Talk:Great Depression/Archive 1
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(1) Removed "American" from "of American history." Books are written about the history of the Depression in Europe... Wikipedia is an international encyclopedia--has to be, since it's on the Internet!
(2) I cannot parse this sentence, so I can't fix it either: "It was an extended economic contraction that ended with the government induced World War II spending economic expansion." I also wonder how widely-agreed upon this explanation is.
(3) Finally--I'm no historian, so I'm just asking--was it the events in the U.S. that led to the worldwide depression? Is that widely-agreed upon as well?
--LMS
Untitled
I would guess that events in the USA were probably the trigger for the depression, but not the real cause. The economic situation in most parts of the world was a real mess ever since the end of World War 1. The appearance of prosperity 1919-1929 was an illusion. Unemployment was high, a lot of people were poor, and most of the rich had money and shares that turned out to be either borrowed, embezzled, or worthless. The big crash was going to happen somewhere, and no matter where it happened it was going to spread.
Also, supposedly world war II ought not get the credit for ending the depression. The economy had already returned to pre-depression status a while before.
- in some places - added to article -- mike dill
I know little about the depression in other countries, but for the U.S. this is not true. The depression began to ease after the Supreme Court struck down FDR's New Deal legislation, but after they began to uphold his legislation, the economy had another serious downturn in 1937 (I think). The economy was on an improving trend prior to our entry into WWII, but was nowhere near its pre-depression status. Jhanley
The Great Depression resulted in deflation, not hyperinflation--right? So says someone on sci.econ. --LMS
- Hyperinflation is when the paper money you hold becomes worthless, in the depression, money actually gained value, while the price of goods was depressed by deflation.
If that's true, then it should be in the article, shouldn't it? --LMS
- see the article now, I added this piece. -- mike dill
Deflation in some countries, hyperinflation in others. It depended on which methods the governments used to try to solve the problem. "Business as usual" and budget balancing resulted in deflation. "Spend our way out of trouble by printing money" resulted in hyper-inflation. Neither method worked.
Someone who has read Frederick Lewis Allen's 'Only Yesterday' and 'Since Yesterday' more recently than 40 years ago needs to work this article over. There is a great deal to be said about the extreme depth of the depression (25% unemployment in the US at one point), Hoover's unfortunate attempts to maintain budget balance (which I believe he himself abandoned near the end of his term); the failure of the US banking system in 1932, etc. (DJK)
Fixed up the sentence on the causes of the Great Depression. I think that there is a general consensus among economists today that certain policies help create the Great Depression. What's more controversial is the notion that government intervention caused the Great Depression, as opposed to wrong government intervention. Also changed the wording on Smoot-Hawley. The conventional wisdom is that things like Smoot-Hawley turned a stock market panic into something worse. However, the paragraph as it stood seem to imply that Smoot-Hawley caused the stock market crash of 1929 which would have been interesting since it was passed afterward.
It's a huge subject, really involving the entire history of the inter-war world economy, and I'm not even going to attempt incorporating these items into the article just yet, but a few thoughts may be worth discussing:
1) European (and particularly German) reliance on the outflow of U.S. dollars in the form of loans and investments (in the absence of buoyant U.S imports of European goods): in this connection the Wall Street boom has to be seen as a cause of the depression in Europe, since the lure of stock market speculation diverted money that might otherwise have gone overseas: Germany was already in recession as the Dow started on its last ascent, sharply cutting the flow of dollars to Europe by mid-1929. As a result, when the crisis came in the States, Europe was in no position to keep the international system afloat with purchases of cut-price U.S. (or other) goods.
2) Deflation vs. inflation: I don't know of any hyperinflations in the 1930s: prices everywhere fell until currencies were freed from gold, and even after currency depreciation, the problem was maintaining prices rather than controlling inflation: hyperinflation requires the belief that today's goods will fetch more (devalued) money tomorrow, which is difficult to achieve in the conditions of the 1930s. Germany's experience under Bruning (1930-32) was actually severely deflationary: I think there's a confusion in paragraph 4 with Germany's 1923 inflation - a very different crisis.
