Extreme Inflation in Germany

When Germany was defeated by the First World War, there was no doubt that in the years to come there would be an economic crisis. When Germany was at war in 1914, the government did not want to impose heavy taxes to the people. Instead, it decided to borrow huge amounts of money, which were to be paid by the enemy after Germany had won the war. Much of the borrowing was discounted and monetized by the Reichsbank, Germany’s central bank.

By the end of the war, things did not come out as planned. There started to be inflation because of the burden of reparation payments imposed by the Treaty of Peace. The country started to issue new money, so the prices had to rise, like the case of the demand for more currency. The consumer price index had risen 140 percent. At the same time, the debt of the Reichsbank had increased from 3 billion marks to 55 billion. Germany borrowed heavily to pay its war costs, although this led also to inflation. By 1923, there seemed to be the wildest inflation in history. Often prices doubled in a few hours, and it took 200 billion marks buy a loaf of bread.

In the beginning inflation was kept within boundaries. Millions of men were still at the front, and not in the market for goods, so the necessities were limited. But the harsh reparation that Germany faced led to the mark to depreciate against foreign currencies. This meant that there was a bigger demand on a limited production capacity. Also, business accepted the inflation because they knew how to profit by speculating in foreign exchange.

The prices were rising much faster than the rate at which money was being printed. This price inflation could hardly be blamed on the government. For the next fifteen months the price index held stable. The mark actually gained in value against foreign currencies, so that prices of imported goods fell by some 50%. Here was a big opportunity to establish a stable currency. However, during these fifteen months the government kept issuing new money. The currency in circulation increased by 50% and the floating debt of the Reichsbank by 100%, providing fuel for a new outbreak.

In May 1921, price inflation started again and by July 1922 prices had risen 700%. All confidence in money vanished and the price index rose faster and faster, outpacing the printing presses which could not run out money as fast as it was depreciating.

From Mid-1922 to November 1923 hyperinflation raged in the Weimar Republic. Reichsbank officials believed that the basic trouble was the depreciation of the mark in terms of foreign currencies. In late 1922 they tried to support the mark by purchasing it in the foreign exchange markets. However, since they continued printing new currency at a fast rate, the attempt failed. They only succeeded in buying worthless marks in return for valuable gold and foreign exchange.

Under inflation, business was now operating at great speed and unemployment had disappeared. However, the real wages of workers had dropped. Businessmen began to abandon their occupations in order to speculate in stocks and in goods. By mid 1923 workers were being paid as often as three times a day, turning their money into fixed investments.

At the same time the economy was collapsing. Storekeepers could not obtain goods or could not to business fast enough to protect their cash receipts. Farms refused to bring their products to the city. Businesses started to close down and unemployment soared. Middle class people who depended on a fixed income found themselves poor. Hospitals, literary and art societies, charitable and religious institutions closed down without any funds.

Then by a mere effort of will, the government stepped in and stabilized the currency overnight. Throughout the "miracle of the Rentenmark" the depreciation halted, business revived, and inflation was ended, although there was an aftermath yet to come.

They say that this inflation contributed to Hitler’s rise to power, mainly when he talks about the negative consequences it lead. Like recently mentioned, the middle class was ruined by the inflation. They became receptive to rabid right wing propaganda and formed a fertile soil for Hitler.

Workers who had suffered through the inflation turned, in many cases, to the Communists. The biggest beneficiaries of this enormous redistribution of wealth were feudalistic industrial leaders who distrusted the democracy and who proved willing to deal with Hitler, thinking that they could control him. The democratic parties and the labor unions lost their capital and were weakened. The liberal democratic regime was discredited.

In conclusion, the government did not realize that the inflation was wiping out its burden of debt in order to ease their financial problems, which lead to greater concern for maintaining a solid currency in the monetary policy. 

Treaty of Versailles

It was signed on June 28th 1919 as an end to the First World War, The Treaty of Versailles was supposed to ensure a lasting peace by punishing Germany and making a League of Nations to solve diplomatic problems. But, instead of that, it left political and geographical difficulties which have often been blamed, for starting the Second World War.

