The Great Depression: The New Deal (1929-1939)

The Great Depression (1929-1939) was the biggest blow to American citizens to date. It shattered the lives of hundreds of thousands of unsuspecting families. No one truly saw it coming, and efforts to try to avoid the onslaught were taken after the tidal wave of economic disparity had already begun rolling. While measures were taken to attempt to fix the damage, few actually worked. The Great Depression was an unfortunate series of events beginning with the stock market crash of 1929 followed by bank failures and efforts taken by both Presidents Hoover and Roosevelt to try and stitch the nation’s economy back together. During the 1920s post World War I era, The United States economy underwent rapid expansion as Americans returned from war.

Roosevelt (FDR) was elected president in 1934 when he beat out Herbert Hoover for the presidency. Unlike his predecessor, FDR’s legislative program, the New Deal, largely increased the role of the federal government in America. His “First Hundred Days” were more productive than Hoover’s entire presidency. He issued an enormous variety of executive orders -known as the New Deal- that furthered the recovery of the nation. FDR’s huge legislation is referred to as the “alphabet soup”. He also declared a “bank holiday” to help prevent runs on banks and allow them to stabilize.. Although, the New Deal targeted certain sectors of the economy (agriculture, relief, manufacturing, financial reforms, etc.), it did not lead to total economic recovery for there was no continual macroeconomic theory. Even though the economy rapidly improved from 1933 to 1937, it sank into another recession in that last year. Following the recession, FDR adopted Keynes’s General Theory (developed by Maynard Keynes). He imposed his idea of expanded deficit spending. In 1938, The Treasury Department’s programs (public housing, slum clearance, railroad construction, and other massive public works) were pushed aside by the immense public spending initiatives for World War II (WWII). The economy was fully revived by the war-related export demands and increased government spending derived for