The Great Depression did not affect everyone the same way.

Many rich people felt no impact at all, and were oblivious to the suffering of others. Up to forty percent of the country never faced real hardship during those years. But most were touched by it in some way. By the time of Franklin Roosevelt's inauguration in 1933, the unemployment rate hovered close to twenty-five percent. Fluctuating during the 1930s, it never fell below 14.3% until 1941. The Depression changed the family in dramatic ways. Many couples delayed marriage - the divorce rate dropped sharply (it was too expensive to pay the legal fees and support two households); and birth rates dropped below the replacement level for the first time in American history. Families suffered a dramatic loss of income during Herbert Hoover's term in office, dropping 35% in those four years to $15M. This put a great deal
Bread Line Washington, DC, October 1930

of stress on families. Some reacted by pulling together, making due with what they had, and turning to family and friends for help. Only after exhausting all alternatives would they reluctantly look to the government for help. Other families did not fare as well, and ended up failing apart. Traditional roles within the family changed during the 1930s. Men finding themselves out of work now had to rely on their wives and children in some cases to help make ends meet. Many did not take this loss of power as the primary decision maker and breadwinner very well. Many stopped looking for work, paralyzed by their bleak chances and lack of self-respect. Some became so frustrated that they just walked out on their families completely. A 1940 survey revealed that 1.5 million married women had been abandoned by their husbands. On the other hand, women found their status enhanced by their new roles. Left with little choice, they went against the historic opposition to married women working outside the home to help support their families. Black women especially found it easier to obtain work than their husbands, working as domestic servants, clerks, textiles workers and other occupations. This employment increased their status and power in the home, gaining them a new voice in domestic decisions. Most minorities, though, benefited little from FDR's New Deal programs.
A mother and her daughters photographed on the road by Dorthea Lange

Minorities, long considered the "last hired, first fired" before the depression, were the first ones hurt by the job layoffs, In order to keep the Democratic Party together and pass New Deal legislation through a Southern-dominated Congress, most of the programs targeted

unemployed white males. Black males were either shut out completely or had to settle for separate and lower pay scales. A shortage of jobs in the Southwest led to the illegal deportation of 400,000 MexicanAmericans so that whites could get more jobs or government relief. Native Americans, though, received their own New Deal, bringing economic relief and some political recognition to this most beleaguered group.

The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in 1930 after the passage of the United States' Smoot-Hawley Tariff bill (June 17), and lasted until the late 1930s or middle 1940s.[1] It was the longest, most widespread, and deepest depression of the 20th century.[2] In the 21st century, the Great Depression is commonly used as an example of how far the world's economy can decline.[2] The depression originated in the U.S., after the fall in stock prices that began around September 4, 1929 and became worldwide news with the stock market crash of October 29, 1929 (known as Black Tuesday). The Great Depression had devastating effects in countries rich and poor. Personal income, tax revenue, profits and prices dropped, while international trade plunged by more than 50%, due in large part to the Smoot-Hawley Tariff. Unemployment in the U.S. rose to 25%, and in some countries rose as high as 33%.[3] Cities all around the world were hit hard, especially those dependent on heavy industry. Construction was virtually halted in many countries. Farming and rural areas suffered as crop prices fell by approximately 60%.[4][5][6] Facing plummeting demand with few alternate sources of jobs, areas dependent on primary sector industries such as cash cropping, mining and logging suffered the most.[7] Some economies started to recover by the mid-1930s. In many countries, the negative effects of the Great Depression lasted until the end of World War II.[8]

Economic historians usually attribute the start of the Great Depression to the sudden devastating collapse of US stock market prices on October 29, 1929, known as Black Tuesday;[9] some dispute this conclusion, and see the stock crash as a symptom, rather than a cause, of the Great Depression.[3][10] Even after the Wall Street Crash of 1929, optimism persisted for some time; John D. Rockefeller said that "These are days when many are discouraged. In the 93 years of my life, depressions have come and gone. Prosperity has always returned and will again."[11] The stock market turned upward in early 1930, returning to early 1929 levels by April. This was still almost 30% below the peak of September 1929.[12] Together, government and business spent more in the first half of 1930 than in the corresponding period of the previous year. On the other hand, consumers, many of whom had suffered severe losses in the stock market the previous year, cut back their expenditures by ten percent. Likewise, beginning in mid-1930, a severe drought ravaged the agricultural heartland of the US. By mid-1930, interest rates had dropped to low levels, but expected deflation and the continuing reluctance of people to borrow meant that consumer spending and investment were depressed.[13] By May 1930, automobile sales had declined to below the levels of 1928. Prices in general began to decline, although wages held steady in 1930; but then a deflationary spiral started in 1931. Conditions were worse in farming areas, where commodity prices plunged, and in mining and logging areas, where unemployment was high and there were few other jobs. The decline in the US economy was the factor that pulled down most other countries at first, then internal weaknesses or strengths in each country made conditions worse or better. Frantic attempts to shore up the economies of individual nations through protectionist policies, such as the 1930 U.S. SmootHawley Tariff Act and retaliatory tariffs in other countries, exacerbated the collapse in global trade. By late 1930, a steady decline in the world economy had set in, which did not reach bottom until 1933.

