The Great Depression

• Unemployment rose from 3.2% of the labour force in 1929 to 25.2% in 1933 (official government figures)
• New York State had 1 million unemployed
• Cleveland had 50% unemployment; Toledo 80%
• Certain industries, such as cigarettes, didn't suffer as much during the Great Depression
• Air-conditioning, airline travel, colour film and supermarkets were all innovations of the depression
• The growth rate fell from 6.7% in 1929 to -14.7% in 1933 and general prices fell by 25%
• Banks closures increased from 5 000 1921-1929 to 10 000 1929-1933. Most were because they had lent too much and couldn't return depositors' money
• People couldn't afford loan repayments, so banks couldn't give depositors' money, so they rushed to withdraw from their accounts
• There were little provisions for the unemployed and no federal benefits. The idea of a strong work ethic was prevalent
• Many unemployed became homeless and were treated very badly
• California posted guards to turn the homeless away at its borders
• Only 11 states operated pension schemes with a total outlay of $220 000. Most of the elderly lived below the poverty line
• Due to the social stigma of receiving relief, only 25% of those entitled to aid were receiving it
• Charities suffered a loss of revenue, supplying only 6% of the necessary funds
• Many states such as Michigan actually reduced relief funds
• Fortune magazine estimated that 28% of the population was receiving no income in September 1932
• Many farms were forcefully exchanged as mortgage repayments
• Farm payments were so low that food could not be profitably harvested
• In Montana, wheat rotted in the fields
• With overproduction and the unequal distribution of income, the population was consuming less than the economy was producing, leading to stagnation
• There were no alternative employment options for those in failing industries
• Both urban and rural areas suffered, so neither could help the other