3) The US banking system only failed in February 1933 - i.e. after Roosevelt's election (November 1932) but immediately before his inauguration (March 4). The immediate effect on business was extremely severe but equally short-lived, with U.S industrial output shooting up in March-July 1933 and prices recovering in the wake of de facto devaluation. The banking crisis is really a distinct episode, one which may paradoxically have assisted recovery by allowing the Administrations to show decisiveness and by enlisting public support for dramatic action.
4) While fear of the Administration's regulatory initiatives appear to have contributed to the downturn of July-Novermber 1933, the Supreme Court's decisions of January 1935-January 1936 and its change of heart in April 1937 came too late to cause the 1933-37 recovery or the 1937-38 recession, which I think is generally blamed on a premature over-tightening of fiscal policy: the 1938 contraction was a temporary affair, and national income in 1940 was already above the 1929 peak. Recovery in most of Europe was already well under way, and war preparations at most cushioned European economies against the effects of the 1937-38 U.S. downturn and contributed to the sharp rise in US production in 1940-41.
In my view, this article needs a serious rewrite. It almost entirely is devoted to a discussion to the debates over what caused it, could have prevented it, or made it worse (and I might add it seems mostly slanted against the New Deal), while spending almost no time discussing the actual facts about what the Depression was and how it affected people. soulpatch
- Agreed. Right now this article amounts to a section -- to be called Causes of the Great Depression -- of the even better article which I hope you will help me write!
- Agreed, and I believe there's an NPOV problem in the later paragraphs, beginning with Because the US was still in a state of depression when it entered World War II, it is hard to make a serious argument that the New Deal was a success. That's advocacy, not description. Many can and do make such serious arguments. For example, it has been argued that the purpose of the New Deal was to "tide people over" to prevent some human suffering until better times. Others have pointed to the growing unrest in Depression-stricken areas, and suggested that the New Deal actually saved capitalism in the United States, which elsewise might have been overthrown by a seriously discontented populace. Now, the original author may not like or agree with these arguments, but they're serious arguments. -- April
Maveric149, I mean not to accuse you personally of a whitewash. Roosevelt is still a towering figure in 20th century history, and because of this honest criticism of actions he took is still muted today. His legacy rides on the triumphs of social security and defeating fascism, and the whitewash lies not with you but with the way his legend is told in our national mythology. Despite confiscating private gold, at least he kept the linkage. If you want to look for the true thieves, consider the meaning of [1] -º¡º
I can't help feeling here that this article is somewhat biased and needs more pro New Deal arguments adding. The anti new deal people seem to contradict themselves, they claim that government deficit spending in the new deal worsened the depression. But then they claim that the depression came to an end due to government deficit spending in World War 2.User:G-Man
Right now, this is the least NPOV article of which I'm aware. One rightwing user single-handedly hijacked this article, determined to stifle any Keynesian analysis. Granted the previous version was in bad shape, but the current version belongs on the talk page until it can be balanced. Until then, the old article should be posted.
Even monetarist economists acknowledge that many factors were involved; this user was just determined to only elaborate on the points that monetarists emphasize the most. Other issues were the lack of diversification of the US economy, a maldistribution of purchasing power, the credit structure of the economy, and America's position in international trade. Many non-monetarist economists would emphasize these four points, and rebut much of the arguments in the current version.
- Then go through the article and delete the hopeless offending paragraphs, move the really bad but possibly fixable ones here and fix the ones that can be easily fixed. However the version you reverted to is ancient and a great deal of work has been done since then. It is very bad form to take the easy route and simply revert - thus destroying the work of many other people. --mav 02:02 20 Jul 2003 (UTC)
Having read the article I do not think the rewrite done is salvageable. Its analysis is so biased even Margaret Thatcher would have blanched reading it. It is so inaccurate and POV it is mindblowing; it is the equivalent of the IRA writing an Irish history article or Saddam Hussein (or rather his ludicrous war spokesman) writing an account of the war in Iraq. The version 172 reverted to is deeply flawed, by far less so than the rubbish which there now. IMHO we should use the version 172 reverted to as the starting point and work on it, incorporating from it the less loopy elements of the current article (I'm sure there is something in somewhere that qualifies, though a first and second glance didn't show up much). I would suggest using the 172 revert as a temp into which salvageable bits of the current article can be moved. Using the current version as the starting point would, as Mr. Spock would say, illogical. It is sooooo POV and simplistic as to be comical. Trying to add to a workable but flawed basic article is preferable to trying to take apart a much longer monumentally flawed bit of POV nonsense, most of which is beyond salvation.
