International Impact Of The Great Depression
Any analysis of the Great Depression must start with World War I. This conflict had a dramatic economic impact, which went far beyond the massive military casualties. It embraced non-belligerents as well as those directly involved in the conflict. The war encouraged but also grossly distorted economic effort.
Law Enforcement And Crime
Law enforcement in the United States is primarily the responsibility of local police departments and sheriff‘s offices, with state police providing broader services. Federal agencies such as the Federal Bureau of Investigation and the U.S. Marshals Service have specialized duties, including protecting civil rights, national security and enforcing U.S. federal courts‘ rulings and federal laws. State courts conduct most criminal trials while federal courts handle certain designated crimes as well as certain appeals from the state criminal courts.
A cross-sectional analysis of the World Health Organization Mortality Database from 2010 showed that United States homicide rates “were 7.0 times higher than in other high-income countries, driven by a gun homicide rate that was 25.2 times higher.” In 2016, the U.S. murder rate was 5.4 per 100,000.
The United States has the highest documented incarceration rate and largest prison population in the world. As of 2020, the Prison Policy Initiative reported that there were some 2.3 million people incarcerated. According to the Federal Bureau of Prisons, the majority of inmates held in federal prisons are convicted of drug offenses. The imprisonment rate for all prisoners sentenced to more than a year in state or federal facilities is 478 per 100,000 in 2013. About 9% of prisoners are held in privatized prisons, a practice beginning in the 1980s and a subject of contention.
The Great Depression And Us Foreign Policy
The Great Depression of the 1930s was a global event that derived in part from events in the United States and U.S. financial policies. As it lingered through the decade, it influenced U.S. foreign policies in such a way that the United States Government became even more isolationist.
The origins of the Great Depression were complicated and have been much debated among scholars. The initial factor was the First World War, which upset international balances of power and caused a dramatic shock to the global financial system. The gold standard, which had long served as the basis for national currencies and their exchange rates, had to be temporarily suspended in order to recover from the costs of the Great War, but the United States, European nations, and Japan put forth great effort to reestablish it by the end of the decade. However, this introduced inflexibility into domestic and international financial markets, which meant that they were less able to deal with additional shocks when they came in the late 1920s and early 1930s. The U.S. stock market crash of 1929, an economic downturn in Germany, and financial difficulties in France and Great Britain all coincided to cause a global financial crisis. Dedication to the gold standard in each of these nations and Japan, which only managed to return to it in 1930, only made the problem worse and hastened the slide into what is now known as the Great Depression.
The International Depression
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Global Comparison Of Severity
The Great Depression began in the United States of America and quickly spread worldwide. It had severe effects in countries both rich and poor. Personal income, consumption, industrial output, tax revenue, profits and prices dropped, while international trade plunged by more than 50%. Unemployment in the U.S. rose to 25%, and in some countries rose as high as 33%.
Cities all around the world were hit hard, especially those dependent on heavy industry. Construction was virtually halted in many countries. Farming and rural areas suffered as crop prices fell by approximately 60%. Facing plummeting demand with few alternate sources of jobs, areas dependent on primary sector industries such as grain farming, mining and logging, as well as construction, suffered the most.
Most economies started to recover by 193334. However, in the U.S. and some others the negative economic impact often lasted until the beginning of World War II, when war industries stimulated recovery.
There is little agreement on what caused the Great Depression, and the topic has become highly politicized. At the time the great majority of economists around the world recommended the “orthodox” solution of cutting government spending and raising taxes. However, British economist John Maynard Keynes advocated large-scale government deficit spending to make up for the failure of private investment. No major nation adopted his policies in the 1930s.
The South And The Midlands
In London and the south east of England unemployment was initially as high as 13.5%, the later 1930s were a prosperous time in these areas, as a suburban house-building boom was fuelled by the low interest rates which followed the abolition of the gold standard, and as London’s growing population buoyed the economy of the Home Counties.
The south was also the home of new developing industries such as the electrical industry, which prospered from the large-scale electrification of housing and industry. Mass production methods brought new products such as electrical cookers and radios into the reach of the middle classes, and the industries which produced these prospered. Nearly half of all new factories that opened in Britain between 1932 and 1937 were in the Greater London area.
Another industry that prospered during the 1930s was the British motor industry. For cities that had a developed motor industry such as Birmingham, Coventry and Oxford, the 1930s were also a boom time. Manufacturers such as Austin, Morris and Ford dominated the motor industry during the 1930s, and the number of cars on British roads doubled within the decade. British Agriculture also flourished in the 1930s.
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The Gold Standard And The Spreading Of Global Depression
The gold standard was the primary transmission mechanism of the Great Depression. Even countries that did not face bank failures and a monetary contraction first hand were forced to join the deflationary policy since higher interest rates in countries that performed a deflationary policy led to a gold outflow in countries with lower interest rates. Under the gold standard’s pricespecie flow mechanism, countries that lost gold but nevertheless wanted to maintain the gold standard had to permit their money supply to decrease and the domestic price level to decline .
