BLOOD,FIRE AND STEEL 150 YEARS OF EUROPEAN HISTORY; THE FORGING OF THE EUROPEAN UNION, EUROPE AND THE LEAGUE OF NATIONS

EUROPE AND THE LEAGUE OF NATIONS

President Woodrow Wilson’s hopes for a permanent association to adjudicate peace amongst nations took shape in the League of Nations that was birthed in 1920. The League was fashioned around its covenant or constitution as the basis for its operations and binding agreements.

With its headquarters in Geneva, it consisted of an assembly in which members had an equal vote, alongside the right of veto and a smaller council of four permanent members and four (later rising to six and eventually nine) members chosen on a rotating basis by the assembly.

The vision of the League was hinged on security; individual and collective. Its members were pledged to seeking peaceful solutions to disputes and to assist one another against aggression. The vision was far reaching and could have become a practical platform for maintaining world peace but for a few shortcomings found in its covenants and in the attitude of some key members.

The League did resolve disputes between nations such as Finland and Sweden, Hungary and Czechoslovakia, Poland and Germany, Albania and Yugoslavia. There were specialized agencies dealing with issues related to the status of Danzig and the Saar, refugees and global trade on narcotics. Out of the league’s initiative came the international labor organization and the international court of justice with its headquarters in The Hague.

That the league eventually floundered in its bid to impose and promote world peace lay with the instruments and mechanisms guiding its operations. To start with because every decision had to be unanimous or set aside, this cast a huge burden on the decision making process. Secondly, not many nations were willing to surrender part of their sovereignty to the collective body in order for its decisions to be binding and far – reaching.

Infractions and disobedience to its covenants were not rigorously sanctioned and enforced. The decision by the US senate not to ratify America’s membership of the league by ratifying the Versailles treaty left the league without the support of one of its most important founding fathers. The membership tenure of some key nations was chequered and tenuous at best.

  The US did not join. Russia only from 1934 to 1939, Germany from 1926-1933, Turkey joined only in 1932 while Brazil withdrew in 1926, Japan in 1933 and Italy in 1937. Its dependence on sanctions as a means of enforcing its covenant was at best illusory and at other times, outrightly counterproductive.

For instance in sanctioning Italy for its invasion of Ethiopia, the economic boycott called for, was rendered ineffective when iron, steel and oil were excluded from the list and before a year could expire, they were lifted.

 Worse still the league was ineffectual when Germany sent troops into the demilitarized Rhine land in violation of the Versailles treaty; and there was never a coordinated response to any of Nazi Germany’s infractions against the Versailles treaty like its re-armament programs and re – occupation of the Saar and even the outright invasion and annexation of Austria. 

The impunity of the German Chancellor Adolf Hitler in violating the terms of the Versailles treaty and the lack of coordinated and determined response on the part of the league members spelled its death knoll.

Anschluss

German troops cross the Austrian border in March 1938. Anschluss, the union of Austria and Germany, was achieved without Austrian resistance.

Corbis

 Other nations like Japan and Italy soon took a cue from Germany in rendering the League of Nations impotent. The appeasement policies of Neville Chamberlain the British Prime Minister compounded the problems of the league.

Even its founding members hardly took the League of Nations and its covenants into consideration in taking major political decisions involving global peace and respect for the territorial integrity of nations whose boundaries were being violated like Austria, Czechoslovakia, Finland, Poland etc.

A positive notable development however sprang forth in course of the existence of the League of Nations when the new French foreign minister Aristide Briand in taking office in 1925 pledged to work for a United States of Europe and on September 9, 1929, he made a speech to the then 27 members of the league in which he suggested the forming of a European Federal Union.

On May 1^st 1930, the French foreign minister actually presented a memorandum from the French government on the organization of a system of European Federal Union. The proposal was well articulated and he pressed the need for Europe to adopt steps for enforcing collective security and economic collaboration. The idea was that European unity could bury the nationalistic agitations that were threatening the peace of Europe.

His proposal also centered on the need to set up a plan involving the establishment of a European conference within the frame work of the committee and a secretariat putting politics before economics in the European community while working towards the establishment of a “common market” in which “the movement of goods, capital and people” would be gradually liberalized and simplified.

The details according to the French foreign minister were to be the specific responsibility of the individual governments concerned. He however insisted that the process of dialogue and understanding must recognize the equality and sovereignty of each individual nation.

Quoting the memorandum he said “is … of each nation to be able to affirm itself still more consciously by cooperating in the collective effort within a federal union that fully respects the traditions and characteristics of each of its constituent people”. The initiative was not enthusiastically followed up by the other European members of the league and only a few countries like Bulgaria, Yugoslavia and to a point Czechoslovakia, Norway and Greece lent their support to the initiative.

The rest were openly skeptical and even out rightly indifferent to the initiative. The Netherlands however alone, argued the need for collective unity. Others felt such an initiative threatened the existence of the league and this view was held by countries like Poland, Sweden, Switzerland and the U.K.

Several other countries felt that rather than set up any other parallel organization, the league should work towards recruiting nations like Russia and Turkey which were then not yet members. The Wall Street crash of October 1929 only served to accentuate the view that Europe’s pressing problems were economic rather than political.

Many countries thereafter became more conscious of the need to protect their individual economies by raising tariffs and imposing restrictions on imports, pursuing a unilateral rather than a multilateral approach to solving Europe’s economic problems. All these rather intensified the nationalistic and altruistic tendencies of the European states promoting competition, rather than co-operation.

The German foreign minister Gustav Stresemann who had helped to formulate the Locarno treaties of 1925 confirming among other things the new western frontiers of Germany, and who was also a fervent believer in European cooperation and unity unfortunately died in 1929 before the idea of European unity and collaboration could take root.

A powerful spokesman advocating Germany’s obligations to observe the Versailles treaty and promote peace in Europe, Stresemann who won the Nobel peace prize in 1926 was a potential candidate for pursuing Briand’s initiative. Unfortunately three years after Stresemann’s death, Briand himself died in 1932, and the most the European countries of the league voted to do, was to endeavor to put the plan before the assembly of the League of Nations.

To compound matters, the German Catholic Centre partly led by Chancellor Heinrich Bunning showed complete indifference to the striving for European unity even as events were pushing the Weimar Republic to the brink of collapse in the face of the growth of extreme groups such as fascists, nationalists, communists and the National socialists’ workers party.

Aristide Briand’s death in 1932 also coincided with the onset of the Great Depression that helped to undo the spirit of collective bargaining and resolution of disputes that were beginning to flower in Europe and instead, led to the entrenchment of nationalistic, sectional, racial and ethnic tensions in Europe.

