Why learn about the Great Depression?

Figure 1. In 1935, American photographer Berenice Abbott photographed these shanties, which the unemployed in Lower Manhattan built during the depths of the Great Depression. (credit: modification of work by Works Progress Administration)

On March 4, 1929, at his presidential inauguration, Herbert Hoover stated, “I have no fears for the future of our country. It is bright with hope.” Most Americans shared his optimism. Hard times had hit the United States before, but never had an economic crisis lasted so long or inflicted as much harm as the slump that followed the 1929 crash. After nearly a decade of supposed prosperity, the economy crashed to a halt. People suddenly stopped borrowing and buying. Industries built on debt-fueled purchases sold fewer goods. Retailers lowered prices, and when that did not attract enough buyers to turn profits, they laid off workers to reduce labor costs. With so many people out of work and without income, shops sold even less, dropped their prices lower still, and then shed more workers, creating a vicious downward cycle.

Four years after the crash, the Great Depression reached its lowest point: nearly one in four Americans who wanted a job could not find one; of those who could, more than half had to settle for part-time work. Farmers could not make enough money from their crops to make harvesting worthwhile. Food rotted in the fields of a starving nation.

The stock market crash of October 1929 set the Great Depression into motion, but other factors were at the root of the problem, propelled onward by a series of both human-made and natural catastrophes. Anticipating a short downturn and living under an ethos of free enterprise and individualism, Americans suffered mightily in the first years of the Depression. As conditions worsened and the government under President Hoover failed to act, they grew increasingly desperate for change. While Hoover could not be blamed for the Great Depression, his failure to address the nation’s hardships would remain his legacy.