There is also consensus that protectionist policies such as the SmootHawley Tariff Act helped to worsen the depression.
The Gold Standard And The Transmission Of The Depression
The depression was transmitted through foreign trade, and the United States was at the heart of the contraction. The supply of dollars to the rest of the world, which resulted both from American overseas lending and payment for U.S. imports, fell drastically from $7.4 billion in 1929 to $2.4 billion in 1932. The growing shortage of dollars became a serious problem. Once Debtor countries used up their meagre reserves, they had to take steps to cut their imports. Unfortunately, in doing so they helped to export the Depression. Primary producing nations found that the prices of their exports fell far more steeply than the prices of the manufactured goods that they wished to import. In Europe, the inter-related war debts and reparations were fundamentally destabilizing. Unfortunately, the gold standard functioned as a mechanism for spreading the Depression rather than containing it.
In April 1933, Roosevelt, who was less committed to orthodoxy than Hoover, devalued the dollar and the U.S. abandoned the gold standard. The president was clearly signalling his intention to put domestic recovery to the fore. The aim of devaluation was to stimulate the U.S. economy and it was an essential prerequisite for New Deal policies designed to raise export-oriented farm prices. Indeed, the devaluation of the dollar was welcomed by farmers who also hoped that some beneficial inflation of farm prices would follow.
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How Photos From The Battle Of Antietam Revealed The American Civil Wars Horrors
Roosevelt took immediate action to address the countrys economic woes, first announcing a four-day bank holiday during which all banks would close so that Congress could pass reform legislation and reopen those banks determined to be sound. He also began addressing the public directly over the radio in a series of talks, and these so-called fireside chats went a long way towards restoring public confidence.
During Roosevelts first 100 days in office, his administration passed legislation that aimed to stabilize industrial and agricultural production, create jobs and stimulate recovery.
In addition, Roosevelt sought to reform the financial system, creating the Federal Deposit Insurance Corporation to protect depositors accounts and the Securities and Exchange Commission to regulate the stock market and prevent abuses of the kind that led to the 1929 crash.
African Americans In The Great Depression
One-fifth of all Americans receiving federal relief during the Great Depression were black, most in the rural South. But farm and domestic work, two major sectors in which blacks were employed, were not included in the 1935 Social Security Act, meaning there was no safety net in times of uncertainty. Rather than fire domestic help, private employers could simply pay them less without legal repercussions. And those relief programs for which blacks were eligible on paper were rife with discrimination in practice, since all relief programs were administered locally.
Despite these obstacles, Roosevelts Black Cabinet, led by, ensured nearly every New Deal agency had a black advisor. The number of African-Americans working in government tripled.
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Recovery From The Great Recession
Following these policies the economy gradually recovered. Real GDP bottomed out in the second quarter of 2009 and regained its pre-recession peak in the second quarter of 2011, three and a half years after the initial onset of the official recession. Financial markets recovered as the flood of liquidity washed over Wall Street first and foremost.
The Dow Jones Industrial Average , which had lost over half its value from its August 2007 peak, began to recover in March 2009 and, four years later, in March 2013, broke its 2007 high. For workers and households, the picture was less rosy. Unemployment was at 5% at the end of 2007, reached a high of 10% in October 2009, and did not recover to 5% until 2015, nearly eight years after the beginning of the recession. Real median household income did not surpass its pre-recession level until 2016.
Critics of the policy response and how it shaped the recovery argue that the tidal wave of liquidity and deficit spending did much to prop up politically connected financial institutions and big business at the expense of ordinary people and may have actually delayed the recovery by tying up real economic resources in industries and activities that deserved to fail and see their assets and resources put in the hands of new owners who could use them to create new businesses and jobs.
Women In The Great Depression
There was one group of Americans who actually gained jobs during the Great Depression: Women. From 1930 to 1940, the number of employed women in the United States rose 24 percent from 10.5 million to 13 million Though theyd been steadily entering the workforce for decades, the financial pressures of the Great Depression drove women to seek employment in ever greater numbers as male breadwinners lost their jobs. The 22 percent decline in marriage rates between 1929 and 1939 also created an increase in single women in search of employment.
Women during the Great Depression had a strong advocate in First Lady Eleanor Roosevelt, who lobbied her husband for more women in officelike Secretary of Labor Frances Perkins, the first woman to ever hold a cabinet position.
Jobs available to women paid less, but were more stable during the banking crisis: nursing, teaching and domestic work. They were supplanted by an increase in secretarial roles in FDRs rapidly-expanding government. But there was a catch: over 25 percent of the National Recovery Administrations wage codes set lower wages for women, and jobs created under the WPA confined women to fields like sewing and nursing that paid less than roles reserved for men.
