History of the United States II / Unit 10 USH2 1397 review, 2 to 3 minutes
What Caused the Depression
The idea
What caused the Great Depression is among the most contested questions in this course, and the sources give several answers rather than one. The anchor leads with speculation and panic: buying on margin, a market that had risen tenfold, and the collapse of October nineteen twenty-nine. Its own chapter also supplies distribution, with a tiny share of Americans holding over a third of the wealth, and savings, with eighty percent of families having almost none. The Yawp calls the Depression the confluence of many problems: overproduction and declining consumption, a construction bubble, the Smoot-Hawley tariff that it says exacerbated the world's collapse, speculative bubbles, and finally panic. Digital History adds that industrial production rose thirty percent in the decade while wages stagnated, and that most families earned less than they needed for necessities.
In practice
A single crash surrounded by its causes: margin loans, idle factories, a tariff wall, empty savings accounts and failing banks.
Where people slip
Two misreadings sit on either side. The first blames the crash alone, which cannot explain why a fall in shares owned by one household in ten became a decade of unemployment. The second dismisses the crash, which cannot explain the timing, or the bank failures and panic it triggered. The sources point to a structure and a trigger: an economy whose growth had outrun its workers' incomes, whose banks were exposed, and whose trade was walled off, set off by the collapse of speculation. The Yawp adds a caution: the business presidents' policies widened the gap between rich and poor, but they were widely popular and widely credited with the boom. Name all the causes, as the anchor's own sections do, and weigh them.
Your place on the trail
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Builds on
Unlocks
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