I won't claim to be an expert on that area but from the knowledge I do possess, I have rarely read an article that drew more "you can't be serious", "that is Bull Shit" and "for fuckin' sake, that is shit" responses from me as this article. This is to history what the X-files is to science. And keeping what is there now as a template would make wiki a laughing stock among historians of the period. Wiki has many many good points but its weakness is that some people, if no-one notices, can totally agendise an article to the point where it becomes a totally biased loopy polemic, whether extreme right or extreme left. This is one article that had been so agendised, so such an extent that it would be a nightmare trying to salvage it. Which is why I believe the revertion, though an extreme act, in this case is the best, or at least the least worst, route. FearÉIREANN 02:40 20 Jul 2003 (UTC)
As I've said before, this is the most one-sided article of which I'm aware. I'm going to restore the older version. 172
- Fine. Just make sure you incorporate all the valid edits made since the biased one. Who did the hack job and when? A cur from that version should help (but that would only work if the longer version is the current version). --mav
The edits were largely copyediting the rightwing rant by Octothorn done in early June.
I have fallen into the traps of too many overly-ambitious topics, which prevent me from working on this page (although it is far more urgent than my unfinished business). I agree with Jtdril that the rant isn't salvageable, meaning that it cannot be restructured to be integrated with the text of the former version. However, the position that it is arguing can go under the heading of a subtopic, say something on the arguments of Milton Friedman.
Until then, I'm glad that I have support now in restoring the less bad version. 172
- OK - that's not so bad. I thought it was a much earlier version. In retrospect I should have watched this article in the first place (then it would have been me doing the reverting last month instead of you doing so now).--mav
- My apologies for this. I was going through a rough patch, I will keep my contributions appropriate and try to help rebuild the page. By the way, 172 and also FearÉIREANN , you don't think your comments are a bit divisive, do you? I mean, how would you feel? Octothorn 10:18 27 Jul 2003 (UTC)
It's my fault too. Rather than having a broad focus, I've made the mistake of getting bogged down in massive projects. I've neglected it too.
Is the point where you guys hug and declare undying love? :-) Wow. Such wikilove. (A slightly merry jtd, having had my first alcohol since the accident! )FearÉIREANN 04:27 20 Jul 2003 (UTC)
I've been working on the causes since we've rescued this article from the ideological hijacking. However, the causes section still requires significant work, along with every other section.
Two problems stand out above all. One is the lack of social history. Impersonal macroeconomic indicators don't tell us the whole story. Second, the article is Amero-centric (something for which I'm partially responsible).
This article should perhaps be redirected to Great Depression (United States).
If anyone's interested in internationalizing this article, I'd be interested in Latin America. I've already written a good deal on the Great Depression in Brazil for the history of Brazil article; perhaps some of that content could be borrowed as a case-study of the Great Depression's impact on Third World monocultural economies. Separate articles on economic history, however, would be useful for Germany and Britain. 172
- I've been working on the article since the rant was removed. It's in better shape now. But due to me not getting around to doing it, it's still very US-centric and lacks social history. I'll get around to it someday, but some help would be great. 172
- BTW, the Great Depression had a profound impact on Latin America. I dealt with this in great detil in the History of Brazil article. This article really needs to be turned into series of articles on key countries, such as Britain, France, Italy, Germany, Canada, Mexico, and Brazil. Of course this isn't the entire world, but each country provides a good case study for each its respective regions. 172
I have a problem with this sentence.
Britain adopted far-reaching measures in the development of a planned national economy
Whilst this is partially true, it did not happen until the Postwar Labour government after WW2, Britain certainly didn't make much progress towards a planned national economy in the 1930s, G-Man 21:56 26 Jul 2003 (UTC)
- yeah, it could be clearer, but notice "in the development..." 172 23:23 26 Jul 2003 (UTC)
The same user is back trying to restore is propaganda piece little by little. See the bottom of the Votes for deletion for details on this user. 172 14:51, 12 Aug 2003 (UTC)
- For the sake of the people who are not very familiar with this point in history, could you give a few examples which specifically show why Octothorn's text is so bad? --mav 04:23, 13 Aug 2003 (UTC)
I propose the following version to the first paragraph of this page:
- The Great Depression is the period of history that followed "Black Thursday", the stock market crash of Thursday, October 24, 1929.
