Great Depression

Definition

The Great Depression was a severe and prolonged economic downturn that affected much of the world, including the United States, in the 1930s. It was characterized by high unemployment, reduced industrial output, and a significant decline in consumer spending and investment.

5 Must Know Facts For Your Next Test

1. The Great Depression was a global economic crisis that began with the Stock Market Crash of 1929 and lasted until the late 1930s.
2. During the Great Depression, the United States experienced a severe decline in industrial output, with many factories and businesses closing down and millions of people losing their jobs.
3. President Herbert Hoover's response to the Great Depression, which focused on voluntary cooperation between the government and businesses, was widely criticized as ineffective.
4. The election of Franklin D. Roosevelt in 1932 marked a significant shift in the federal government's approach to the Great Depression, with the implementation of the New Deal programs aimed at providing relief, recovery, and reform.
5. The origins of the Second World War can be traced in part to the economic and social upheaval caused by the Great Depression, which contributed to the rise of authoritarian regimes in Europe and Asia.

Review Questions

• Explain how the Great Depression affected the consumer culture in the United States during the 1920s.
  • The economic prosperity and consumer boom of the 1920s came to a sudden halt with the onset of the Great Depression. As businesses closed, unemployment skyrocketed, and consumer spending plummeted, the vibrant consumer culture that had emerged in the previous decade was severely disrupted. People became more cautious with their spending, and the demand for luxury goods and entertainment declined significantly. This shift in consumer behavior had a profound impact on the American economy, as industries that had thrived during the 1920s struggled to adapt to the new economic realities of the Great Depression.
• Analyze how the political landscape in the United States changed during the Republican Ascendancy of the 1920s and the subsequent rise of Franklin Roosevelt's New Deal in the context of the Great Depression.
  • The 1920s were marked by the Republican Ascendancy, with a focus on limited government intervention and pro-business policies. However, the onset of the Great Depression exposed the limitations of this approach, as the voluntary cooperation between the government and businesses advocated by President Hoover proved ineffective in addressing the economic crisis. The election of Franklin D. Roosevelt in 1932 ushered in a dramatic shift in the federal government's role, with the implementation of the New Deal programs. These programs, which included increased regulation, public works projects, and social welfare initiatives, represented a fundamental change in the government's approach to economic management and the role of the state in addressing the challenges of the Great Depression.
• Evaluate the impact of the Great Depression on the origins of World War II, particularly in terms of the economic and social upheaval it caused in Europe and Asia.
  • The Great Depression had far-reaching global consequences, contributing to the conditions that led to the outbreak of World War II. The economic devastation and social unrest caused by the depression created an environment that was ripe for the rise of authoritarian regimes in Europe and Asia, such as Nazi Germany and Imperial Japan. These regimes, driven by nationalist and expansionist ideologies, sought to address the economic and political instability of the post-depression world through military aggression and the pursuit of territorial conquest. The economic hardship and disillusionment with the existing political and economic order also fueled the growth of extremist movements, further destabilizing the international system and setting the stage for the outbreak of the Second World War.

Related terms

Stock Market Crash of 1929:

The dramatic collapse of stock prices on the New York Stock Exchange, which marked the beginning of the Great Depression in the United States.

New Deal:

A series of economic programs and reforms implemented by President Franklin D. Roosevelt to address the effects of the Great Depression, including increased government intervention and regulation.

Unemployment: A significant increase in the number of people who were unable to find work during the Great Depression, leading to widespread economic hardship and social upheaval.