Hello everyone,
I've been thinking a lot about a possible sequence of events in the late Weimar Republic after I've read, a few weeks ago, @Faeelin's old and magnificent timeline Holding Out for a Hero - Gustav Stresemann Survives.
I like the idea of Stresemann's lethal stroke not happening in 1929, and his survival making a difference in the darkest (and IOTL last) hour of the Weimar Republic. But then, I was not entirely sure about that timeline's turning point and how fast things turned for the better in his Weimar. Faeelin has Stresemann as chancellor, and then he kills off Hindenburg earlier, too, leaving Stresemann as acting - and later elected - Reichspräsident, with a unified liberal-conservative party which tackles the Depression with a sort of German New Deal, achieves the Anschluss of Austria and a lot more.
But the question of the difference Stresemann would have made hasn't left my mind since then. I'm not a fan of the Great Men view of history, but I think significant divergences are still plausible here. Gustav Stresemann has pulled, with varying degrees of success, his national-liberal Deutsche Volkspartei (DVP) from the monarchist-restorationist into the republican camp, and repeatedly convinced it of the necessity of coalition governments including the SPD, whom the industrialist support base of the DVP hated, feared, and despised. He was a convincing politician and statesman, with a good international reputation, and often surprisingly persipacicous views. But he was also operating in greater structural contexts which aren't so easily fixed by a single person. So we ought to be careful in balancing what we can theoretically attribute to his alternate survival.
So, what could be possible outcomes of Stresemann's survival throughout Weimar's Depression years, if we leave @Faeelin's secondary PoD, Hindenburg's early death, aside?
When he died, the Depression had not yet fully hit Germany. The Reich was governed by a great coalition of Stresemann's DVP, the liberal DDP, the Catholic Zentrum, and the SPD. The latter, like the communists, had fared rather well in the 1928 Reichstag elections, so the chancellor of this coalition was a Social Democrat, Hermann Müller.
IOTL: Five months after Stresemann's death, the great coalition fell apart. The Depression slowly made itself felt in Germany, too, and as the number of unemployed rose, so did the costs of social unemployment insurance, a Weimar addition on Bismarck's system of social security paid by employers and employees in equal measure. The DVP, the voice of the industrial capital, opposed higher unemployment insurance contributions, while the SPD pushed for them. Proposed compromises fell through, and so Müller stepped down and the SPD left the coalition. This made re-elections for the Reichstag necessary, in which all parties of the great coalition suffered, and the Nazis, who had been a 2.4 % splinter party in 1928, jumped to over 18 % in 1930, making a renewal of the republican great coalition mathematically impossible (NSDAP, DNVP, KPD and a host of splinter parties together held a majority of seats now).
Let's say that Stresemann's talent for brokering compromises and bridging political chasms and his comparatively lucid view of the dangers entailed by hasarding the (feeble) stability of the Republic's institutional framework lead to Müller's great coalition trudging on instead. They have a comfortable majority, so even if Stresemann is only able to persuade the coalition parties' leaderships while a few parliamentarians on the right wings of DVP and Zentrum (or alternatively on the SPD's left wing) are voting against, the raise of unemployment contributions passes the Reichstag. Is that plausible for you, too?
The government Müller II does not fall on March 27th, 1930, thus, and therefore there are no September 1930 Reichstag elections. Alfred Hugenberg, chairman of the ultra-right-wing DNVP and media tycoon, spits his venom against this government, against Jews, and against "socialism" through his huge network of newspapers and newspaper service providers, so the NSDAP is not likely to remain a splinter group as more and more companies shut their doors, the numbers of unemployed swell, and fear creeps into the middle class. But it also doesn't receive the boost or momentum and the parliamentary resonance room which the 1930 election gave them IOTL. This means, the Nazis are becoming visible in a few regional elections (Landtagswahlen), but much more than that through the SA's violent presence in the streets, whose numbers are likely to be considerably lower than with the 1930 election momentum and everyone listening to Hitler's speeches at once, but still numbering tens of thousands. (Other paramilitary political groups are still likely to be stronger than them by 1930, though: the Stahlhelm, the Reichsbanner Schwarz-Rot-Gold, and maybe even the remnants and re-formations of the communist Rotfrontkämpferbund, which Müller's government had outlawed in 1929.)
So, everyone's focus is not on the Nazis. It is still on the economic crisis, and on the weak position Germany has internationally, being forced to pay reparations in a context in which other governments react to the economic downturn with increasing protectionism.
