By the end of World War One, Germany was suffering from many problems. The Allied Naval blockade had caused severe food shortages and this, coupled with the lack of basic medical supplies, led to thousands dying of hunger and common diseases such as influenza. The people left in the poverty-stricken country were then expected to pay in annual instalments the £6,600 million which the Versailles Treaty demanded. The treaty was deeply resented by the Germans, who regarded it as a peace dictated by politicians that was shameful and unfair to Germany. In a period of civic unrest ex-soldiers murdered many politicians and extremists tried to overthrow the government. The government was forced to use the Freikorps to stop the violence. After paying thefirst instalment, the German government announced that it was unable to pay the reparations for the next three years.
In 1923, French and Belgian troops moved into the Ruhr to exact the payment by force. Under the terms of the Versailles Treaty, Germany was not allowed to station troops in the Ruhr, so was unable to fight back. Instead, the government ordered passive resistance – local people were not to assist the French or Belgians in any way. In retaliation and to make room for French workers, 150 thousand people were expelled from the region. With nowhere to go unless they had relatives with spare room, many of these people would suffer until the troops left the Ruhr.
The Ruhr was a major industrial region but because of the passive resistance, industry was virtually at a standstill. This meant that instead of rebuilding the economy and helping improve conditions in Germany, nothing was happening and conditions were getting worse. Since the Government was paying out vast sums of money as unemployment benefit to the workers in the Ruhr, while not getting much back as taxes, it was in financialdifficulty.
The German government 's decision to deal with the lack of money