Tuesday, November 22, 2022

The German Inflation Of 1923

     "The fundamental quality of the disaster was a complete loss of faith in the functioning of society. Money is important not just as a medium of economic exchange, after all, but as a standard by which society judges our work, and thus ourselves. If all money becomes worthless, then so does all government, and all society, and all standards. In the madness of 1923, a workman's work was worthless, a widow's savings were worthless, everything was worthless. 'The collapse of the currency not only meant the end of trade, bankrupt businesses, food shortages in the big cities and unemployment', according to one historian, Alan Bullock. 'It had the effect, which is the unique quality of economic catastrophe, of reaching to and touching every single member of the community in a way which no political event can. The savings of the middle classes and the working classes were wiped out at a single blow with a ruthlessness which no revolution could ever equal. . . The result of the inflation was to undermine the foundations of German society in a way in which neither war, nor the revolution of November, 1918, nor the Treaty of Versailles had ever done. The real revolution in Germany was the inflation."

 

Otto Friedrich, Before the Deluge, A Portrait of Berlin in the 1920s, HarperPerennial, NY 1995 pg.126-127. 

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