(Archive - Week of December 11, 2004)
The Great Depression
Bub Field's family, Alabama - Circ. 1935
American Cultural History
1930 - 1939
FACTS ABOUT THIS DECADE
*1000 homes foreclosed each day
If you were not living during the 1920s and '30s you have no idea what it was like trying to survive during the Great Depression. It was not only the people of the United States, it was world wide. Although few people died from starvation, many did not have enough to eat. Some people searched garbage dumps for food or ate weeds. Malnutrition took a toll: A study conducted in eight American cities found that families that had a member working full time experienced 66 percent less illness than those in which everyone was unemployed. The Wall Street crash had ushered in a world-wide financial crisis. In the United States between 1929 and 1933 unemployment soared from approximately 3 percent to 25 percent, while manufacturing output declined by one-third. Governments worldwide sought economic recovery by adopting restrictive autarkic policies (high tariffs, import quotas, and barter agreements) and by experimenting with new plans for their internal economies.
The economic crises due to the depression were a terrible epidemic throughout the United States and many parts of the world. Consumers reduced their purchases of luxury cars, clothes, and many businesses cut production. Big businesses such as General Motors saw their sales drop by 50% in the late 1920s and the early 1930s. This caused businesses to lay off thousand of workers.
When the farm prices fell, small farmers went bankrupt and lost their land. By June of 1932, the American economy had fallen by about 55% of the work force. The Government tried to restore prosperity by spending on welfare and public works.
After the stock market collapse, the New York banks became frightened and called in their loans to Germany and Austria. However, without the American money, Germans had to stop paying reparations to France and Britain. Of course, this was a chain reaction and they could not repay their war loans to America. Therefore, the depression had spread to Europe. All governments were forced to cancel both reparations payments and war loans.
The United States government tried to protect domestic industries from foreign competition by imposing the highest import duty in American history. In retaliation, other countries raised their tariffs on imports of American goods. As a result, global industrial production declined by 36% between 1929 and 1932, while world trade dropped by a breathtaking 62%.
Belew family portrait, Lawrence County Tenn., Circ. 1932 (Noah - left front)
In 1932, the United States had elected President Franklin D. Roosevelt. He proposed the "New Deal," a platform of government programs to stimulate and revitalize the economy. The British and French governments also intervened in their economies and escaped the worst of the depression. Moreover, the Soviet Union put in the five-year plans.
Observers throughout the world saw in the massive program of economic planning and state ownership of the Soviet Union what appeared to be a depression-proof economic system and a solution to the crisis in capitalism.
In Germany unemployment increased drastically, fueling widespread disillusionment and anger. The institutions of the Weimar Republic, which had already been standing on shaky ground, started cracking in the years from 1930 to 1932, while Chancellor and finance expert Heinrich Brening was trying to fix the economy by drastically cutting state spending. At the time, the NSDAP gained much popularity, winning the two general elections in 1932, which eventually led to the appointment of Adolf Hitler as Chancellor on January 30, 1933. (See Weimar Republic for details.) In Nazi Germany economic recovery was pursued through rearmament, conscription, and public works programs. In Mussolini's Italy the economic controls of his corporate state were tightened.
In the United Kingdom, the Labour government of Ramsay MacDonald, and later the Conservative-dominated "National Government" responded to the depression by imposing tariffs on all imports except those of the British Empire (which arguably worsened the global situation), by cutting public spending, and by abandoning the Gold Standard which reduced the cost of British exports. (see Great Depression in the United Kingdom).
|This family, the Wares, squatted on Terminal Island, California, United States in 1930 because of the Great Depression.|
In the United States, President Herbert Hoover made only half-hearted efforts to control the situation, and hindsight shows that at first, he gravely underestimated the severity of the crisis, (even announcing to Congress on December 3, 1929 that the worst effects of the recent stock market crash were behind them and that the American people had regained faith in the economy). Having realized his mistake, Hoover went before Congress again on December 2, 1930 to ask for a $150 million public works program to help generate jobs and stimulate the economy. However, one of the major problems was that with deflation, the currency that you kept in your pocket could buy more goods as prices went down. The other was that there had been no federal oversight of the stock market or other investment markets, and with the collapse, many stock and investment schemes were found to be either insolvent, or outright frauds. Unfortunately, many banks had invested in these schemes, and this precipitated a collapse of the banking system in 1932. With the banking system in shambles, and people holding on to whatever currency that they had, there was minimal cash available for any activities that would cause positive change.
