Reparations
Background:
One of the most devastating terms of the Treaty of Versailles was the ‘War Guilt Clause’ which states that Germany and its allies was to blame for the outbreak of the war and required them to pay reparations for the damage and casualties caused by the war.
One motive of the reparation payments was to weaken Germany’s economy so that it could not threaten other countries in the future.
Reparation Terms:
As Germany signed the Treaty of Versailles, they were essentially accepting blame for the war.
Due to the complications which led to the war outbreak, it would be unreasonable for Germany and its allies to accept FULL responsibility, the Germans thought so too.
Germany’s enemies had suffered greatly due to the war in terms of economy and human terms.
France, in particular, demanded compensation as most of the war was fought in French land, ruining a vast amount of their infrastructures.
Disagreement of Reparations
Wilson (USA) opposed the idea of reparation payment as he claimed that this would cause resentment and urge Germany to get revenge in the future
Lloyd George (Britain) was in the middle. Although he was keen on the idea of reparation payment, he wanted to keep them as low as possible so that the German economy could recover quickly, as he was also concerned that this would disturb its trading links with Britain
Clemenceau (France) wanted Germany to suffer and pay high reparations. Apart from serving as a compensation, Clemenceau insisted this so that Germany would be kept weak and could never threaten France again.
After long discussions, it was finally decided that Germany and its allies were to pay reparations where the amount would be set by the Reparations Commission in 1921.
However, it was clear that Germany and Bulgaria would mostly suffer from this as the Treaties of Saint-Germain, Trianon and Sevres acknowledged that Austria-Hungary and Turkey had limited resources and would find it difficult to pay reparations.
Reparations Commision:
The Reparations Committee met again in 1921 to determine how much the losing nations have to pay for reparations
Austria and Hungary didn’t have to pay reparations due to their major economic problems
Turkey had to pay a small amount of reparations according to the terms of Treaty of Sevres, but were eliminated in the Treaty of Lausanne in 1923
A figure of £100 million was set for Bulgarian reparations but only a fraction had been paid by 1932 until it was cancelled
As a result, Germany had to pay the highest reparations of £6.6 billion. This horrified the German representatives and argued that Germany was in no position to pay this as the war resulted into their economy’s devastation
→ This was unfair to the defeated nations as when they signed the treaties back in 1919-1920, they signed the Treaty without knowing how much they had to pay. It was like signing a blank cheque.