Tuesday, 29th October, 1929 has been recorded in the history of the United States as one of the most catastrophic events ever. Widely known as the Black Tuesday, it initiated a flow of events that occurred simultaneously and truly shook the very roots of the United States. All of these events submerged into one ghastly glum entity, the start of an era, which was entirely new for the United States and has been dubbed by historians all over the world as the era of the Great Depression. The New Era which came before the Great Depression was an epoch of low unemployment when prosperity reigned far and wide and masked the various discrepancies, especially in income (Mitchell). For the United States had enjoyed a time full of prosperity and fortune in the 1920s and when President Herbert Hoover took office, his speech was full of hope because he is known to have said, “We in the United States today are nearer to the final triumph over poverty than ever before in the history of any land. The poorhouse is vanishing from amongst us” (Reef). Though Hoover’s statement claimed success, the real reason for the Great Depression as put by the majority was, in essence, Hoover’s languishing policies. However, the core of the problem did not stand on the structure of Hoover’s policies as vastly blamed by the majority. It lay on numerous factors that bubbled forth and gave way to numerous consequences in turn and resulted in the period of gravest adversity that was to shadow not only the United States but most of the Europe in its wake (Ross 19).
Historians around the world have had a heated discussion for years and therefore differ in their opinions about as to what brought about the Great Depression. Despite these controversies, they have agreed that there must have been countless causes which brought about the Great Depression and a havoc of economic instability and political downfall (Ross 25). Many historians state that the crash of the Stock Market was the most important factor that brought about the Great Depression. Historic facts and analysis too make it undoubtedly clear that the crash of the Stock Market was in actuality one of the many factors that rapidly threw the United States and its neighboring countries in the Great Depression. The crash of the Stock Market, unemployment and bankruptcy, the Smoot-Hawley Tariff led political changes, emigration and new reforms such as The New Deal took the United States in a sweeping landslide (Sauert 129).
The dawn of the Great Depression is usually narrowed down to the crash of the Stock Market which occurred on Tuesday, 29th October, 1929 when the Dow Jones Industrial Average fell to a very low rate, almost as low as 23 percent and the market suffered a gigantic loss which ranged from $ 8 billion to $ 9 billion. However, this was just one of the many losses in a period when severe market volatility was rampant and it exposed the people who had bought stocks on loans (Taylor). This crash of the Wall Street Stock Market completely changed the direction of the events. It marked the arena where the United States was thrown into political chaos and economic instability. The crash of the Stock Market was one of the major reasons that led to the Great Depression. However, it merely dealt out a card and there were many more reasons to come. For two months after the crash there was a loss of more than $ 40 billion dollars (Ross 32).
Stock holders could not pay back their loans and there was a marked reduction in transactions. People stopped purchasing items which led to a lesser number produced and hence lack of work force. More and more people lost their jobs which simultaneously led to their properties being repossessed. Soon unemployment was rampant in the region (Hembree).
The crash of the Wall Street of the Stock Market was thoroughly disastrous for the United States for it completely negated the concept of the American Dream as propagated by President Hoover and his predecessors. For the American Dream thrived on the idea of liberty, equality and happiness for all the citizens of the state. In the crash and the resulting causes which turned into a tide of the Great Depression, the American Dream was somehow lost by the start of the 1929. The mid-19th century saw that these very rights were denied to the citizens as their numbers grew and a very small, ultra- rich, upper class came to govern the economy. Eighty years ago, James Truslow Adams had come up with the idea of the American Dream. He believed that the dream should be within the range of every American. The American Dream was not common to every American in his time and neither was it common during the Great Depression. (Hearn 223).
President Herbert Hoover, who was a Republican and a former Commerce Secretary to boot, believed that not only should the government monitor the economy but it should also encourage investment that is not cyclical but he also viewed the direct intrusion of the government as abhorable. As unemployment spread to all the four corners of the United States, he resisted every amount of help from every government party such as the Congress and even political figures to finance the jobs of the public sector. Although he encouraged the creation of such jobs, he was of the opinion that the government should finance them. It was his sole belief that it was the job of the government as well as the various charity groups to handle the unemployment and to relieve the massive suffering (Taylor).
