Domestic politics also offered reason to hope. During the occupation of the Ruhr and the great inflation, republican government in Germany had appeared on the verge of collapse. In 1923, Communists momentarily entered provincial governments, and in November, an obscure politician named Adolf Hitler leaped onto a table in a beer hall in Munich and proclaimed a “national socialist revolution.” But the young republican government easily crushed Hitler’s plot, and he was sentenced to prison. By the late 1920s, liberal democracy seemed to take root in Weimar Germany and the economy had stabilized.

Sharp political divisions remained, however. Throughout the 1920s, Hitler’s Nazi Party attracted support from fanatical anti-Semites, ultranationalists, and disgruntled ex-servicemen. Many unrepentant nationalists and monarchists populated the right and the army. On the left, members of Germany’s recently formed Communist Party were noisy and active. The Communists, directed from Moscow, reserved their greatest hatred for their cousins the Social Democrats, whom they accused of betraying the revolution. Though the working class was divided, a majority supported the nonrevolutionary Social Democrats.

The situation in France was similar to that in Germany. Communists and Socialists battled for workers’ support. After 1924, the democratically elected government rested mainly in the hands of coalitions of moderates, with business interests well represented. France’s great accomplishment was the rapid rebuilding of its war-torn northeastern region. The expense of this undertaking led, however, to a large deficit and substantial inflation.

Britain, too, faced challenges after 1920. The great problem was unemployment. In June 1921, 23 percent of the labor force was out of work, and throughout the 1920s, unemployment hovered around 12 percent, leading to a massive general strike in 1926. Yet the state provided unemployment benefits and supplemented the payments with subsidized housing, medical aid, and increased old-age pensions. These and other measures kept living standards from seriously declining, helped moderate class tensions, and pointed the way toward the welfare state Britain would establish after World War II.

Relative social harmony in Great Britain was accompanied by the rise of the Labour Party as a determined champion of the working class and of greater social equality. Committed to the kind of moderate revisionist socialism that had emerged before World War I (see "The Socialist International" in Chapter 23), the Labour Party replaced the Liberal Party as the main opposition to the Conservatives. In 1924, and from 1929 to 1931, the Labour Party governed the country with the support of the smaller Liberal Party. Yet Labour moved toward socialism gradually and democratically, so as not to antagonize the middle classes.