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Young Plan,program for settlement of German reparationsreparations,
payments or other compensation offered as an indemnity for loss or damage. Although the term is used to cover payments made to Holocaust survivors and to Japanese Americans interned during World War II in so-called relocation camps (and used as well to describe
..... Click the link for more information. debts after World War I. It was presented by the committee headed (1929–30) by Owen D. Young. After the Dawes PlanDawes Plan,
presented in 1924 by the committee headed (1923–24) by Charles G. Dawes to the Reparations Commission of the Allied nations. It was accepted the same year by Germany and the Allies.
..... Click the link for more information. was put into operation (1924), it became apparent that Germany could not meet the huge annual payments, especially over an indefinite period of time. The Young Plan—which set the total reparations at $26,350,000,000 to be paid over a period of 58 1-2 years—was thus adopted by the Allied Powers in 1930 to supersede the Dawes Plan. Designed to substitute a definite settlement under which Germany would know the exact extent of German obligations and to reduce the payments appreciably, the Young Plan divided the annual payment, set at about $473 million, into two elements—an unconditional part (one third of the sum) and a postponable part (the remainder). The annuities were to be raised through a transportation tax and from the budget. No sooner had the plan gone into effect than Germany felt the full impact of economic depression, and a moratorium was called for the fiscal year 1931–32. When Adolf HitlerHitler, Adolf
, 1889–1945, founder and leader of National Socialism (Nazism), and German dictator, b. Braunau in Upper Austria. Early Life
The son of Alois Hitler (1837–1903), an Austrian customs official, Adolf Hitler dropped out of high school, and
..... Click the link for more information. took over Germany, he defaulted on the unpaid reparations debt. After Germany's defeat in World War II, an international conference decided (1953) that Germany would pay the remaining debt only after the country was reunified. Nonetheless, West Germany paid off the principal by 1980; then in 1995, after reunification, the new German government announced it would resume payments of the interest.
the second reparations plan for Germany, replacing the Dawes Plan. Drawn up by a committee of financial experts from several countries under the chairmanship of the American banker O. Young, the plan was adopted, with some modifications, at the Hague Conference on Reparations of 1929–30.
The creation of the Young Plan was dictated to a considerable extent by the interests of the private, mostly American, creditors of Germany, whose solvency was being undermined by the enormous reparations it was required to pay. The new plan retained the anti-Soviet character of the Dawes Plan. It provided for a slight reduction in the amount of annual payments (by an average of up to two billion marks), the abolition of the reparations tax on industry, a reduction of taxation on transportation, and the elimination of foreign controls. One of the most important consequences of the adoption of the Young Plan was the early withdrawal of occupation troops from the Rhineland.
The Young Plan remained in effect only until July 1931; it was officially abolished in 1932. The burdens imposed by the plan, however, were made use of by reactionary forces in Germany to incite a spirit of chauvinism in the country.