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In 1966, faced with an economic recession, the two major West German political parties--Social Democratic Party (SPD) and Christian Democrats (CDU)--came together to form what came to be known as the Grand Coalition. Their decision to allow Kurt Georg Kiesinger of the CDU serve as chancellor proved controversial, as Kiesinger played an active role in the foreign ministry under the Third Reich.

Following a loss in World War I, Germany was charged to pay reparations for their destructive role. The bill was $33 billion. Germany had been weakened by the war and paying the reparations at the rate in which they were due would have completely crippled the country. Germany therefore tried to gain more time to pay. The Germans set forth a proposal for U.S banks to loan funds for the reparations and for France to reevaluate the reparations.