Causes
Main article: Causes of the Great Depression

Crowd gathering at the intersection of Wall Street and Broad Street after the 1929 crash. There were multiple causes for the first downturn in 1929. These include the structural weaknesses and specific events that turned it into a major depression and the manner in which the downturn spread from country to country. In relation to the 1929 downturn, historians emphasize structural factors like major bank failures and the stock market crash. In contrast, monetarist economists (such as Barry Eichengreen, Milton Friedman and Peter Temin) point to monetary factors such as actions by the US Federal Reserve that contracted the money supply, as well as Britain's decision to return to the gold standard at preWorld War I parities (US$4.86:1). Recessions and business cycles are thought to be a normal part of living in a world of inexact balances between supply and demand. What turns a normal recession or 'ordinary' business cycle into a depression is a subject of much debate and concern. Scholars have not agreed on the exact causes and their relative importance. The search for causes is closely connected to the issue of avoiding future depressions. Thus, the personal political and policy viewpoints of scholars greatly color their analysis of historic events occurring eight decades ago.[citation needed] An even larger question is whether the Great Depression was primarily a failure on the part of free markets or a failure of government efforts to regulate interest rates, curtail widespread bank failures, and control the money supply. Those who believe in a larger economic role for the state believe that it was primarily a failure of

free markets, while those who believe in a smaller role for the state believe that it was primarily a failure of government that compounded the problem.[citation needed] Current theories may be broadly classified into two main points of view and several heterodox points of view. There are demand-driven theories, most importantly Keynesian economics, but also including those who point to the breakdown of international trade, and Institutional economists who point to underconsumption and over-investment (causing an economic bubble), malfeasance by bankers and industrialists, or incompetence by government officials. The consensus among demand-driven theories is that a large-scale loss of confidence led to a sudden reduction in consumption and investment spending. Once panic and deflation set in, many people believed they could avoid further losses by keeping clear of the markets. Holding money became profitable as prices dropped lower and a given amount of money bought ever more goods, exacerbating the drop in demand. There are the monetarists, who believe that the Great Depression started as an ordinary recession, but that significant policy mistakes by monetary authorities (especially the Federal Reserve), caused a shrinking of the money supply which greatly exacerbated the economic situation, causing a recession to descend into the Great Depression. Related to this explanation are those who point to debt deflation causing those who borrow to owe ever more in real terms. There are also various heterodox theories that downplay or reject the explanations of the Keynesians and monetarists. For example, some new classical macroeconomists have argued that various labor market policies imposed at the start caused the length and severity of the Great Depression. The Austrian school of economics focuses on the macroeconomic effects of money supply, and how central banking decisions can lead to over-investment (economic bubble).

Turning point and recovery

The overall course of the Depression in the United States, as reflected in per-capita GDP (average income per person) shown in constant year 2000 dollars, plus some of the key events of the period.[39] In most countries of the world, recovery from the Great Depression began in 1933.[9] In the U.S., recovery began in early 1933,[9] but the U.S. did not return to 1929 GNP for over a decade and still had an unemployment rate of about 15% in 1940, albeit down from the high of 25% in 1933. The measurement of the unemployment rate in this time period was unsophisticated and complicated by the presence of massive underemployment, in which employers and workers engaged in rationing of jobs.[citation needed] There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the 1937 recession that interrupted it). The common view among mainstream economists is that Roosevelt's New Deal policies either caused or accelerated the recovery, although his policies were never aggressive enough to bring the economy completely out of recession. Some economists have also called attention to the positive effects from expectations of reflation and rising nominal interest rates that Roosevelt's words and actions portended.[40][41] It was the rollback of those same reflationary policies that led to the interrupting recession of 1937.[42] One contributing policy that reversed reflation was the Banking Act of 1935, which effectively raised reserve requirements, causing a monetary contraction that helped to thwart the recovery.[43] GDP returned to its upward slope in 1938.

According to Christina Romer, the money supply growth caused by huge international gold inflows was a crucial source of the recovery of the United States economy, and that the economy showed little sign of self-correction. The gold inflows were partly due to devaluation of the U.S. dollar and partly due to deterioration of the political situation in Europe.[44] In their book, A Monetary History of the United States, Milton Friedman and Anna J. Schwartz also attributed the recovery to monetary factors, and contended that it was much slowed by poor management of money by the Federal Reserve System. Current Chairman of the Federal Reserve Ben Bernanke agrees that monetary factors played important roles both in the worldwide economic decline and eventual recovery.[45] Bernanke, also sees a strong role for institutional factors, particularly the rebuilding and restructuring of the financial system,[46] and points out that the Depression needs to be examined in international perspective.[47]