- It is widely believed that the events in the United States triggered a world-wide depression, which led to deflation and a great increase in unemployment.
- However, economic data shows that the US Federal Reserve's monetary policy, except for very brief periods in 1929 and 1936-1937 when it turned mildly deflationist, was consistently and unremittingly inflationist in the 1920s and 1930s.
- On the global scale, the market crash in the USA was a final straw in an already shaky world economic situation. By then, since 1914, Britain, Europe and the United States had been implementing the most extreme interventionist global economic policies in history. These policies, largely involving Britain and the US, were in dealing with the British Monetary Crisis. Partly as a result of this, bad fiscal policy and also in part due to demands for reparations for World War I, Germany was suffering from hyperinflation of currency. Many of the Allied victors of World War I were also having serious problems paying off huge war debts. In the late 1920s the American economy at first seemed immune to the mounting troubles, but with the start of the 1930s it crashed with startling rapidity.
My reasons for suggesting these changes are as follows:
The economic data of the period reflect that the depression was not accompanied by a deflation, but a consistently inflationary period. Looking at the data, it's obvious that there were much longer, and more sudden and severe periods of deflation through the 1800's. By comparison with the 1800's, the tiny deflationary blips in the period 1925 through 1940 are minor and trivial. Prior to the 20th century, protracted periods of deflation were an expected part of the business cycle, and did not cause anything like the Great Depression. It is important to highlight these facts.
Also, no account of the leadup to the Great Depression is complete without some mention of the British Monetary Crisis. The US, due to their trading ties with Britain, involved themselves in this issue during most of that time. The British monetary crisis is a perid of economic history that set the scene for the Great Depression. The article already mentions, in several places, that the rest of the world was already suffering severe financial troubles prior to October 1929, so any resistance to expanding slightly on that information does not seem reasonable.
I note that 172 is attempting to supress the update of this page with that information. I do understand why, due to my previous radical changes to this page. However, at the time I was suffering from a nervous breakdown, and was trying to occupy my mind with other things. I guess I just got too obsessed. Those who look at some of the other pages I have edited will see that this type of behaviour is unusual. You will also faind my apology on this page.
I do not think that the alterations I have suggested here are in any way unusual, and I believe they improve NPOV. I am more than willing to back up the information I am attempting to include. -- Octothorn 15:07, 12 Aug 2003 (UTC)
I would also like to make a suggestion with regard to the following paragraph, as it appears in the main text:
- The US economy had thus been showing some signs of distress for months before October 1929. Commodity prices had been falling worldwide since 1926, reducing the capacity of exporters in the peripheral, undeveloped economies of Latin America, Asia, and Africa to buy products from the core industrial countries, such as the United States and Britain. Business inventories of all types were three times as large as they had been a year before (an indication that the public was not buying products as rapidly as in the past); and other signposts of economic health--freight carloads, industrial production, wholesale prices--were slipping downward.
I think it is important to add that in 1929 the Smoot-Hawley tariff act (a measure aimed at protecting US agriculture) was well known to be progressing through congress. In October of 1929 it passed a critical Senate committee vote.
My reason for suggesting that thisinformation should be added is that throughout 1929 it was probably also well known that there was a high likelihood of the act passing. This knowledge is likely to have affected business decisions in 1929, causing US business to begin preparing for the worst -- battening down the hatches, so to speak, since they were well aware that raising domestic tariffs would cause retaliation from overseas trading nations, and justly predicted that this would lead to a consequent decrease in overseas demand for their production.
It's most likely that the direct effect of this preparation was that businesses began a pre-emptive round of layoffs, but I need to look into that level of detail a little more. In 1930 the act passed, after the financial collapse began, but I am trying to point out that it is likely that the knowledge of the intention to pass the act was sufficient to damage industry and probably contributed to triggering the Great Depression. -- Octothorn 17:11, 13 Aug 2003 (UTC)
The first paragraph of the introduction begins with:
- International finance never recovered from the strains of World War I. Some believe that World War I caused a dramatic increase in productivity capacity, particularly outside Europe, without a corresponding increase in sustained demand.
