Historical Look: The Great Depression

After several months, I have finally finished book two of Ken Follet's history trilogy, "Winter of the World". I found the book to be just as good as the first one, full of great historical insight. It is set about fifteen years after WWI during the midst of the Great Depression and the Rise of the Third Reich.  I will soon have a review on the book, yet first I wanted to jump into some of these historical settings. I have already written about the Spanish Civil War, Rise of Fascist Italy, and the Rise of the Third Reich. So I'm going to post on different topics including the Great Depression, World War II, and the Aftermath of WWII.


The Stock Market Crash of 1929

Beginning with the American Stock Market Crash of 1929, the world entered a period of serious economic downturn that lasted nearly a decade. There were many causes that led to this depression, yet most had to do with the economic boom of the 1920s. Other explanations are deflation in asset prices, dramatic drops in credit, and disruption of trade. President Herbert Hoover received much of the blame for letting the economy slip so badly. The early 1930s marked a time of high unemployment, low profits, poverty, deflation, plunging farm incomes, and loss opportunities for economic growth. The city streets turned into slums of homeless people, which became known as Hooverville, in honor of Herbert Hoover. The crisis eventually spread beyond the United States and into the global market of almost every country.

The New Deal

 In 1932 Franklin Delano Roosevelt was elected president of the United States. By 1933 he constructed a policy to recover the economy, called The New Deal. The First New Deal was enacted to provide short-term recovery, from 1933-1935. This dealt with banking reform laws, emergency relief programs, work relief programs, agriculture programs, industrial reform, most notably the National Recovery Administration (NRA), and the end of the Prohibition.

The Second New Deal carried on from 1935-1938 and included labor union support, the Works Progressive Administration (WPA), Social Security, and programs to aid farmers. The Fair Labor Standards Act of 1938, was the last major program passed, which set maximum hours and minimum wages for workers.

The Dust Bowl of the 1930s was a period of severe dust storms that spread throughout much of the American and Canadian prairies and farms, damaging a good portion of the agriculture industry. For nearly 6 years these storms led to draughts that stopped crop rotation and sent thousands of farmers out of work. It also left more than 500,000 people homeless in states like Texas, Oklahoma, and throughout the Great Plains.

Onset of World War II 

Things got better for a while, until The Recession of 1937 hit the economy, causing high rises once again in unemployment. The Recession lead to strong opposition against the New Deal, claiming that it had done nothing, and spent far too much of the Federal budget. This eventually strengthened the Conservative Coalition, who were eventually able to stop Roosevelt from spending more money on his New Deal. The Conservative Coalition managed to shut down most of the New Deal programs during World War 2, and end his business regulations in the years to come.  

In the end it was the massive rearmament policies to counter the threat of Nazi Germany that saved most countries from the Depression. Once World War II began in 1939, the United States managed to double its Gross Domestic Product, due to a high demand for war spending. Once soldiers were sent off to war, companies and factories grew desperate for workers to continue weapon production. The war effort got things moving again, and afterwards the economic crisis was over and the economy was back on track.