Both the Great Depression and World War II heavily impacted the US economy in the first half of the previous century. The effects of war and the mentioned economic collapse were severely felt during the pre-and post-war periods emphasizing the country’s vulnerability on the global stage. The present paper will touch upon the major changes in world economics and politics that led to the occurrence of these two historical events.
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Longrigg (2017) indicates that the Great Depression was caused by the combination of worldwide and domestic conditions that later forced the United States to face the most remarkable financial crisis in history. This crisis, however, had then echoed in the rise of extremism in Germany, which, in the end, led to World War II.
The Great Depression
Among the reasons for the depression in America in the 1930s, the five factors are considered to have the greatest impact. To their number Longrigg (2017) relates bank failures, crash on the stock market in 1929, reduced purchases, drought, and American economic policy with Europe. After the crash on the stock market in October 1929, stockholders lost above $40 billion (Longrigg, 2017). It was the time when more than 9,000 banks across the country failed, resulting in the entire loss of savings for depositors. The occurring situation had forced people to stop purchasing items, which, in turn, led to the full stop of production and the reduction of the workforce.
Increased taxation for imports had affected the trade relationships between the USA and Europe. The emerging drought was of such proportion that many residents could not even pay taxes. Such an intense economic situation lasted from 1929 to 1939 (Longrigg, 2017). Throughout the entire ten-year period, Wall Street remained in a state of panic. All these factors put together to make the Great Depression much worse compared to any other economic collapse. If one draws a parallel between events in the 1930s and in 2008, the recent crisis arrives as much less severe, for the central banks worldwide put maximum effort to alleviate the impact.
World War II
The outcomes of the Great Depression are known to be tremendous and affect the world’s political and economic arena. Geiger (2017) finds interrelations between the events in the United States and the rise of extremists in Germany in the 1930s. The collapse in America convinced Europeans that an authoritarian regime is the only means to prevent the expansion of economic crisis. Nevertheless, the impact of the American depression on the minds of European society was secondary. The origins of the radical public attitude were primarily attributed to the Treaty of Versailles established in June 1919 (Geiger, 2017).
German people found the terms of the treaty to be unsustainable. Food prices went extremely high within the country; citizens openly expressed their discontent with the occurring state of events. Everyone who promised to resolve the situation was treated with credence and general respect. It was the time when Adolf Hitler gained nationwide support.
The reasons for the Great Depression in the United States in the 1930s find their origins in the crash on the stock market in 1929 and its consequences. The research provides sufficient evidence as to how the events in the USA affected the political and economic situation in Europe. Combined with the Treaty of Versailles, the given economic collapse had formed a background for the extremism and authoritarian regime to emerge in Germany.
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Geiger, R. L. (2017). Research and relevant knowledge: American research universities since World War II. New York, NY: Routledge.
Longrigg, S. (2017). The Great Depression. New York, NY: Routledge.