History of the United States II / Unit 11 USH2 1548 worked example, 60 to 90 seconds
The Roosevelt Recession
The idea
By nineteen thirty-seven production, wages and profits had returned to their levels of nineteen twenty-nine, the anchor says, and unemployment had fallen from twenty-five percent to fourteen. Reassured, Roosevelt cut government spending, and the economy fell back. The anchor records two million Americans newly out of work, unemployment up five points and industrial production down by a third.
In practice
Digital History's figures for the same months: industrial production down forty percent, unemployment up four million, stock prices down forty-eight percent.
Where people slip
The two sources measure the fall differently, and both are stated. What followed is the test case for the whole New Deal. Several advisers, among them Harry Hopkins and Henry Wallace, urged Keynes's argument that deficit spending was needed to maintain employment, and in the spring of nineteen thirty-eight Roosevelt asked Congress for more emergency relief spending. The Yawp judges that it was perhaps too late.
Your place on the trail
Every lesson rests on earlier ones and opens later ones. Tap any to jump.
Something wrong in this lesson? Flag it · Sources for History of the United States II