Great Depression Causes and Lasting Impact
The Great Depression Duration and Scope
Duration and Global Reach
The Depression of the 1930s was prolonged, often described as lasting over a decade when measured from its late 1929 onset into the late 1930s and until the economic mobilization of World War II revived full employment and industrial output.
The U.S. collapse helped trigger a global contradiction. Trade declined sharply (tariff and debt dynamics worsened this), commodity prices collapsed, and many countries experienced severe unemployment and deflation.
Unemployment and Poverty
- Unemployment peaked at extraordinarily high levels; commonly cited figures are around 25% in the U.S. at the worst point (early 1933). Other estimates sometimes reference 20% for different years or measures, but the point is the same: mass joblessness on an unprecedented scale.
- Hoovervilles: Shantytowns of makeshift shelters sprung up in and around cities, named derisively after President Hoover to indicate public blame for insufficient federal relief.
The Farm Crisis and Dust Bowl
Farm Crisis Factors
- Farmers had plowed up native prairie grasses to plant wheat.
- Over-farming exhausted the soil. When the drought hit, there was nothing to hold the dry soil in place. Wind erosion turned fertile farmland into a desert.
The Dust Bowl Disaster
Severe drought combined with poor farming practices destroyed the topsoil. Without grass and roots to hold the soil, massive dust storms swept across the plains. These black blizzards could darken the sky for days and bury entire farms. Crops failed repeatedly, leaving farmers with no income.
The environmental disaster known as the Dust Bowl struck the Great Plains (primarily Oklahoma, Kansas, Texas, and surrounding states) in the 1930s.
Consequences and Cultural Impact
Crops failed, topsoil blew away, and many tenant farmers and smallholders (often called Okies because they were notably from Oklahoma) migrated west to California and other areas seeking work. This mass migration worsened the economic hardship of the Great Depression.
John Steinbeck’s The Grapes of Wrath (published 1939) dramatized this migration and the suffering of Dust Bowl families, making those rural hardships a national moral issue. A realist novel, it earned the National Book Award, the Pulitzer Prize for Fiction, and contributed to his Nobel Prize in Literature in 1962. Celebrated for its powerful social commentary and historical depth, the novel remains a staple in American literature courses and was adapted into a 1940 film directed by John Ford and starring Henry Fonda.
The Ghost of Tom Joad Quotation
A quote from the brother, later appearing in the song “The Ghost of Tom Joad,” illustrates the spirit of resistance:
“Wherever there’s a fight so hungry people can eat, I’ll be there. Wherever there’s a cop beatin’ up a guy… Look for me, Mom, I’ll be there.”
World War I Veterans and the Bonus Army
The Bonus Certificate System Problem
During the Great Depression, many WWI veterans faced severe unemployment and poverty. In 1924, Congress had passed the World War Adjusted Compensation Act, but redemption was scheduled for 1945.
- Each qualifying veteran received a certificate with a cash value based on service length, including compound interest.
- The Problem: By the early 1930s, veterans were desperate, holding certificates they could not access for another 13 years.
The Bonus Army’s Demand
The veterans’ primary demand was simple: immediate cash payment of their bonuses. In 1932, 43,000 demonstrators (17,000 veterans, their families, and affiliated groups) marched on Washington demanding immediate payment.
The Hoover administration’s decision to forcibly remove encamped veterans using federal troops produced public outrage and tarnished Hoover’s reputation, highlighting the administration’s inability to handle mass distress compassionately.
Franklin D. Roosevelt and the New Deal
FDR’s 1932 Election Victory
Economic despair and perceptions of Hoover’s failed responses led to Franklin D. Roosevelt’s victory over Hoover. FDR’s campaign promised bold, active federal intervention: “A New Deal for the American People.”
FDR’s Philosophy and Style
- Roosevelt blended practical experimentation with political public relations. He emphasized restoring confidence and reshaping the relationship between the federal government and citizens.
- In his 1933 inaugural address, he famously stated, “The only thing we have to fear is fear itself,” framing fear as an enemy that fed paralysis.
- Fireside Chats: Regular radio addresses that explained policies in plain language and built personal rapport with Americans, calming panic.
- Eleanor Roosevelt: An active First Lady who redefined the role through advocacy for civil rights, labor, and the disadvantaged.
- Brain Trust: A loose group of advisers (academics, economists, lawyers) who brought policy expertise and diverse perspectives into the administration.
The New Deal: Relief, Recovery, Reform
FDR’s New Deal (early 1930s through the remainder of the decade) was a sweeping set of legislative, regulatory, and administrative initiatives based on the Three R’s:
Goals of the Three R’s
- Relief: Immediate aid for the unemployed and hungry (e.g., CWA, FERA, and later WPA provided direct job creation).
- Recovery: Measures to restart economic activity (e.g., banking reforms, industrial codes in the NRA).
- Reform: Structural changes to prevent future collapses (e.g., banking reform, securities regulation, and social insurance).
Major Programs & Agencies (The Letter Soup)
- CCC (Civilian Conservation Corps, 1933): Employed young men in conservation projects, providing wages and skill training.
- WPA (Works Progress Administration, established 1935): A massive jobs program that built infrastructure (roads, schools, airports) and supported artists and writers.
- Social Security Act (1935): Instituted old-age pensions, unemployment insurance, and aid for dependent children, creating the basis of modern social insurance in the U.S.
- SEC (Securities and Exchange Commission, 1934): Regulated securities markets to reduce fraud and increase transparency.
- Banking Reforms: Included the Emergency Banking Act (1933) and the FDIC (Federal Deposit Insurance Corporation) to restore confidence in the banking system.