Essay Cause Of The Great Depression

From 1861 to 1877 the Civil War and Reconstruction affirmed the integrity of the Union, ended slavery, and generated three constitutional amendments that at least laid the foundation for honoring the Declaration’s promise that "all men are created equal." And between 19 the Great Depression and World War II utterly redefined the role of government in American society and catapulted the United States from an isolated, peripheral state into the world’s hegemonic superpower.

Yet for most of the 1920s the mood of much of the country, impervious to news of accumulating international dangers and buoyed by wildly ascending stock prices as well as the congenital optimism long claimed as every American’s birthright, remained remarkably upbeat. The Great Crash in October sent stock prices plummeting and all but froze the international flow of credit. Herbert Hoover, elected just months earlier amid lavish testimonials to his peerless competence, saw his presidency shattered and his reputation forever shredded because of his inability to tame the depression monster—though, again contrary to legend, he toiled valiantly, using what tools he had and even inventing some new ones, as he struggled to get the upper hand.

By 1932, some thirteen million Americans were out of work, one out of every four able and willing workers in the country.

To those abundant physical and institutional ills might be added a rigidly doctrinaire faith in laissez-faire, balanced national budgets, and the gold standard.

All of this added up to a witches’ brew of economic illness, ideological paralysis, and consequent political incapacity as the Depression relentlessly enveloped the globe.

Virtually none enjoyed such common urban amenities as electricity and indoor plumbing.

Other maladies began to appear, faintly at first, but with mounting urgency as the Depression began to unfold.As for government—public spending at all levels, including towns, cities, counties, states, and the federal government itself, amounted only to about 15 percent of the gross domestic product in the 1920s, one-fifth of which was federal expenditures.Ideology aside, its very size made the federal government in the 1920s a kind of ninety-pound weakling in the fight against the looming depression. Millions—nobody knew at first how many, so primitive were the government’s fact-finding organs—went unemployed.Even those horrendous numbers could not begin to take the full measure of the human misery that unemployment entailed.Given the demography of the labor force and prevailing cultural norms that kept most women—and virtually all married women—out of the wage-paying economy, a 25 percent unemployment rate meant that, for all practical purposes, every fourth household in America had no breadwinner.It did not entirely lift until the next world war, more than twenty years later.The long-suffering countryside was home to nearly half of all Americans in the 1920s; one out of every five workers toiled on the nation’s fields and farms.The United States Senate refused to ratify the Treaty of Versailles and rejected membership in the nascent League of Nations.Congress in 1922 effectively closed the American market to foreign vendors with the Fordney-Mc Cumber Tariff, among the highest in United States history, and the Smoot-Hawley Tariff eight years later.Among those eventually excluded (though none could yet know it) were thousands of Jewish would-be fugitives from Nazi persecution.Militarily, diplomatically, commercially, financially, even morally, Americans thus turned their backs on the outside world.

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