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Comparison With The Great Recession
The worldwide economic decline after 2008 has been compared to the 1930s.
The causes of the Great Recession seem similar to the Great Depression, but significant differences exist. The previous chairman of the Federal Reserve, Ben Bernanke, had extensively studied the Great Depression as part of his doctoral work at MIT, and implemented policies to manipulate the money supply and interest rates in ways that were not done in the 1930s. Bernanke’s policies will undoubtedly be analyzed and scrutinized in the years to come, as economists debate the wisdom of his choices. Generally speaking, the recovery of the world’s financial systems tended to be quicker during the Great Depression of the 1930s as opposed to the late-2000s recession.
1928 and 1929 were the times in the 20th century that the wealth gap reached such skewed extremes; half the unemployed had been out of work for over six months, something that was not repeated until the late-2000s recession. 2007 and 2008 eventually saw the world reach new levels of wealth gap inequality that rivalled the years of 1928 and 1929.
Canada And The Caribbean
- In Canada, Between 1929 and 1939, the gross national product dropped 40%, compared to 37% in the U.S. Unemployment reached 28% at the depth of the Depression in 1929 and 1930, while wages bottomed out in 1933. Many businesses closed, as corporate profits of C$396 million in 1929 turned into losses of $98 million in 1933. Exports shrank by 50% from 1929 to 1933. The worst hit were areas dependent on primary industries such as farming, mining and logging, as prices fell and there were few alternative jobs. Families saw most or all of their assets disappear and their debts became heavier as prices fell. Local and provincial government set up relief programs but there was no nationwide New Deal-like program. The Conservative government of Prime Minister R. B. Bennett retaliated against the SmootHawley Tariff Act by raising tariffs against the U.S. but lowered them on British Empire goods. Nevertheless, the Canadian economy suffered. In 1935, Bennett proposed a series of programs that resembled the New Deal; but was defeated in the elections of that year and no such programs were passed.
- Cuba and the Caribbean saw its greatest unemployment during the 1930s because of a decline in exports to the U.S., and a fall in export prices.
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There’s A Difference Between Crisis And Collapse
Kimberly Amadeo is an expert on U.S. and world economies and investing, with over 20 years of experience in economic analysis and business strategy. She is the President of the economic website World Money Watch. As a writer for The Balance, Kimberly provides insight on the state of the present-day economy, as well as past events that have had a lasting impact.
The U.S. economy’s size makes it resilient. It is highly unlikely that even the most dire events would lead to a collapse. If the U.S. economy were to collapse, it would happen quickly, because the surprise factor is a one of the likely causes of a potential collapse. The signs of imminent failure are difficult for most people to see.
Most recently, the U.S. economy almost collapsed on September 16, 2008. That’s the day the Reserve Primary Fund broke the buckthe value of the funds holdings dropped below $1 per share. Panicked investors withdrew billions from money market accounts where businesses keep cash to fund day-to-day operations. If withdrawals had gone on for even a week, and if the Fed and the U.S. government had not stepped in to shore up the financial sector, the entire economy would likely have ground to a halt. Trucks would have stopped rolling, grocery stores would have run out of food, and businesses would have been forced to shut down. That’s how close the U.S. economy came to a real collapseand how vulnerable it is to another one.
Statistics On Postpartum Depression Types
Part of spreading awareness about postpartum depression understanding that this condition can take many forms. Here are some statistics regarding the rates and risk factors of specific types of postpartum depression:
- Between 1 and 2 women out of every 1,000 will develop postpartum psychosisa severe and potentially deadly disorder.
- Women who have a history of bipolar disorder are 40% more likely to develop postpartum psychosis.
- Tragically, 10% of postpartum psychosis cases result in suicide or infanticide.
- One study found that over 60% of women with postpartum depression also had signs of postpartum anxiety disorder, a condition that isnt always associated with depression.
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The First Shock: 19281930
In early 1928 the Fed moved to curb growing stock market speculation by introducing a tight money policy. As interest rates rose, Fed officials believed that borrowing for speculative purposes would become too expensive and the furious buying would fade away. This strategy was a complete failure. It did, however, have serious repercussions for international lending because it altered the relationship between U.S. interest rates and those in the rest of the world. Since 1924 the Fed had kept rates low in order to encourage U.S. money to flow overseas, and many economies had become highly dependent on the continuation of the flow. However, borrowers began to see that much of the international capital was short term and highly volatile. Indeed the term “hot money” had been coined to describe its chief characteristic. Responding to higher interest rates, U.S. savers decided that the domestic opportunities had become so attractive that money which previously would have been sent overseas remained at home. But the United States was the world’s leading international investor during the 1920s, with central Europe and Latin America being especially favored. How could international borrowers entice Americans to send more capital to them?