Great Depression

Definition

The Great Depression was a severe worldwide economic downturn that began in 1929 and lasted through most of the 1930s, characterized by widespread unemployment, plummeting industrial production, and a dramatic fall in consumer spending. This economic crisis significantly influenced global politics and society, fostering an environment where militarism and ultranationalism began to rise as countries sought to address the hardships faced by their populations.

5 Must Know Facts For Your Next Test

1. The Great Depression led to the unemployment rate soaring above 25% in the United States, causing immense social strain and hardship for many families.
2. Countries like Japan responded to economic distress by turning towards militarism, believing that military expansion could provide jobs and boost national pride.
3. The economic turmoil contributed to the rise of extremist political movements in various nations, including fascism in Europe and militaristic regimes in Asia.
4. In Japan, the military gained significant influence over government policy during this period, advocating for aggressive expansionism as a solution to domestic economic problems.
5. The Great Depression triggered a global reevaluation of economic policies, with many nations moving away from laissez-faire approaches toward more government intervention in the economy.

Review Questions

• How did the Great Depression influence the political climate in countries like Japan during the 1930s?
  • The Great Depression created significant economic hardships in Japan, leading to a surge in unemployment and social discontent. In response, many citizens turned to militaristic ideologies, believing that military expansion could resolve economic issues by providing jobs and resources. This shift resulted in increased power for the military within Japanese politics, as they advocated for aggressive foreign policies that promised national rejuvenation through conquest.
• Analyze how the Great Depression affected international relations during the 1930s.
  • The Great Depression severely disrupted international trade and economic cooperation, leading countries to adopt more isolationist policies. As nations struggled to protect their economies, tensions rose between countries seeking resources and markets. This environment fostered aggressive nationalism and militarism, as seen in Japan's expansion into Manchuria and Italy's invasion of Ethiopia, contributing to an unstable geopolitical landscape that set the stage for World War II.
• Evaluate the long-term impacts of the Great Depression on global economic policies and governance.
  • The Great Depression prompted a fundamental shift in global economic policies, as many countries moved away from traditional laissez-faire approaches toward more active government intervention. This included initiatives like Franklin D. Roosevelt's New Deal in the United States, which set a precedent for future welfare states. Additionally, the crisis highlighted the need for international financial cooperation and regulation, influencing institutions like the International Monetary Fund (IMF) and World Bank established after World War II to promote stability and prevent future crises.

Related terms

Stock Market Crash of 1929: A catastrophic collapse of stock prices in the United States that marked the beginning of the Great Depression, leading to widespread financial instability and loss of wealth.

New Deal: A series of programs and policies implemented by U.S. President Franklin D. Roosevelt aimed at providing relief, recovery, and reform to combat the effects of the Great Depression.

Hyperinflation: An extremely high and typically accelerating inflation rate that can erode the value of currency, contributing to economic instability and distress during crises like the Great Depression.