This suggests a narrow POV in line with the J. M. Keynes thesis that it was a "failure of demand", which is reflected throughout the article. It is suggested that people stopped buying goods (Since 1918?? What about the roaring 20's, with the accompanying sustained high inflation??), and this caused the Depression in 1929. But the POV is not mentioned that this thesis is also subject to a reversal of causality. It can as well be claimed that nearer to 1929, when the high consumption of the roaring 20's petered out, people spent less because the economy was already in a depression.
I admit that I have never considered the Keynes thesis to be reasonable. It is in effect the claim that people were poor because they already had everything that they needed (and hence stopped buying): they were poor because they were so rich. I mean, people then had a lot less "stuff" than people have today. So why did they have "too much", while today no one has enough?
Basically, the article has a thoroughly Keynsian POV, with little or no consideration for monetarist theory. -- Octothorn 17:45, 13 Aug 2003 (UTC)
There is also no mention of the tactics by FDR when he decided to try to end the depression by burning the crops, killing the livestock, and raising interest rates and taxation. It's strange that the words "tax" or "taxation" do not appear even once in the entire article when it is common to have some discussion of the way taxation levels changed over the period of the Great Depression. I am concerned this also indicates some lack of NPOV in the article. -- Octothorn 17:45, 13 Aug 2003 (UTC)
- There are articles on the New Deal and Roosevelt administration. Please, however, don't annoy us with your POV agendas there. 172 17:55, 13 Aug 2003 (UTC)
- I have no interest in New Deal or Roosevelt. I would expect they would be more matters of history than POV in any case. Aany mess over there can be for someone else to clear up, I have my hands full just drawing attention to a blatant lack of NPOV here, thank you very much. -- Octothorn 18:15, 13 Aug 2003 (UTC)
I ran across this article [2] which says "A number of myths that are popular in conventional histories of the Depression are punctured in Parker's book. For example, the Wikipedia echoes many textbooks in saying, "A fundamental misdistribution of purchasing power, the greatly unequal distribution of wealth throughout the 1920s, was a factor contributing to the depression." None of the economists interviewed by Parker cites this so-called causal factor." Glad to see Wikipedia being quoted, even if in a not so pleasant light. Dori 01:04, Oct 20, 2003 (UTC)
"In other words, the banking system was not well prepared to absorb the shock of a major recession. The banking system as a whole, moreover, was only very loosely regulated by the Federal Reserve System."
The article is too eager (and certainely biased) here to implify that the crash was worsened, or even created by a lack of FED control over commercial banks. Today FED has the power to control the cash reserve ratio of all the U.S. banks because of the Monetary Control Act 1980 and a crash doesn't look all that impossible in the near future.
On the contrary, the article should state the possibility of FED actually being a major cause of the Great Depression with its power to inflate and deflate and in so control the money supply at its will. It's good to remember that that the actual crash doesn't cause the wealth to disappear, it just moves it around and it is possible that it went into the hands of the private bankers behind the FED. I'm not claiming here to be NPOV, but I think it is important to bring this point of a view into the article. Googling to ' "federal reserve system" "great depression" ' should prove the issue is widely debated. Finlander 00:49, 5 Jan 2004 (UTC)
The article in its present form discusses several supposed causes of the Great Depression, but all of these causes come from the same macroeconomic view (aka the "Keynesian" view). There are at least four distinct theories of what caused the depression.
1. The European fallout theory: The physical and institutional destruction of the War, along with the terms of the Versailles treaty, caused a delayed worldwide collapse of finance and trade. This appears to have been the dominant contemporary view, but it is rare today.
2. The macroeconomic view: Diverse imbalances and weaknesses in the economy produced a financial collapse. Roosevelt's policies were deliberately designed to correct these imbalances and weaknesses. This is the most commonly taught theory today.
3. The Austrian view: Protective tariffs and a cheap credit policy by various central banks during the 1920s distorted business decision-making so as to weaken the economy. A tightening of credit in 1929 made these decisions unsustainable, but government stabilization measures discouraged businesses from correcting their mistakes.