GERMANY AND THE WEIMAR REPUBLIC

Demonstration Against the Versailles Treaty

On June 22, 1919, the government of Weimar Germany, under international pressure, accepted the Treaty of Versailles. The treaty held Germany solely responsible for World War I, and accordingly imposed harsh conditions on Germany. A fundamental revision of the “Dictat of Versailles,” as the peace treaty was referred to in Germany, became the pressing goal of a wide cross-section of German society. Mass demonstrations and rallies against the Treaty of Versailles, like this one in Berlin, were the order of the day.

ORF Enterprise Ges.m.b.H

Following its defeat in World War 1 and the abdication of Emperor Wilhelm II as Kaiser, Germany was proclaimed a Republic by the government of the then Chancellor prince Maximilian Von Baden who also resigned in favor of the Social Democrat leader Friedrich Ebert who formed the new government in November 1918.

The proclamation took place on November 9, and on November 11, Germany signed the armistice peace terms bringing the war to an end. The new Republic that emerged like any child of circumstances was plagued with fundamental problems bordering on its legitimacy and popular support from the word- go.

For a government conceived in defeat, that signed the unpopular armistice agreement coupled with the even more unpopular Versailles treaty, the Weimar Republic came to bear the brunt of the blames and reproach concerning defeat in World War 1.

 With the nationalist socialist party of Adolf Hitler branding the signatories to the peace of 1918, ‘November criminals’ the stigma of illegality, betrayal and conspiracy came to hang heavy on the fortunes of the Weimar republic. The government was not only unpopular but also unstable, having to contend with revolutionary forces from the left, extreme right and centre left.

 That it was democratic did not strengthen its support base either, partly because the culture of democracy and freedom were still an alien concept in the early 20^th century Germany. The idea of a strong government that imposed its will on the people were what the German people were accustomed to, not one that had its roots and foundation in a peace treaty prepared by foreign powers and signed by Germany in a moment of defeat.

Crises dogged the footsteps of the Weimar Republic right from its inception. The new Republic came first under pressure from both left wing and right wing politicians particularly the left wing socialists and Marxists “Sparta cists” led by Karl Liebknecht and Rosa Luxemburg who organized strikes and founded Soviet model workers and soldiers’ councils. The insurrection however was crushed by the army in January 15, 1919 when both leaders were arrested and killed violently.

On the other hand right wing ex-army officers came together to form the paramilitary Freidkorps who also sought to besiege the government. In the bid to give the new Republic constitutional footing, elections were held on January 19, 1919 to elect delegates to the 163 seats, the Catholic centre party won 89 seats and the Progressive party won 75 seats.

The coalition of these three parties formed the government; to the exclusion of the old conservatives now called the National people’s party with 42 and the new people’s party with 21 seats. On the left the independent socialists held 22 seats.

This assembly met on February 6, 1919 at Weimar an ancient city on the Weimar River, basically to avoid the predictable opposition that sitting in Berlin would have exposed the gathering to, as feelings were still running high in Germany over the defeat in the war and humiliating peace treaty that ensued.

The new parliament (Reichstag) did not reconvene in Berlin until the spring of 1920 and even then the Republic was named the Weimar Republic. The new constitution was modern, democratic and embraced the concept of representative government and democratic rights which were yet to be firmly etched in the psyche of the average German.

 The constitution was inaugurated on July 31 1919. In March 1920, the new republic was shaken by an attempted coup d’état coupled with an election in June that resulted in serious defeat for the republicans.

The centrist Democrats and the Social democrats both lost considerable seats in the parliaments shifting the momentum to the forces of the extreme right, made up of right – wing parties and the left wing socialists and other smaller parties that made considerable gains. 

The original coalition that formed the new Republic suddenly found themselves in the minority and the new groups, violent in expression dominated the new parliament. On the streets, political violence was widespread. Things got to a head when on August 26 1921, two former officers of the German armed forces shot and killed Mathias Erzberger, a Catholic centre party deputy who had negotiated the peace terms.

 On June 24 1922 three right wing students shot and killed Walter Ratheneau, the newly appointed foreign minister who was Jewish. And to cap it all on November 8 1923, an abortive putsch involving elements of Adolf Hitler’s National socialist party and other right wing extremists was crushed and Adolf Hitler, Herman Goering and Erich Ludendorff were implicated and charged to court.

In the midst of these all, the Weimar Republic continued and even recorded some remarkable success in the economic arena as the German economy flourished and the revived economic fortunes of Germany helped partially to stabilize the polity. Germany was even able to make substantial reparations payment and grow its economy substantially; increasing its share of European and world trade.

Germany at a time stood next to the United States in terms of economic performance boasting of more per capita income than any other nation in Europe. As the 20’s progressed, more and more Germans began to fantasize the issue of national rebirth, extreme nationalism and the glory of the fatherland.

The rise of National Socialism and its extreme doctrines built around the myth of the superiority of the Aryan race, the manifest destiny surrounding Germany’s ascendancy in Europe, the need to uproot the Jews as the main obstacles to Germany’s nationalistic aspirations, the need to re-unite Germans wherever they may be found, began to resonate with a cross section of the German people and fan the flames of racial, ethnic and nationalistic bigotry.

Midnight SS Ceremony

The Schutzstaffel, or SS, was the most feared organization within Adolf Hitler’s National Socialist Party. During World War II (1939-1945), the SS was responsible for running the Nazi concentration camps and extermination centers at which many hundreds of thousands of people were systematically killed. Shown here, new members of the SS are sworn in at a midnight ceremony.

Bruce Coleman,

The German people under the influence of the teachings and propaganda of the Nazi party and other extreme right wing groups were encouraged to see themselves more as Germans, the Aryan race destined to rule the whole world while other European races and peoples were presented as racially inferior and destined to be subjugated and conquered.

Adolf Hitler while in prison over the Munich Putsch wrote his thoughts in his book ‘Mein Kampf’ in which he set out his beliefs, thoughts and vision for Germany. By appealing to the altruistic tendencies in the people, reminding them of their inherent racial supremacy, Hitler created a consciousness in Germans of their innate superiority that made his national socialist party extremely popular and appealing.

He conveniently labeled the defeat of 1918 as the work of Jews, fifth columnists, communists and other enemies of Germany. In convincing the nation that Germany did not really suffer a defeat on the battlefield, he began to prepare the people for another re-match, a contest of wit and muscle for a people whom he convinced did not lose the war but were rather stabbed in the back.

 Germany thus entered the 1930s initially hesitant, undecided but gradually yielding, as successive elections showed to the rhetoric’s and propaganda of the national socialist workers party. The Nazi’s kept improving their electoral fortunes in election after election until by 1930 no party could form a coalition government without the support of Hitler’s national socialists’ workers party.