How does Müller's great coalition fare with the time which Stresemann's genius has bought it? With regards to foreign policy and the Versailles regulations, it is going to be Müller's great coalition, not Heinrich Brüning's emergency cabinet backed by Reichspräsident Hindenburg, who gets to organise the festivities when the last French soldiers are leaving the Rheinland in 1930. Other than that, the new regulations of the Young Plan, which Stresemann had negotiated, apply now. They are less severe than the previous Dawes Plan, but still they're asking quite a lot from a government which is approaching illiquidity very fast.
Like Brüning's, Müller's most immediate challenge is going to be the economic downturn, which escalated throughout 1930 and culminated in 1931 with the German banking crisis [the wikipedia article is unfortunately avaiable only in German, but it's rather good].
Brüning reacted with his austerity policies, which accelerated and deepened already existing deflatory tendencies. In the two years of his government, countless taxes were raised, unemployment sky-rocketed to six million (and that was in a mostly male job market!), wages were frozen, banks became insolvent and were propped up by the government, de facto nationalising them, foreign invested capital retreated, currency controls were introduced, prices dropped, production dropped, too, countless companies went out of business.
How would a great coalition led by Müller's SPD act? And how long could it last, always supposing Stresemann continues to work his compromise magic to the best of his abilities?
For once, I don't think they'd be as courageous (and dumb) as Brüning, who didn't have to care for parliamentary support anymore because IOTL the SPD was scared shitless after the 1930 results and tacitly tolerated his government by not contributing to votes of no confidence or to revocations of the presidential decrees (Notverordnungen), so they probably wouldn't go ahead with drastic measures which hurt almost everyone (except agrarians because Hindenburg wouldn't decree anything which went against the vested interests of his junker camarila), just to prove to the Versailles powers that he had done everything he possibly could and yet still wouldn't be able to pay the reparations.
On the other hand, there's still the looming state bankruptcy, and the German government had to pay its reparations in gold-based currency, so simply printing new money wasn't really an option - and besides, after the experiences of 1923, no German politician would openly suggest this, at least not until the opposite, deflatory policies, had proven at least equally dangerous.
Where could Müller cut back, or tap into new sources of income, or otherwise save his government from bankruptcy?
I have this one idea. Who is not represented in the great coalition? The SPD primarily represents industrial workers, the DVP industrial capitalists, bankers etc., the DDP represents the "Bildungsbürgertum", and the Zentrum a socially very diverse clientele united merely by their Catholic faith. Who is left out? Evidently the small but disproportionately influential landowning class, the junkers whose voices are articulated by the DNVP and, to a smaller degree, by the short-lived CNBL.
Could the government Müller II have dared to cut back on the ample agrarian subsidies instead of cutting back on unemployment benefits and public works and raising taxes for everything from petrol to schnapps? Especially the Osthilfe had been intensified after the Agrarkrise of 1927, and while the SPD initially wanted some sort of infrastructural development for East Elbia, too, this looks like something they could easily decide to drop without hurting their own voters too much.
I'll go with this option, but I'm curious to hear what you think. Either way, this is not going to be enough; if we add the possibility of Stresemann, as a more capable foreign secretary compared to Julius Curtius, probably obtaining the discussed 3 bn RM French emergency loan by not pushing for the German-Austrian Customs Union at the wrong moment, it might buy Müller II another year, or maybe a year-and-a-half, in which they'd increasingly also have to reduce spending in other domains, each of which would come at the cost of antagonising one or another of those interest groups whose support the coalition cannot really afford to lose.
And the Junkers would not simply stand by and watch. They can stage boycotts and the like, but their primary focus would be on president Hindenburg, who had two open ears for them. Meanwhile, Hugenberg is going to go into overdrive, both with his DNVP and his media empire, and shoot from all angles against the government. On the streets, while the situation may not look quite as dire socially and as violent as IOTL with "Hungerkanzler Brüning" and bloody clashes between SA, Reichsbanner et al., it's still not going to be nice.
And the banking system is going to fold in 1931 either way. And an SPD-led government is going to see itself with no other option than to bail out the banks, too, and when too much capital leaves the country, they'd have to introduce currency controls, too. The social democratic minister of the finances, Rudolf Hilferding, is going to see this as his theory of state-monopolising capitalism coming true: after all, the banks have ended up owned by the government at their own request... all the while the extreme right is going to shout their ugly stuff about Jewish bankers bleeding out German businesses and causing German workers to be laid off, and the moderate, liberal-conservative right and especially its industrial-capitalist base is not going to be pacified by Stresemann's calls for statesmanlike and civic responsibility forever, for all of this looks really dangerous to them, socialism looming on the horizon and everything.
