How Did The Great Depression Affect The Economy

Across the long arc of American history, three moments in particular have disproportionately determined the course of the Republic’s development. Each has defined the historical legacy of a century with lasting transformative impacts. During the Great Depression of the 1930s, the American people endured the largest economic crisis in the history of the country where many became unemployed. The New Deal programs began to reshape the public’s attitudes toward government. However, only the mobilization that followed America’s entry into World War II would be the historical moment that would bring an end to the Depression. This war would be one of the most defining events in history because it solidified America’s role as a global power as well

as the many social that it caused. Growing out of post-World War after the Japanese surrender, tensions between the United States and the Soviet Union lasted for much of the second half of the 20th century. The Cold War rivalry between the two resulted in mutual suspicions, heightened tensions and a series of international incidents that brought the world’s superpowers to the brink of disaster. Between 1929 and 1945 the Great Depression and World War II utterly redefined the role of government in American society and catapulted the United States from an isolated state into the world’s hegemonic superpower. Post-War, the Cold War has shaped the American views to today of the fear of war and the economic impact that follows instilling the anti-communism stance of American culture. Like past occurrences that reshaped America, the Great Depression, World War II and the Cold War were the three defining experiences the nation has had to face that would reshape American society in years to come.
The Great Depression was the larges economic downfall of American history; at its worst, greater than a quarter of all Americans were unemployed. It began with the crash of the stock market on October 24,1929 which was considered "Black Thursday" at the time. Although there were many other events that led up to the Great Depression, including tariffs and over-production of products, the stock market crash would have the largest impact that would trigger the Depression. There were 9,000 bank failures that occurred throughout the 1930s, where people lost all of their savings. The late twenties to early thirties would impact American society for the next decade where people lost all of their savings from bank failures as well as businesses going under. Many Americans came to believe that they were witnessing not just another downswing of the business cycle, but the collapse of a historic economic, political, and social order, perhaps even the end of the American way of life. The economy partially recovered from the Depression through the New Deal programs to put Americans back to work. Elected to the presidency in 1932 on a platform that promised "a new deal for the American people," Franklin Roosevelt now took up that challenge. The programs expanded the regulatory power of the federal government and their role in the economy. It focused new attention on the plight of workers, women, children, racial minorities and other groups. Roosevelt used the Depression to invent many governmental institutions like the Securities and Exchange Commission and the National Labor Relations Board to bring stability to the shaky banks, stock exchanges, and labor relations. To this day the New Deal stands as an accomplishment and failure for many because while it was a great social success, it was not able to reverse the down economy from the Depression. Before World War II wiped out the Depression at a stroke, none of FDR’s exertions managed to take the unemployment rate below 14 percent. Americans lived for generations thereafter in a world rendered more predictable and less volatile, and for those reasons more prosperous with FDR’s achievements. Once the U.S. decides to join World War II in 1941, America would see an economic turnaround which pushed demand for goods and services greatly.
The world the American people had tried to exclude after the First World War could not be avoided forever.

Though the Allies and the Axis Powers had been at war since 1939, the United States remained neutral until the Japanese attacked Pearl Harbor in December. The civilian economies of both the Soviet Union and Great Britain shrank by nearly one-third during war time. In the United States civilian consumption expanded by nearly 15 percent. The war forever banished the Depression and ignited the economic after-burners that propelled the American economy to unprecedented heights of prosperity in the postwar decades. Roosevelt created ways to maximize the advantages at minimum costs. From ‘Ken Burns “The War,” Explore PBS Website,’ it says “American industry provided almost two-thirds of all the Allied military equipment produced during the war: 297,000 aircraft, 193,000 artillery pieces, 86,000 tanks and two million army trucks. In four years, American industrial production, already the world’s largest, doubled in size.” This shows the scope of American production, post-Depression, and the major turnaround of the American economy it caused. War production profoundly changed the American industry where industries were transformed. For example, making cars turned into making engines and other parts for airplane engines, guns, tanks, and other military purposes. The War also led to many social changes, including a women’s movement that would put women into previously male only

jobs. Yet, while the United States was defending democracy, it was denying civil liberties of Japanese Americans and the civil rights of racial minorities. Historians would see the country emerge from World War II very different than when going in with new enemies globally and new challenges to face at home.

The Cold War started after the Second World War, when the Unites States and the USSR no longer shared a common goal.

As soon as the Cold war was instigated, the differences in ideology and other factors became apparent which worsened the relationship between the two countries. This was shown in the many events such as the Cuban Missile Crisis and the arms race which nearly led to a war. As the Cold War progressed for decades until the collapse of the Soviet Union, it had major impacts on American society. The Cold War created a strong anti-communism idea within the USA. The hysteria over the perceived threat posed by Communists in the U.S. became known as the Red Scare. The Red Scare led to a range of actions that had a profound and enduring effect on U.S. government and society. Instigating the fear was a senator, Joseph McCarthy. The hatred got so strong that it eventually led to McCarthyism in 1950 where people were accused and aggressively investigated of being affiliated with the party without evidence. This eventually came to an end when McCarthy began to accuse everyone of being affiliated until an army man denounced McCarthyism. Although the Cold War never actually led to a hot war between the two major powers, it caused massive impact upon the world, including American society spreading the fear of communism, war and economic

damage.
These major events have shaped American society and built the foundation that everyone is currently living in. The Great Depression created social change and agencies like the SEC to protect citizens, business, and banks. It wasn’t until the Second World War, where massive production was needed for Americans to supply weapons, tanks and other military materials to us and our allies, causing the United States to come out of it an economic and strong powerhouse. The Cold War began as soon as our ideology post-war differed from the USSR almost causing another all-out war. The Cold War had its effects on the American people by instilling the fear of war and communism. The experiences the U.S. has faced has molded and shaped America today.