After the surrender, Germany was divided into four occupation zones, and in 1949 the country was split in two. They weren’t paid in actual money, but through industrial dismantling, the removal of intellectual property and forced labor for millions of German POWs. The Allies exacted reparations for World War II, too. Most of Germany’s institutions had crumbled, and its populace was on the brink of starvation. Over 5.5 million German combatants, and up to 8.8 million German civilians, were dead. Germany made no payments during Hitler’s rule.īut Germany wasn’t destined to win the war, and the Third Reich ended with Hitler’s suicide in April 1945 and Germany’s official surrender a few days later. His refusal was seen as an act of patriotism and courage in a nation that saw the reparations as a form of humiliation. “Hitler was committed to not just not paying, but to overturning the whole treaty,” historian Felix Schulz told the BBC’s Olivia Lang. Germany was still on the hook for its war debt.
Congress refused to sign on to the resolution. The next year, Allied delegates attempted to write off all of Germany’s reparations debt at the Lausanne Conference, but the U.S. In an attempt to thwart disaster, President Herbert Hoover put a year-long moratorium on reparation payments in 1931. But the dawn of the Great Depression ensured its failure and Germany’s economy began disintegrating again. The Young Plan involved a reduction of Germany’s war debt to just 121 billion gold marks. The plan was heralded as a victory-Charles Dawes, a banker who later became vice president under Calvin Coolidge won a Nobel Prize for his role in the negotiations.īut the Weimar Republic still struggled to pay its debts, so another plan was hashed out in 1928. lent Germany money to pay reparations, and the countries that collected reparations payments used that money to pay off United States debts. Reparations continued to be paid through a strange round robin: The U.S. In 1924, the Dawes Plan reduced Germany’s war debt and forced it to adopt a new currency. By November 1923, 42 billion marks were worth the equivalent of one American cent.įinally, the world mobilized in an attempt to ensure reparations would be paid. Reparations further strained the economic system, and the Weimar Republic printed money as the mark’s value tumbled. Germany had suspended the gold standard and financed the war by borrowing. Intense negotiation resulted in the Treaty of Versailles’ “war guilt clause,” which identified Germany as the sole responsible party for the war and forced it to pay reparations. That’s how long Germany took to repay World War I reparations, thanks to a financial collapse, another world war and an ongoing debate about how, and even whether, Germany should pay up on its debts.Īllied victors took a punitive approach to Germany at the end of World War I. Nobody could have dreamed that it would take 92 years. How-and when-could Germany possibly pay its debt? The Treaty of Versailles didn’t just blame Germany for the war-it demanded financial restitution for the whole thing, to the tune of 132 billion gold marks, or more than $500 billion today.
But most embarrassing of all was the punitive peace treaty Germany had been forced to sign. World War I’s victors blamed Germany for beginning the war, committing horrific atrocities and upending European peace with secretive treaties. Germany had been forced to become a republic instead of a monarchy, and its citizens were humiliated by their nation’s bitter loss.Įven more humiliating were the terms of Germany’s surrender. Up to 3 million Germans, including 15 percent of its men, had been killed. At the end of World War I, Germans could hardly recognize their country.
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