What do you think so far? Where would you consider other divergent paths more plausible? Any other options? Any factors I haven't taken into account but should?
All in all, given the above, I've been wondering whether we'd see some sort of right-wing coup around the summer of 1931 or maybe the autumn. Maybe Hilferding announces the intention to give up gold-backed currency and devaluate the Reichsmark in order to facilitate exports after the Bank of England has done the same - and the fear of "our money going in flames again" is the proverbial drop in the bucket which causes the overflow?
Such a coup would be different from OTL 1933. Surely, it would be based on an alliance of big industry and junkers, and it would lack a proper majority, with some right-wing politicians from the DVP and the Zentrum deserting the coalition and supporting a "technocratic" presidential government which suspends the Reichstag "for a limited period of national emergency", say after the great coalition has lost its majority with the above-mentioned desertions, and circumnavigating / ignoring the constitutional demand to hold new elections. (I guessed such a capitalist-junker coup would want to avoid new elections because they don't know about the spectacular vehicle which they could gain in the NSDAP from such elections, and instead they know they can't get a majority anyway and fear that, on the opposite, the communists are going to come out stronger in them.)
What do you think of that? Paul von Hindenburg swearing in some right-wing chancellor of his liking - if agrarian troubles dominate in the leadup to the coup, maybe Elard von Oldenburg-Januschau; if the fear of "financial socialism" or "hyperinflation" is going to dominate, maybe Hjalmar Schacht? In the backrooms, conspirators from the right wings of DVP and Zentrum have prepared for the day and appear together to rally majorities in their own parties in support of the self-suspension of the Reichstag, at least until the date for the next regular elections - probably, say, under the hypocritical pretext of the violence in the streets making a regular election presently impossible?
The new presidential cabinet immediately restores agrarian subsidies, abolishes unemployment benefits, leaves the Reichsmark tied to the gold standard for the time being, probably freezes wages and/or cuts at least those of the state's employees... while the debts are still as pressing as ever.
What do you think of this sketch?
Any turn of the road where you think a different development makes more sense?
If you wish to follow me so far - what might happen next?
I've been thinking a lot about a possible sequence of events in the late Weimar Republic after I've read, a few weeks ago, @Faeelin's old and magnificent timeline Holding Out for a Hero - Gustav Stresemann Survives.
I like the idea of Stresemann's lethal stroke not happening in 1929, and his survival making a difference in the darkest (and IOTL last) hour of the Weimar Republic. But then, I was not entirely sure about that timeline's turning point and how fast things turned for the better in his Weimar. Faeelin has Stresemann as chancellor, and then he kills off Hindenburg earlier, too, leaving Stresemann as acting - and later elected - Reichspräsident, with a unified liberal-conservative party which tackles the Depression with a sort of German New Deal, achieves the Anschluss of Austria and a lot more.
But the question of the difference Stresemann would have made hasn't left my mind since then. I'm not a fan of the Great Men view of history, but I think significant divergences are still plausible here. Gustav Stresemann has pulled, with varying degrees of success, his national-liberal Deutsche Volkspartei (DVP) from the monarchist-restorationist into the republican camp, and repeatedly convinced it of the necessity of coalition governments including the SPD, whom the industrialist support base of the DVP hated, feared, and despised. He was a convincing politician and statesman, with a good international reputation, and often surprisingly persipacicous views. But he was also operating in greater structural contexts which aren't so easily fixed by a single person. So we ought to be careful in balancing what we can theoretically attribute to his alternate survival.
So, what could be possible outcomes of Stresemann's survival throughout Weimar's Depression years, if we leave @Faeelin's secondary PoD, Hindenburg's early death, aside?
When he died, the Depression had not yet fully hit Germany. The Reich was governed by a great coalition of Stresemann's DVP, the liberal DDP, the Catholic Zentrum, and the SPD. The latter, like the communists, had fared rather well in the 1928 Reichstag elections, so the chancellor of this coalition was a Social Democrat, Hermann Müller.