The response of the Hoover administration helped little; instead of increasing the money supply, the Hoover administration did the exact opposite and raised interest rates, falsely believing that inflation was the real danger. Many in the Hoover administration believed that as wages fell, the cost of production would drop, and as a result, production would pick up again, and the depression would be self-correcting. For this reason, they saw no need for the government to intervene in the economy, a policy which proved disastrous.
Like their counterparts abroad, many Americans were disillusioned with their system of government, believing that Hoover's policies had driven the country to ruin. (Shantytowns populated by unemployed people at the time were often dubbed Hoovervilles to highlight the President's fading popularity.) During this period, several alternative and fringe political movements saw a considerable increase in membership. In particular, a number of high-profile figures embraced the ideals of Communism, although this would subsequently be used against them during the Red Scare of the 1950s. Radio speakers such as Father Charles Coughlin saw their listening audiences swell into the millions, as they sought for (and often found) easy scapegoats to blame the country's woes upon.
Upon accepting Democratic nomination for president (July 2, 1932), Roosevelt promised "a new deal for the American people," a phrase that has endured as a label for his administration and its many domestic achievements.
Life during the Depression
|Unemployed shown in American Soup Kitchen: Washington, D.C. - Circ. 1935|
In the so-called Dust Bowl, a massive area of the great plains consisting mainly of Kansas, Oklahoma, and parts of Texas, people found themselves unable to make a living. On top of the economic crisis, the earth withered and blew away in a series of massive dust storms. For a farming people this was disastrous, and these migrants were led westward by advertisements for work put out by agribusiness in western states such as California. The migrants came to be called Okies, Arkies, and other derogatory names as they flooded the labor supply of the agricultural fields, driving down wages and increasing competition for jobs in a place that couldn't afford it. This story was dramatized in the famous novel The Grapes of Wrath by John Steinbeck.
Bonus veterans from Boston, Massachusetts
Photographs of members of the 1932 Bonus Expeditionary Force, jobless veterans of World War I who unsuccessfully tried to persuade Congress and President Hoover to grant them their Veterans Bonus ten years early. Any hopes for relief from their economic distress faded with their forcible eviction from their encampment by federal troops. Photographs of the Bonus marchers are sympathetic, showing their living conditions, sense of humanity, and their feeling of neglect.
Few images from the Great Depression are more indelible than the rout of the Bonus Marchers. At the time, the sight of the federal government turning on its own citizens -- veterans, no less -- raised doubts about the fate of the republic. It still has the power to shock decades later.
From the start, 1932 promised to be a difficult year for the country, as the Depression deepened and frustrations mounted. In December of 1931, there was a small, communist-led hunger march on Washington; a few weeks later, a Pittsburgh priest led an army of 12,000 jobless men there to agitate for unemployment legislation. In March, a riot at Ford's River Rouge plant in Michigan left four dead and over fifty wounded. Thus, when a band of jobless veterans, led by a former cannery worker named Walter W. Walters, began arriving in the capital in May, tensions were high. Calling themselves the "Bonus Expeditionary Forces," they demanded early payment of a bonus Congress had promised them for their service in World War I.
