The Transformations of the 1930s
From the stock market crash to the bombing of Pearl Harbor, through the Great Depression and years of ongoing positive changes, the 1930s in the U.S. transformed the country quickly. This decade is one of the most dynamic time periods of the twentieth century. President Henry Hoover chose the “hands-off” policy despite the obvious crisis while newly elected Franklin Delano Roosevelt put as many reforms into action as was possible politically and economically.
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The collapse of the financial system in the U.S. in 1929 and several economically unstable years which followed it were not surprising. During the 1920s, wealth was distributed rather unequally among the citizens. At the same time, the consequences of the First World War had their effect on the international political and economic situation (Onion et al. para. 3). The government did not provide any “safety nets” for the unemployed people and businesses that were no longer profitable, as well as regulations for the banks to survive through the recession.
The economy entered a stagnation phase as people stopped spending their money. At the same time, President Hoover did not do anything radical to change the situation (Onion et al. para.6). He tried to convince the state governments to support local businesses and the union workers to stop striking. In a way, that could be an effective strategy since the economy needs money investments and spending in order to exit the recession. Still, for people and businesses used to the prosperity of the 1920s, more government guidance was necessary.
By the time of the presidential elections in 1932, the American people were ready for a president of the action, and the New York governor Franklin Delano Roosevelt was the right candidate to take this place. He proposed a New Deal, a strategy that would change everything (Onion et al. para.8). The paradox of the economic crisis is the following: to help the country overcome a crisis, a good leader has to convince the citizens that the recession is already under control. This way, people started trusting banks, investing, and pouring money into the state and federal financial systems. President Roosevelt was convincing enough in his program that the citizens followed, and that made the Great Depression not as harmful as it could have been.
Unlike Henry Hoover, president Roosevelt started actively passing new laws as soon as he was elected. The Agricultural Adjustment Act, the Glass-Steagall Banking Bill, the Home-Owners’ Loan Act, and other changes convinced the U.S. citizens that their new leader was a man of action (Onion et al. para 9). People did not have any savings but believed in their president enough to go to the movie theaters, attend dance parties, and buy new products, all of which supported the American economy at those challenging times (Onion et al. para 10). However, that was not enough to end the Great Depression, so president Roosevelt proposed more changes.
The Second New Deal
The next set of reforms brought more organizations and regulations that the country needed. The Works Progress Administration provided workplaces for unemployed people, the Wagner act made labor unions more organized, and the Social Security Act of 1935 regulated the financial side or retirement (Onion et al. para. 11). These reforms helped president Roosevelt to win the elections of 1936. Unfortunately, they still could not end the Great Depression, and eventually, Roosevelt’s opposition made it difficult for the administration to pass new laws and regulations.
By the end of the 1930s, the Second World War was about to begin, and the U.S. could not focus mainly on internal issues any longer. In 1941, the Japanese bombed Pearl Harbor, which stimulated American mobilization and production processes (Onion et al. para. 13). That Great Depression was over; however, it did not mean prosperity – the country has entered the war.
Connection to the Present
Economic crisis and recession are not new concepts in world history. They happened before and after the American Great Depression. The World Financial Crisis of 2007-2008 shows similar problems and traits to the events of the 1930s (Subbarao 5). Governments also had to resolve the issues of unemployment and people’s mistrust. Perhaps learning from Roosevelt’s administration, the world leaders publicly showed that they performed as many actions as possible to resolve the situation.
President Franklin Roosevelt was a popular figure, partly because his strategy of promising people changes worked. Modern politicians rely on similar behavior lines during debates or speeches. However, people’s trust in political promises is no longer as strong as it was in Roosevelt’s time. That may be why modern politicians go too far in their talks, trying to impress the public and not delivering all the actions afterward.
The Social Security system came as a relief in 1930 as the citizens were less nervous about their retirement finances. Unfortunately, today, when the generation of Baby Boomers is retiring, and the workforce is not as productive as needed. The U.S. government has to consider different options to avoid the new crisis.
The 1930s were a decade of great dynamic changes with the Great Depression, President Roosevelt’s reforms, and social development. History repeats itself, but the situations, technological progress, and social development always change. People can learn from the lessons of the past and adjust this knowledge before applying it to current events.
Onion, Amanda, et al. “The 1930s.” History, 2020. Web.
Subbarao, Duvvuri. “Post-crises Issues in Financial Sector Regulation.” S. Rajaratnam School of International Studies, 2020. Web.