Great Depression Effects

Many times throughout history the United States has undergone economic
depression. The most recognized period of economic depression is called the

Great Depression. The Great Depression is well known because of the seriousness
of the stock market crash. The results of the crash were more serious than any
other crash throughout American History. The Great Depression caused a change in
the nature of the American family, an increase in poverty, and President Herbert

Hoover's proposal for immediate action by the government, balanced his belief in
"rugged individualism" with the economic necessities. While most

Americans are familiar with the Great Depression as a time of economic disaster,
it also had an impact on the American Family life. There were obvious
differences in the classes as a result of the Great Depression. The lower and
the middle classes changed considerably, but the upper class lifestyle did not
vary a great deal. (Simmons 41) The father's role as head of the household
became more challenging because there were fewer jobs. The expectation was for
fathers to work and support their families. The reality of the lower class was
that few men brought home paychecks. Some fathers suffered anxiety and a feeling
of worthlessness for failing to provide for their families. Many resorted to
stealing food and money just to survive. (Simmons 41) Women were offered greater
opportunities in the work force, however they tended to take the position of
stay-at-home mothers. According to Simmons "Men resented employed women for
they felt that they were occupying jobs that could be given to unemployed
men."(Simmons 43) Children in the lower class were expected to get an
education so that they could improve their situation. In addition they were
needed at home to help with household chores. Unfortunately, many poor children
dropped out of school because of their obligations at home. Children in the
middle class were better than those in the lower class. They had the opportunity
to stay in school and were treated to some luxuries. The children of the upper
class families received an excellent education and were treated to many
luxuries. (Simmons 42-43) Along with a change in the American family life, there
was also an increase in poverty. The Great Depression was an intense time of
poverty. The downfall of American businesses, the closing of banks, and the
lowered employment contributed to this period of destitute. According to an old
study "26,000 American businesses collapsed; in 1931, 28,000 more met the
same fate. And by the beginning of 1932, nearly 3,500 banks, holding billions of
dollars in uninsured deposits, had gone under. Twelve million people were
unemployed (nearly 25 percent of the workforce), and the real earnings for those
still lucky enough to have jobs fell by a third" (Internet). This
statistical evidence effectively illustrates the increase in poverty caused by
the Great Depression. An additional result of the Great Depression was that

President Hoover balanced his belief of "rugged individualism" with
the economic necessities of the time by proposing direct action by the
government. Hoover had only been in office for eight months when the stock
market crashed. At first he treated this financial disaster and decline in
employment and business that followed the Great Depression as a panic. According
to The American Pageant "He was accused of saying, yet did not use these
precise words, that prosperity was just around the corner" (Bailey 776). As
the depression got worse Hoover became more and more concerned about the
troubles of Americans. Hoover refused to agree with the request of the Democrats
in Congress, who wanted the government to distribute money to the unemployed.
"...[Hoover] as a "rugged individualist" deeply rooted in an
earlier era of free enterprise, shrank from the heresy of government handouts.

Convinced that industry, thrift, and self-reliance were the virtues that made

America great, President Hoover felt that a government doling out doles would
weaken, perhaps destroy the national fiber..."(Bailey 776). However,

President Hoover "would assist the hard-pressed railroads, banks, and rural
credit corporations, in the hope that if financial health were restored at the
top of the economic pyramid, unemployment would be relieved at the bottom on a
trickle-down basis" (Bailey 777). In order for Hoover to do so he
introduced The Reconstruction Act. This Act was created to prepare emergency
financing for banks, insurance companies, and other companies. The Glass-Steagall

Act used government gold reserves to help industry. The Federal Home Loan Bank

Act created discount banks to help refinance homes and prevent foreclosures.

Hoover also wanted the reform of bankruptcy laws to help in the reconstruction
of businesses. He supported a loan of $300 million to states for