IOTL: Five months after Stresemann's death, the great coalition fell apart. The Depression slowly made itself felt in Germany, too, and as the number of unemployed rose, so did the costs of social unemployment insurance, a Weimar addition on Bismarck's system of social security paid by employers and employees in equal measure. The DVP, the voice of the industrial capital, opposed higher unemployment insurance contributions, while the SPD pushed for them. Proposed compromises fell through, and so Müller stepped down and the SPD left the coalition. This made re-elections for the Reichstag necessary, in which all parties of the great coalition suffered, and the Nazis, who had been a 2.4 % splinter party in 1928, jumped to over 18 % in 1930, making a renewal of the republican great coalition mathematically impossible (NSDAP, DNVP, KPD and a host of splinter parties together held a majority of seats now).
Let's say that Stresemann's talent for brokering compromises and bridging political chasms and his comparatively lucid view of the dangers entailed by hasarding the (feeble) stability of the Republic's institutional framework lead to Müller's great coalition trudging on instead. They have a comfortable majority, so even if Stresemann is only able to persuade the coalition parties' leaderships while a few parliamentarians on the right wings of DVP and Zentrum (or alternatively on the SPD's left wing) are voting against, the raise of unemployment contributions passes the Reichstag. Is that plausible for you, too?
The government Müller II does not fall on March 27th, 1930, thus, and therefore there are no September 1930 Reichstag elections. Alfred Hugenberg, chairman of the ultra-right-wing DNVP and media tycoon, spits his venom against this government, against Jews, and against "socialism" through his huge network of newspapers and newspaper service providers, so the NSDAP is not likely to remain a splinter group as more and more companies shut their doors, the numbers of unemployed swell, and fear creeps into the middle class. But it also doesn't receive the boost or momentum and the parliamentary resonance room which the 1930 election gave them IOTL. This means, the Nazis are becoming visible in a few regional elections (Landtagswahlen), but much more than that through the SA's violent presence in the streets, whose numbers are likely to be considerably lower than with the 1930 election momentum and everyone listening to Hitler's speeches at once, but still numbering tens of thousands. (Other paramilitary political groups are still likely to be stronger than them by 1930, though: the Stahlhelm, the Reichsbanner Schwarz-Rot-Gold, and maybe even the remnants and re-formations of the communist Rotfrontkämpferbund, which Müller's government had outlawed in 1929.)
So, everyone's focus is not on the Nazis. It is still on the economic crisis, and on the weak position Germany has internationally, being forced to pay reparations in a context in which other governments react to the economic downturn with increasing protectionism.
How does Müller's great coalition fare with the time which Stresemann's genius has bought it? With regards to foreign policy and the Versailles regulations, it is going to be Müller's great coalition, not Heinrich Brüning's emergency cabinet backed by Reichspräsident Hindenburg, who gets to organise the festivities when the last French soldiers are leaving the Rheinland in 1930. Other than that, the new regulations of the Young Plan, which Stresemann had negotiated, apply now. They are less severe than the previous Dawes Plan, but still they're asking quite a lot from a government which is approaching illiquidity very fast.
Like Brüning's, Müller's most immediate challenge is going to be the economic downturn, which escalated throughout 1930 and culminated in 1931 with the German banking crisis [the wikipedia article is unfortunately avaiable only in German, but it's rather good].
Brüning reacted with his austerity policies, which accelerated and deepened already existing deflatory tendencies. In the two years of his government, countless taxes were raised, unemployment sky-rocketed to six million (and that was in a mostly male job market!), wages were frozen, banks became insolvent and were propped up by the government, de facto nationalising them, foreign invested capital retreated, currency controls were introduced, prices dropped, production dropped, too, countless companies went out of business.
How would a great coalition led by Müller's SPD act? And how long could it last, always supposing Stresemann continues to work his compromise magic to the best of his abilities?
For once, I don't think they'd be as courageous (and dumb) as Brüning, who didn't have to care for parliamentary support anymore because IOTL the SPD was scared shitless after the 1930 results and tacitly tolerated his government by not contributing to votes of no confidence or to revocations of the presidential decrees (Notverordnungen), so they probably wouldn't go ahead with drastic measures which hurt almost everyone (except agrarians because Hindenburg wouldn't decree anything which went against the vested interests of his junker camarila), just to prove to the Versailles powers that he had done everything he possibly could and yet still wouldn't be able to pay the reparations.
On the other hand, there's still the looming state bankruptcy, and the German government had to pay its reparations in gold-based currency, so simply printing new money wasn't really an option - and besides, after the experiences of 1923, no German politician would openly suggest this, at least not until the opposite, deflatory policies, had proven at least equally dangerous.
Where could Müller cut back, or tap into new sources of income, or otherwise save his government from bankruptcy?
