Germany's financial collapse in the summer of 1931 was one of the biggest economic catastrophes of modern history. It led to a global panic, brought down the international monetary system, and turned a worldwide recession into a prolonged depression. The crisis also contributed decisively to the rise of Hitler. Within little more than a year of its onset, the Nazis were Germany's largest political party at both the regional and national level, paving the way for Hitler's eventual seizure of power in January 1933. The origins of the collapse lay in Germany's large pile of foreign debt denominated in gold-backed currencies, which condemned the German government to cut spending, raise taxes, and lower wages in the middle of a worldwide recession. As political resistance to this policy of austerity grew, the German government began to question its debt obligations, prompting foreign investors to panic and sell their German assets. The resulting currency crisis led to the failure of the already weakened banking system and a partial sovereign default. Hitler managed to profit from the crisis because he had been the most vocal critic of the reparation regime responsible for the lion's share of German debts. As the financial system collapsed, his relentless attacks against foreign creditors and the alleged complicity of the German government resonated more than ever with the electorate. The ruling parties that were responsible for the situation lost their credibility and became defenceless in the face of his onslaught against an establishment allegedly selling the country out to her foreign creditors. Meanwhile, these creditors hesitated too long to take the wind out of Hitler's sails by offering debt relief. In this way, a financial crisis soon developed into a political catastrophe for both Europe and the world.
Reviews
Engaging book * Foreign Affairs *
The value of Swiss historian Tobias Straumann's book is that it focuses our attention squarely on the drama of that year, the moment when the fragile political and financial order restored after the first world war came apart ... a fast-paced and elegantly constructive narrative... If John Kenneth Galbraith forever etched the 1929 crash into historical consciousness, with his classic 1955 account, Straumann has given us the narrative of 1931 that every decision maker in Europe should read. * Adam Tooze, Financial Times *
Tobias Straumann's book is a welcome addition ... Straumann ably shows the progress of the German crisis and how it was intertwined with the vexed issues or reparation ... Straumann relates [...] complex events with remarkable clarity, largely eschewing jargon and displaying considerable panache. Rarely has the dismal science been less dismally presented. Happily, for those wishing to write about Nazism's rise, there is now an accessible, non-specialist volume to explain the economic aspect. * Roger Moorhouse, BBC History Magazine *
Tobias Straumann's 1931, is, like George Orwell's 1984, dour and disturbing; ironic and important. * David Marx: Book Reviews *
a vivid and very readable account... a wake-up call for today's politicians and economic policy makers * Kirsten Wandschneider, EH.Net *
A stunning, fast-paced and deeply researched narrative that accurately delineates the links between financial panic and political collapse in the most iconic case of all: the destruction of democracy in Weimar Germany. * Harold James, Claude and Lore Kelly Professor in European Studies, Princeton University *
In this engaging book, Straumann, a leading Swiss economic historian, examines a critical factor in Adolf Hitler's rise to power. * Foreign Affairs *



Book Information
ISBN 9780198816195
Author Tobias Straumann
Format Paperback
Page Count 272
Imprint Oxford University Press
Publisher Oxford University Press
Weight(grams) 292g
Dimensions(mm) 216mm * 135mm * 21mm