Causes of the Great Depression

Rachael B. Hill

Professor Travis Felker

HIS 108 95N

June 24, 2017

Struggle upon struggle

        In 1929 a tragic event occurred, something that tore the world apart, and ruined a lot of people’s lives. Many people still to this day don’t even know why the Great Depression happened. No one has an answer for it, but in my belief, I think it was from the government failing to do their duty. They were the cause for civilians struggling as much as they did. World War I was another way of the Great Depression happening, but with the entire world going down ruined a lot of happiness for people, and they all had to put up with it.

        In the beginning of the Great Depression it all started with corporate and the private changing the entire system to the United States economy. In 1933, the unemployment rate went all the way down to 3.2 percent when it was at 24.9 percent. Years going by consumer spending and investments dropped and companies were beginning to failure poorly with employers getting laid off because of the situation. In the middle of the year 1929, everything could not be justified for any future earnings. By 1930, that is when the world saw it all as a Great Depression. In the beginning of 1930 over 3,000 banks collapsed. People were losing their money, people were withdrawing people’s money which was known as a bank run, and when this happened more banks were being forced to close. With this issue towards Americans, they were all unable to get any money out, which lead to hardly any spending money. Socialist analysis of modern problems was economic, they maintained that the profit motive was distorted human behavior, forcing people to compete for survival as individuals instead of joining to promote the common good (Oakes 631.) This I feel like, is giving out hints to the Americans to tell them basically that we must be strong and be prepared for what’s coming next.

        In 1930 congress passed a new act called the “Tariff Act,” this was to have imported goods transferred to the United States. Before the tariff act, the years of 1929 and 1934 the world fell with their trades of two-thirds. So congress went into effect allowing the president to negotiate lowering the tariff rates in other nations. This was all dealt mainly with the policy with Europe, so Americans in the United States could eat, and provide for their families.

        Drought conditions went into effect in 1930. This was tragic in the time, because it’s what the Americans relied on for food daily. In 1931 prices towards crops were lowering and when the prices lower it means that the farmers must go find more acreage, and find new varieties of crops to produce enough crops, and make sure it’s enough so they are able to make payments for their own farm equipment. While this happened during the Great Depression some farmers had to go get government assistance, but even with their help a lot of farmers couldn’t maintain their own operations and were forced to leave their own land that they farmed on. This destroyed the entire economic system, and the farmers were unable to do anything about it until the bank issues where fixed. In the book before the great depression started everything was always self-motivated and everyone had high standards. When I was talking about tariff rates, it says in the book, “congress also knew that tariff rates could influence the expansion of trade (Oakes 598.)” By doing this, “it allowed the president to use the tariff to punish countries that closed their markets to US goods or to reward them for lifting custom barriers (Oakes 598.)”  This was holding everything down in my opinion, people didn’t have the chance to help anyone out. It was like a war without being physical. I think a lot of Americans disliked the president Hoover while he had the privilege to take over in the tariff act. People had to wait for their food instead of getting it from their own families. Having political and economic tensions around the United States helped turn racist customs into a rigid caste division (Oakes 607.) Hostility was the major issue and didn’t help a thing, because nothing had changed, so they all dealt with it.