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The Great Depression
The Great Depression was from 1929 to 1939 and was the largest and most important economic depression in the 20th century that affected the economy, employment rates, and family life.
The Great Depression was the largest and most important economic depression in the 20th century as an example of how far the world’s economy could fall. On March 4, Herbert Hoover began his presidency. Hoover was a self-made millionaire who had easily been elected president in 1928. Herbert Hoover was president when the depression began. President Herbert Hoover believed limiting government interference in the economy was the key to ending the depression.
In 1929 the American stock market fails in October, and millions of investors are plunged into bankruptcy. The stock market crash mostly affected the poor and middle-class families, because they kept their savings in banks. On Black Tuesday, October 29, 1929, the stock market lost $14 billion making the loss for the week $30 billion. On March 26, investors sold off stocks, causing prices to fall as much as 30%. In 1929 about two million Americans owned stocks. Just thirty minutes after the New York Stock Exchange opened, 3,259,800 shares had been sold for a loss of over $2 billion. Police had to be called to control the crowd outside the New Police had to be called to control the crowd outside the New York City stock exchange on October24. On October 24, 1929, people sold their stocks more desperately than ever. Stock prices continued to decline until about 1932 they had dropped 20% of their value in 1929. “Stock prices have reached what looks like a permantly high plateau.”- Irving Fisher. After the collapse of the stock market, more banks failed and were unable to give depositors the money from their accounts. The number of banks in the U.S. fell 35% between 1929 and 1933. Between 1929 and 1933, more than 100,000 businesses failed across the nation. After the stock market crashed there was a wave of suicides in New York. Roosevelt declared a federal bank holiday to temporarily close all of the banks in America until further notice. The federal bank holiday prevented depositors from removing more money from the banks. On the federal bank holiday, banks that were unstable closed until they proved to banks auditors that they could remain stable after reopening. People began to hoard money in their mattresses, walls of their houses, and tin cans buried in their yards. Prices did not go down as long as people continued to purchase goods and services and have confidence in the nation’s economic health. The nonmilitary spending of the federal government accounted for 1.5% of GDP 1929 but 7.5% in 1939. Department store sales and prices lowered. A poster urged Americans cars: “How’d they expect us to but autos when we can’t buy food?” a tinsmith asked. During the summer of 1929, automobile manufacturing and housing construction slowed down. Farming suffered as crop prices fell about 60%. When conditions didn’t improve in 1934 and 1935, Midwest farmers had no choice but to abandon their farms and head west to California.
The Great Depression affected almost all nations. Because of all the influence the American economy had in the world. The U.S. stock market was just as important to the world economy. Most countries began to limit the number of foreigners who were allowed in the country. Some nations even changed their leader and type of government. The Great Depression was felt around the world, but it had different effects on different countries. The Great Depression hit hardest of those nations that were mostly deeply indebted to the United States; such as Germany and Britain. Great Britain survived the Great Depression more easily than the other western countries. In Germany, unemployment rose sharply beginning in late 1929 and by early 1932 it had reached six million workers or 25% of the workforce.
When they couldn’t no longer pay the rent and were evicted from their apartments, they used scraps of lumber and cardboard boxes to build shacks that they could live in. “The Great Depression had pup on our doorstep.”- An Oklahoma farmer. Banks, stores, and factories closed down and left millions of Americans jobless and homeless. There were more workers seeking employment than there were job openings. In 1934 alone, eighteen hundred strikes in which workers refused to work and attempted to close down industries that would not negotiate with them. The San Francisco strike of 1934 is one of the most famous examples of a strike. Many cites declared bankruptcy and could not pay their teachers, firefighters, and police officers.
By 1932 about 50% of the nations black workers were unemployed. Blacks were frequently forced out of jobs in order to give them to unemployed whites. Black factory workers were always the last to be hired; but they were the first to be hired when production began to slow down. Many surveys found unemployment rates among blacks to be 30% to 50% higher than among whites. In the 1930s jobs and businesses favored men over women. Domestic workers accepted jobs for as little as ten dollars every month.
The Great Depression is known as the first period of high unemployment activity in modern day. The number of unemployment was up to eight million by 1931. By 1932, ten million people were out of work. 25% of the nation’s workers, one out of four, were unemployed. Because of the large numbers of people looking for work, employers were able to offer slave wages. Most earned less than two hundred dollars a year. Married women were often the first to be laid off; but unemployment rates among women were lower than for men during the 1930s. Skilled factory workers were reduced to twenty-five cents a hour, sometimes less. Secretaries who earned fifty dollars a week before the depression were now accepting jobs for only ten dollars.
Long-term unemployment appears to have been among people in their late teens and early twenties and those older than fifty-five. Some teenagers found jobs to help support their family. Thousands of young men and boys became hoboes, traveling back and forth across the country looking for temporary jobs. Almost twelve million Americans were unemployed in 1932. People who have never been out of work found them living in poverty, and they couldn’t quite believe what was happening to them. Millions of workers lost their savings they had scrapped together over a lifetime. By 1932, one of every four American workers was unemployment. No job meant no money to pay the mortgage or buy food or clothes for your family. The unemployment rate peaked about 25% in 1933 and remained above 14% into the 1940s.