Many steps were taken to protect the economy from deteriorating and going down. Many small and big banks both in rural areas and the cities had overextended credit to farmers and other people. The crash led to the stoppage of lending from banks with a staggering amount of loan on the people. Many of them panicked and withdrew their deposited money which caused these banks to go bankrupt. There were only a few causes to light the fire of the Great Depression but the effects were so numerous and terrible that it could not be extinguished for many years to come (Ross 45).
The consequences of the Great Depression were staggering for it left thousands and thousands of unemployed people roaming the streets by night and day and trying to find work. The tide of the Depression had calamitous consequences. Not only billions of people lost their homes in one sweeping wave but they also had to migrate to places which were not fit for living. Shanty towns had cropped up in various parts of the United States and they were built out of tents and other sorts of garbage like items such as hulks of old cars. They were known as ‘Hoovervilles’ which was a mocking reference to President Hoover as he had fallen into disgrace for many blamed him for their turmoil and the turn of events. There were also other derogatory terms used in reference to him such as ‘Hoover Blank’ which was an old newspaper used as a blanket, ‘Hoover wagon’ which was an vehicle drawn by a horse since the owner could not afford gas. Unable to do anything, the general public vented out their pent-up misery by using such offensive references for Hoover. The coining of these terms depicted the nationwide view of Hoover in the minds of the public. Women took up men’s work so as to support their families along with their men but the availability of jobs was scarce. Children lived to see many dietary and other types of diseases which were due to malnutrition. Most of them died or suffered a heady fate. Schools shut down due to the lack of resources and the education system was completely crushed (Gold 43).
The consequences also caused major political change in the United States. For three years into depression, President Hoover lost the Presidential Elections of 1932 to Franklin Delano Roosevelt. Hoover told his friends, “we are at the end of our string… there is nothing more we can do.” “I pledge you, I pledge myself, to a new deal for the American people”, were the words of Roosevelt and he became the president officially on March 4, 1933 with the declaration that “the only thing we have to fear is fear itself.” (BBC). Power suited Roosevelt for he set out into curbing the situation a feat that the Hoover government could not muster. Roosevelt immediately set into motion a recovery plan which was known as The New Deal.
The Great Depression also prompted one of the massive migrations in the history of the United State for it was the first time such a large crowd was seen leaving the country. In order to escape the depravity of the situation, people began to migrate for the prospect of a better future (Gutierrez and Drash). Teenagers all over the continent were seen hitch-hiking or as better put ‘riding the rails’ in freight trains so as to search wide and far for both jobs and food. Many immigrants returned to their own countries with their respective families. Others were forced to leave their own native land for better prospects (Uys 112).
The start of the World War II surprisingly gave an edge to the United States.The defeat of France by Germany led to Britain and its allies buying war material and goods in abundance from the United States. Not only did this mean gold – as the favorable Britain so graciously doled out gold in return, but it was defined as the benchmark which halted the gun smoke powder of the Great Depression. The necessity of these war products created a huge demand and therefore resulted in a tremendous quantity of goods which led to the restoration of employment in the United States. This stimulated not only the income in gold but it also made their monetary base firm and solid. The United States economy reached a plateau, an accomplishment which was not seen since the start of the Great Depression. The table of events changed suddenly and played a huge part in stabilizing the economy of the United States (Ross 53).
A deep look into the causes of the Great Depression in the United States thus brings to attention the events which resulted in great havoc and chaos in the region of the United States. Although the causes of the Great Depression and the initial breakdown of the Stock Market were in a sense apparent yet retrospectively, they were quite inevitable. The short term causes acted as a catalyst yet the long term causes such as economic decline and lack of progress added fuel to the fire. The long term causes clearly played a significant role in accelerating the Depression. However the history of the Great Depression has lended a crucial lesson for the upcoming generations. The major role played by the crash of the Stock Market in the chaos of the United States illustrates the fact that internal strength as well as solidity is crucial for the peace and survival of any nation. What the United States government lacked were economic stability, a powerful leadership and an active government which could deal with any kind of circumstances. The lack of these instills anarchy and disorder. The United States should learn from their own mistakes that led to their downfall in the Great Depression in order to devise strategic planning to save themselves from pandemonium in future.
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