Lausanne bond

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The Lausanne loan was a loan of the League of Nations granted to Austria on July 15, 1932 for 300 million schillings with a term of 20 years.

prehistory

In the course of the global economic crisis , the federal government of Ender learned on May 8, 1931 that the largest bank in the country, the Creditanstalt für Handel und Gewerbe , would have a deficit of 140 million schillings in its upcoming balance sheet, funds that had been irrecoverably lost. The bank had previously taken over banks in distress, such as the second largest bank in Austria, Allgemeine Bodencreditanstalt . It controlled around two thirds of Austrian industry through industrial holdings.

The government could not afford the collapse of a bank that was so important for the Austrian economy. Feverishly looked for ways to rescue the Creditanstalt and on May 11th the press announced how the bank was doing and how it should be intercepted: the republic would be 100 million, the national bank 30 million and that at the Creditanstalt involved Haus Rothschild to raise a further 30 million schillings.

As soon as the state of the bank became known, foreign banks demanded back the loans they had granted to the Creditanstalt, but the rescue capital raised was insufficient to service these demands. The government stepped in again, guaranteeing international creditors that they would repay all loans taken out by Creditanstalt if the bank were unable to do so. In a short time, guarantees worth two billion schillings had to be given. Domestic savers - this guarantee did not apply to them - stormed the banks to withdraw their deposited money. The entire banking system in Austria threatened to collapse. By investing in gold , which is regarded as safe , the coverage of the shilling by gold and foreign exchange fell within a few weeks from 84 to only 17 percent.

The bank's foreign creditors constituted a committee in London on June 1, 1931 , which acted as a negotiating partner with the government. A $ 150 million loan from the Bank of England allowed the government to keep the bank running, but was not enough to end the financial crisis. In order to limit the deficit in the state budget, the government decided to cut costs and increase tariffs and tobacco prices.

Austria turned to France for help. France was extremely hostile to the planned German-Austrian customs union and tied political conditions to any support:

  • The federal government must immediately ask the League of Nations for a thorough investigation of the economic and financial situation of the country and undertake in advance to agree to any measure that the League Council will propose.
  • The federal government must officially forego any economic or political “combination” that would change Austria's international status. That meant the end of the planned customs union.

For the Ender government, the customs union was at the heart of its efforts to deal with the economic crisis. It considered these conditions unacceptable and therefore resigned on June 16, 1931, and because of a simultaneously developing government crisis. The next government officially asked the League of Nations for help on August 7, 1931 and sent Foreign Minister Johann Schober to Geneva , where on September 3, 1931, together with his German colleague Julius Curtius , he officially renounced the customs union before the League Council.

The Lausanne Protocol

The negotiations on the loan took place at the same time as the Lausanne Conference at the League of Nations in Lausanne in June and July 1932. In the Convention of July 15, the so-called Lausanne Protocol, which was concluded between representatives of Austria, Great Britain , France, Italy and Belgium , Austria undertook to renew its commitments in the Geneva Protocols , i.e. its political independence, territorial integrity and sovereignty preserve, thus a confirmation of the connection ban . Furthermore, it had to be promised that Austria would immediately repay all of the previous loans from the Bank of England and the Bank for International Settlements . In addition, Austria had to make some financial and monetary policy commitments. The League of Nations sent the Dutchman Meinoud Rost van Tonningen as a representative to Vienna to oversee the state finances .

In return, Austria was guaranteed a bond of 300 million schillings with a term of 20 years. The possibility of early repayment after ten years was agreed.

Reactions

Germany was indignant about the "linking of political demands with a purely financial operation" and only through telephone intervention by Chancellor Engelbert Dollfuss with Reich Chancellor Franz von Papen did the German council delegate abstain from the decisive vote on the minutes.

On July 16, the Lausanne Protocols were published in newspapers and domestically, the conditions for the bonds sparked protests from the opposition left and right of Dollfuss. The representative of the League of Nations was referred to as a "financial dictator". Social Democrats and Greater Germans demanded that the government waive the Lausanne loan. Leopold Kunschak , the leading representative of the workers' wing in the Christian Social Party , became increasingly dissatisfied with the Chancellor's course and finally resigned from his post as Viennese party chairman.

Acceptance of the conditions

On August 17, 1932, the National Council voted on the acceptance of the Lausanne loan, and the corresponding government bill was approved with 81 to 80 votes. After the Federal Council had raised an objection, the government introduced an insistence on 23 August, which was approved with 82 votes to 80.

literature

  • Klaus Berchtold: Constitutional history of the Republic of Austria. Volume 1: 1918-1933. Springer, Vienna / New York 1998, ISBN 3-211-83188-6 , pp. 607-696.

Individual evidence

  1. ^ Hugo Portisch : Austria I: The underestimated republic . Kremayr & Scheriau, Vienna 1989, ISBN 978-3-218-00485-5 , p. 395-399 .
  2. ↑ The von Papen Cabinet: Doc. No. 40 of June 25, 1932. In: “Files of the Reich Chancellery. Weimar Republic ”online. Retrieved December 16, 2017 .
  3. ↑ a b Peter Berger: In the shadow of the dictatorship: the financial diplomacy of the representative of the League of Nations in Austria, Meinoud Marinus Rost van Tonningen 1931-1936 (=  Herbert Matis , Roman Sandgruber [ed.]: Studies on economic history and economic policy . Volume 7 ). Böhlau, Vienna 2000, ISBN 978-3-205-99206-6 , pp. 244 ff . ( limited preview in Google Book search).
  4. ^ A b Hugo Portisch: Austria I: The underestimated republic . Kremayr & Scheriau, Vienna 1989, ISBN 978-3-218-00485-5 , p. 415-417 .