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Economic costs

Germany in 1919 was bankrupt, the people living in a state of semi-starvation and having no commerce with the remainder of the world. The Allies occupied the Rhine cities of Cologne, Koblenz and Mainz, with restoration dependent on payment of reparations. In Germany a Stab-in-the-back myth (Dolchstoßlegende) was propagated by Hindenburg, Ludendorff and other defeated generals, that the defeat was not the fault of the 'good core' of the army but due to certain left-wing groups within Germany who signed a disastrous armistice; this would later be exploited by nationalists and the Nazi party propaganda to excuse the overthrow of the Weimar Republic in 1930 and the imposition of the Nazi dictatorship after March 1933.

France suffered more casualties relative to its population than any other great power and the industrial north-east of the country was devastated by the war. The provinces overrun by Germany had produced 40 percent of French coal and 58 percent of its steel output. Once it was clear that Germany was going to be defeated, Ludendorff had ordered the destruction of the mines in France and Belgium. His goal was to cripple the industries of Germany's main European rival. To prevent similar German attacks in the future, France later built a massive series of fortifications along the German border known as the Maginot Line.