 In the 1932 elections, the Nazis had become the single largest party in Germany’s parliament and were now in a position to form a coalition government of their own.

The Emergence of Adolf Hitler and the Nazi party

BLOOD,FIRE AND STEEL, THE MAKING OF THE EUROPEAN UNION, CENTRAL EUROPE AND THE MIDDLE EAST 1920-1930

CENTRAL EUROPE AND THE MIDDLE EAST, 1920 – 1930

With the expiration of the Habsburg Empire, the successor states of Austria, Hungary and Czechoslovakia came to be the main object of the peace conference’s deliberations. The first two, being the main stays of the Austro – Hungarian empire were dealt with as defeated powers.

Czechoslovakia and Yugoslavia together with Poland even though were given benevolent treatment by the victorious powers, were however not in themselves homogeneous entities; rather conflicting ethnic, racial, economic, military and political divisions left these states less than stable even with the victorious powers.

The state of Yugoslavia was only an amalgamation of Serbs, Croats and Slovenes, while Czechoslovakia was a melting pot made up of Czechs, Slovaks and Sudeten Germans. Poland on its own part comprised Ukrainians, Germans, Lithuanians and Yiddish speaking Jews. Romania greatly enlarged by the addition of Transylvania and Bessarabia, now included millions of Ukrainians, Hungarian Jews and other minorities.

The term balkanization of Europe was drawn largely from the many nationalities and ethnic divisions and rivalries that these new nations came to represent. Poland even though enjoying the sympathies of the United States and France remained agitated over the issues of an outlet to the sea through the Port city of Danzig which incidentally consisted of 1.5 million Kashribians and Germans.

Further north, the Baltic states of Lithuania, Latvia and Estonia won their independence from Russia and depended largely on Britain’s sea power to secure their freedom. However Poland and Lithuania were tangled in a quarrel over the control of Villinius a town which according to Russia’s 1877 census figures was 40 percent Jewish, 31% Polish, 24% Russian and 2% Lithuanian. In December 1919 the Supreme Allied council awarded the city to Lithuania.

Similarly the Czech–Polish dispute over the coal – rich Teschen district led to recognition of the occupation claims of both powers as they were presently standing. The German – Polish dispute over Upper Silesia also was resolved in favor of Poland which came to win over most of the mines to the disadvantage of Germany which had the greater ethnic nationalities population resident there.

 An Allied approved plebiscite in 1921 showed that ethnic Germans were more outside the coal mine district while the Poles were in the majority around the coal mines.

The treaty of st Germaine similarly disposed of the Austrian half of the former Hapsburg monarchy in favor of Czechoslovakia while the American President succeeded in getting the strategically important province of Bohemia granted to Czechoslovakia with the inherent problem of 3.5 million ethnic Sudeten Germans alongside the grant of territory stretching south to Bratislava on the Danube river but also creating a host minority of 1 million Magyars.

The settlement of Italy’s territorial claims on Austrian land became a heated issue as the Italians insisted on the Allies fulfilling their wartime promises which President Wilson regarded as immoral and unethical.

Before World War I began in 1914, the major European powers included Britain, France, Italy, and the empires of Germany, Russia, and Austria-Hungary. The Ottoman Empire also controlled territory in Europe.

 His denunciation of the Allies pact with Italy was made openly in a press conference in Paris on April 24, 1919 in violation of the ethics of the conference; only to return later to a compromise solution that included declaring the city of Fiume an open city to both Italy and Austria.

Meanwhile Italy was granted Trieste, parts of Istria and Dalmatia and the upper Adige as far as the Brenner pass with its 200,000 Germans speaking Austrians. The refusal of Wilson to concede Fiume to the Italians led to an imbroglio that led to the collapse of the Orlando government and the ultimate victory of Mussolini’s fascists in 1922 following Italy’s revolt over the Allies’ volte-face on the territorial claims issue.

As for Hungary, the treaty of Trianon which was delayed by the communist coup in Hungary until 1920 partitioned the ancient Hungarian kingdom among neighbors. Transylvania along with its 1.3 million.... minority was handed over to Romania; the Banat of Temesvar (Timisoara) was divided between Romania and Yugoslavia.

Hungary’s territories thus shrank from 109, 000 to 36,000 square miles, while the post war armies of Austria and Hungary were limited to 35,000 men each. The treaty of Neville with Bulgaria saw Bulgaria losing its western territories to the kingdom of Serbs, Croats and Slovenes and nearly all of Western Thrace to Greece cutting the Bulgarians off from the Aegean Sea.

Their armed forces were limited to 20,000 men for Austria, Bulgaria and Hungary even though the reparations payment was eventually called off for obvious reasons of economic weakness. The treaty settlement in East Europe was a fair attempt to implement the principles of self – determination in an area where the conditions were completely unfavorable to its policies.

 The issues of dissatisfied and dislocated minorities, inadequate finances, lack of an existing democratic culture, equipping of a functional government, army, police and institutions of government all combined to make these newly formed countries unstable and potential breeding grounds for dissent and crises in the midst of the suppressed nationalistic aspiration of a defeated Germany and a comatose Russia.

Austria with its population nearly all German was forbidden by the terms of the treaty from seeking union with Germany.

MIDDLE EAST AND EUROPE, 1920

The Ottoman Empire was likewise dismantled by the treaty of Sevres. The political aims of Great Britain and France were largely achieved, as president Woodrow Wilson felt less inclined to interfere on behalf of Arab aspiration as he felt that the Arab world was not yet ready for self rule. The British and French thereby legitimized their acquisition of Ottoman Turkish territories under League of Nations mandate.

The mandates were classed as ‘A’ for those territories ready for independence and class ‘B’ for those judged as not yet ready for independence. Britain thereby obtained Iraq, Transjordan and Palestine under class ‘A’ while France obtained Syria and Lebanon.

Class ‘B’ territories were Tanganyika to Britain, Cameroon and Togo land divided between Britain and France, Rwanda, Burundi to Belgium and class ‘C’ mandates of German south west Africa (Namibia) to South Africa, New Guinea to Australia, German Samoa to New Zealand, and the Marianas, Marshall and Caroline Island to Japan.

In the Mediterranean area, the Allies informally conceded that south eastern Anatolia would be a French sphere of influence while Italy received the Dodecanese Islands and a sphere in western and southern Anatolia. The British supplied the Greek government of Eleutherious Venizelos with funds and Greece occupied Smyrna and its hinterlands to the surprise of the Italians who felt that Greece was intruding into its sphere of influence.

