Wall Street US government billion Germany Allies reparations United States Britain France
In all nations, the government's share of GDP increased, surpassing 50% in both Germany and France and nearly reaching that level in Britain. To pay for purchases in the United States, Britain cashed in its extensive investments in American railroads and then began borrowing heavily from Wall Street. President Wilson was on the verge of cutting off the loans in late 1916 but allowed a great increase in US government lending to the Allies. After 1919, the US demanded repayment of these loans. The repayments were, in part, funded by German reparations that, in turn, were supported by American loans to Germany. This circular system collapsed in 1931 and some loans were never repaid. Britain still owed the United States $4.4 billion of World War I debt in 1934; the last installment was finally paid in 2015.