4. The Marxist view: the Great Depression was one of the periodic catastrophes that must occur in capitalism.
- In the United States, President Herbert Hoover made only half-hearted efforts to control the situation...
Hoover took more action against an economic crisis than any president before him. This is forgotten for two reasons. First is the sheer scale of Roosevelt's programs. Second is the fact that Hoover eschewed federal legislation for his early measures, preferring informal agreements with state governments and private institutions. Therefore focusing on legislative measures misses a large part of the picture. The difference between Hoover and Roosevelt was not over whether the government should act, but whether it could/should be the sole agent of recovery.
- Many in the Hoover administration believed that as wages fell, the cost of production would drop, and as a result, production would pick up again, and the depression would be self-correcting. For this reason, they saw no need for the government to intervene in the economy....
This is true but misleading. Hoover noted in his memoirs that many in his administration held these views. However he and other officials did not, and his policies were not based on them. The article does not make this clear.
Details of Hoover's response to the Great Depression can be found in Hoover's public papers.
taxcollection
Wasn't it under FDR that the Federal government began the policy of weekly tax payment deductions. Which certainly helped the Federal Government's cash flow and probably had a related impact on the the economy by lowering the amount of interest the government had to pay. reggers vilppu
---
For what it's worth, being a mere amateur economic enthusiast who has read many books on the causes of the Great Depression, it seems to me that the suggestion above regarding mutiple theories seems the most helpful. Clearly, trying to announce that there is a "widely held view" and then reporting that in this article fails to communicate much intersting information. Why not have different sections on different theories? This eliminates the clearly contentious matter of what the "real" reason is, and I think it would be safe to say that no one knows the real reason for sure anyhow! Plus, I think it would be fascinating and quite useful to see how the various theories, including Keynesian, Classical, Marxist, Austrian, etc. compare to each other. I might feel up to writing up a few of the books I have read, presenting them as points of view. I'm sure we could find willing and competent authors for most of the major theories.
Additionally, I would suggest having a separate entry on Causes, and then another on events, life during the Depression, social impact, etc.. Finally, this is my first edit on Wikipedia, so if I have inadvertently broken some ettiquete, please feel free to point it out.
patimen
"Maldistribution"
- I just read this article for the first time, and was immediately struck by how biased it is. Much of the text is judgmental and does not present a "neutral" point of view. For example, the phrase "maldistribution of purchasing power" contains an assumption about what would be "good" or "bad" distributions. Putting to one side the debate about how purchasing power was actually distributed ( in itself a difficult subject, and one that continues to be debated ), it would surely be more in keeping with the spirit of Wikipedia to avoid making judgments of this kind. - IM.
- Exactly the same as my first thought. - 20:04, 9 Nov 2004 (UTC)
maldistribution and other questionable claims
I second the writer above about the "maldistribution" section and about the lack of objectivity in this article as a whole.
Another specific example of the lack of objectivity is the bit which blames "Hoover and the Republican Congress" for Hawley-Smoot. The House Ways and Means Committee held hearings which generated 20,000 pages of documents regarding tariff protection. It was thought at the time that tariff protection would not only protect American business but also American jobs. Therefore, Congress passed the legislation and Hoover signed it into law despite his misgivings. It is part of the bias of this article and others related to this era that Hoover is first accused of "doing nothing" (which is extremely inaccurate) and then condemned when he did act.
While it is common in many circles to blame Hoover for "doing nothing" and being a lassiez-faire president (patently false - he rejected lassiez-faire and was an active reformer both as Secretary of Commerce and as President), one must understand the times before passing judgments such as he did little or nothing to help.
Before Hoover, the Federal government did not intervene with direct aid or public works spending to counteract a financial crisis. Many people would have considered it a violation of American republican principles to do so. The idea that a government could spend its way out of contraction was not common. FDR himself promised to REDUCE Federal spending during the 1932 election during which he accused Hoover of reckless and profligate spending.
The following is an outline of just some of the actions Hoover took to end the Great Depression.
1) Signed the Emergency Relief and Construction Act, the nation’s first Federal unemployment assistance.