Meanwhile Armenia was offered as mandate territory to the US which declined, and thereafter there were talks of Armenian independence more so because of the Christian population and the genocide inflicted on the Christians by the Muslim Turks in course of its war with Russia.

With Russia down, the issue of the Dardanelles Strait and Constantinople were left unresolved as the US declined intervention there. The vacuum thus created led to a conflict between Greece which wanted to expand its territories into the former Ottoman Turkish held lands and the new Turkish ruler, Mustafa Kemah who commanded Turkish forces during the war.

With the imposed treaty of Sevres signed in August 1920 by the weakened Sultan, Mustafa Kemah rallied his Turkish forces against foreign influence in Anatolia and Constantinople. British Prime Minister Lloyd unwilling to commit British troops instead urged Greece to enforce the Provisions of the treaty.

The Greeks thus seized the opportunity to dominate the entire Turkish area and impose Greek rule. The ensuing Greco-Turkish war thus started in 1920 upon the signing of the treaty. By the end of 1920, Greek forces had moved out from Izmir, occupied the western third of Anatolia and were threatening the Turkish capital of Ankara.

In March 1921, the British and French proposed a settlement that was rejected by the Turks who at the same time sought to divide the ranks of the Allies on the issues. The Turks fighting under Kemah later renamed Ataturk, eventually turned the tide against the Greeks .In August 1921 Turkey signed a treaty of friendship with the new U.S.S.R regulating the border between them and ending the hopes of the newly declared independence of Armenia and Tran Caucasian Republics.

 An Allied approach to Ataturk was rebuffed in March 1922, and he instead launched a fresh offensive on the Greeks who withdrew hastily and in panic from Izmir which the Turks re – possessed.

The Turks now turned on the Allied position on canal kalong on the Dardanelles Strait leading to the withdrawal of French and Italian forces while the British prepared to open hostilities against the Turks who eventually relented and the fighting was brought to an end in the truce of Mudanya (October 11 1922).

 Eight days later Lloyd George resigned his premiership and a new peace conference produced the treaty of Lausanne (July 24^th 1923), which returned Eastern Thrace to Turkey and recognized the Nationalist government in return for the demilitarization of the Straits. The success of the Turkish revolt inspired other Arab elements on the same course of action.

THE ROAD TO WAR 1929 – 39; THE REMAKING OF EUROPE

The 1930s was a decade of unrelenting crises and events that eventually festered into a total, Second World War. The pace of events was fast – paced, rapid and in quick succession. The treaties and structures put in place in 1919 all gave way to the shock waves of the Great Depression, political instability and ideological struggles that were to sweep through Germany, Italy and eventually Japan.

The emergence of Adolf Hitler as the German Chancellor on January 20, 1933 altered the political direction of Europe. By 1933 hardly one stone stood on another of the economic structures raised in the 1920s. By 1935 Adolf Hitler’s Nazi regime had torn up the treaty of Versailles, and by 1936 the Locarno treaties as well.

Armed conflicts that began in Manchuria in 1931 had spread to Abyssinia in 1935, Spain in 1936, China in 1937, Europe in 1939 and the United States and the USSR in 1941. The collapse occurred in the context of an economic blizzard that hemorrhaged the democracies and reinvigorated the dictatorships.

Many citizens and intellectuals in the west lost faith in democracy and free market economics, while widespread pacifism, isolationism and the earnest desire to avoid the mistakes of 1914 left many of the leaders of the Western Alliance without the will or the means to defend the 1919 order.

The combination of demoralized politicians, stricken institutions and uninspired leadership led historian Pierre Renouin to describe the 1930s simply as ‘la decadence’.  The militant, authoritarian states on the other hand like Italy, Japan and Germany seemed only to wax stronger and more powerful in the wake of these crises.

To be sure and candid, no one can say as a rule that the Depression was the reason for the rise of the Third Reich or the ideological dispositions of the German, Italian, and Japanese governments; but it did provide the favorable conditions for the Nazi seizure of power and implementing of extreme measures ostensibly designed to save and perpetuate the state, as well as Mussolini’s grand plan for the restoration of the old Roman Empire in Italy.

Hitler and Mussolini aspired to total control of their domestic societies, in part for the purpose of girding their nations for wars of conquest which they saw in turn as necessary for revolutionary transformation at home.

This ideological meshing of foreign and domestic policy rendered the fascist leaders political agenda wholly incomprehensible to the democratic statesmen of Britain and France whose attempts to accommodate rather than resist their regimes only made inevitable the conflicts they longed to avoid.

THE ECONOMIC DOWNTURN, 1929-33

Banking Crisis, 1930s

By 1933 the banking system in the United States was near collapse. Some banks had made speculative investments in the stock market and were hurt by the crash of 1929. Others failed when depositors, fearing that their bank would go bankrupt, rushed to withdraw their savings. Here, depositors besiege Merchants Bank in Passaic, New Jersey.

UPI/THE BETTMANN ARCHIVE

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The great depression as it came to be known was a phenomenon that spawned on Tuesday October 28^th 1929 known as black Tuesday when the prices of stocks on the New York stock exchange suddenly crashed as many went to sell their stocks against a perceived crash in the market that was rumored to happen. Wall Street prices fell sharply and the future of many investors was irredeemably marred.

As panic spread, many went to their local banks to retrieve their funds and this led to a rush of customers and a run on the banks that forced many banks to shut their doors to customers and this eventually led to a credit squeeze that shut down many business and factories.

Breadline during the Depression

The Great Depression forced many Americans to go hungry or depend on charities for food, clothing, and other necessities. Here, people wait in a breadline to receive free food.

Culver Pictures

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Wall Street prices fell from an index of 216 to 145 in a month, stabilized early in 1930, then continued downwards to a bottom of 34 in 1932, industrial production fell 20 percent in 1930.

Unlike previous swings in the business cycle, this financial panic did not follow the expected period cycle of boom and bust, but rather defied all government and private efforts to restore prosperity for years, until it seemed to a great many that the system itself was breaking down.

The crises led to a heated exchange across the Atlantic as Europeans and Americans traded blames over who was responsible for the crisis. Americans blamed the Europeans for the reparations and for pegging their currencies too high upon the return to the gold standard and for the misuse of the America loans of the 1920s.

The Europeans on the other hand blamed the Americans for their insistence on the repayment of war debts, high tariffs and the unfettered speculation leading to the stock market crash. 

There is no doubt that an element of all these, contributed to the crash. The trend of events leading to the crash had tended to suggest that a crisis of international capital was in the offing. A sudden contraction of international credit in June 1928 signaled the fact that international credit was in peril.

