Making Cause and Effect Connections

Learning Objectives

  • Explain and justify the connections between the causes and effects of the Great Depression

When we talk about the relationship between causes and effects in a historical context, the concepts of time and place are paramount. History happens at many different chronological “levels” and on many different scales. The effects of some historical events can be felt for decades or even centuries, while others might only be felt for a few months or years. Some of these effects might only be seen on a small, local scale, others are felt on a national or regional level. Still others have global or even interplanetary implications, such as the Moon Landing and the launch of the Hubble Telescope!

Short-Term Effects and Long-Term Results

In this activity, we will distinguish between the shorter-term, direct effects of historical events versus the longer term, sometimes more indirect, results.[1]

If we return to our example of the watermelon and rubber band experiment, the short-term effects of the watermelon explosion could be that you have a lot of clean up work to do, you have lots of watermelon to eat, and you are now all out of rubber bands. The long-term results of your watermelon experiment could be that your parents ban you from conducting anymore viral video experiments in their yard, you are picking up rubber band pieces for two months, or maybe you even find a watermelon plant growing on your front lawn one day due to some far-flung seeds.

Hindsight is 20/20

Remember, some of these effects or results are relatively foreseeable: you knew when you started that you would have to clean up the mess from your experiment and that there would probably be some edible watermelon leftover. Some of the long-term results, however, may have been harder to see coming, like the ban on further fruit experimentation in the yard or the surprise watermelon vine. It is important to remember this idea when talking about historical events, because sometimes we look at history through our modern lens and wonder “how could people have thought that was a good idea?”

We must remember that, in the midst of a crisis like the Great Depression, people were making decisions that may have had long-term consequences which they were unable to foresee. For example, some of the legislation passed during the Great Depression in an attempt to stabilize failing banks also played a role in the 2007-2009 “Great Recession.” President Franklin D. Roosevelt, elected in 1932 on the promise that he would end the crisis, had one of the greatest impacts of any President on American history because many of his policies have lingered around to this day. It is easy for us to look at the past with our 20/20 hindsight; some of the things they did may seem strange to us because we can see the long-term consequences of those actions, but we must remember that they did not have that gift of premonition.

Effects of Historical Events

When we talk about effects in the context of this Hack and the Great Depression, we are first looking at the direct effects that were almost immediately felt after 1929, such as the massive bank runs which began in early 1930 and had an immediate and devastating effect on the savings accounts of American families. These were the types of everyday problems faced by the American populace, such as poverty and homelessness. Some of these effects were felt over a longer period of time, but were still directly linked to the stock market crash and subsequent Depression, such as the Dust Bowl and the unemployment rate, which did not go back under 10% until 1941.

The results of the Great Depression can also be thought of as “lessons learned.” These are the events, movements, ideas, or conditions that came into existence because of the Depression, but were maybe not direct results of the stock market crash or subsequent financial crisis. In a historical context, results are often measures taken in order to try and end a situation or they are measures taken in order to prevent a similar event from happening again in the future. Results could be things that took place before the Depression even ended, such as the repeal of Prohibition, or they could have occurred over a longer period of time, such as the cultural and political shifts in American society that took place during and after the Great Depression and were manifested in programs like Roosevelt’s New Deal.

Try It

In this activity, you will learn about the short-term effects and the long-term results of the Great Depression and exercise your critical thinking skills in matching these effects and results to the previous historical events that caused or precipitated them. But before we look at the effects and results of the Great Depression, let’s return to the completely fictional story of the flat tire from the previous page. We have determined the vulnerabilities and triggers which led to the situation of your Kia Sportage being in the shop for several weeks, leaving you with a $1200 bill to pay. Now we will look at the direct effects and the longer-term results of this situation.

Worked Example: The Flat Tire Saga, Part 2

What are the effects of your Kia Sportage breaking down?

