1930’s Eric Schumacher

The Great Depression began right before 1930 and started the decade in a terrible way. Billions of dollars were lost in the stock market crash, and quality of life quickly deteriorated. The 1920’s were a decade of wealth prosperity, but many people bought on credit. This means they didn’t always have enough money to pay for the things they were buying. This was the cause of the depression. The stock market crash was the catalyst, or spark that created a decade of woe and despair.

The 1930’s had a terrible economy and the dollar had less value than it had before. Things that once cost $1 now cost $3. Another thing that happens was the devaluation of the agriculture industry. This means that crops that were grown were worth less than before. The dust bowl was an event involving massive dusts storms that ruined crops, and forced people to give up their family farms and homes.

Overall millions of jobs were lost, and life savings gone. Many people never trusted banks again and remained frugal for the remainder of their lives. This affected the economy long term because millions refrained from buying stocks and putting their money in banks. The farms in the Midwest became broke, and their crops obliterated by the dust storms. They migrated west in hopes of jobs and shelter. Unfortunately, it was bereft of jobs by the time most people arrived. In addition to this, the okies, as they were known by the Californians, were treated terribly.

The difference in wealth between the classes was another reason for the Depression. The rich people had all the money, and everyone else was broke. This meant that the wealth was not shared, and the rich corrupted many in order to become wealthier and force the lower class to lose more money.

Finally, the decrease in foreign trade meant that we no longer had a reliable source of income as a country. This means we didn’t sell goods to other countries, and we spent more of our money buying their products. There is a similar situation today, where America buys everything from China.