The heavy defeat in the war of the early 20th century had more impact on Germany than any other country. The Greta War has brought huge material losses: a few million people were killed, industrial production fell by more than 40%, acute crisis has affected agriculture, and transport. Alsace and Lorraine moved back to France. The prices for consumer goods went up by many times; real wages decreased by a quarter.
Especially grave consequence of defeat in the war was the fact that the victorious powers imposed reparations on Germany (i.e., the amount of war damage, which was supposed to be compensated by Germany) in the amount of 132 billion of gold marks. Due to the fact that Germany couldn’t pay such an amount for the short term, the winners exported from Germany everything that was of value.
In 1918, the Hohenzollern dynasty was overthrown and the bourgeois republic was established. In June 1919, the winners imposed the Treaty of Versailles on Germany, according to which the country was deprived of 1/8 of the territory and 1/12 of the population; it also lost all colonies, and the main part of the merchant fleet. In addition, the reparations made more than 130 billion marks.
Only by 1928, German industry has reached the pre-war level. The industrial production grew by 13% in 1929. The industrial boom strengthened the concentration and centralization of capital. The chemical concern IG Farben created in 1925 controlled 80% of the products of chemistry. Steel Trust controlled more than 40% of steel production and iron. Most of the German banking capital was concentrated in Dresden, Discount Gesellschaft and Darmstadt banks-monopolists.
According to the total volume of industrial production, Germany ranked second after the United States. Expansion of the production went on a new technical basis. Germany used the US techniques of squeezing the sweat (Henry Ford and Edward Burnett Taylor), as a result of which labor productivity increased by 40%.
German monopolists participated in the creation of international monopolies. In 1926, at the initiative of Germany the European steel cartel was established controlling 2/3 of European steel production.
Foreign trade operations surpassed the pre-war on import by 30%, and export by 17%. Germany surpassed Britain in the export of machinery and equipment.
Once in power, fascism became a special form of state monopoly capitalism and state management led to an extreme degree. The main content of the economic policy of fascism became a general mobilization. Military industrial production was increased by 22 times.
The heavy defeat in the war of the early 20th century had more impact on Germany than any other country. The Greta War has brought huge material losses: a few million people were killed, industrial production fell by more than 40%, acute crisis has affected agriculture, and transport. Alsace and Lorraine moved back to France.