Political Consequences of the Great Depression

Political Effects of the Great Depression

• Political effects:

1. Governments were criticized, especially democrats.
2. Many countries turned to dictatorship.
3. Japan, Italy, and later Germany threatened the peace and security of other nations.
4. International tensions rose as global trade collapsed.

Influence on Global Powers

• Influence on powers:

1. US: High unemployment turned voters against President Hoover, leading to his defeat.
2. Germany: The Weimar government struggled, allowing fascism to rise as Hitler promised a strong government and a better life.
3. Italy: Mussolini sought to build a new Roman Empire by expanding power abroad to distract citizens from economic problems.
4. France: The luxury goods market, such as wine, collapsed, leading to unemployment and the rise of fascist influence.
5. Japan: Unable to export silk, Japan turned to aggressive expansionism to seize resources from other countries.

The New Deal

In 1932, Franklin D. Roosevelt (Democrat) became President of the US. The New Deal was a comprehensive plan to provide solutions to the effects of the Great Depression.

Proposed Solutions

• Spend government money to create jobs.
• Rebuild US trade and industry.
• Improve the quality of life for workers and the general public.

• Roosevelt closed fragile banks and provided loans to stable ones.
• He implemented regulations for the stock market.
• He initiated programs to feed the impoverished.
• He created jobs and improved working conditions.
• He helped farmers modernize and rebuild their businesses.

The policy focused on supporting the poor and those without economic power.

Successes

1. Roosevelt restored the confidence of the American people.
2. Increased public participation in government projects.
3. Alphabetical agencies significantly improved schools, roads, and hospitals.
4. The banking system was rescued, effectively stabilizing capitalism.

Failures

1. The Roosevelt Recession occurred.
2. Many created jobs were temporary, leading to recurring unemployment.
3. The government incurred massive debt, leading to criticism that funds were sometimes wasted.

To implement these works, Roosevelt utilized Alphabetical Agencies, named for their various acronyms.

Key Roosevelt Legislation

Wagner Act: Required employers to allow workers to join trade unions.

Social Security Act: Established a system where workers pay special taxes to receive benefits during unemployment or retirement.