The Factors Of The End Of The Great Depression

The Great Depression had devastating effects on the country, spreading throughout the country and causing hardship in small and large cities. There were no economic classes, social or racial. 1933 was the depths of the depression. 13 million people had lost their jobs, 50% of banks were foreclosed on them, the national income plummeted by 42%, and a million people were homeless. This terrible crisis was ended by what? This is what a radio talk host regularly says: “Franklin Delano Roosevelt’s New Deal failed to bring an end of the Great Depression. Only the Second World War was able to lift us from the depression. The depression could not have continued without the Second World War. The New Deal failed to realize its potential. It did nothing to help people get back to work. This statement is not true. I want to refute it by saying that the New Deal wasn’t an abject failure. The Great Depression was not ended by World War Two. Massive spending was the main reason for the Great Depression’s end.

Is the New Deal a complete failure? Franklin D. Roosevelt created the New Deal to tackle the Great Depression. Many agencies were created under the New Deal to aid the people and economy. To help the economy, industries, and labor, the National Recovery Administration and Public Works Administration was created. The Civilian Conservation Corps was created by the Unemployment Relief Act. It employs many young men in uniform to perform public works like firefighting or reforestation. Overproduction of crops was also solved by the Agriculture Adjustment Act. The Tennessee Valley Authority was formed to help rebuild a large region that was severely impoverished. Although it provided jobs for the unemployed, and supplied electricity at a low cost to an area, this agency was widely criticized. In 1935-1936, the New Deal was more focused on reform. New Deal measures during this period included Social Security Act and National Housing Act which established the Federal Housing Administration. Also, Works Progress Administration was created. WPA employed an average 2,100,000 workers each year, which included artists, writers, and who built or upgraded schools, hospitals and airports by the tens in thousands. The New Deal is a failure because of all the agencies that created jobs and helped people in their millions. Roosevelt’s suicide in the war’s final year prevented Roosevelt from launching the New Deal revival. However it was so well-received that even President Harry Truman was part of most of its new reforms. Truman delivered major speeches about the New Deal over the following months. He also supported the creation of a national housing program and a national healthcare program. Even though he was no longer living, Lyndon B Johnson made the declaration of war against poverty. It was based upon Roosevelt’s New Deal. His achievements included Medicare for the Old, education assistance for the Young, tax reductions for business, a higher min wage, food for hungry, housing for homeless, poverty grants and other benefits. Roosevelt brought hope back to Americans who had been plunged into despair by an almost endless depression. This is why people loved Franklin D. Roosevelt. Higgs once stated that conflict is sometimes necessary but that wartime expenditures are destructive of resources and life. If depression is characterized by a substantial drop in living standards, the Great Depression could not have ended during World War II. The fact that production was diverted to war purposes and away from civilian use makes wartime prosperity an illusion. A military draft that allowed 12 million men to work below the market wage also resulted in low unemployment, but at the expense of their lives. Higgs also claimed that war was a period capital accumulation and not capital consumption. The military only uses of tanks, bombs, or helicopters are limited. It was impossible to use the labor used to make them; people ended up without any consumer goods. The world’s bottom oceans saw warships as a loss of opportunity. The Depression lasted only until the end of the war.

What brought down the Great Depression was massive Federal spending. World War Two was a significant event. The Federal government was more motivated to spend huge sums of dollars because of this event. In 1937, the economic recovery appeared to be complete. This gave policymakers every reason for believing that the economy was strong enough not to continue spending. After the federal debt grew to 40% of GDP in 1936, Republicans and members within his own party demanded that the federal budget be balanced. In an attempt to balance it, President Franklin D. Roosevelt enacted income taxes increases and a reduction in federal spending. Between 1936 and 1937, income tax revenue increased by 66%. I believe that The Great Depression wouldn’t have happened if the government spent the same amount of money as before. The Great Depression was not ended by World War Two, nor should it be used to solve an economic crisis. The truth is that the total amount spent by Americans on war bonds during World War II was 180 dollars. Forced savings were used to purchase war bonds. If war hadn’t begun, Americans would have been able to spend that money elsewhere, such as on appliances, automobiles, and other necessities. This amount of private spending would have been enough to end the Depression.