The First World War has been fought for four years when, on November 11th 1918, Germany and the Allies signed an armistice. The Allies soon join to discuss the peace treaty they would sign, but Germany and Austria-Hungary weren't invited; instead they were only allowed to present an answer to the treaty, a response which was largely ignored. Instead terms were made mainly by the ‘Big Three’: British Prime Minister Lloyd George, French Prime Minister Frances Clemenceau and US President Woodrow Wilson.

THE BIG THREE

• Woodrow Wilson: Wanted a 'fair and lasting peace' and had written a plan (the Fourteen Points) to achieve this. He wanted the armed forces of all nations reduced, not just the losers, and a League of Nations created to be sure that there would be peace.
• Frances Clemenceau: Wanted Germany to pay dearly for the war, including being taken from land, industry and their armed forces. He also wanted heavy reparations.
• Lloyd George: While he agreed with Wilson, he was affected by public opinion in Britain which agreed with Clemenceau.

It was an almost impossible task, with the need to pay debts with German cash and goods, but also to restore the pan-European economy; the need to sate territorial demands, many of which were included in secret treaties, but also allow self-determination and deal with growing nationalism; the need to remove the German threat, but not humiliate the nation and breed a generation intent on revenge, all while mollifying voters.

Reactions and Results

• Germany lost 13% of its land, 12% of its people, 48% of its iron resources, 15% of its agricultural production and 10% of its coal. Britain and France felt the treaty was fair (they actually wanted harsher terms imposed on the Germans) but the United States refused to ratify it because they didn't want to be part of the League of Nations.
• The map of Europe was redrawn with consequences which, especially in the Balkans, remain to the modern day.
• Numerous countries were left with large minorities groups: there were three and a half million Germans in Czechoslovakia alone.
• The League of Nations was fatally weakened without the United States and its army to enforce decisions.
• Many Germans felt unfairly treated, after all they had just signed an armistice, not a unilateral surrender, and the allies hasn't occupied deep into Germany. 

Mussolini Rises to Power in Italy

The new state of Italy was far from being a great success in the years before 1914; the tension of the First World War on her economy and the disappointment at her treatment by the Versailles Treaty caused growing discontent. Between 1919 and 1922 there were five different governments, all of which were incapable of taking decisive action that the situation demanded. In 1919 Benito Mussolini founded the Fascist party which won 35 seats in the 1921 elections. At the same time there seemed to be a real danger of a left-wing seizure of power, in a time of strikes, the fascists staged a 'March on Rome' which culminated in King Emmanuel III giving Mussolini the opportunity to form a government in October 1922. Mussolini remained in effective power until July 1943.

• All parties except the fascists were suppressed: Opponents of the regime were exiled or murdered. Socialist leaders Giacomo Matteotti and Giovanni Amendola were both beaten to death by the fascists. After 1926, when Mussolini felt secure in power the violence was greatly reduced.
• A strict press censorship was enforced in which anti-fascist newspapers were suppressed or their editors replaced by fascist supporters. Radio, films and the theatre were similarly controlled.
• Education in schools and universities was supervised, teachers had to wear uniforms, new textbooks were written to glorify the fascist system. Children and young people were forced to join the government youth organizations which indoctrinated them with the brilliance of the Duce and the glories of war.
• Corporate State: The government tried to promote co-operation between employers and workers and to end class warfare in what was known as the Corporate State. Fascist controlled unions had the sole right to negotiate for the workers and both unions and employers' associations were organized into corporations and were expected to co-operate to settle disputes over pay and working.
• Catholic Church: Mussolini left religion outside the control of the government. He had his children baptized and married their mother in the church. He passed laws to make swearing in public a crime and allowed crosses to be hung in public buildings. He made religious education compulsory in Italy. In 1929 he signed a treaty with Gasparri.