Since the Dawes plan of 1924, Europe had depended on the availability of American loans for capital and liquidity, but increasingly American investors were flocking to the stock market with their savings, and new capital issues for foreign accounts in the United States dropped 78% from 530 million dollars to 119 million dollars.

 Loans to Germany collapsed from 200 million dollars in the first half of 1928 to 77 million dollars in the second half and 29.5 million dollars for the entire 1929.

The commodity market also forced a down turn in a market that had been depressed for much of the decade. The Soviet government was also complicit in the crises; in flooding the wheat market with over- supplies in their bid to raise foreign exchange to finance the first of their five years development plans.

The Hawley- smoothey tariff the highest in US history was passed into law on June 17, 1930 and retaliatory measures were also passed by the European governments; and all these helped to push down world trade from a peak of 2.9 billion in 1929 to less than one billion dollars by 1933. The credit squeeze, bank failures, deflation and loss of exports forced production down and unemployment up in all industrial nations.

GNP and Income in the Depression

During the Great Depression, both Americans’ personal income and the gross national product (the total output of goods and services) declined sharply. They had partially recovered by 1939.

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In January 1930, the United States had over 3 million unemployed workers and by 1932 there were more than 13 million unemployed workers. In Britain 22% of the workforce were out of work and in Germany, unemployment in 1932 peaked at 6 million. Altogether over 30 million people were out of work in the industrialized nations. The depression took its toll in Austria where the Central Bank, the Kredistanstalt was on the verge of bankruptcy.

Unemployment During the Depression

After the stock market crash of 1929, unemployment in the United States soared, reaching nearly 25 percent in 1932. It remained high until World War II brought an economic recovery.

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To compound matters, French objection to the formation of a customs union between Austria and Germany in March 1931, saw a credit run on the Austrian Central bank that almost put the bank out of business. The panic eventually got to Germany where the Reich bank was unable to meet its obligation under the Young plan.

President Herbert Hoover responded on June 20 1931 with a proposal for one year moratoriums on all inter –governmental debts. Short of a general recovery or global agreement on the restoration of trade, however the moratorium could only be a stop gap. Instead every country sought refuge under policies of protectionism of regional trading blocs designed to insulate each one from the effect of the global down turn.

Herbert Hoover

Herbert Hoover had been president for less than eight months when the stock market crashed in 1929 and the United States faced the Great Depression. Hoover did not believe that the government should lead the way to end the economic depression, instead wanting to rely on private measures to solve it.

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On September 21 1931, the Bank of England left the gold standard and the Pound Sterling promptly lost 28% of its value, undermining financial stability in the countries of Eastern Europe and South America. In October a national coalition government was formed in the UK to take emergency measures.

The Ottawa imperial economic conference of 1932 gave birth to the British commonwealth of nations and a system of imperial preferences, bringing Britain’s eighty six years old policy of free trade to an end.

The Lausanne conference of June – July 1932 took up the question of what should be done after the Hoover moratorium. The French at this time realizing that German reparations payment would be impossible to fulfill, requested a once and for all payment of 3 billion marks on Germany and even this was never paid.

 In spite of these, the US still insisted on the payment of war debts resulting in a French default and a strain in Franco – US relations. The League of Nations also failed to address the issues of disarmament in the first years of the Depression.

The London naval conference of 1930 had proposed an extension of the 1922 Washington ratios for naval tonnage, but this time France and Italy refused to accept the inferior status assigned to them.

In land armaments, the policies of the Great Powers were by now fixed and predictable. Britain and the United States deplored wasteful military spending by France especially as reparations and war debts remained unpaid. But then even Premier Herriot and foreign minister Briand were unwilling to consider disarmament when Britain was unwilling to offer additional security guarantees.

 Fascist Italy even though experiencing financial crises was unwilling to consider disarmament, whilst Germany was more concerned with seeking equality of treatment with the other great powers. It was either France must disarm or Germany must be allowed to expand its army.

Nonetheless the league council summoned delegates from 60 countries to a grand disarmament conference at Geneva beginning in February 1932. When Germany failed to achieve its objectives in the July adjournment, it withdrew from the negotiations.

 France, Britain and the United States devised various measures to break the deadlock including a no – force declaration of December 11, 1932 abhorring the use of force to resolve disputes and a five power (including Italy) promise to grant  Germany equality in a system providing security for all nations.

 On the basis of this commitments the disarmament conference resumed in February 1933.  By then however Adolf Hitler was Chancellor of the German Reich.

EUROPE AND THE LEAGUE OF NATIONS

BLOOD, FIRE AND STEEL ;150 Years of European History ; Europe in the inter war years

The staggering rate of loses in the war of 1918 had even affected the demographic balance with women outnumbering men in demographic counts all over Europe. This of course led to many women taking up jobs in areas of the economy hitherto reserved for men. The bye product was the granting of the right to vote to women in many parts of Europe beginning with Britain in 1920.

The women suffrage campaign now extended to the struggle for equal rights for women and the escalating debates over birth control and the woman’s right to have abortion. This shifting trend in society became the hallmark of European society in the post World War 1 era as technology, innovations and a shift in social behavior became a dominant trend.

The nationalistic aspirations that erupted as a result of the dissolution of the Empire of Germany, Austro – Hungary, Russia, Ottoman Turks also led to an explosion in the number of nation states in Europe that were seeking visibility and rights to self determination.

The rights of ethnic minorities, nationalities and races were vigorously campaigned- for and upheld. The issues in any case that arose in the November armistice of 1918 had to be dealt with in a larger and more complex treaty that was to ensue after the conflict.

A peace conference to thrash out the issues dealt with in the Armistice of November 1918 was called for in Paris and attended by the leaders of the major Allied nations, George Clemenceau of France, Lloyd George of Great Britain, Woodrow Wilson of the U.S.A and Orlando of Italy.

 The one year long conference was designed specifically to put in place a peace and conflict resolution mechanism that was designed to ensure that a conflict on the scale of the Great War as World War 1 was then known, never recurred again.

The Allied delegates embarked on the conference with a spirit of vengeance and a determination to punish Germany; and imposed terms that were both harsh and severe and ultimately difficult to fulfill or even supervise. Whereas the sanctions were specific, the mechanism for enforcement or even supervision was vague as each country was left to fulfill its obligations to the best of its interpretation and conscience.

The French were determined not only to recover Alsace – Lorraine but also to occupy the Saar and detach the Rhineland from Germany. The British were more interested in increasing Germany’s reparations payment and sought terms that were harsh and ultimately difficult to fulfill in the midst of Germany’s own political and economic turmoil.