2) Increased Public Works Spending – some of Hoover’s efforts to stimulate the economy through public works are as follows:
a) Asked congress for a $400 million increase in the Federal Building Program b) Directed the Department of Commerce to establish a Division of Public Construction in December 1929. c) Increased subsidies for ship construction through the Federal Shipping Board d) Urged the state governors to also increase their public works spending though many failed to take any action.
3) Signed the Federal Home Loan Bank Act establishing the Federal Home Loan Bank system to assist citizens in obtaining financing to purchase a home.
4) Increased subsidies to the nation’s struggling farmers.
5) Established the President’s Emergency Relief Organization to coordinate local, private relief efforts resulting in over 3,000 relief committees across the U.S.
6) Urged bankers to form the National Credit Corporation to assist banks in financial trouble and protect depositor’s money.
7) Actively encouraged businesses to maintain high wages during the depression. Many businessmen, most notably Henry Ford, raised or maintained their worker’s wages early in the depression in the hope that more money into the pockets of consumers would end the economic downturn.
8) Signed the Reconstruction Finance Act. This act established the Reconstruction Finance Corporation which made loans to the states for public works and unemployment relief. In addition, the RFC made loans to banks, railroads and agriculture credit organizations.
9) Raised tariffs to protect American jobs. After hearings held by the House Ways and Means Committee generated over 20,000 pages of testimony regarding tariff protection, Congress responded with legislation that Hoover signed despite some misgivings. Instead of protecting American jobs, the Hawley-Smoot tariff is widely blamed for setting off a worldwide trade war which only worsened the country’s economic ills. This is a classic example of how government actions, despite good intentions, can trigger negative, unintended consequences.
In order to pay for these and other government programs, Hoover agreed to one of the largest tax increases in American history. The Revenue Act of 1932 raised taxes on the highest incomes from 25% to 63%. The estate tax was doubled and corporate taxes were raised by almost 15%. Hoover also encouraged Congress to investigate the New York Stock Exchange and this pressure resulted in various reforms.
Despite these actions and the massive intervention by his successor, FDR, the economy did not improve. A severe contraction occurred in 1937-38 (a contraction labeled a depression by some economists) and the economy continued to struggle until the 1940’s (unemployment did not drop below 9.9% until 1942).
Maybe he should have joined WWII earlier....
Seriously, there has to be a reason why there WAS a depression in the 1930s and there wasn't from the late 1940s to the early 1970s. There is some doubt about how effective FDR's policies were (equally the UK government's policies in the same period) but essentially he saved capitalism by at least appearing to do something. The most successful economies in the 30s were the totalitarian ones, unconcerned with having to keep voters and businesses happy. How long Hitler would have lasted without a war is an interesting question, would the deficit financing have brought him down sooner or later in a huge financial crash?
Just put the numbers there
You may not be able to convince anyone of anything hat they don't want to believe. Just put the numbers there and let people decide for themselves. Here are some of them, [3], I'll try to find all of them. - Jerryseinfeld 20:34, 9 Nov 2004 (UTC)