  • The most direct and obvious effect is that you will not have a car for two weeks, since driving on a broken axle could be dangerous. You still have to get to work and classes, not to mention running errands, so you must rely on your friends, coworkers, Uber/Lyft, and the public transportation system to get around. This will cost you extra money, since you will have to give your friends gas money or pay for a ride-share. Public transportation might be cheaper, but can often be unreliable or difficult to access, if it even exists in your town at all. Relying on your friends for rides could also make you late for work, school, or other obligations, putting you at risk of being fired (depending on how kind your boss is).
  • The other immediate effect of your car being in the shop is that you must pay for it. If you mechanic allows you to make payments, you may be in luck, as long as they don’t charge interest or a fee, but they can also report you to a collection agency if you fail to make the payments. If you borrow money from another source, like a family member or a short-tern lender, in order to make a lump sum payment, you will still have to pay that money back and most short-term loans carry a high interest rate. No matter what you decide, you will have to pay for the repairs and it could end up costing you much more than just the $1200 you owe the mechanic if you end up borrowing money.
  • Another effect, although a longer-term one, is that you may have to purchase a new vehicle sooner than you planned. Some people may even choose to simply scrap their damage Kia Sportage and buy a new car right then and there, since the repairs cost more than you originally paid for it. However, if you decide to go ahead with the repairs thinking that you can get another couple of years out of the car, you will need to start saving and planning for that purchase.

What are the results of your Kia Sportage breaking down?

  • What have you learned from this situation? What will you do to prevent this from happening again in the future? The most important thing you probably learned was that your car needs regular maintenance and upkeep. Driving on worn out tires, particularly when you are on bad roads, will lead to issues sooner or later, so it is best to keep up with getting your tires replaced, rotated, and having your vehicle’s alignment checked regularly, even if you car is older. These are results that can be seen in the immediate aftermath of your car problems, since you will hopefully be more careful with your Kia when you get it back, especially after spending so much money having it repaired. You will also most likely want to purchase a car jack, lug wrench, and tire patching kit, and other emergency equipment to keep in your vehicle.
  • Longer-term results may be that you become very careful about your driving and maintenance habits in the future, even after you have parted with your Kia Sportage. While you might already be saving money for a new car, you also might realize that having an emergency savings account is a good idea, or you might decide to invest money in AAA or another emergency services program, in case something like this happens to you again. You may also decide that the atrocious conditions of the city roads contributed to your experience, so you might decide to write a letter to the City Council requesting that the roads around your apartment be repaired.

Now that you’ve identified the effects and results of the car situation, let’s see if we can connect these repercussions with the causes from the previous page.

Connecting Effects and Results with Causes

For this activity, you will be matching the results and effects of this situation with their direct causes from the Worked Example in Part 1. Here were the list of causes:

  • Buying an old car
  • Having high mileage in an old car
  • Old tires
  • Poor road conditions
  • Lack of regular maintenance
  • Getting a flat tire
  • Driving on a flat tire
  • Driving home over potholes and hitting the curb
  • Driving a few weeks on a spare tire
  • Shaking and wobbling car
  • Not having enough money to get the car fixed

Sometimes, these connections can be tenuous or difficult to make, but the exercise should require you to use your critical thinking skills to see the connections and then defend your answers. Try to put in the causes into the spaces in the chart.

Effect or Result? Effect or Result (from Pt. 2) Cause (from Pt. 1) Connection/Justification
(1-2 bullet points)
Effect No car for two weeks.

Hitting the curb & driving on the spare caused the axle damage.
If you had changed the tire at the gas station, your axle wouldn’t have been damaged.
Effect You must come up with $1200, plus extra money for rides.

Hitting the curb & driving on the spare caused the axle damage.
If you had changed the tire at the gas station, your axle wouldn’t have been damaged.
Effect Purchase new vehicle sooner than planned.

Your car had extra wear & tear anyway, but the axle damage will probably require you to buy a new car sooner than later, whereas just having a flat tire would not have had that result.
Result Practice regular upkeep on Kia (and any future cars).

You have learned that cars need regular maintenance.
Result Driving more carefully.

You have learned that road conditions & your driving play an important role in your cars’ condition & drivability.
Result Keeping a car jack, lug wrench, and other emergency equipment in good working order & in your vehicle at all times.

If you had proper equipment, you could have changed your tire on your own, or you could have waited for a friend with proper equipment to help you.
You have learned the importance of having those items in your own vehicle.
Result Starting an emergency savings account.

This decision is what cost you $1200 at the mechanic, so it is the cause of your future choice to be more responsible & start an emergency savings.
Had you changed your tire at the gas station, you would not have needed that $1200 on such short notice.
Result Signing up for AAA or another emergency vehicle service.

You have learned that any type of car emergency could happen at any time, so it is best to be prepared & have a backup plan.
Result Becoming involved in local road condition activism.

