Some 13% of Americans were of German descent in the 1970s, and this proportion would have been higher in 1919. Many had gone to America to escape Bismarck’s repressive rule after 1870. … However, in 1919, when Germany was said to be on the verge of starvation, … their sympathies returned to their former heartland. p.50-51
(American) Popular opinion had been divided when France first occupied the Ruhr. However, after the shootings at Krupp’s factory and the evidence of German hardship and malnutrition, sentiment hardened against France. Church ministers were horrified at stories of the suffering of German children, while the important farm lobby … longed to send Germany more food. p.104
President Warren Harding … died suddenly on 2 August 1923. … His successor, Calvin Coolidge, believed that if Germany was only presented with a reasonable deal the (war) reparations problem would be solved … He … granted Germany Most Favoured Nation status as a trading partner even before a new reparations deal had been agreed. p.114
Stresemann believed that the Allies would not have won the First World War without American finance. He thought … that if America lent Germany now, it would cement the friendship between the two nations. And if there was another argument over the reparations, America would be more willing to support Germany …if it was financially involved. He wrote in his diary on 25 September, ‘The thing to do now is to win over the individual subscriber to the idea of a German loan. The granting of a loan would give us an army of 300,000 people in America who would make propaganda for Germany because they would be interested in her welfare’. p.132
After the Dawes (reparations) Plan agreement, many German Americans felt that it would be both safe and profitable to help Germany, especially as German interest rates were standing at 9%. Although they fell to 7% towards the end of the 1920s, German bonds still represented an outstanding opportunity compared to other European investments. By 31 July 1931 loans and credits from abroad would amount to no less than £1,190 million. p.144
America … was worried about the fate of its loans because the Germans seemed to want to borrow more and more money. … Dr Schacht promised that if the Americans would give Germany a new deal on the reparations … he would personally promise to curb the Socialists’ spending. p.142-3
Over the final weekend (of April) Owen D Young, the American Chairman of the Reparations Review Committee and Dr Schacht produced a new scheme for the payment of the reparations without consulting the Allies. p.151
The German delegation … had one (final) condition (for agreeing to the Young Plan) that the occupation troops … would leave the Rhineland the following year, five years ahead of schedule. …. Finally, on 31 August 1929 the Young Plan agreement was signed … On 4 September the American stock market dived. (One month later it collapsed) p.157-160
On 20 October the Foreign Policy Association of America gave a dinner discussion on the Young Plan and invited Dr Schacht and John Foster Dulles to be the speakers. … Schacht promised another crisis over the reparations, and … declared that now that the Allies had withdrawn their troops from the Rhine there was nothing the Americans could do about it. p.180
Unfortunately, there were no longer any troops guarding the Rhine, and there were no Allies in control of German finances. So when Germany refused to pay its bills, the only way open … was appeasement. In July 1931, under the so-called ‘Standstill Agreement’, the Allies and America agreed to refrain from demanding , repayment of most of the ‘banking credits in Germany expressed in foreign currencies’ for a six-month period. Naturally after six months the agreement was renewed.
(Keynes’s German banker friend) Carl Melchior expressed disgust at the dirty part he had been called upon to perform … ‘This is the first time I have had to refuse to fulfil an obligation to which I had freely committed my name, simply because the state required me to refuse’. p.187
In price adjusted terms, Germany received nearly four times as much financial assistance between 1919 and 1931 as the US government gave West Germany between 1948 and 1952 under the terms of the Marshall Plan, in the hope that it would make Germany a rich and contented member of the international community. But America’s trust was misplaced. The German leadership (merely) took advantage of its generosity to pursue its own nefarious aims. p.218
The Americans had forged what they believed to be close political and business ties with Germany in the 1920s. They could not believe that their goodwill was not returned. Newspapers began to point out that since cotton was the chief export of the United States, the cancellation of international debts (in particular the war reparations) might proved to be a small price to pay for the restoration of foreign markets for cotton. Their arguments carried weight at that time even though they later proved to be a fantasy.
Germany only offered wine and beer (rather than cash) for America’s cotton after the ending of reparations demands and threatened a moratorium in a successful bid to decimate the value of its debts. p.203
How Germany helped cause the dust bowl in America in 1930
Germany had demanded payment in dollars (for its sale of armaments and heavy industrial infrastructure) and there was only one way for Stalin to find the foreign exchange. While Russian kulaks were being transported north to the Arctic, with floodlights on the roofs and guards with dogs inside … more (wheat) trains were busy … going … westwards towards the prosperous continent of North America. … The world wheat market collapsed under the deluge, causing untold misery and lasting damage to the agricultural communities of America. … Yet the US administration did not want to blame the Communist administration for ruining the American dream … (Particularly) as Stalin’s representative, Lubimoff, claimed that the USSR’s success … was solely due to the superiority of the Communist economic system. p.191-