The Great Depression had a varied impact on the American people’s lives, and I will explore these. It lasted throughout the 1930’s.
Between 1929 and 1932 5000 banks went bust, while the value of America’s foreign trade dropped from $9 billion to $3 billion. By 1932 unemployment had risen to at least 12 million. The Great Depression took America at unawares. America’s self-perpetuating image of prosperity and hedonism rose to unprecedented heights, but it is well known that the higher you climb, the harder you fall.
The look of prosperity had hardly finished waxing in the boom of the 1920’s, before it was ruthlessly cut short by an unprecedented eclipse. This did catch almost all off guard- those with investments in banks lost all, and those with nothing to invest lost their jobs. From 1928, to 1933, industrial production fell by forty per cent, while average salaries decreased by sixty per cent. This cut down in production led to workers being laid off, so these people bought less.
By 1932 there were about 14 million unemployed, while 5000 banks had gone bust, and America was in the grip of the most serious economic depression the world had ever seen.Of the extremely few to come out unscathed from the depression were the large land owners- the extremely wealthy. This is for the simple fact that as businesses went bust and unemployment rose, as less money was spent and the cycle repeated itself, millions of dollars were lost in the form of share-value, and banks that supported these businesses crumbled under the pressure. The rush to withdraw money from banks helped them to bankruptcy even quicker, so in the end the only group with any assets of value remaining were the landowners, since the investors had gambled and lost.
The very wealthy in turn, by holding so much of the wealth to themselves helped to widen the gap between wealth and poverty. The only effect would have been that they may have lost some of their investments, of which they would both have had relatively few and probably of these few, the companies concern would have been hit less badly than most. This is because these people would have trusted their money to ‘blue chip companies’, or the more steady ones, which could be relied on.This did not necessarily mean that their share prices shot up, and so in general the hefty amount of speculators looking to make a speedy profit would let these ‘blue chip companies’ pass.
Of the few aristocracy around at the time, they managed to avoid most of the pit-falls that were synonymous with the great depression. This group of well-off individuals also tended to have mansions, large tracts of land, and other possessions, which meant that they too were able to remain mostly unaffected by the depression.Thus the aristocracy did have assets in which to fall back on when in debt, and could pay off lost money invested in the stock exchange. However, the upper middle class who in many cases had sizeable investments in firms and had only a little to support them.
When overproduction struck their firm and share prices plummeted, so did these people literally. A popular joke at the time was: Did you hear about the man that checked into a hotel and asked for a room? The receptionist asked whether it was for sleeping or jumping.This sums up part of the feeling amongst the upper-middle class at the time. Many had spent all their working careers trying to make a success of their business, only to see it crumble before their eyes.
Of the white middle class, they were most probably worst affected of anyone. Life savings were wiped out in a flash when banks went down, and the white middle class would have been the bulk of their investors. Debt would drive many to the brink, and strand them there. Of course the white middle class were the ones who speculated.
They gambled on the stock market and lost all. The reason that they were hit the worst was because they tended to place all their eggs in the speculating basket, and was left with absolutely nothing during the depression. All the white working class had to lose from the depression was their jobs- so that is what happened. Not being able to even afford investments in the stock market, the poor simply became poorer still.
As large factories and industries slowed production and ground to a halt, so were workers’ wages cut, then they were fired.Those lucky enough to keep their jobs got paid hardly enough to keep them alive, so as to turn up for work the next day. Of the millions cut loose, homelessness and hunger became synonymous. One housewife remarked, “I forget how to cook good since I have nothing to cook with”, as people literally starved.
People would flock round garbage dumps, immediately scavenging any scraps brought in by the daily garbage removers. They built shacks where they could find unoccupied land. These communities were symbols of the Depression and were known as Hoovervilles (after President Hoover).In many cases it was the lucky ones, which found Hoovervilles, others huddled together on doorways and in street corners, begging for money from the better off.
Breadlines and soup kitchens came about, for the purpose of feeding the mass of unemployed. However, hours of waiting would usually produce a bowl of mush, often without milk or sugar, and a tin cup of coffee. Here, what Will Rogers, an American writer in 1931 captures the absurdity of the Depression, which everyone must have felt: There is not an unemployed man in this country that hasn’t contributed to the wealth of every millionaire in America.The working classes didn’t bring this [the Depression] on- it was the big boys.
