Why did USA introduced the Dawes plan - I know it was to decrease the financial burden on Germany but why would they want to help Germany?
Answers
Answer:
Explanation:
After the end of World War I in which the European powers emerged victorious, they demanded compensation from Germany for the devastation caused because of the four-year conflict. They held Germany and its allies responsible for the financial stress.
During the 1919 Paris Peace Conference the parties failed to fix the quantum of payment to be made by Germany which led the United States, France, United Kingdom and the other Allies to form a Reparation Commission in order to overcome this issue.
During the 1921 spring, the Commission fixed the compensation at 132 billion gold marks which was about $31.5 billion. In January 1923 when Germany failed to discharge their obligation, Belgium and France soon occupied the Ruhr in order to force them to pay.
United States was not inclined to collect reparations from Germany but was determined to get back the payment to the tune of more $10 billion it had provided as loan to the Allies during the war period.
Till the late 1923 the deadlock between the European powers over German reparations persisted which resulted in formation of a committee by the Reparation Commission to assess the situation. In April 1924 the committee which was headed by Charles G. Dawes ,a Chicago banker presented a proposal. Under the proposal known as the Dawes Plan it was decided that the annual reparation payments of Germany would be reduced but at the same time would be increased as and when the economy improves, however the quantum of payment was left undecided.
It was decided that France and Belgium would leave the Ruhr and foreign banks would provide loan to the German government to the tune of $200 million to bring about economic stabilization. J. P. Morgan ,the U.S. financier floated the loan in the U.S. market. The next 4 years saw U.S. banks lending Germany substantial money in order to meet its reparation payments to France and the United Kingdom. The reparation money received by these countries from Germany helped them to pay off their their war debts to the United States.
This was the reason why U.S. helped Germany.
Hope this helps.
Answer:
Germany did not pay repression payments to France, which occupied Ruhr. Germany resisted and printed paper currency. The value of German mark gradually fell. the Americans intervened and introduced the Dawes Plan, which reworked the terms of reparation payment to ease the financial burden on Germany.