What Caused The Great Depression

When a person hears the words “The Great Depression,” almost everyone thinks of the worst economic times in the United States. The Great Depression started in the late 1920s and continued on until the early 1940s. It is known as being “the deepest and longest-lasting economic downturn in the history of the western industrialized world” (“Causes”). We can learn from the occurrences during The Great Depression that government involvement is the deciding factor of whether an economy will expand or continue to shrink during a recession. The Great Depression was a horrendous time for everyone from people with businesses to farmers even banks until The New Deal was introduced then finally things got better.

The 1920’s, also known as the Roaring

The farmers’ struggle happened because of the dramatic decrease in food prices and “the loss of export markets” following World War I (Taylor). The effect of overgrazing and the horrible droughts was that the grass started to disappear, which left the topsoil exposed. When high winds would come they would pick up the dirt and carry it with them, causing “dust storms”. These “dust storms” destroyed everything in their paths, leaving farmers without their crops (“Causes”). The lands where farming took place in the United States became known as “The Dust Bowl” (“Causes”). Along with the bad weather conditions, during this time the tractor was created which resulted in less workers on farms. Farmers were in debt due to the fact that they needed to borrow money to buy seed. In the bad conditions they weren’t able to pay back their debt back because they did not have enough crops to feed their families, let alone extra crops for them to then sell. The dust storms ruined the land and crops and with no money to pay back their debts, banks had no choice but to foreclose on the small farms. These farmers and their families became

Hoover underestimated the seriousness of the economic downturn. He even said that it was “a passing incident in our national lives” and that “it would be over in 60 days” (Byas). Many people looked down on Herbert Hoover for the way he handled the situation our country was in and for the little he did to try and help fix it. An empty pocket that was turned inside out became known as a “Hoover flag” and dirty shantytowns that were around the country because so many people were so poor and homeless were known as “Hoovervilles” (Freedmen). Newspapers became known as “Hoover Blankets” and broken down cars that were pulled by horses were called “Hoover Wagons” (Rosenberg). When it came time for reelection Hoover wasn’t reelected and was instead beat by Franklin Delano Roosevelt who told Americans the many ways that he was going to fix the economy and get them out of the depression. Roosevelt was elected in 1932 and would go on to be in office for 3 terms. When Franklin Delano Roosevelt came to office, he had many plans to help the United States economy get out of the depression. The first thing that FDR did once in office was “[declare] a four-day bank holiday, during which Congress passed the Emergency Banking Relief Act to stabilize the bank system” (Byas). This Act took place in 1933 and helped to get three-quarters of the United States’ closed banks back open by the end of March. What Roosevelt