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If the Dust Bowl and those it deprived of a living and a home was a national tragedy of catastrophic proportions, it was only the most recent of many. Before the start of the dirty thirties, the country had already plummetted into economic depression like a sky diver wearing weights.
.....Since the late 1870s, the US had been riding a wave of prosperity. The discovery and development of its vast mineral deposits, the exploitation of its fossil fuel resources, its rolling farm lands and expansive forests all contributed to to the national wealth. In the same period, manufacturing output increased dramatically as did iron and steel output (always one of the best measures of economic health.) In the wake of the First World War, with prosperity running at an unprecedented level, when even the poorest had a dime in their pockets to buy a beer and a sandwich, optimism was the order of the day. For many, it seemed that maybe the American Dream had become the American Reality. From the mid-1920s the US stock market went thruough rapid and dramatic expansion. Industry was booming and fortunes were to be made by the cunning and careful investor. Why even Joe Anybody could make a little nest egg with some judicious investments in stocks and shares.
.....The stock market peaked in August 1929 and then, in a dramatic reversal, share prices started to decline. The market fell consistantly throughout September and early October. On 18th October, the decline increased. Investors, large and small, watched with growing concern as they saw their investments shrinking away. On Thursday, 24th October, the concern turned to panic as they tried to save what they could by selling and selling fast. On that day nearly 13 million shares were traded, a record that would soon be broken. Although a number of major banks and investment companies stepped in to buy large blocks of shares and thus stem the panic, there was more of the same only four days later. The panic began again on Black Monday, 28th October. On even Blacker Tuesday, over 16 million shares were traded and the stock market collapsed completely. It was the start of the longest and worst depression the western world had ever witnessed.
.....As well as ruining many thousands of individual investors, the collapse of the stock market put severe strain on banks and investment houses. Within two years almost half of America’s banks had gone into insolvency. Many of them taking their customers’ money with them. The failure of so many banks fed the increasing lack of confidence in the country’s economy. This, in turn, led to much reduced consumer spending, Less consumer spending means less demand for mnaufatcured products. And suddenly we are in a downward spiral. The dramatic fall in consumer demand produced a dramatic rise in unemployment as workers were laid off. By 1932, US production has halved from it’s pre-Drepression levels and unemployment had risen to between a quarter and a third of the total workforce.
.....When the factory whistles sounded for the last time and the workers were laid off, depression, in more ways than one, settled upon the nation. As the American Dream came crashing down around them, the population stared in consternation verging on horror at the nation’s shattered economy. The industrial infrastructure lay in ruins as banks closed and capital investment dried up. In a state of numbed shock, the unemployed gathered together on street corners to share their despair. Waiting in the soup kitchens clutching a tin cup or queuing in the breadlines for a hand-out, there was not much to do except try to keep body and soul together. There was no work, no jobs for which to apply, and there seemed little prospect that prosperity would return. There was no money around. Anywhere.
.....As the Depression dragged on, things of course, did not get better. Unemployment was an epidemic that swept the country. By 1933 there were13 million unemployed. There was starvation and deprivation everywhere. Those who had been early victims of the crash were in a state of dire poverty. The coats they had worn through two winters were wearing thin, their trousers were ragged and patched, their feet and knees wrapped in gunny sacks as their clothes and shoes fell apart. Destitution, complete and utter, was the order of the day. Without an income many found themselves without accommodation. Whole families would be evicted, all their belongings dumped on the sidewalk with no way to move it all and no where to move it to.
.....On the outskirts of many cities, shanty towns of huts made of tar-paper, packing cases, corrugated iron and metal advertising boards grew up. Called Hoovervilles, in honour of President Hoover who had been in power when the slump hit, the shanty towns were just a development of the hobo camps that had been around for decades.
.....Although the depression would drag on for a full decade, the tide started to turn in 1933 with the election to the presidency of Franklyn D, Roosevelt. There was only one issue in the presidential campaign that year -- the National Economy. Despite a crippling disability, the result of childhood polio, that had left him essentially wheelchair bound, the erstwhile president criss-crossed the country by train bringing his policies for recovery, which he called the New Deal, to the electorate. Speaking from the caboose (which, conveniently, has a wrought iron safety fence he could use to support himself) at every stop, with his reassuring smile, his articulate but easily understandable policies and, most of all, the impressive example he gave of the ability of man to rise above all difficulties, Roosevelt was the most positive thing that had happened in America since the turn of the decade.
.....With his confident assertions that he could turn the economy around, Roosevelt took the election with a massive majority. He took office on 4th March 1933 amid a national banking crisis which had seen the banking sector virtually disappear as state after state suspending banking activities. In his inaugural address he told the numbed nation that ‘we have nothing to fear but fear itself’ but that was not much consolation when you were scraping the grease off the insides of dustbins to stay alive. On his second day in office, he put a stop to all trading in gold -- which was undermining the paper economy -- and declared an extended national ‘bank holiday.’ On 9th March he submitted to Congress an Emergency Banking Bill giving the Government sweeping powers to support, reorganise and reopen all solvent banks. The bill passed through the two Houses with almost no opposition. On 12th march, the President announced that on the following day the banks would start to reopen.
.....Everyone heaved a huge sigh of relief when the news came in at the end of the first normal banking day that deposits had exceeded withdrawls for the first time since the start of the crash.’Capitalism,’ said one of Roosevelt Brain’s Trust, a select group of advisors, ‘had been saved in eight days.’ Although the bank holiday had dubious legality, it had had the right effect -- it had restored confidence where none existed and saved the financial system only days before its descent into oblivion. It was a masterful piece of leadership.
.....Over the next few months, with Congress almost continuously insession, the President put together the basis of his New Deal. In addition to creating support packages for industry and the financial sector, he set up large municipal work projects like dams and power plants and sought to bring relief to the starving millions. He also turned his attention to the struggling-to-survive farming sector which had not only been undermined by the downturn in domestic consumer spending but also by the knock-on effects of the depression on exports. Then there was the big wind that blew across the southern and mid-western states. That didn’t help at all.
.....Slowly but slowly the US economy struggled back. In the wake of the depression there was widespread disillusionment. Angry, embittered, scarred by their poverty, those who had survived the depression no longer viewed the world with a rosy hue. They had had time to think about the inequalities and the realities. The workers could see that they were the lifeblood of the economy and they were intent on making sure that they got something back for what they put in. If the employers thought that it was their market still, to use and abuse as they saw fit, they were in for a bit of a shock.