In U.S. history, the cause of the Great Depression that resulted in one of the worst economic involved more than one factors. These factors were both domestic and worldwide economic conditions. Although the causes are still debated up to date, economists and historians have come up with the possible causes.
Stock Market Crash of 1929: Economists have come to a conclusion that on Black Tuesday, October 29, 1929, the stock market crash that occurred made a significant contribution to the Great Depression. Two months later after the crash, more than $40 million dollars was lost by the investors (Croft Communications, n.d.). Although by the late 1930 stock markets started to recover, the comeback was not enough to regain the loss.
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Bank Failures: In the 1930s, more than 9000 banks in America had failed. At this time, most of the bank's deposits were uninsured and most of the customers lost their savings. Due to this economic uncertainty, the surviving banks were not sure of their success and thus, they limited their loan provision. This resulted in reduced expenditure in the economy.
Reduction in Purchasing Across the Board: After the crashing of the stock market, the fear of further economic woes continued and most of the individuals reduced their purchasing patterns. The production of goods and services reduced which also lowered the workforce level. The decreased workforce meant that people were losing their jobs to the position that they cannot continue repaying loans and other items they had bought through installment. Most of the items were repossessed. The level of unemployment increased above 25% which in return reduced the spending level as people try to alleviate the economic situation.
New Deal to Solve the Great Depression
The New Deal that was intended to solve the economy from the Great Depression included a number of projects and programs initiated by President Franklin D. Roosevelt. This was aiming at restoring the prosperity of the American economy. First, the new deal introduced some of the reforms which were both social and economic. On the unemployment, the government introduced the Civilian Conservation Corps program which targeted the jobless young men and women between the age of 18 and 25. The population under this age bracket were enrolled in work camps across the country earning an average of $30 per month. In the late 1930s, more than 2 million young people had enrolled with this program. In the agriculture sector, the New Deal believed most of the country's economic problems would be solved with greater regulation. The Congress through the Agriculture Adjustment Act (AAA) provided relief to the farmer by providing subsidies and another form of compensation for cutbacks in production. Fortunately, even before this Act matured into law, the growing season for farmers was well underway. The third approach of the New Deal targeted Blacks in the Depression. The Great Depression affected African American as three times more than the whites as the former suffered a high rate of unemployment after being fired from their jobs. Further, most of the public assistance in the days of depression were provided more to the whites where some charitable organizations eve excluded the blacks from the “kitchens soup.” The blacks benefitted from the New Deal by receiving low-cost public housing and the Civilian Conservation Corps and the National Youth Administration helped the blacks in continuing with their education. And for the first time, the Congress of Industrial Organizations (CIO) enrolled the largest number of blacks into the labor unions. In the second New Deal, the principal relief agency such as WPA started to provide work rather than welfare.
World War II and Cold War Tensions
Effects of the Arms Race
The Nuclear Arms Race remains to be an example of the aftermath fueled solely by fear as the different ideologies of the US and Soviet Union clashed (Sullivan, n.d.). This lead to the bombing of Hiroshima and Nagasaki, the massacre which ended the WW II. However, the arms race began after the Soviet was able to manufacture the first nuclear weapon known as Joe 1.
Increased Cold War Tension
To better understand the ideological conflict of the Cold War it is first important to understand the main principles of capitalism, communism, democracy and dictatorship. During the Cold War, the United States was based upon capitalism and democracy while the Soviet Union was based upon communism and dictatorship. The differing ideologies between the Soviet Union and the United States emerged from politics should be handled in the government.
U.S. Ideologies: The U.S. believed that citizens should act Constitution provides their freedom since this is capitalists country. The presence of democracy guarantees people their freedom including the right to vote. At this, they were also led by an elected president where different political parties were converged in to the two-party political system. Further, the U.S. wished to attempt reconstruction and aiding of the war-torn areas within Asia, Europe, and especially Germany. The tension of the cold war increased as the US planned to create nuclear weapons ahead of Germany. This failed after the first detonation, Trinity test, occurred two months later after the Nazi's surrendered. This effort was intended to be done through the World Bank and International Monetary Fund (IMF).
