The Impact Of Reparations On The German Economy - 994 Words

future economic and political issues in Germany. [ CITE HISTORY.COM]. Keynes also noted that the fact that the Germans did not have any contribution to the Treaty of Versailles, claiming that the Germans would be very unsatisfied with the strict terms that they’d have to abide by. â€Å"Keynes argued that the large amounts of war reparations that were imposed would have a secondary effect that the terms of trade (the price of exports relative to the price of imports) would turn against Germany, thereby placing a burden on the country’s economy that came in addition to the direct payments of reparation.† [BOOK pg.362] The impact of reparations on the German Economy John Maynard Keynes clearly foresaw the future issues politically and economically in Germany. The German people did not like the reparations, which caused the Nazi party to rapidly grow in popularity in Germany over the next decade, which would over the following two decades cause an uproar and the second world war. [CITE cheaptalk]. The German economy was weak already due to the first world war, and having a harsh reparation made it very difficult to grow back the economy to it’s natural state (before the war). This combined with the loss of 10% of German territory, merchant ships confiscated, and other terms, easily aggravated the German people. As Keynes predicted, the Germans could not repay back their reparations, falling behind on payments, causing a devaluation of the German currency. [History.com] â€Å"ThatShow MoreRelatedThe Impact of the Treaty of Versailles on Germany Essay529 Words   |  3 PagesThe Impact of the Treaty of Versailles on Germany The Treaty of Versailles was received very badly within Germany. The nation had been blamed entirely for the first world war and had been forced to pay compensation to the allies under the war guilt clause of the treaty. 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