Year %Change in GNP President ---------------------------------- 1930 - 9.4% Hoover 1931 - 8.5 Hoover 1932 -13.4 Hoover 1933 - 2.1 Hoover/Roosevelt 1934 + 7.7 Roosevelt 1935 + 8.1 Roosevelt 1936 +14.1 Roosevelt 1937 + 5.0 Roosevelt 1938 - 4.5 Roosevelt 1939 + 7.9 Roosevelt Annual Growth of Tax Collections by President (1) President Tax Growth ---------------------- Roosevelt 121.3% Truman 3.7 Eisenhower 2.4 Kennedy 4.8 L Johnson 6.9 Nixon 0.3 Ford 6.4 Carter 3.0 Reagan 2.4 Bush 0.0 Government Receipts, Combined, Federal, State and Local (Percentage of GDP) (2) Year Combined Federal State and Local ------------------------------------------ 1947 22.9% 17.3% 5.6% 1948 22.6 16.8 5.8 1949 21.1 15.0 6.1 1950 21.4 14.8 6.6 1951 22.7 16.5 6.3 1952 25.7 19.4 6.2 1953 25.5 19.1 6.4 1954 25.7 18.9 6.7 1955 23.9 17.0 6.9 1956 25.0 17.9 7.0 1957 25.6 18.3 7.3 1958 25.4 17.8 7.6 1959 24.2 16.5 7.7 1960 26.2 18.3 7.9 1961 26.6 18.3 8.4 1962 26.4 18.0 8.4 1963 26.8 18.2 8.6 1964 26.7 18.0 8.7 1965 26.1 17.4 8.7 1966 26.6 17.8 8.8 1967 27.5 18.8 8.8 1968 27.4 18.1 9.4 1969 29.8 20.2 9.6 < tax plateau reached 1970 29.7 19.6 10.2 1971 28.1 17.8 10.3 1972 28.9 18.1 10.9 1973 29.0 18.1 10.8 1974 29.5 18.8 10.7 < economy slows down 1975 29.3 18.5 10.8 1976 28.5 17.7 10.8 TQ 28.3 18.3 10.1 1977 29.4 18.5 10.9 1978 29.2 18.5 10.7 1979 29.1 19.1 10.0 1980 29.6 19.6 10.1 1981 30.2 20.2 9.9 1982 30.0 19.8 10.3 1983 28.6 18.1 10.5 1984 28.6 18.0 10.5 1985 29.1 18.5 10.6 1986 29.0 18.2 10.7 1987 30.1 19.2 10.9 1988 29.6 18.9 10.7 1989 29.9 19.2 10.7 1990 29.5 18.8 10.7 1991 29.5 18.6 10.9 1992 29.5 18.4 11.1 1993 29.6 18.4 11.2 1994 30.0 19.0 11.1 1995 30.4 19.3 11.0 Percent of U.S. individual worker productivity (U.S. = 100%) Country 1950s 1960s 1970s 1980s 1990 ------------------------------------------------ United States 100% 100 100 100 100 Canada 77.1 80.1 84.2 92.8 95.5 Italy 30.8 43.9 66.4 80.9 85.5 France 36.8 46.0 61.7 80.1 85.3 Germany 32.4 49.1 61.8 77.4 81.1 United Kingdom 53.9 54.3 58.0 65.9 71.9 Japan 15.2 23.2 45.7 62.6 70.7
I can't find the "unemployment" data before 1948. Does anyone know where it is? For $5 there seem to be some data since 1929 here: [4]. Which is used here: [5].
Assessment comment
The comment(s) below were originally left at Talk:Great Depression/Comments, and are posted here for posterity. Following several discussions in past years, these subpages are now deprecated. The comments may be irrelevant or outdated; if so, please feel free to remove this section.
The only thing I don't like about this article is the lack of cite templates. It is well referenced, but hard to skip back and forth.
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Last edited at 16:53, 11 December 2006 (UTC). Substituted at 20:37, 2 May 2016 (UTC)
Section on Other depressions
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Longwave Economics (see Kondraitiev wave) researchers document that similar Great Depressions, Persistent Recessions and Panics have occurred cyclically in regular 40 to 65 year cycles in Capitalist Economies; documented in academic papers and books based on records back to 1763 BCE. The Code of Hammurabi, for example, confirmed that Depressions (periods of high inequity) were corrected by "Jubilees" (wealth distributing Government Policy) every 50-years as required to prevent revolution and social collapse problems proactively.
This section is lacking and does not reference what was originally called the "Great Depression" and now is called the Long Depression. This Depression hit Europe in the late 1800's, and was long and severe there, but mostly missed the US.
Historians seem more then a bit confused on what happened in the US during this period. Some seem to think it was a period of slow growth full of panics, others that is was the most exceptional period of growth in US history. The US passed England as the #1 economic power during this time frame which supports the fast growth camp.71.174.141.198 (talk) 22:06, 17 December 2013 (UTC)
i noticed that the beginning sentence says the depression was the decade following WWII i think the author meant WWI considering WWII began during the Great Depression. — Preceding unsigned comment added by 75.76.122.90 (talk) 02:20, 17 April 2014 (UTC)
- it was the decade BEFORE world war two (which started in 1939). Rjensen (talk) 03:48, 17 April 2014 (UTC)
Not done: this is the talk page for discussing improvements to the page Great Depression/Archive 1. Please make your request at the talk page for the article concerned. SparklingPessimist Scream at me! 22:14, 10 September 2017 (UTC)
