Hey Hey Hey Essay Research Paper The
Hey Hey Hey Essay, Research Paper
The Great Depression
By: Raymond Torres
Electronic mail: SableLvr17 @ aol.com
The 1920 & # 8217 ; s was a period of general prosperity for many Americans but the decennary ended with the most serious depression in United States history. When Herbert Hoover ( 31st president ) took curse into office in March 1929, trade was dining, industry was booming. Unemployment was low, rewards were up, monetary values were steady and corporations were doing large net incomes and paying fat dividends. Before the terminal of Hoover & # 8217 ; s first twelvemonth in office, the stock market had collapsed. The state was get downing to skid into the worst depression in history. By the clip Hoover left office in 1933, many citizens had lost faith in their concern leaders. Some had begun to oppugn the American economic system and even democracy itself. The Roaring Twenties was an epoch dominated by Republican presidents: Warren Harding ( 1920-1923 ) , Calvin Coolidge ( 1923-1929 ) and Herbert Hoover ( 1929-1933 ) . Under their conservative economic doctrine of laissez-faire ( & # 8221 ; go forth it entirely & # 8221 ; ) , markets were allowed to run without authorities intervention. Taxes and ordinance were slashed dramatically, monopolies were allowed to organize, and inequality of wealth and income reached record degrees. The state was on the conservative & # 8217 ; s preferred gilded criterion, and the Federal Reserve was non allowed to significantly alter the money supply. During October, 1929, the stock market had some bad yearss. Then, all of a sudden, on October 24 [ otherwise known as “ Black Thursday ” ] , monetary values began to fall, and purchasers on border had to sell their stocks. The haste to sell made monetary values fall even faster. In the 1920 & # 8217 ; s, after World War I, danger signals were evident that a great Depression was coming. A major cause of the Depression was that the wage of workers did non increase at all. Because of this, they couldn & # 8217 ; t afford manufactured goods. While the mills were still fabricating goods, Americans weren & # 8217 ; t able to afford them and the mills made no money. There were serious failings in the economic system that had barely been noticed up to so. As we have seen, while the end product of American workers in creased steadily during the mid-twentiess, their rewards had non kept gait. At the same clip, concern net incomes and the incomes of the wealthy had shot up. In 1929, the 36,000 wealthiest households in America had a combine income equal to that of the about 12 million households with incomes of less than $ 1500 per twelvemonth. Yet the cost of necessities for a household was $ 2000 a twelvemonth. This meant that & # 8220 ; prosperity & # 8221 ; & # 8211 ; the whole economic system & # 8211 ; depended on the disbursement and reinvestment of their money by the wealthy and by concern houses. When the stock market terror frightened them, they stopped disbursement and puting. As for the staying mass of people, they could non pick up the slack. They had bought all they could on clip, and they had no trim hard currency. Most consumers could no longer afford to purchase the new autos and wirelesss and iceboxs. Inventories piled up. Factories laid away more and more workers. Another major cause related to husbandmans. Farmers weren & # 8217 ; t making to good because they were bring forthing more harvests and farm merchandises than could be sold at high monetary values. Therefore, they made a really little net income. This deficient net income wouldn & # 8217 ; t let the husbandmans to buy new machinery and because of this they could non bring forth goods promptly plenty. A new program was created called the installment program. This program was established because many Americans didn & # 8217 ; Ts have adequate money to purchase goods and services that were needed or wanted. The installment program stated that people could purchase merchandises on recognition and do monthly payments. The one major job with this thought was that people shortly found out that they couldn & # 8217 ; t afford to do the monthly payments. In 1929, the stock market crashed. Many Americans purchased stocks because they were certain of the economic system. Peoples started selling their stocks at a fast gait ; over 16 million stocks were sold! Numerous stock monetary values dropped to fraction of their value. Banks lost money from the stock market and from Americans who couldn & # 8217 ; t pay back their loans. Many mills lost money and went out of concern because of this great calamity. By the 1930 & # 8217 ; s, 25 % of all workers [ 13 million workers ] , lost their occupations. The inkinesss and unskilled workers were ever the first to be fire. Farmers had no money and weren & # 8217 ; t capable of paying their mortgages. Americans traveled throughout the state looking for a topographic point to work to back up themselves and their households. Another failing in the economic system lay in our dealingss with the remainder of the universe. As a consequence of the war, many states owed the United States money. Yet our & # 8220 ; duty & # 8221 ; walls kept them from merchandising with us. So we