Inflation and the Destruction of Democracy: The Case of the Weimar Republic
The hypothesis of this article is that the great German inflation of 1919-1923 was an important cause of the destruction of democracy in the Weimar Republic and of the development of totalitarian government which culminated in Hitler's Third Reich. Concerning this inflation, Lionel Robbins wrote (in 1937) as follows: "It was the most colossal thing of its kind in history: and, next probably to the Great War itself, it must bear responsibility for many of the political and economic difficulties of our generation. It destroyed the wealth of the more solid elements in German society; and it left behind a moral and economic disequilibrium, apt breeding ground for the disasters which have followed. Hitler is the foster-child of the inflation."' Robbins emphasized the need to study the great German inflation not only to understand the tragic events of the past, but also to learn how to avoid their future recurrence. The historical method will be used to identify and to explicate the sequence of cause-and-effect relationships that began with the inflation and ended with the destruction of German democracy.2