Successes

• Industry: gave government subsidies where necessary so that iron and steel production doubled by 1930 and artificial silk production tenfold.
• Battle of Wheat: encourages farmers to concentrate on wheat production in a drive for self-sufficiency; by 1935 the wheat imports had been cut by 75 per cent.
• Land Reclamation: a program was started and the Pontine Marshes around Rome were drained and reclaimed.
• Public Works Program: this was designed to reduce unemployment. It included the building of motorways, bridges, blocks of flats, railway stations, sports stadiums, schools and new towns on reclaimed land.

Hitler in the Interwar

In 1920, Hitler seized control in the German Workers Party, changing its name to the National Socialist German Workers Party, called the Nazi Party for short. On November 9, 1923, Hitler and World War I hero General Ludendorf attempted a small revolution known as the Beer Hall Putsch. Hitler had jumped onto a beer hall table and proclaimed the current Weimar government overthrown.

Released in 1925, Hitler worked for the advancement of the Nazi party. Such advancement was slow in coming through the years 1925 to 1929, a fairly stable period in Europe. However, as the world became mired in depression and unemployment rose, so did support for the Nazi Party, which promised employment and a return to glory for the nation. In 1932 the Nazis won 37.3 percent of the popular vote and occupied 230 seats in the German Reichstag. Hitler dissolved the Reichstag and persuaded Hindenburg to issue a decree granting Hitler authority to prohibit public meetings, the wearing of political uniforms, and publication of dissenting opinions.

On February 27, 1933, the Reichstag building burned down and a retarded Dutch boy claiming he worked for the communists was arrested for arson. There is evidence to prove that the Nazis themselves had set the fire, but in any case, Hitler used the incident to persuade Hindenburg to restrict all individual rights and declare that the central government could oust any state government failing to maintain order. Hitler systematically took control of all of the state governments this way. The Nazis only won 43.9 percent of the vote in 1933. To gain a two-thirds majority Hitler formed an alliance with the Nationalist party, and declared the communist party illegal.

On March 23, 1933, the Reichstag passed the Enabling Act, giving Hitler the power to make decrees with the status of law, and ending elections.

Hitler's vague policy included a planned economy in which the unemployed were put to work on government projects, working hours were shortened to open up jobs, and labor was forbidden to organize.  All education and speech was controlled. Curricula and textbooks were rewritten to reflect Nazi ideology, and all movies, newspapers, radio, and art were regulated by the vigilant Ministry of Propaganda, under Joseph Goebbels. One of the Ministry's main tasks was to mobilize German anti- Semitism in support of Nazi persecution of German Jews, which would reach its climax in the Holocaust, begun in earnest in 1941. The persecution of the Jews was a major step in Hitler's plan to conquer all of Europe for the Aryan race, a plan that resulted in the outbreak of World War II.

Foundation of BBC

The British Broadcasting Corporation (BBC) is a British public service broadcaster, headquartered at Broadcasting House in the City of Westminster, London. It is the largest broadcaster in the world, with a staff of 23,000 staff. It is responsible to provide public service broadcasting in the UK.

The original company, the British Broadcasting Company, was founded on October 18, 1922. It was founded by a group of six telecommunication companies to broadcast experimental radio services. Its staff was of four, and it was funded by a license fee at a rate set by parliament. The first broadcast came from London on November 14, and listening to it quickly became part of the daily life. John Reith, a Scottish broadcast executive, became the general manager in December of that year. In 1927, he was employed as the Director-General of the BBC, under a Royal Charter. His concept of broadcasting as a way of educating the masses marked for a long time the BBC and similar organizations around the world.

The BBC was officially established on January 1, 1927; with Reith as the Director-General and George Villiers as the chairman. It was recognized as a broadcasting monopoly operated by a board of governors and director general. The BBC became the world’s first public service broadcasting organization, with headquarters in London, where advertising on radio was banned.

John Reith had a mission to educate and improve the audience, and under his leadership the BBC developed a reputation for having serious and important programs. He also insisted that all radio announcers should wear dinner jackets while being on the air. Since the 1930’s, the BBC introduced more sports and light entertainment on the radio, for acquiring a bigger audience.