You have realized the importance of road conditions & their relationship to your vehicle.
You decide that you don’t want your Kia, or any future car, or any other person’s car, to be affected by poor road conditions.

 

Try It

Now that you’ve done this exercise related to our hypothetical car situation, let’s do the same activity related to the Great Depression. By doing this, you’ll hopefully come to recognize that there were both many causes and many effects and results of the Depression.

Activity #2

As you read through this table, try to determine if these events or trends were effects or results of the Great Depression, as they are defined above and try to connect them to specific causes that you read about in Part 1. In the table below, identify each outcome as either an effect or a result, based on the descriptions above. Note that labeling each term correctly is not a big deal here, but you want to think carefully about the outcomes to understand the short- and long- term implications of the Great Depression. You may even disagree with some of the answers as they are listed—that’s okay, too! As long as you can justify your response and support it with evidence, you are on the right track.

Outcome Description Effect or Result?
1 Extremely high unemployment Prior to the Great Depression, unemployment in the U.S. had been incredibly low due to war production and the big business boom. However, between the stock market crash in 1929 and the height of the Great Depression in 1933, the unemployment rate climbed from around 9% in 1930, to 15% in 1931, and hit a high of 25% in 1933 at the peak of the crisis. It did not drop back down below 15% until 1937 and did not go back to pre-Depression levels (around 3%) until 1943, when World War II was in full swing and the U.S. had drastically ramped up war production again.

2 Homelessness & the development of Hoovervilles Around 2 million Americans became homeless during the Great Depression, and many more who lost their homes had to move in with relatives or neighbors. The result of this was the development of shantytowns in large urban centers, which were often referred to as “Hoovervilles,” in a dig at President Herbert Hoover. The people living in these homeless encampments were forced to rely on charities or begging for food, clothing, and medicine. Most Hoovervilles were torn down or abandoned in the late 1930s, but some remained as late as 1941.

3 Decrease in wages for workers As unemployment rose, wages also fell, so any worker lucky enough to still have a job was making only a fraction of what they used to make. For example, wages for manufacturing workers dropped from about $27/week in 1929 to around $18/week in 1932, and some coal miners saw a 44% cut in wages between those years.[2] These cuts were fairly consistent across major industries except public utility workers.

4 Organized crime Petty crimes decreased during the Great Depression, since no one had anything worth stealing, but organized crime and violent crimes increased during the worst years of the crisis. In 1933, the nation’s homicide rate hit the highest levels of the century.[3] Bootlegging experienced a surge in popularity as people tried to make money by any means necessary, and many felt they needed a drink. However, when Prohibition was repealed in 1933, other organized crime like bank robberies, gambling, and prostitution increased. In fact, one of the most famous criminals of the time, the Chicago gangster Al Capone, was doing so well during the Depression that he opened soup kitchens to feed Chicago’s homeless.[4]

5 Demographic changes: increased internal migration, decreased foreign immigration Searching for work or new land, around three million families migrated across the U.S. during the Great Depression, while millions more single men left their homes and “rode the rails,” or illegally jumped on freight trains in order to travel from one down to the next, looking for jobs. They were often met with even worse conditions in the cities where they ended up, as the whole nation was struggling with unemployment and homelessness.
The rest of the world was also suffering from economic depression, which reduced immigration numbers since not many foreigners could afford to travel to the U.S. However, the number of immigrants also dropped because America was no longer “the promised land” where fortunes could be made. Additionally, U.S. immigration officials were instructed by the Hoover administration to scrutinize immigrants more closely in order to keep out those who might become “public charges” or those who might be willing to work for lower wages, thereby taking already scarce jobs away from American citizens.

6 Changes in attitudes/beliefs of Americans During the Industrial Revolution and Gilded Age, the U.S. had been seen as a land of economic and social opportunity, where a person could possibly make a fortune overnight or climb to the top of the political or social ladder. The Great Depression was a clear demonstration that there were limits to America’s economic greatness and that unchecked growth would eventually come crashing down. It was the end of an era, in many ways, because it was the first time that large numbers of American citizens had suffered widespread poverty, homelessness, and uncertainty, which permanently altered the national consciousness.
Another change was the attitude that Americans took toward government involvement in their lives. The Hoover administration had taken a very hands-off approach to economics and social policy, believing that the economy would regulate itself and that people should rely on one another during times of crisis. The Great Depression showed Americans that the economy could not, in fact, regulate itself and that it was hard to rely on your neighbors when they had also lost everything. Social welfare policy became more prominent with the election of Franklin D. Roosevelt in 1932 and Americans’ attitudes toward government regulation and welfare began to change when they saw how it lifted the nation out of the Depression.