had to do loans and investings abroad if the foreign states were to payt us. Once the flow of American money slowed down, these states could non pay their debts. And they could no longer afford to purchase American goods. This was another cause for mills to close down, throwing still more Americans out of work. The rise of & # 8220 ; keeping companies & # 8221 ; had created particular jobs that did non rapidly run into the oculus. During the 1920 & # 8217 ; s more and more of these companies had been formed to keep the stock of other companies. Business power was being concentrated in fewer custodies. Besides, investing trusts were set up to seel their ain stock and so put the returns in the stock market. Naturally, the investing trusts and keeping companies depended on the net incomes of the companies they held. If anything happened to those, the keeping companies and investing trusts would fall in. Then assurance in concern throughout the state would drop even more. The worst defect in the economic system of the late 1920 & # 8217 ; s was the stock market itself. It provided a gaming sphere where caprices, baseless frights, and undue hopes could trip catastrophe. The stock market provided a phase where the whole state could watch the monetary value of Wall Street & # 8217 ; s stocks travel blessing and the flop! This was difficult for citizens to recognize why the monetary value and non the value of the states merchandise were & # 8220 ; roller-coastering. & # 8221 ; Doubt and fright spread across the state. The Great Crash became the Great Depression. The mill proprietors who could non sell their merchandises slowed down their mills and laid off workers. Idle workers who had lost their nest eggs could non afford to purchase anything. Still more mills closed down. The prostration of the stock market had signaled the prostration of industry and helped to convey on a terrible economic depression non merely in the United Sates, but in the developed states around the universe. Before the terminal of 1932 there were 12 million able-bodies Americans who were unemployed. Many who had occupations were working merely part-time. When they could non afford to pay their rent, they had to squash in with friends and relations. Thousands took to the roads, floating from topographic point to topographic point, urgently trusting that somehow in the following town they would happen a occupation. Respectable Americans who merely a few months before had lived in nice houses now had to seek shelter in shanty-towns of cartons and wood garbages on vacant tonss. These were a called & # 8220 ; Hoovervilles. & # 8221 ; The immature people with no money, no occupation, and no chances did non make bold marry. Within three old ages, the figure of matrimonies dropped by one-quarter. College registrations sank. Millions went hungry. Children cried for the nutrient their parents could non give them. Two-thirdss of the kids in New York City suffered from malnutr
ition. Some parents went wandering around through alleys, rooting in garbage pails for scraps to try to keep their families alive. By the 1932 hundreds of banks had failed, hundreds of mills and factories had closed, mortgages on farms and houses were being foreclosed in large numbers, and more and more people were unemployed. The presidential campaign of 1932, in which the candidate was Franklin Delano Roosevelt, was wages on the issues of Prohibition and the economic crisis. The democratic platform declared for outright repeal of the 18th Amendment and promised a “new deal” in economic and social matters to bring about recovery from the Depression. The republicans did not call for outright repeal and, in regard to the Depression, warned against the danger to business and the nation finances if the social and economic philosophies of the Democrats were substituted for the sound of conservative ideas of the Hoover administration. Secretary of the Treasury Andrew Mellon took the tradition approach that the government should do nothing to end the depression or ease its effects. But when the collapse came, President Hoover tried hard to help. He use all the familiar ways to relieve suffering. He called upon cities, states, and all private charities to help feed the hungry. He brought business and labor leaders together to the White House, where they promised to keep up wages and keep the factories going. He actually cut his own presidential salary by one-fifth. In November 1929, Hoover even took the daring step for those days of persuading Congress to cut income taxes. He hoped this would leave people some money to buy goods to keep the factories going. But for most people income taxes were still so low that a tax cut made little difference. A family with a $4000 income saw its tax decline from $5.63 to $1.88. The wealthy, of course, saved much more. But they were frightened of the future and so did not dare to increase their spending. President Hoover tried really hard to make the times better for the unemployed first by setting aside almost $800 million for public works like the now Hoover Dam. Conditions, however, failed to improve. His other policies , the “Reconstruction Finance Corporation (RFC)” and the Home Loan Bank Act, also didn’t make much difference. When