In What Ways Did The Wall Street Crash Affec t Life In The U.S.A From 1929-1932?

In What Ways Did The Wall Street Crash Affect Life In The U.S.A From 1929-1932?

The Wall Street crash affected America in numerous ways; Businesses’ went bust, people lost their jobs, their homes and their lives. These normal people trying to live the American dream were left with nothing. There was a banking crisis, the banks had lost clients savings on the stock market, which left some very unhappy customers. Even farmers were affected, they also lost money so they moved into the city but this didn’t help one bit. No one seemed to know what to do not even the government, they tried but they had little effect on the suffering of the people, this led to people losing faith in the government and therefore in 1932 voting for Franklin Roosevelt and his “New Deal”.

Unemployment was probably the main affect of the crash. This was due to companies going bust, their shares became worthless so they had to cut costs and unfortunately this meant sacking workers, around 20,000 companies went bust. It was a vicious cycle people had no money because they had no jobs therefore they couldn’t buy any goods so the companies had to cut costs (sack workers). During this period unemployment skyrocketed and rose to whole new levels. In 1923 24.9% of Americans were unemployed; this doesn’t seem a lot however a country over 10% is deemed to be in trouble almost 25% is catastrophic.

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These people had little hope; they weren’t able to keep up payments up on their mortgages so lost their houses they started to feel the consequences of gambling on the stock market, they were left with debts to stockbrokers where they had bought on the margin. They had little hope, as the government was Republican therefore it didn’t believe in benefits, so the families had to live on hand outs from charities such as “Holy Name mission”. The unemployed joined the infamous “bread lines”; they would queue for hours upon hours among 10,000 men to receive a piece of bread and a cup of “Hoover stew” (because they blamed him for because little was done), sometimes they wouldn’t even eat it, they would take it home to their starving families and they would go without. This was when there was food from charities; when it ran out men had to look to other sources for food. Some even went to rubbish tips and spent hours looking for scraps of meat and leftover food; in some cases men would fight over barrels of rubbish.

Herbert Hoover’s idea of “rugged individualism” people should work hard, Hoover thought that Americans thrived in tough times, he thought that America’s economy would recover with no help from the government but he was wrong that is why little was done, he was a victim to his own beliefs.

These people were victims, they didn’t have anything left not even enough money for a home so they migrated to small shanty like towns named “Hoovervilles”, they took their name from the growingly unpopular president Herbert Hoover. Hoovervilles were on the edge of cities all over the U.S.A, growing larger and larger every day as the amount of homeless people grew. Whilst others took the route of becoming a Hobo, they would roam the cities sneaking on to trains looking for food.

However it wasn’t just city people who suffered farmers also were affected, farmers didn’t want to lose their homes and land so they worked harder and harder every day producing more and more goods, however this led to overproduction, they had all these crops with no one to sell them to, because there was so many goods in the agriculture industry the prices were forced down. So around 1 in every 20 Farmers lost their land due to failure to keep up mortgage repayments/rent and moved to the cities such as California to find work however when they arrived they discovered it was just as bad.

Another effect of the Wall Street Crash was the closing down of banks; this had a large effect on the U.S economy and confidence in the government. Leading up to the crash the banks had lent out and invested huge sums of money; the banks lost a lot of their investments in the stock market just like everyone else however this lead to the banks customers from losing all their savings, so they had no income and no savings. The other reason why banks went bankrupt was that they couldn’t retrieve any of the money that they had lent out. The banks’ customers had borrowed huge amounts of money for their mortgages however after the crash they couldn’t pay the money back. As a result of this over 5000 banks closed down between 1929 and 1932.

For all the above reasons the American people lost faith in their government, they were sick of it, they wanted the government to do more to help them not just sit back and hope that the economy will recover. However some couldn’t take it anymore and in1932 23,000 people committed suicide that is the highest ever yearly figure in American history this fact really shows how bad it got for some families. However others went down another route; some expressed their dissatisfaction in the government by protesting. One of the most famous groups were the “Bonus Army”, they were a group of struggling World War 1 veterans who were seeking their promised government pension early because they were hit hard by the depression. They then marched on Washington and set up a “Hooverville”. However the government wasn’t going to sit back and let it happen, they responded with force in the form of an army armed with gas as a result leaving 2 dead and 1000 injured.

This was the last straw, finally when the next election came around the American people made their voices heard, by an overwhelming majority they voted in a new Democratic government under the lead of Franklin Delano Roosevelt (FDR) who promised to do more for the country and lead America out of the tough times, he promised them a “new deal” only time would tell if he would deliver.

Tom Gavin History coursework 13/08/2010 page