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The Great Depression In U.S. history, the severe economic crisis supposedly precipitated by the U.S. stock-market crash of 1929. Although it shared the basic characteristics of other such crises the Great Depression was unprecedented in its length and in the wholesale poverty and tragedy it inflicted on society. Economists have disagreed over its causes, but certain causative factors are generally accepted. The prosperity of the 1920s was unevenly distributed among the various parts of the American economyfarmers and unskilled workers were notably excludedwith the result that the nation's productive capacity was greater than its capacity to consume. In addition, the tariff and war-debt policies of the Republican administrations of the 1920s had cut down the foreign market for American goods. Finally, easy-money policies led to an inordinate expansion of credit and installment buying and fantastic speculation in the stock market. The American depression produced severe effects abroad, especially in Europe, where many countries had not fully recovered from the aftermath of World War I; in Germany, the economic disaster and resulting social dislocation contributed to the rise of Adolf Hitler. In the United States, at the depth (1932-33) of the depression, there were 16 million unemployedabout one third of the available labor force. The gross national product declined from the 1929 figure of $103,828,000,000 to $55,760,000,000 in 1933. The economic, agricultural, and relief policies of the New Deal administration under President Franklin Delano Roosevelt did a great deal to mitigate the effects of the depression and, most importantly, to restore a sense of confidence to the American people. Yet it is generally agreed that complete business recovery was not achieved and unemployment ended until the government began to spend heavily for defense in the early 1940s. See Dixon Wecter, The Age of the Great Depression, 1929-1941 (1948, repr. 1956); Arthur M. Schlesinger, Jr., The Crisis of the Old Order, 1919-1933 (1957); D. A. Shannon, ed., The Great Depression (1960); A. U. Romasco, The Poverty of Abundance (1965); Goronwy Rees, The Great Slump (1970); C. P. Kindleberger, The World in Depression, 1929-1939 (1973).
In economics, period of economic crisis in commerce, finance, and industry, characterized by falling prices, restriction of credit, low output and investment, numerous bankruptcies, and a high level of unemployment. A less severe crisis is usually known as a recession, a more common occurrence generally thought to be a normal part of the business cycle. Recessions mark a downward swing in the curve of the business cycle and are caused by a disequilibrium between the quantity of goods produced and the consumers' ability to purchase. If a recession continues long enough, it can turn into a depression. Neither term has ever been defined by a set of criteria, however, so it is difficult to say at what point the two merge. A short period in which fear takes hold of the minds of businessmen is more properly called a panic and does not necessarily occur in every depression, but lack of confidence in business is always present in a depression. Overproduction, decreased demand, or a combination of both factors forces curtailment of production, dismissal of employees, and wage cuts. Unemployment and lowered wages further decrease purchasing power, causing the crisis to spread and become more acute. Recovery is generally slow, the return of business confidence being dependent on the development of new markets, exhaustion of the existing stock of goods, or, in some cases, remedial action by governments. Depressions and recessions today tend to become worldwide in scope because of the international nature of trade and credit. Insufficient numbers of profitable investment outlets, overexpansion of commerce, industry, or agriculture, a stock-market crash, the failure of a great banking or industrial firm, or war may be among the precipitating factors. In antiquity, and even up to the 18th cent., depressions had chiefly noneconomic causes, such as wars and weather-induced crop failures. From c.1700 to 1825 economic crises were in the main speculative or commercial; since 1825 they have been increasingly industrial. The economic crises of the 20th cent. saw the entry of governments into large areas of the economy that had previously been in private hands. Job reeducation programs, government employment of the previously unemployed, and increased public welfare responsibilities are among the programs adopted to alleviate depressions. Moreover, by applying Keynesian economic principles to public policy, governments have sought to affect the business cycle directly and prevent depressions. Large-scale public works expenditure (pump priming), tax cuts, interest rate adjustments, and deficit spending during recession are among the measures that have been taken to reduce the severity of periodic economic downturns such as those experienced in the United States in 1982 and internationally in the early 1990s. See Michael Bernstein, The Great Depression (1987); C. P. Kindleberger, The World in Depression, 1929-1939 (rev. ed. 1986) and Manias, Panics, and Crashes (rev. ed. 1989); W. C. Mitchell, Business Cycles and Their Causes (1989);; A. W. Mullineux, Business Cycles and Financial Crises (1990).
1930s Great Depression Gallery - http://www.sos.state.mi.us/history/museum/explore/museums/hismus/1900-75/depressn/labnews2.html These historical documents, activities and lesson ideas relate to the galleries at the Michigan Historical Museum and online.
The Day of the Black Blizzard - http://www.discovery.com/area/history/dustbowl/dustbowlopener.html This site offers a narrative and picture history of the great Dust Bowl that occurred on Palm Sunday 1935.
The Great Depression - http://newdeal.feri.org/ The New Deal Network is an educational guide to the Great Depression of the 1930s. NDN is sponsored by the Franklin and Eleanor Roosevelt Institute and the Institute for Learning Technologies at Teachers College/Columbia University.
The Main Causes of the Great Depression - http://www.escape.com/~paulg53/politics/great_depression.shtml A brief summary of the causes of th Great Depression, includes a bibliography.
Riding the Rails - http://www.pbs.org/wgbh/amex/rails/ Includes stories og hobo life, songs, a timeline, and more. From PBS.
Surviving the Dust Bowl - http://www.pbs.org/wgbh/amex/dustbowl/ In 1931 the rains stopped and the "black blizzards" began. Powerful dust storms carrying millions of tons of stinging, blinding black dirt swept across the Southern Plains--the panhandles of Texas and Oklahoma, western Kansas, and the eastern portions of Colorado and New Mexico. Topsoil that had taken a thousand years per inch to build suddenly blew away in only minutes.
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History