Franklin Delano won the election on the Democratic ticket, their was a hope for a change in lifestyle from the Depression. His promise of a “new deal” gave Americans hope for what he could do for them. Two days after his inauguration he ordered a “bank holiday” for all banks in the country to close. When they reopened, people felt more safe putting their money in banks with the government backing up. FDR’s “New Deal” became what started the nations turn around. With such programs as the CCC (employing single males from the ages of 17-28 to do community labor like road buildings), the FERA (used $250 million to aid the unemployed, elderly, and sick) and the AAA (paid farmers to grow less), the NIRA (set up price controls), the WPA (creating as many jobs as possible), and others, Franklin Roosevelt became one of the most successful leader this country has ever had. Throughout his presidency, he almost single-handedly changed the fate of America. He turned this country around so we could be a great nation again. In May of 1933, the Agricultural Adjustment Act was passed. The aim of this act was to raise the farm prices by growing less. The farmers were paid not to use all of their land to plant crops. The money came from tax on millers, meat packers, and other food industries. In June of that same year, the Farm Credit Act was passed. This act helped farmers get low interest loans. With this act, farmers wouldn’t lose their farms to the banks that held the mortgages. The farmers who lost their farms already would also receive low interest loans. A great novelist, born in 1902, by the name of John Steinbeck, grew up during the Depression near the fertile Salinas Valley and wrote many books of fiction based on his background and experiences during that time and area of the country. One of his greatest works would be the Grapes of Wrath. In this book, Steinbeck describes the farmers plight during the Great Depression and drought. When the rains failed to come, the grass began to disappear. As the farmers watched their plants turn brown and the dirt slowly turn to dust they began to fear what was to come. In the water-cut gullies the earth dusted down in dry little streams. AS the sharp sun struck day after day, the leaves of the young corn became stiff and erect; then it was June and the sun shone more fiercely. The brown lines on the corn leaves widened and move in on the central ribs. The weeds frayed and edged back toward their roots. The air was thin and the sky more pal; and every day the earth paled (Steinbeck, 2-3). The farmers worst fears were realized when their corn and other crops began to die. The dust became so bad, they had to cover their mouths with handkerchiefs so they could breath (Steinbeck, 3). When the drought hit the Great plains and the soil turned to dust, many farmers moved to California because they could no longer farm their land. The drought began to affect other parts of the country. In 1930, Virginia’s belt of fertile land dried up. Ponds, streams, and springs all dried up and the great Mississippi River water level sank lower than ever recorded. Small farmers every where began to feel the drought. Their small gardens were ruined and their corn crops was cut almost down to nothing. The hay and grass needed to feed their livestock was no longer available. They now face a major problem – how to feed their livestock. The silos were rapidly emptying and the barns in many cases were empty. The farmers were terrified that the government feed loans wouldn’t be available to keep the livestock from dying. In many cases, the Red Cross was making allowances for deed to keep alive livestock. The small farmers of fruit trees and vegetable plants depend on others who ran canneries to bottle and can their produce. The people they depended upon were the same people that hired scientists to experiment on the fruits and vegetables to come up with better tasting and yielding produce. Thus, the small farmers were dependent on these same rich landowners for almost everything. They couldn’t harvest their produce on their own so they sold it to the rich landowners and thus made very little money on their produce (Steinbeck 444-447) The farmers found themselves in debt caused by the purchase of land, tools, animals and other items bought on credit. This credit was due to the bank and when the farmers found themselves unable to repay their debts the bank took away everything they had. The Great Depression was the end result of World War I. It affected the rich and poor alike, factory workers and farmers, bankers and stockbrokers. In short, it affected everyone; no one was left untouched. But of all the people hurt, farmers were the worst off. John Steinbeck chose to write about farmers hoping that Americans would recognize their plight and correct the situation. The Great Depression is known to be the worst economic disaster in United States History. For this reason, the Depression caused many people to change their ideas about the government and economy. As a great man once said “Those who can not remember the past, are condemned to repeat it.” Let’s pray that the United States people and government never have to go through what the people of the 1920’s – 1930’s had to go through.