Cities all around the world were hit hard, especially those dependent on heavy industry. Like farming, the mining industry was already on shaky ground well before 1929. Areas with jobs for farming, the mining, and logging suffered the most. Industrial production falling about 50%. In the 1930s there were eight and half million tenant farmers and share croppers living in the south about half of them were homeless and jobless.
Life wasn’t very good for the people in the cities, where fourteen million people lived in crowded, unheated, unsanitary, tenements. Family life during the depression was pretty hard, money was scarce so they had to make do with what they had and save on where they could. Whole families worked in the field from sun-up- to- sun down. Descions to marry and have children were delayed. People began taking in homeless and used the money they received from the tenants to pay the bills. A third of a million children were out of school because their communities couldn’t afford to keep the schools open. The children ran away from their homes and set their lives on the railroads; they were often called the Box Car Kids. Mental health problems rose. Also family violence began to rise.
Over 200,000 people lost their home in the start of the depression and became bums or nomads traveling across the Great American Highways. Homeless people were sleeping on the streets of every major city, and the number was growing every day. In cities all over the U.S.A. there were hoovervilles set up everywhere; hoovervilles are villages that sprang up in vacant lots where the homeless were sheltered themselves. There were “Hoover Blankets”, old newspapers used for warmth by bench “tenants”. Hoover hogs; jack rabbits used as food. There were also Hoover wagons, which were broken cars that were pulled by mules. Hoover stew was food dished out inside of soup kitchens. Businessmen slipped from being homeowners’ to room renters, and even wandering the street. In the 1930s, there was an overpopulation of hoovervilles coast to coast in the U.S. The biggest Hooverville of all sprang up on the president’s doorstep in Washington. Some hoovervilles had their own mayor sanitary committee and other committee. In 1941 shack elimination was put into effect and shanty towns were torn down.
The people who had no homes and could not afford goods went to breadlines that the government formed. Breadlines provided bread and soup for the poor were established in every town, and hospitals distributed their leftover food. During the Great Depression there were no governmental social agencies, welfare departments or aid. With no governmental assistance available for the needy, private charities and churches struggled to provide relief for the rapidly growing numbers of unemployed. For millions, soup kitchens provided the only food they would have all day. Chicago gangster Al Capone opened a soup kitchen during the Great Depression. Middle-class people who had supported such organizations were no longer able to contribute because they were unemployed themselves. There were hunger marches in major cities as families struggled to live on $3.15 worth of food a week. 50% of Americans lived below the poverty level on family incomes of less than a hundred dollars a year. There were food riots in New York in which hundreds of hungry men and women marched into grocery stores and took food off the shelves.
Over 180,000 improvised families in New York received no relief at all because public and private charities had run out of funds. The depression was especially critical in rural areas, where there were few charitable or government organizations to assist. During the Great Depression there were no governmental social agencies, welfare departments, or aid for children. With no governmental assistance available for the needy, private charities and churches struggled to provide relief for the rapidly growing numbers of unemployed. The small amount of resources that the federal government actually made available often didn’t go to the sick, hungry, and homeless. That was because many cities officials kept the valuable resources to themselves. The only assistance people could get was from churches and private charities like the Salvation Army. The depression was followed by a severe recession, and another period of economic growth.
During the depression, listening to the radio was as popular a family activity as watching television is today. In the winter of 1932 the most popular song on the radio was “Brother Can You Spare a Dime?” It told the story of a man who had lost his job and suddenly found himself begging for money on the street. Once I built a railroad, made it run, made it race against time. Once I built a railroad, now it’s done. Brother can you spare a dime?”.
Hoover left office in 1933, national unemployment hovered at a staggering thirteen million; nearly 25% of Americas work force. About fifteen million people lost their jobs during the Great Depression. The crash on Wall Street wasn’t the only thing that caused the Great Depression; the recession from years before also caused it. The U.S. economy actually had gone into a depression six months earlier than that of “Black Tuesday”. In the 1830s, 1870s, and the 1890s, there had been years when prices of goods fell, unemployment rose, wages were cut, and production was down. On Saturday, March 4, 1933, Franklin D. Roosevelt took the oath of office as the thirty-second president of the United States. Roosevelt was paralyzed as a result of this disease; he wore metal braces and used a cane. Many New Deal laws were passed during the first one hundred days that Roosevelt president. In 1932, Roosevelt “new deal” reforms gave the government more power and helped ease the depression.Tech advances were largely responsible for advances in productivity in the 1920s. Such as: assembly lines, radios, and homogenous good .During the war Asia and South America gad become much more industrialized to provide consumer productions to Europe. The increased production during the war provided jobs and large amounts of money back in circulation. This led to the wonder how long the depression would have continued without the advent of WWII.