One of the early reasons for the adoption of appeasement was economic difficulties.
Impact of the Great War
- In present day terms, the Great War had cost Britain around $35 billion.
- As a result, the Government was looking to cut back on military spending.
- In 1919 the Treasury introduced the
Ten Year Rule - they believed there wouldn't be another major threat to the British Empire for at least 10 years.
- As a result, the armed forces were cut back dramatically.
- The Wall Street Crash of 1929 and the Great Depression also put off military spending.
- Unemployment was rising and many businesses closed.
- With three million people unemployed, the government faced greater need for social welfare spending.
- Chamberlain wanted to increase the amount of money used for social welfare, so was reluctant to increase military spending.
Cost of rearmament
- Spending on the armed forces would affect attempts to recover from the Depression.
- It would divert spending away from social welfare
- It would divert spending away from consumer goods such as cars or radios. These were very profitable and helped the economy to grow.
- Europe's economy was still recovering from the Great War and the effects of the Wall Street Crash.
- It was thought that a strong, prosperous Germany could help revitalise the economy of these nations.