The Great Depression and how governments responded

The Great Depression was the worst economic crisis of the 20th century. It is often dated from the U.S. stock market crash of October 1929, but deeper causes included bank failures, farm overproduction and falling prices, heavy debt, war debts and reparations left over from World War I that tied national economies together, and a collapse of international trade made worse by protectionist tariffs such as the U.S. Smoot-Hawley Tariff of 1930. The crisis spread worldwide: U.S. unemployment reached about 25 percent by 1933, and about 6 million Germans were out of work by 1932. Governments responded very differently. In the United States, Franklin D. Roosevelt's New Deal created public works jobs, bank reforms, and social safety nets like Social Security. In Germany, the despair helped Hitler's Nazi Party win power in 1933, and the Nazis cut unemployment through public works and rearmament while destroying democracy. The Soviet Union, largely cut off from world markets, pressed on with Stalin's Five-Year Plans. In several countries, the Depression strengthened extremist movements and helped set the stage for World War II.

This explanation is AI-generated and can occasionally be wrong. 🚩 Report