In 1936, the BBC began the world’s first regular television service. This was halted during World War II, and all of BBC’s efforts were concentrated on radio broadcasting. The BBC television service was established on November 2, 1936, but was suspended because of the outbreak of World War II, in 1939.

Today, the BBC has expanded with new channels; World Service radio is complemented by a BBC World television service, while a satellite channel UK Gold helped it exploit its valuable archives. It has been expanding in both radio and television, and has become an important factor in news and entertainment.

Discovery of Penicillin

Penicillin is a group of antibiotics derived from Penicillium fungi. Penicillin antibiotics are historically significant because they are the first drugs that were effective against many previously serious deseases, such as syphilis and infections. They are still widely used today, though many types of bacteria are now resistant and are less needed. It is said that penicillin heralded the dawn of the antibiotic age; because before its discovery, there was no treatment for diseases such as pneumonia, gonorrhea, or rheumatic fever.

Penicillin was discovered by the Scottish scientist and Nobel laureate Alexander Fleming, in 1928. He began to sort through petri dishes with colonies of Staphylococcus, bacteria that caused boils, sore throats, and abscesses. In one dish he noticed something unusual: it was dotted with colonies, save for one area where a blob of mold was growing. The zone around the mold (penicillium notatum) was clear, as if the mold had secreted something that inhibited bacterial growth.

He later detected that the mold possessed properties that could kill a wide range of harmful bacteria cells without harming human blood cells. He determined this by isolating pure penicillin from the mold juice. It proved to be very unstable, and they were only able to prepare solutions of crude material to work with.

In June 1929, Fleming published his findings in the British Journal of Experimental Pathology, with only a passing reference to penicillin’s potential therapeutic benefits. This was of practical benefit to bacteriologists, and kept interest in penicillin going. Other scientists, including Harold Raistrick, Professor of Biochemistry at the London School of Hygiene and Tropical Medicine, tried to purify penicillin but failed.

The chemical structure of penicillin was determined by the British chemist Dorothy Crowfoot Hodgkin in 1945.  Ever since, penicillin has become the most widely used antibiotic, and it is still used for many bacterial infections. A team of Oxford research scientists devised a method of mass-producing this drug. In this same year, the Australian scientists Howard Florey and Ernst Boris Chain shared the Nobel Prize in Medicine with Fleming for their work.

Time Magazine

Time is an American news magazine, and it was created in 1923 by Briton Hadden and Henry Luce, making it the first weekly news magazine in the United States. It was published as a news magazine that summarized and organized the news so that the “busy men” could stay informed, this being described by the Time magazine itself. The first issue of Time was published on March 3, 1923. Its cover featured the retired Speaker of the United States House of Representatives, Joseph G. Cannon.

Hadden and Luce had already worked together for the Yale Daily News, and had considered calling this magazine Facts. Hadden was known for being carefree, he liked to tease Luce and saw Time as something important but also fun. This is a reason for some critics, mentioning it as “too light for serious news and more suited to its heave coverage of celebrities, the entertainment industry, and pop culture”.

After Hadden’s death in 1929, Luce became the dominant man at Time, and a major figure in the history of 20^th-century media. Roy Edward Larsen was hired to play a small role in the development of Time Inc. He then became the general manager of Time, and an influential and important figure after Luce. After Time magazine began publishing its weekly issues in March 1923, Roy Larsen was able to increase the circulation by utilizing U.S. radio and movie theaters around the world.

On March 6, 1931, Larsen arranged a 30-minute radio program, The March of Time, which would be broadcasted over CBS. Each week, it presented an adaptation of the week’s news for the radio listeners; and Time was brought “to the attention of millions previously unaware of its existence”, which led to an increased circulation of the magazine during the 1930’s. Between 1931 and 1937, the radio program was broadcasted by CBS radio, and between 1937 and 1945 it was broadcasted over NBC radio.

Time magazine is now the world’s largest weekly news magazine, and has a domestic audience of 20 million and a global audience of 25 million.