Soviet Union Ideologies: On the other hand, Soviet was a communist country and it is individuals who controlled their lives and freedoms. It was led under the dictatorship of Joseph Stalin who was against capitalism and all its elements. Therefore, Soviet Union did not have freedom compared to the citizens of the United States(Ourdocuments.gov., n.d.-b). Stalin led only one-party political system and citizen would only vote for the communist party. They were also opposing the reconstruction of Germany and its wellbeing along the borders. With this, it was worried of its weak borders and inability to protect from other similar invasion. Therefore, they considered expanding to other territories in order to provide military bases in areas a security measure.
Effects of Cold War Tensions on American Culture and Domestic Policies
The Cold War tension lasted for over 40 years. This massively affects American culture as well as domestic policies. The increased fear among the American people resulting in the development of anticommunism as the World War turned into political beliefs of the Soviets communist (Ourdocuments.gov., n.d.-a). The communism threat leads to the American people being placed under a microscope and they would be suffering societal alienation for anything that deemed to communist related. For instance, Senator Joseph McCarthy initiated anticommunist movements based on the belief in the belief that there were some sympathizers within Congress.
Changes Resulting from one of the Historical Events
Civil Rights Movement: One of the notable changes that were witnessed during this movement was the Civil Rights Act of 1964. This Act ended peoples' segregation based on race, religion, color, sex in public places while making employment discrimination illegal (History.com Staff, 2010). The Act was initiated by John F. Kennedy who felt that American has not yet guaranteed freedom until every citizen could enjoy his or her constitutional freedom. It is this philosophy that resulted in his assassination. It is his successor, Lyndon B. Johnson who saw the act passing and its debut. Furthermore, the Act led to the formation of the Equal Employment Opportunity Commission which was entrusted with the task of ensuring that citizens were not segregated or being denied jobs on the basis of religion, race, or gender. This law marked the establishment of other laws such as the Voting Rights Act of 1965. The latter Act came into force and banned the use of tests among other discrimination actions which intended to prevent people from voting.
The second major event that occurred at the time of the Civil Rights movement in the case landmark between Brown V. Board of Education of Topeka. It is after this precedent of the Supreme Court that saw the follower of the Plessy v. Ferguson case be overturned on the basis of being unconstitutional and public schools’ segregation being declared unconstitutional. It is this court that set up guidelines of how other district courts should implement this law in overseeing the desegregation in the public schools (History.com Staff, 2009a). However, this ruling of the court was not well received by everyone. The court systems in the southern state resisted the Plessy offered to rule and rather applied its principals for the court cases that were also used to fight for desegregation (History.com Staff, 2009a).
References
Croft Communications. (n.d.). Causes of the Great Depression . Retrieved from http://thegreatdepressioncauses.com/causes/
History.com Staff. (2009a). Brown v. Board of Education . Retrieved from http://www.history.com/topics/black-history/brown-v-board-of-education-of-topeka
History.com Staff (2009b). New Deal . Retrieved from http://www.history.com/topics/new-deal
History.com Staff. (2010). Civil Rights Act . Retrieved from http://www.history.com/topics/black-history/civil-rights-act
Ourdocuments.gov. (n.d.-a). National Industrial Recovery Act (1933). Retrieved from https://www.ourdocuments.gov/doc.php?flash=true&doc=66
Ourdocuments.gov. (n.d.-b). Tennessee Valley Authority Act (1933) . Retrieved from https://www.ourdocuments.gov/doc.php?flash=true&doc=65
Sullivan, N. (n.d.). The Effects of the Nuclear Arms Race on Cold War Politics . Retrieved from http://study.com/academy/lesson/nuclear-arms-race.html