.. We’ve got more wheat, more corn, more food, more cotton, more money in the banks, more everything in the world that any nation that lived ever had, yet we are starving to death. We are the fires nation in the history of the world that has been going to the poor house in an automobile.
By 1932 farm prices had fallen so low that the cost of transporting animals to market was higher than the price of the animals themselves.Overproduction had plummeted produce value previously, and the farmers by now definitely had drawn the short straw. Total farm income had slipped to just $5 billion per year. America’s international trade had also been drastically reduced, falling from $10 billion in 1929 to $3 billion in 1932.
Between 1920 and 1932 the total income of farmers had dropped by about 70%, and wheat prices by 75%. Farmers suffered more than most in the Depression. Often families who had farmed their land for generations were forced to sell up – if they could find anyone to buy their land.Millions of farm workers drifted into the big cities, searching for work that was not there.
The people in agricultural areas were hit so hardly when the Depression came along just because the 1920’s had not been kind to them before, as they had not shared in the general prosperity. Now things were getting worse. This double blow of the Depression meant that people could not afford to buy their produce, or if they could, it was at rock-bottom prices. Many farmers were ruined; they could not afford to pay for their mortgages and many were evicted from farms.
They became desperate and angry, and some banded together and used guns to drive away the men who came to evict them. They paraded round the streets of their local towns waving placards with slogans like ‘In Hover we trusted, now we are busted’. However threats of violence were not confined to farmers alone. In the spring of 1932 thousands of First World War veterans descended on Washington, set up camp and demanded bonus payments to help them deal with being out of work.
They claimed that they had done their bit for their country, and now it was time for their country to help out them.The protest did not have a have happy ending. They were forced away with tear gas by armed troops, while their shacks were burned, and whispers of a revolution could be heard. Recent immigrants had a tough time in terms of being relatively new to America, moving so as to start another life- a better life, and finding all their hopes immediately ruined.
In 1929, six hundred and fifty nine banks failed. For example, as banks failed people stopped trusting them and withdrew their savings. In 1930 another 1352 went bankrupt. The largest of these was the Bank of the United States in New York.
It held 400,000 depositors savings- many of them recent immigrants. To have this disaster fall upon you soon after arriving in America- ‘the land of prosperity’- would surely have been a harsh blow, even to the extent of forcing these new arrivals either to leave again or beg on the streets, as there was no unemployment benefit available. Two groups of Americans that were never prosperous to start with were the Blacks and the Hispanics. Widely spread racism meant that these two groups usually ended up with the hard, dirty physical labour.
With low wages and thus little money already, what happened to the blacks and the Hispanics was that they were the first to lose their jobs. If a prejudice employer had to make the cut, the chances were that it would be any blacks working for them that went first. The Ku Klux Klan spread their principles of racial inferiority, and so the Hispanics were generally valued little as people, while blacks were seen simply as paid slaves. Although they had little to lose in the first place, most found themselves going hungry, jobless and homeless before the Depression was in mid swing.
Grown men worked for 5 cents an hour in sawmills, Negroes learned the cruel truth of the saying that they were, “the last to be hired and the first to be fired”. An idea of the living conditions for the badly hit is “The cold was bitter in unheated tenements, in the flophouses smelling of sweat, in the parks, the empty freight cars, along the windy waterfronts. With no money left for rent, unemployed men and their families began to build shacks where they could find land that was not already occupied. “In 1930 the American Communist Party organised unemployment marches throughout the country.
The biggest of these was held in Union Square in New York on March 6. As people began to leave at the end of the rally, some of the leaders called on the demonstrators to March to the city Hall. The police had forbidden this. On hearing the leaders call the police charged the demonstrators.
Many people were injured. The elderly had nothing to live on during the Depression, since there was no pension scheme provided by the government.They were left to fend for themselves. Children were in the same boat – one in five children were malnourished in 1932 – many struggled to find food at all.
So during the Great Depression in America, there was much unrest. Almost no one had it easy at anytime, while the worse affected were constantly faced with starvation. For all Americans it must have been a strange time. Since so much of the wealth surrounding the 1920’s had been destroyed, it was a long, hard road back up the mountain of prosperity for everyone.