I have this one idea. Who is not represented in the great coalition? The SPD primarily represents industrial workers, the DVP industrial capitalists, bankers etc., the DDP represents the "Bildungsbürgertum", and the Zentrum a socially very diverse clientele united merely by their Catholic faith. Who is left out? Evidently the small but disproportionately influential landowning class, the junkers whose voices are articulated by the DNVP and, to a smaller degree, by the short-lived CNBL.
Could the government Müller II have dared to cut back on the ample agrarian subsidies instead of cutting back on unemployment benefits and public works and raising taxes for everything from petrol to schnapps? Especially the Osthilfe had been intensified after the Agrarkrise of 1927, and while the SPD initially wanted some sort of infrastructural development for East Elbia, too, this looks like something they could easily decide to drop without hurting their own voters too much.
I'll go with this option, but I'm curious to hear what you think. Either way, this is not going to be enough; if we add the possibility of Stresemann, as a more capable foreign secretary compared to Julius Curtius, probably obtaining the discussed 3 bn RM French emergency loan by not pushing for the German-Austrian Customs Union at the wrong moment, it might buy Müller II another year, or maybe a year-and-a-half, in which they'd increasingly also have to reduce spending in other domains, each of which would come at the cost of antagonising one or another of those interest groups whose support the coalition cannot really afford to lose.
And the Junkers would not simply stand by and watch. They can stage boycotts and the like, but their primary focus would be on president Hindenburg, who had two open ears for them. Meanwhile, Hugenberg is going to go into overdrive, both with his DNVP and his media empire, and shoot from all angles against the government. On the streets, while the situation may not look quite as dire socially and as violent as IOTL with "Hungerkanzler Brüning" and bloody clashes between SA, Reichsbanner et al., it's still not going to be nice.
And the banking system is going to fold in 1931 either way. And an SPD-led government is going to see itself with no other option than to bail out the banks, too, and when too much capital leaves the country, they'd have to introduce currency controls, too. The social democratic minister of the finances, Rudolf Hilferding, is going to see this as his theory of state-monopolising capitalism coming true: after all, the banks have ended up owned by the government at their own request... all the while the extreme right is going to shout their ugly stuff about Jewish bankers bleeding out German businesses and causing German workers to be laid off, and the moderate, liberal-conservative right and especially its industrial-capitalist base is not going to be pacified by Stresemann's calls for statesmanlike and civic responsibility forever, for all of this looks really dangerous to them, socialism looming on the horizon and everything.
What do you think so far? Where would you consider other divergent paths more plausible? Any other options? Any factors I haven't taken into account but should?
All in all, given the above, I've been wondering whether we'd see some sort of right-wing coup around the summer of 1931 or maybe the autumn. Maybe Hilferding announces the intention to give up gold-backed currency and devaluate the Reichsmark in order to facilitate exports after the Bank of England has done the same - and the fear of "our money going in flames again" is the proverbial drop in the bucket which causes the overflow?
Such a coup would be different from OTL 1933. Surely, it would be based on an alliance of big industry and junkers, and it would lack a proper majority, with some right-wing politicians from the DVP and the Zentrum deserting the coalition and supporting a "technocratic" presidential government which suspends the Reichstag "for a limited period of national emergency", say after the great coalition has lost its majority with the above-mentioned desertions, and circumnavigating / ignoring the constitutional demand to hold new elections. (I guessed such a capitalist-junker coup would want to avoid new elections because they don't know about the spectacular vehicle which they could gain in the NSDAP from such elections, and instead they know they can't get a majority anyway and fear that, on the opposite, the communists are going to come out stronger in them.)
What do you think of that? Paul von Hindenburg swearing in some right-wing chancellor of his liking - if agrarian troubles dominate in the leadup to the coup, maybe Elard von Oldenburg-Januschau; if the fear of "financial socialism" or "hyperinflation" is going to dominate, maybe Hjalmar Schacht? In the backrooms, conspirators from the right wings of DVP and Zentrum have prepared for the day and appear together to rally majorities in their own parties in support of the self-suspension of the Reichstag, at least until the date for the next regular elections - probably, say, under the hypocritical pretext of the violence in the streets making a regular election presently impossible?
The new presidential cabinet immediately restores agrarian subsidies, abolishes unemployment benefits, leaves the Reichsmark tied to the gold standard for the time being, probably freezes wages and/or cuts at least those of the state's employees... while the debts are still as pressing as ever.
What do you think of this sketch?
Any turn of the road where you think a different development makes more sense?
If you wish to follow me so far - what might happen next?
.