The Great Depression was the worst economic period in our nations history. There are many causes, and all the factors culminated and made a bad situation for the United States.
II Causes
II Causes
The causes of the great depression were overspeculation, overproduction, and uneven prosperity.
A Overspeculation: When people were buying stock and products with money they didn't have. It was a big factor in the Depression because when the stock market crashed and banks closed, people didn't have money to pay off their purchases so companies went out of business as a result.
B Govt Policy
C Unstable Economy: Because of overspeculation and uneven prosperity, the economy couldn't recover quickly and instead the economy got steadily worse.
1 uneven prosperity: The distribution of wealth was really uneven; either people were poor or people were rich. This was a problem because poor people got even poorer when the depression hit and no one could stimulate the economy.
2 overproduction: After world war one, farmers were used to producing a lot of food to support Europe as well as the United States, but when Europe started to recover and didn't need Americas help anymore, the farmers kept making the same amount of food, which led to overproduction. The surplus of food meant that farmers were losing money, which made the economy even worse.
3 worker issues / farm issues: Workers were losing money and being underpaid, which made them not want to work, so there were strikes and walk-outs. The Dust Bowl hit the Midwest which made it impossible for farmers to continue working their land.
III Effects
The effects of the depression were bank closures, a poverty-stricken middle class, and a much more involved federal government.
A Poverty: Most Americans were starving and penniless; houses were foreclosed on and people lost their jobs. this didn't help the economy at all because people weren't able to spend money on anything and stimulate the economy.
B Society: After the prosperity of the 20s, Americans in the 30s were cynical and jaded. Too many people were homeless and jobless and it was probably hard to trust the government in the beginning, but the federal programs like the WPA also helped society and the country.
C World
IV Solutions
Solutions to the depression were varied; Hoover wanted as little direct relief as possible and didn't do much to help the economy, while Roosevelt wanted increased federal involvement and a lot of government programs.
A Hoover: Hoover was timid and didn't do much to help the economy recover.
1 Volunteerism: He wanted people to volunteer and for the states to give out relief rather than the federal government to do so.
2 Public Works: He did increase public works, but the government couldn't raise taxes so they had to run a deficit, and Hoover didn't like doing that. He feared that deficit spending would delay an economic recovery.
3 Hawley Smoot: A tariff that raised the tariff rate to the highest level ever before. It was supposed to protect American goods, but it hurt the economy because foreign countries stopped buying goods from the United States.
4 RFC: The Reconstruction Finance Corporation made loans to banks, railroads, and farms, but the RFC was too cautious and didn't do enough to help jump start the economy.
B Roosevelt: Franklin Delano Roosevelt won the presidency in 1932 and was well-known for his plan to help the economy recover, called the "New Deal."
1 new deal: The New Deal was composed of 15 acts all passed within 100 days of Roosevelt's Inauguration. The New Deal helped the economy more than anything Hoover had done in the past.
The Great Depression was fixed largely because of the start of World War Two, when Americans had to start making products for Europe and men were sent off to war. Hopefully the United States will never be in such a bad economic situation again.
The Great Depression was fixed largely because of the start of World War Two, when Americans had to start making products for Europe and men were sent off to war. Hopefully the United States will never be in such a bad economic situation again.