 Economists like Maynard Keynes had strongly argued for a more accommodating term of reparations for Germany. In any case the treaty was signed on June 28^th 1919. Germany’s Colonies were dismantled and taken over by the victorious Allies; heavy reparations were imposed on her army and fleet.  Parts of the Rhineland, Saar and other parts of the fatherland were put under occupation until the reparations were paid and the terms of the treaty fulfilled.

Woodrow Wilson’s fourteen peace points had dealt with issues such as rights to self determination, determination of the right of nations and minorities, freedom of the seas, trading, reduction of armaments and adjustment of colonial claims.

His proposition concerning the general assembly of nations transposed into the League of Nations which was meant to be a body to ensure peace and tranquility amongst the nations of the world by settling disputes and conflicts amongst the major and minor powers without a resort to armed conflict.

The failure of the US to ratify the treaty setting up the league meant that the same Europeans the league was meant to pacify were the same nation states left to enforce its sanctions and covenants. In the event it was obvious to see why the league failed.

 The European statesmen were anxious to curtail Germany’s position and influence and did not give much thought to the political path and direction, Germany might follow after the war in the wake of such a punitive peace deal.

The 1920s fortunately brought a brief season of flowering economically as Europe and the rest of the world including the U.S.A experienced a season of economic boom that helped to reduce tensions and make payments of reparations easier. The period also saw a boom in the stock exchange as trading in stocks and equities boomed. While the economic boom lasted, the terms of the treaty were somehow enforced and peace seemed to endure.

The futile efforts to give teeth to the decisions of the League of Nations at this time underscored the deficiencies associated with the setting up of the body. In this period also the international Court of Justice at The Hague was set up and the Geneva conventions regulating the conduct of war, prisoners and treatment of civilians were also established.

 The Washington naval conference of 1922 also sought to enforce a treaty of self restraint on the part of the major powers with regards to the building of capital ships.

 GERMANY AND THE ISSUE OF PAYMENT OF REPARATIONS

The challenges of maintaining domestic stability while responding to the demands of the Versailles treaty continued to prove a daunting task to the post- war German governments. The elections that followed the treaty seemed to favor the centre right parties that were in opposition to the treaty. The coalitions cabinets that resulted thereafter felt insecure in their bid to fulfill the treaty whilst placating domestic opposition to the treaty.

This put the government in the centre in Berlin in a weak position, unable to stamp its authority on the country particularly with relations to raising taxes and curbing inflations. This gave the industrial leaders the courage to defy government policies while actively crafting policy by stealth.

The leadership dithered over how to satisfy the electorate without violating the treaty. Some favored rapprochement with Bolshevik Russia in order to pressure the West to ease its demand on Germany for fear of communist inroads into Germany

While the reparation committee dithered over how much to demand from Germany as reparations and also how to share the proceeds amongst the Allies in 1920, a new formula was soon adopted with France taking 52 percent of the reparations while Britain got 22 percent.

After the treaty of Versailles, Great Britain faced further challenges on the home front in the form of Ireland’s agitation for independence. The agitation had been boldly suppressed while World War 1 went on, as Britain could not afford the distraction.

After the signing of the armistice in 1918, Lloyd George finally caved in to the pressure of the Irish Republican movement for independence. After much deliberation in the face of the threatened revolt in Dublin, a compromise was reached in 1921 that established Irish Free State as a British dominion in the South while predominantly protestatant, Northern Ireland remained in the United Kingdom.

The Sinn Fein nationalists however continued to agitate until in 1937, Eire (Ireland) achieved full independence while Northern Ireland (Ulster) remained British.

In (November 1921 – February 1922) US Secretary of State Charles Evans Hughes invited the Great Powers to Washington D.C to forge a new order for maritime power and Asian stability. Amongst other agreements including the decision to respect China’s sovereignty; a five-power treaty on naval armaments was put in place to forestall a naval arms race between the US, U.K, Japan, France and Italy. The treaty temporarily put a halt to the escalating naval arms race between the US, U.K, Japan and Italy.

Europe 1922

The period described above was a period of armistice between one season of war and another. It was obvious that the peace settlement of 1919 as comprehensive as it sought to be, did not deal comprehensively with all the issues that had arisen concerning defeated Germany and Russia and the Victorious Powers of Britain, France, Italy and the USA.

French insistence on Germany being weakened, coupled with the harsh reparations policy meant that the feuding parties were still seething with resentment. The US which had argued strongly for equality and self determination amongst nations, had failed to ratify the treaty leaving only Britain and France to enforce the treaty, the best they could.

There were so many loose ends arising from the treaty that were left and handled unsatisfactorily. For instance the dismembering of Germany and handing over of her territories alongside the forbidding of the Anchluss (Union) with Austria meant that a sizeable German minority were left to their fate in a number of countries like Poland, Czechoslovakia, France, Belgium etc.

 The issue of war guilt which was imposed on Germany, Austria and Hungary was one pill too, that the defeated nations found difficult to swallow; as well as the oppressive nature of the reparations payments. The territorial issues that touched on Germany and the newly created nations of Poland especially as it related to the corridor carved out of Germany in favor of Poland, i.e. Danzig was another bone of contention.

 With the over one million German residents trapped there, that proved to be another point of injustice that needed to be dealt with as far as the German people were concerned. The treaty of Versailles was one harsh treaty that was carefully crafted; yet nobody was ready to fully defend it.

 Even the French that had demanded many of the harsh provisions, ironically stood aloof when Hitler’s Nationalist Socialist party came to power and began to openly repudiate the terms of the peace treaty.

In the words of another “The great war failed to solve the German question especially as it related to her role and destiny in Europe’’. Though defeated and shackled by the Versailles treaty, Germany’s strategic position still remained strong because on all sides it was surrounded by weakened and dispirited nations.

 France and Russia had been drained and weakened by the war. Moreover the rest of the newly emerging European countries were hardly in a position to confront a resurgent Germany’’.

The post-war French leaders thought seriously over these issues. There was a momentary resort to an -intra European defense arrangement between France and Belgium in September 1920, a Franco-Polish alliance in February 1921 and a Franco – Czechoslovak entente in January 1924. The strivings of a need for European unity was pulsating, but who was to lead it?

Britain, feeling secure in her strength and the natural barrier of the English Channel, concentrated her energy on her empire and did not see any serious need to commit vigorously to Europe once the treaty had been signed. The strict enforcement of the treaty came to rest on a hesitant France which was all too concerned over its defense than in the provocation of a fresh war with Germany.

The security of France and the entire Europe came to depend on German disarmament and the Allied occupation of the Rhineland. French finances were strained by the cost of rebuilding the war- devastated region of the north, the army and the demands of the colonial holdings as well as the refusal of the French parliament to levy sizeable tax increases until either Germany had paid the reparations or France’s war debts had been forgiven.

