The Great Depression In America In The 1930's

The Great Depression started in the United States with the collapse of the New York stock exchange in 1929 and quickly spread around the developed world in what came to be known as the worst economic downfall in the history of humankind. With the crash of the stock market came uncertainty regarding investments and consumerism came to a halt. Outdated world policies such as the gold standard drove the economy further from the boom experienced in the roaring twenties, and overprotective economic views propelled the developed world economy into depression. Looking back gives the distinct advantage to see where world leaders went wrong and allows us to learn from society’s past mistakes.

The gold standard was the international method of determining

When the conservatives entered office in 1930, they immediately instituted an array of public work programs in order to stimulate the economy and bring jobs to areas of the country which had been most devastated by the Depression. In fact, between 1929 and 1932, federal government expenditures rose by $132 million, working in a counter-cyclical fashion inline with the Keynesianism ideologies which would take the economic world by storm a decade later. Unfortunately, as expenditure increased, Dominion revenues decreased by $140 million, discouraging the continuation of Bennett’s public work programs and undoing any progress the programs had made (Norrie 328). As the government moved efforts from spending money to saving money, public work expenditures were halted and construction was postponed, forcing the loss of jobs by the thousands and ending any hope of Keynesian methods being

When examining situations like these it is important to realize that every decision made was made in hope that it would bring an end to the suffering, however, using the economic knowledge and theory we now know, it is easy to see where mistakes were made and how those events could have been handled better. It was a brave decision for Canada to discard the outdated system of the gold standard before other world leaders, but perhaps if Canada had more autonomy regarding exchange rate flexibility the Depression would have looked marginally brighter. The tariffs implemented by the Bennett government were clearly not the policy reforms needed at the time and only sent Canada’s export based economy further into the Depression. Open trade deals enacted with the Commonwealth countries were a wise choice and kick started the end of the Depression. Perhaps Dominion expenditure could have been increased or held in place for longer so that Keynesian theory could take hold. Regardless, the most important aspect of the Depression is to make sure we understand what worked and what did not so that it may never happen