remarkable fortitude, it was true, but to what end? And what would happen now?
A few months later, Ebert would give a speech in which he spoke of his motives at the time of the November revolution:
We were in the real meaning of the word the insolvency administrators of the old regime: All the warehouses were empty, all stocks dwindling, all creditworthiness shattered, our morale sunk to the depths. We . . . exercised our best energies to overcome the dangers and the misery of the transitional period. We did not prejudge things that were the business of this National Assembly. But where time and necessity were of the essence, we made every effort to fulfil the most urgent demands of the workers. We did everything we could to restore economic life. If our degree of success did not accord with our wishes, then the circumstances that prevented us from doing so must be properly judged . . . 5
This speech was many things but it was
One thing was certain. In the brief vacuum that had followed the announcement of the Kaiser’s abdication, the far left had failed to take control. Liebknecht’s call for a socialist republic of Germany and for a world revolution had fallen mostly on deaf ears. The masses had stuck overwhelmingly with their familiar democratic socialist leaders, including the relatively moderate leaders of the Independents, with Ebert at the apex of that new power structure.
By the day after the great transformation, Sunday, 10 November, Berlin was surprisingly calm. The theologian and philosopher Professor Ernst Troeltsch described the scene in the leafy Berlin suburb of Grunewald, where he noticed the solid middle-class burghers taking their usual Sunday strolls in the woods, though with one or two concessions to the new era:
No elegant grooming, a conspicuous ‘citizen’ look. With many, probably deliberately, simply dressed. Everyone somewhat subdued, as you might expect from people whose fate was being decided somewhere far away, but all the same reassured and comfortable that things had gone so well. The trams and the underground railways were running as usual, a sort of pledge that, so far as the immediate necessities of life were concerned, all was in order. On every face was written: Salaries are still being paid. 4
The mixture of relief and apprehension that characterised the great majority of Germans’ attitudes during this interlude – the armistice followed the next day, on Monday, 11 November – seemed to bode well for change. But most Germans, including the leadership of the Social Democratic Party, typified by Friedrich Ebert, did not want too much of it.
The new governing elite wanted enough to give the country’s citizens some more freedom and equality, to brush aside the stuffy authoritarianism of the Empire, and, so far as the outside world was concerned, perhaps to induce a more merciful peace settlement along the lines of President Wilson’s Fourteen Points. And perhaps a little socialism, too. Even before 1914, German industry had already developed along lines that diverged consciously from the free-market, individualist ‘Manchesterism’ of Britain or the USA, and the passions and necessities of war had done much to move the Reich’s economy towards a kind of corporate socialism that was even more peculiarly German. But not so much socialism that ‘Russian conditions’ would be created, for both the prosperous classes and the majority of workers did not want Bolshevism.
The main thing was that the old system seemed both discredited and ruined. The Kaiser, after his apparently panic-stricken flight across the border into Holland, was held in widespread contempt. The generals and the officer class had brought their nation nothing but drawn-out suffering and defeat. Germans had stood together for four years with remarkable fortitude, it was true, but to what end? And what would happen now?
A few months later, Ebert would give a speech in which he spoke of his motives at the time of the November revolution:
We were in the real meaning of the word the insolvency administrators of the old regime: All the warehouses were empty, all stocks dwindling, all creditworthiness shattered, our morale sunk to the depths. We . . . exercised our best energies to overcome the dangers and the misery of the transitional period. We did not prejudge things that were the business of this National Assembly. But where time and necessity were of the essence, we made every effort to fulfil the most urgent demands of the workers. We did everything we could to restore economic life. If our degree of success did not accord with our wishes, then the circumstances that prevented us from doing so must be properly judged . . . 5
This speech was many things but it was
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