Interwar Period Crises: Causes of World War II and the Great Depression

Failure of the League of Nations

Originated at the end of World War I to keep peace, the League of Nations did not fulfill its aspirations. The League was intended to sanction countries attacking others, but its effectiveness depended on member countries to reinforce its decisions. For instance, in 1931, Japan invaded Manchuria, and in 1935, Italy invaded Abyssinia; in both cases, the League failed to act decisively. Furthermore, when Adolf Hitler began breaking the terms of the Treaty of Versailles, the League also proved ineffective.

Appeasement Policy and Non-Intervention

European countries attempted to appease Adolf Hitler, allowing him to pursue his expansionist agenda in an effort to avoid war. This policy enabled aggressive nations to achieve their objectives at the expense of others, significantly contributing to the outbreak of war. A notable example was the non-intervention of Western democracies in the Spanish Civil War, while Hitler and Benito Mussolini actively supported the military coup. This inaction greatly increased the likelihood of a wider conflict and strengthened Germany's rearmament efforts.

The Treaty of Versailles: Key Provisions and Impact

The Treaty of Versailles, signed under protest by Germany, imposed harsh conditions that ultimately contributed to the rise of Adolf Hitler and the Second World War.

Important Territorial Losses

• Germany lost 13% of its territory.
• Alsace and Lorraine were returned to France.
• Parts of East Prussia and Upper Silesia were ceded to Poland.
• Danzig was declared a free city.

Military Conditions

• Demilitarization and a fifteen-year occupation of the Rhineland.
• Significant restrictions on the size and capabilities of the German armed forces.

War Reparations

• Germany was obliged to pay substantial war reparations to the victorious Allied powers, an amount that proved very difficult to pay off.

Other Provisions

• Germany was forced to accept sole responsibility for the war (the "War Guilt Clause").
• The League of Nations was established, but Germany was initially excluded from membership.

The Stock Market Crash of 1929 and the Great Depression

In October 1929, the stock market crashed, triggering a worldwide economic depression. Business firms closed their doors, factories shut down, and banks failed. Millions of Americans were unemployed. Many banks had invested their deposits heavily in the stock market, exacerbating the crisis. On October 24, 1929 – known as Black Thursday – panic ensued in the morning hours, share prices plummeted, and many people went bankrupt. The conservative government of the United States initially believed that the market would self-correct and that the crisis would be short-lived, but they were gravely mistaken.