Army Chief of Staff MacArthur was convinced that the march was a communist conspiracy to undermine the government of the United States, and that "the movement was actually far deeper and more dangerous than an effort to secure funds from a nearly depleted federal treasury." But that was simply not the case. MacArthur's own General Staff intelligence division reported in June that only three of the twenty-six leaders of the Bonus March were communists. And the percentage within the rank and file was likely even smaller; several commanders reported to MacArthur that most of the men seemed to be vehemently anti-Communist, if anything. According to journalist and eyewitness Joseph C. Harsch, "This was not a revolutionary situation. This was a bunch of people in great distress wanting help.... These were simply veterans from World War I who were out of luck, out of money, and wanted to get their bonus -- and they needed the money at that moment."
At first, it seemed as though order might be maintained. Walters, organizing the various encampments along military lines, announced that there would be "no panhandling, no drinking, no radicalism," and that the marchers were simply "going to stay until the veterans' bill is passed." The government also did its part, as Washington Police Superintendent Pelham D. Glassford treated his fellow veterans with considerable respect and care. But by the end of June, the movement had swelled to more than 20,000 tired, hungry and frustrated men. Conflict was inevitable.
The marchers were encouraged when the House of Representatives passed the Patman veterans bill on June 15, despite President Hoover's vow to veto it. But on June 17 the bill was defeated in the Senate, and tempers began to flare on both sides. On July 21, with the Army preparing to step in at any moment, Glassford was ordered to begin evacuating several buildings on Pennsylvania Avenue, using force if necessary. A week later, on the steamy morning of July 28, several Marchers rushed Glassford's police and began throwing bricks. President Hoover ordered the Secretary of War to "surround the affected area and clear it without delay."
Conspicuously led by MacArthur, Army troops (including Major George S. Patton, Jr.) formed infantry cordons and began pushing the veterans out, destroying their makeshift camps as they went. Although no weapons were fired, cavalry advanced with swords drawn, and some blood was shed. By nightfall, hundreds had been injured by gas (including a baby who died), bricks, clubs, bayonets, and sabers.
Next came the most controversial moment in the whole affair -- a moment that directly involved General MacArthur. Secretary of War Hurley twice sent orders to MacArthur indicating that the President, worried that the government reaction might look overly harsh, did not wish the Army to pursue the Bonus Marchers across the bridge into their main encampment on the other side of the Anacostia River. But MacArthur, according to his aide Dwight Eisenhower, "said he was too busy," did not want to be "bothered by people coming down and pretending to bring orders," and sent his men across the bridge anyway, after pausing several hours to allow as many people as possible to evacuate. A fire soon erupted in the camp. While it's not clear which side started the blaze, the sight of the great fire became the signature image of the greatest unrest our nation's capital has ever known.
Although many Americans applauded the government's action as an unfortunate but necessary move to maintain law and order, most of the press was less sympathetic. "Flames rose high over the desolate Anacostia flats at midnight tonight," read the first sentence of the "New York Times" account, "and a pitiful stream of refugee veterans of the World War walked out of their home of the past two months, going they knew not where."
Hard economic times always incur a certain amount of social dislocation and consequently create opportunities for politically extreme movements. The global economic event that began in 1929, known as the Great Depression, allowed radical movements of the Left and Right to make headway in Europe during the 1930's. As one of the major industrial powers and one of the hardest hit by the Great Depression, radical groups like these could have posed a serious challenge to public order in the United States. There were many instances of labor unrest and strikes that turned violent, incidents that prompted temporary mobilizations of state National Guards. There were also instances where regular Army troops were called out in aid of the civil power.
The last of the Bonus Army Marchers left Washington. Hoover could not publicly disagree with his Chief of Staff and Secretary of War, and ended up paying the political cost of this incident. The possibility of widespread civil unrest growing into a popular revolution had been averted, but the forceful eviction of the Bonus Army Marchers, even though not one shot had been fired and only four people killed (the two demonstrators who had been shot by the police and two infants asphyxiated by tear gas), tilted public opinion against Hoover and ensured that he would lose the upcoming election. Franklin Roosevelt was elected by a landslide that November, the rest is history.
In 1934 and 1936 drought and dust storms ravaged the great American plains and added to the New Deal's relief burden.
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