By Brendan Foley, Matthew Yao, and Aakansha Jain
Business Production from 1929 to 1932
The 1930's Great Depression was unlike any other recession that America had suffered below. America would have to endure a period marked by the highest and worst unemployment rate. One of the greatest causes of the Great Depression was that prosperity from the boom of the Roaring Twenties was not spread evenly among workers. Thus, farmers, workers of in the coal, railroad, and textile industries were laid off. Industrial production increased by fifty percent, but because laborers could not afford to buy these goods, there was a lot more supply than demand.
Did business failures generally increase or decrease from 1920 to 1932?
- From 1920 to 1922 it rose greatly, but then it dropped in one year and after that it remained slightly rising until 1929. Starting in 1929 and lasting until 1932, the number of business failures climbed to more than triple the total from 1920.
- (A general increase in business failures from 1920 to 1932.)
- 1929's Black Tuesday does not signify the beginning of the Great Depression in the case of business failures. Businesses were shutting down by the thousands even during the roaring twenties. Farmers suffered overproduction and new industries were replacing old ones (ex. the automobile industry replaced the steel industry).
- It can be speculated, however, that the brief declines in business failures was also a result of the roaring twenties. New industries had caught the public's attention and held onto it. These new industries included radios and "talkies" (movies) to automobiles and electric companies.
What year was the depression was the most severe?
Why did businesses fail so badly during this time?
The Difficulties Hoover Faced in Trying to get Reelected
In an attempt to revitalize the economy, Hoover initiated the Smooth-Hawley Tariff which would dramatically raise tariffs. The Bill had actually halted trade with foreign nations to standstill.
Nevertheless, the Hoover Administration, through its efforts such as the RFC did prove for the first time, the U.S. government`s willingness to assume responsibility for rescuing the economy by overt intervention in business affairs.
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