The swing is fun to be on, especially when swinging up, the disappointing part is coming down and that’s what happen in the 1930s. The Great Depression happened in the United States in 1929, the depression was the biggest economic fall in America’s history.This crash stretched throughout the globe and affected the rich as well as the poor. The difference between the rich and the poor people was the large industrial production during this time. Also in this period production cost fell quickly, wages rose slowly, and prices remained steady. Women were also affected during the Great depression in the U.
S. During this crisis period President Hebert Hoover was elected by saying ” We have not yet reached the goal, but, given the chance to go forward with the policies of the last eight years, we shall soon, with the help of God, be in sight of the day when poverty will be banished from this nation”, but it turn to be the other way around. President Hoover was on rich people side, he literally made the rich richer and poor poorer. During this time frase unemployment rates went up and were the highest they have ever been.
Not only that, but companies and farmers were running out of business and were force to file bankruptcy. I believe the three major events that caused The Great Depression were the stock market crash, the bank crisis, and the public overreacting. Before the Great Depression businesses were skyrocketing this time period was called the “Roaring 20s”. There were too many companies expanding and not enough demand, so the production was going in one big circle, it was a bubble just waiting to burst. Corporate profits went out the roof they were making more than ever while wages increased at a steady paste, which enlarged the distribution of wealth. Also middle class families were introduced to credit, where you could buy something without having money and pay for it later on in full or in payments. This led them to believe they could afford items that they could not, so they weren’t able to pay off their items.
This was similar to the problem banks created by being too easy in handing out loans. The stock market was also doing well during this period. It seemed that it will never fall, so people believed it was a guaranteed profit. This was the time where people got rich easily. This went up like the swing, but at some point the swing has to come down and that’s what happen 1929.
Stocks dropped by a little and this caused the stock market crash. This event was like when you push a piece of domino and then the rest start to fall, which lead to The Great Depression. Real gross domestic product (GDP) fell 30 percent. Unemployment rose from 3.
2 percent of the labor force in 1929 to 24.9 percent in 1933. Hunger and fear paralyzed the nation. The second major event in this time period was the bank crisis. As I said before, banks had been too generous handing out loans. A good amount of these loans was invested into the stock market and lost when it crashed. Some banks even invested peoples’ money themselves into the stock market.
The investors were also unable to pay back the loan to the banks. This made banks go out of business without them giving back the people’s’ money. Like nowadays if a bank files bankruptcy they are by law have to give the customer their deposit back.
But back then the bank system was poor, so they couldn’t do that.This caused people to rush and withdraw their money and banks were forced out of business. All this chaos with the banking system caused the public to panic and made it worse. They affected the stock market by being too quick to on selling their stocks. Since during this time period stocks were skyrocketing and only seemed to rise, when they started to drop people overreacted. On the other hand when the stock market crashed people from all classes stopped purchasing consumer products. Which lead to a cut in consumer products being made, which caused less jobs and this caused a reduction in the workforce.
As people lost their jobs they were unable to pay for the items that were bought on credit. Not only that but debt was catching up from every corner and the problem was just growing bigger. The value of the dollar continued to drop while debt amounts stayed the same. The unemployment rate rose and cause even less spending to assist to lesson the economic situation.
The government tried to help American companies by creating the Smoot-Hawley Tariff. This gave American companies the right to charge a high tax for imports, thereby leading to less trade between America and foreign countries. The working class paid taxes therefore, they had a right to receive unemployment benefits. But so many people had to suffer more lost, due to Hoover not giving them unemployment paid.
This man destroyed families and lives because some people thought everything was over for them since they didn’t have a job or money. Unemployment affected men differently in most cases than women, old people differently than young, and married people differently then single. Also unemployment had their pros and cons, some were that it brought family members closer together. Some men enjoyed having more time to be with their children, others found that being around the children for long periods of time to be extremely stressful. Others became absorbed in doing chores around the house; while others took up new hobbies.
But the sad part is that some took to drink and others sulked for their lost. In the other hand, women could not find work, some women husband had abandon them because they couldn’t take care of them any longer. The women could not comfort each other because of the pain they all shared. Hoovers’ plan was to overcome poverty and prayed that the depression would be short-lived.
However, the United States was still suffering with the depressed economy. According to Henretta ; Brody (2010) stated Hoover endorsed a double policy to address the depression. First, Hoover approached business pioneers. In the hope they would retain salaries and productive to restore the people faith in a capitalism economy not only that, but reducing taxes.
The purpose of reducing federal taxes were for the people to spend money and, corporations would return back to investing. He believed non-profit organization and community authority should have helped the unemployed people. Hoover realized later he was wrong not to pay the people unemployment. But, he did want to pay unemployment benefits to laid-off employees.
Finally, what to do about the unemployed was the larger question and how to end the economic collapse that had caused so many workers to be laid off. It was said that ending of the Depression would solve the unemployment problem or at least bring unemployment down to manageable levels. And we are prove that the ending of the Great Depression was a new era and a new beginning. Some might say this was the end of the beginning, but I believe it is the beginning of the end. Because if we are not careful we might just go back down the pit and will have a hard time getting back up.
There was also, the big picture of the problem of what to do about the unemployed people who needed help merely to survive. Whether the efforts to aid the unemployment would help end the Depression or make it worse was Hoover’s main concern. People hated Hoover, especially the middle class, because the depression continued to get worse. The people went from residing in houses to living in crates or on the streets. Some landlords let families stay in just because of apathy.
The American people were using newspaper for blankets to cover themselves. Now just imagine using newspaper as blankets during the winter. The people became violent due to being angered about their situation, some lost everything their house and family. The farmers were being evicted by the banks and force off their land by the sheriffs.
The people who worked for the industrial were laid-off and some wages were reduced. Violently, the people went on strike. The mine owner sought help from the National Guard which defeated the union. A brutal altercation between labors and authorities lead to three fatalities and acute trauma at the Ford Motor plant (p.693). Hoover’s cabinet contained six millionaires.
In other words Hoover was for the wealthy and not the middle-class Americans. Instead of improving the economy he made it worse. I believe president hoover went down in history as the worst president. In the end these events were part of a chain that caused one another and ultimately lead to the worst depression in American history. The depression had been building up for years and wasn’t avoidable when looking at it from far down in history. They thought by raising taxes the income would be greater and the crisis would finish soon, but it was the other way around. Now we have corrected the problems to help avoid this from occurring again in the future.
But to be honest if this would have not happen back in the 1930s we could have been worse off today if it happened because we wouldn’t have any knowledge of what is right or wrong to do during such crisis. Probably if the Great Depression happen today the whole country would turn upside-down and we will be in greater debt. But if our current debt keeps growing by the minute I don’t see why the second Great Depression isn’t right around the corner. But deep down I know that getting out from a bad situation requires guts and strength to pull through and those people back in the 1930s have my respect because they never gave up. And I also treat life as a swing because if it’s too good to be true and easy going up then coming down will have its toll and disappointment in life.