As long as Germany was not forth coming in settling its debts, then France would continue to face serious budget deficits that threatened its currency. France also depended on Germany for the coal needed to revive iron and steel production while at the same time bracing up to face the stiff competition from German exports.

To compound matters, France’s war- time Allies, the US and Great Britain quickly distanced each other from the enforcement of the Versailles treaty. Britain meanwhile was facing a post- war economic slump that was due mainly to wartime losses particularly in ships and foreign markets. Unemployment in Britain in the post war years had climbed to 17% in 1921.

Wartime spending and neglect had accelerated the decline of the ageing British industrial plants and the economy generally. Unemployment figures in the 20s generally hovered above 10% and there was pressure on the British government to boost employment by reviving trade.

 British economist Maynard Keynes argued at this time that the recovery of Europe was tied to the recovery of the German economy which was the dominant economy in Europe, and yet the very fabric of the Versailles treaty seemed designed to ensure that Germany never got back on its feet economically as virtually every clause seemed designed to restrain Germany from reviving its natural economic capacity.

As a pragmatic measure Britain needed the reparation debts from Germany to balance her own war debts to the United States. However after the war, British Prime Minister Lloyd George came to support German recovery in the overall interest of trade. The entente with France became strained as early as 1920 over the issues of reparations, Turkey and the coal shortage of that year, from which Britain garnered major profits at the expense of France.

EUROPEAN ECONOMIC SLUMP

Economically, Europe had come out of World War 1 much weakened by the economic effect of the conflict particularly as it related to the credit purchases from the United States which as far back as 1914 had been the world’s leading economic power. By 1918, the US had invested more than 9billion dollars abroad compared with the 2.5 billion dollars before the war.

Britain and France alongside Italy in the course of the war had used most of their investments in the US and had consequently accumulated large public debts particularly to the US treasury. Europe was thus faced with the shadow of American financial domination alongside European indebtedness in the first decade following the war.

The Allies were also indebted to one another and to Britain too which in turn was indebted in the United States. To compound matters, Germany and Austria faced the penalty of reparation according to the Versailles treaty which they found very difficult to pay.

English Economist of that era Maynard Keynes had in his opposition to the principle of reparations payment described it as “morally detestable, politically foolish and economically nonsensical”. British Minister and First Lord of the sea, Sir Winston Churchill described it as “a sad story of complicated idiocy”.

The Allied policy of demanding goods and cash from Germany as reparations were bound to afflict industry as in the case of the former or lead to the acquisition of unrepayable loans as in the latter, particularly because Germany’s only recourse was to source large loans from the United States.

In April 1921, the Allied reparations committee set Germany’s reparations bill at 132 billion gold marks to be increased if the Germans proved able to pay. The first installment of one billion marks was due by the end of May 1921.

Germany wavered behind two extreme views, refusal to pay and paying with a view to establishing trust which would now form the basis for a revised and more lenient repayment policy as advocated by Walther Ratheneau the finance minister and Stresemann the foreign minister

The Weimar Republic chose the path of compromise by paying the first installment in August 1921 with a loan obtained in London. After that, several payments were made in kind until the beginning of 1923 when it couldn’t continue anymore, and thereafter the French promptly occupied the Ruhr industrial region with the support of Belgium, but with the opposition of the US and Britain.

Gustav Stresemann

German statesman Gustav Stresemann won the 1926 Nobel Peace Prize with his French counterpart, Aristide Briand. Stresemann was recognized for his work toward peace and his efforts to have Germany admitted to the League of Nations.

Corbis

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The occupation in any case proved fruitless as the Ruhr workers with the connivance of the German government brought production to a virtual halt and the German treasury printed a huge sum of paper money which turned out to be worthless and led to a near collapse of the German economy

By 1924 Germany was facing hyper inflation leaving the mark with no purchasing value, thereby enriching speculators and owners of real property while ruining the salaried workers and middle class. This trend of events opened the door for pessimism that gave way to the Nazi victory in years later at the polls. The Germans loss of faith in   their economic system only opened the way for extreme political doctrines to become acceptable.

The Allies therefore set up a committee of financial experts chaired by the American, Charles G. Dawes to find a lasting solution to the issue of reparations payment. The committee resolved to offer Germany a two – year moratorium on payments, grant Germany a fresh loan of 800 million marks, coupled with a new rate for reparation payment of 1 – 25 billion gold marks annually. This was continued for five years.

In 1929 a further committee chaired by Mr. Owen D. Young revised the Dawes plan by granting Germany a new loan of 1.2 billion marks and to spread reparations payments over the next 59 years. The plan was grudgingly accepted by the German people and parliament in a nationwide referendum, but in real terms, reparations payment ceased in 1932 when the effect of the great depression really hit hard and payment became impossible.

The rest of Europe also faced serious and severe debt issues that arose out of World War1; and while the United States was willing to write – off debts associated with reparations, it could not write off the commercial debts owed to it.

This trend of events opened the door for the pessimism that gave way to the Nazi victory in years later at the polls. The Germans loss of faith in their political and economic system only opened the way for extreme doctrines to become acceptable.

On the whole Europe prospered in the inter war years  as economic growth enabled most of the European countries to exceed their 1914 economic output levels as growth continued across all sectors of the economy. Growth however turned out faster in the United States where the 1920s saw such a period of rapid growth that speculative financial investments particularly in stocks and risky financial behaviors became the order of the day.

Borrowing to buy and postponing the day of payment became the order of the precarious prosperity people were investing in. A lot of the money involved was based on pure speculation as people borrowed to buy stocks and the declared values of the stock exceeded the actual value of the investment made. Life was easy and prosperity came in handily even though many people knew that the boom could go bust anytime.

This finally came to on “Black Tuesday” 24^th October 1929 when the Wall Street stock market crashed as everybody seemed to want to disinvest in stocks all about the same time as investor’s confidence in the system had plummeted. It was an all – sellers market and few buyers.

With so many people willing to sell their stocks at any rate and few people willing to buy the overvalued stocks, the inevitable result was a crash that eventually sent the economy into a depression that took the wind out of the world economy.

Banks that had invested heavily in the overvalued stocks suddenly saw their balance sheets turn red as the stocks went up in smoke, and with their capital gone, most banks stopped lending and the effect spread to every part of the  US and eventually the world economy.

Many major banks went under and most mortgages failed as the number of people out of job spiraled. Unemployment reached unprecedented figures, almost affecting over a quarter of the entire workforce in the United States.

As the Depression hit harder in the US, the effect spread to Europe as loans were quickly recalled and foreign investments dried up. As the American institutions repatriated huge sums of money to shore up their own sagging economy many European banks were hit and many went under.