7 Changes to banking & economic sector In order to prevent a future crisis on the same level as the Great Depression, the U.S. government began to regulate the banking industry, starting with the United States Banking Act of 1933, which set regulations meant to protect consumers & stabilize banks.
The Banking Act also created the Federal Deposit Insurance Corporation (FDIC). This agency is responsible for ensuring that, when people deposit money into an American bank, that money will not be lost if the bank closes. If a bank were to close, every customer who had money deposited with that bank would receive a reimbursement from the federal government (up to a certain amount). Initially the FDIC insured deposits up to $2,500 (equal to around $50,000 in today’s money), which was later raised to $5,000. Today, the FDIC insures deposits of up to $250,000.
Another part of the Banking Act, sometimes called the Glass-Steagall Act, forced banks to separate themselves into commercial or investment institutions. This prevented the type of cascading bank failures that happened during the Great Depression because commercial banks could not invest their customer’s deposits and investment banks could no longer take deposits.

8 The New Deal & changes to social welfare The New Deal was a massive package of various legislation passed by President Roosevelt between 1933 and 1939. The purpose was “the 3 R’s: relief, recovery, and reform.” Relief for those who were hit hardest, recovery through job creation, and reform of the systems that caused the crisis. The New Deal primarily focused on creating jobs through public works and programs, including the Civilian Conservation Corps, the Civil Works Administration, the Farm Security Administration, the National Industrial Recovery Act of 1933, and the Social Security Administration. The New Deal also created the first unemployment insurance and disability assistance. This is only a brief overview, as you will learn more about the New Deal in Module 9 of this course.

Activity #2 Directions

Next, using the lists of causes of the Great Depression from the previous page, let’s connect the causes to the outcomes. Note that some of the causes are also, in some cases, the outcomes. For example, financial panic, bank runs, and the Dust Bowl could easily be considered both causes and effects of the Great Depression. The causes of the Great Depression are listed again here:

  1. Wealth inequality
  2. Speculation, easy credit, and buying on margin
  3. Lack of banking regulations
  4. The deflationary spiral
  5. The Federal Reserve
  6. Financial panic
  7. Bank runs
  8. WWI
  9. The stock market crash of 1929
  10. The Dust Bowl

Do not put too much emphasis on getting the “correct” answer. Your priority here should be to practice drawing solid, defensible connections between the causes and the effects/results using critical thinking skills and your historical knowledge.

You may assign more than one cause, as long as you explain the connection and your justification for each answer individually. So, if you put connect two causes to “Extremely high unemployment,” you would need to write out at least a few bullet points justifying why you made that connection.

Effect or Result of Great Depression Causes of the Great Depression Connection/Justification
Extremely high unemployment

Homelessness & the development of Hoovervilles

Decrease in wages for workers

Organized crime

Demographic changes: increased internal migration, decreased foreign immigration

Changes in attitudes/beliefs of Americans

Changes to banking & economic sector

The New Deal & changes to social welfare

Critical Thinking Questions 

  • Did you label the New Deal & other changes to social welfare as an effect or a result of the Great Depression? Explain your reasoning.

  • What do you think the most lasting result of the Great Depression was, based on your study of this Module and the material in these exercises? Explain your reasoning

  1. Although the words “effect” and “result” have similar meanings, in this activity we will use them as labels within the context of the Great Depression and its aftermath. ↵
  2. Wolman, Leo. 1933. “Wages During the Depression.” National Bureau of Economic Research Bulletin 46 (May): 1-6. https://www.nber.org/system/files/chapters/c2256/c2256.pdf. ↵
  3. Latzer, Barry. 2014. “Do hard times spark more crime?” Los Angeles Times, January 24, 2014. https://www.latimes.com/opinion/op-ed/la-oe-latzer-crime-economy-20140124-story.html. ↵
  4. Klein, Christopher. 2021. “Mobster Al Capone Ran a Soup Kitchen During the Great Depression.” HISTORY. https://www.history.com/news/al-capone-great-depression-soup-kitchen. ↵