"eternal" penny was introduced and with it came interest and accumulation of wealth in the hands of increasingly fewer people, as well as the accompanying social and economic problems. The lesson here is that taxes should be levied separately and not connected with the circulation fee on money.
THE WEIMAR REPUBLIC AND THE GOLD STANDARD During the Weimar Republic (1924-33), the central bank's president, Hjalmar Schacht, had the desire to create an "honest" currency in Germany which - in his understanding meant a return to the gold standard. Since he could not buy enough gold on the world market adequate to the amount of money in circulation, he began to reduce the latter. The shorter supply of money resulted in rising interest rates, thereby reducing the incentives and possibilities for investment, forcing firms into bankruptcy, and increasing unemployment, which led to the growth of radicalism and finally helped Hitler to gain more and more power. Figure 17 shows the links between growing poverty and radicalism in the Weimar Republic.
Figure 17 Unemployment Impoverishes, Poverty Radicalizes This development had been foreseen by Silvio Gesell - although for different reasons. Already in 1918, shortly after World War I, when everybody talked about peace and many international organizations were created to secure that peace, Gesell published the following warning in a letter to the editor of the newspaper "Zeitung am Mittag" in Berlin: In spite of the holy promise of all people to banish war, once and for all, in spite of the cry of millions 'Never a war again,' in spite of 40