A Bundle of Marks

After World War I (1914-1918), inflation in Germany was so high that millions of marks were required to buy even the most basic item. As a result, German money frequently had more value as kindling than as legal tender. Shown here, a German woman prepares to light her stove with a bundle of paper currency.

Corbis

Microsoft ® Encarta ® 2009. © 1993-2008 Microsoft Corporation. All rights reserved.

Germany, Austria and Britain were the hardest hit and the great Kredistanstalt bank of Vienna collapsed in May 1931 and as depositors rushed to withdraw their savings, the Bank of England began to lose gold at the rate of 2.5 million pounds a day and this led to a catastrophic decline in production as figures fell 40 percent in Germany, 14 percent in Britain and 29 percent in France.

To compound matters the United States under President Hebert Hoover tried to mitigate the effect of the slump and had granted a moratorium on the payment of all government debts for one year on Jan 1931. When this expired in June 1932, the US Secretary of State Henry Stimson proposed another one year extension which the president refused.

The European Allies meanwhile had tied the canceling of Germany’s reparations payment to the willingness of the US to forego all wartime debts which the Americans promptly declined, citing a European conspiracy; and as everybody subsequently went their way, the situation was compounded.

CENTRAL EUROPE AND THE MIDDLE EAST, 1920 – 1930

With the expiration of the Habsburg Empire, the successor states of Austria, Hungary and Czechoslovakia came to be the main object of the peace conference’s deliberations. The first two, being the main stays of the Austro – Hungarian empire were dealt with as defeated powers.

Czechoslovakia and Yugoslavia together with Poland even though were given benevolent treatment by the victorious powers, were however not in themselves homogeneous entities; rather conflicting ethnic, racial, economic, military and political divisions left these states less than stable even with the victorious powers.

The state of Yugoslavia was only an amalgamation of Serbs, Croats and Slovenes, while Czechoslovakia was a melting pot made up of Czechs, Slovaks and Sudeten Germans. Poland on its own part comprised Ukrainians, Germans, Lithuanians and Yiddish speaking Jews. Romania greatly enlarged by the addition of Transylvania and Bessarabia, now included millions of Ukrainians, Hungarian Jews and other minorities.

The term balkanization of Europe was drawn largely from the many nationalities and ethnic divisions and rivalries that these new nations came to represent. Poland even though enjoying the sympathies of the United States and France remained agitated over the issues of an outlet to the sea through the Port city of Danzig which incidentally consisted of 1.5 million Kashribians and Germans.

Further north, the Baltic states of Lithuania, Latvia and Estonia won their independence from Russia and depended largely on Britain’s sea power to secure their freedom. However Poland and Lithuania were tangled in a quarrel over the control of Villinius a town which according to Russia’s 1877 census figures was 40 percent Jewish, 31% Polish, 24% Russian and 2% Lithuanian. In December 1919 the Supreme Allied council awarded the city to Lithuania.

Similarly the Czech–Polish dispute over the coal – rich Teschen district led to recognition of the occupation claims of both powers as they were presently standing. The German – Polish dispute over Upper Silesia also was resolved in favor of Poland which came to win over most of the mines to the disadvantage of Germany which had the greater ethnic nationalities population resident there.

 An Allied approved plebiscite in 1921 showed that ethnic Germans were more outside the coal mine district while the Poles were in the majority around the coal mines.

The treaty of st Germaine similarly disposed of the Austrian half of the former Hapsburg monarchy in favor of Czechoslovakia while the American President succeeded in getting the strategically important province of Bohemia granted to Czechoslovakia with the inherent problem of 3.5 million ethnic Sudeten Germans alongside the grant of territory stretching south to Bratislava on the Danube river but also creating a host minority of 1 million Magyars.

The settlement of Italy’s territorial claims on Austrian land became a heated issue as the Italians insisted on the Allies fulfilling their wartime promises which President Wilson regarded as immoral and unethical.

Before World War I began in 1914, the major European powers included Britain, France, Italy, and the empires of Germany, Russia, and Austria-Hungary. The Ottoman Empire also controlled territory in Europe.

 His denunciation of the Allies pact with Italy was made openly in a press conference in Paris on April 24, 1919 in violation of the ethics of the conference; only to return later to a compromise solution that included declaring the city of Fiume an open city to both Italy and Austria.

Meanwhile Italy was granted Trieste, parts of Istria and Dalmatia and the upper Adige as far as the Brenner pass with its 200,000 Germans speaking Austrians. The refusal of Wilson to concede Fiume to the Italians led to an imbroglio that led to the collapse of the Orlando government and the ultimate victory of Mussolini’s fascists in 1922 following Italy’s revolt over the Allies’ volte-face on the territorial claims issue.

As for Hungary, the treaty of Trianon which was delayed by the communist coup in Hungary until 1920 partitioned the ancient Hungarian kingdom among neighbors. Transylvania along with its 1.3 million.... minority was handed over to Romania; the Banat of Temesvar (Timisoara) was divided between Romania and Yugoslavia.

Hungary’s territories thus shrank from 109, 000 to 36,000 square miles, while the post war armies of Austria and Hungary were limited to 35,000 men each. The treaty of Neville with Bulgaria saw Bulgaria losing its western territories to the kingdom of Serbs, Croats and Slovenes and nearly all of Western Thrace to Greece cutting the Bulgarians off from the Aegean Sea.

Their armed forces were limited to 20,000 men for Austria, Bulgaria and Hungary even though the reparations payment was eventually called off for obvious reasons of economic weakness. The treaty settlement in East Europe was a fair attempt to implement the principles of self – determination in an area where the conditions were completely unfavorable to its policies.

 The issues of dissatisfied and dislocated minorities, inadequate finances, lack of an existing democratic culture, equipping of a functional government, army, police and institutions of government all combined to make these newly formed countries unstable and potential breeding grounds for dissent and crises in the midst of the suppressed nationalistic aspiration of a defeated Germany and a comatose Russia.

Austria with its population nearly all German was forbidden by the terms of the treaty from seeking union with Germany.

MIDDLE EAST AND EUROPE, 1920

The Ottoman Empire was likewise dismantled by the treaty of Sevres. The political aims of Great Britain and France were largely achieved, as president Woodrow Wilson felt less inclined to interfere on behalf of Arab aspiration as he felt that the Arab world was not yet ready for self rule. The British and French thereby legitimized their acquisition of Ottoman Turkish territories under League of Nations mandate.

The mandates were classed as ‘A’ for those territories ready for independence and class ‘B’ for those judged as not yet ready for independence. Britain thereby obtained Iraq, Transjordan and Palestine under class ‘A’ while France obtained Syria and Le