American Literature: Great Depression

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Transcript

00:41

the broch rawdon on point with the evil music today

00:44

huh Thie great depression was as bad as the name

00:47

implies This tidal wave formed in october nineteen twenty nine

00:50

when the american stock market collapsed The dow industrial average

00:54

the primary measure of the stock market back then peaked

00:57

in september nineteen twenty nine at three hundred eighty one

01:00

point seventeen points and would plunge to a staggering forty

01:04

one point twenty two points by nineteen thirty two Okay

01:08

some context might be useful here The proceeding decade was

01:10

known as the roaring twenties due to rising income inequality

01:14

and general debauchery by fancy folks The stock market crash

01:18

ended this decade of decadence in an instant The story

01:21

of the great depression can be told with a litany

01:23

of the leak statistics It was like a magic trick

01:26

Billions of dollars in assets disappeared Just like that Wealthy

01:31

americans who owned almost all the nation's stock at the

01:35

time were walloped by an eighty percent decline in the

01:38

value of their holdings More troubling to the wider population

01:41

were rampant bank failures between nineteen twenty nine and nineteen

01:45

thirty three Two out of every five banks in america

01:48

collapsed effectively annihilating more than seven billion dollars of their

01:54

customers Hard earned savings By nineteen thirty three the country's

01:58

gnp i'ii gross national product had fallen to barely half

02:03

of its nineteen twenty nine level which is huge Imagine

02:07

if your country suddenly started producing half the amount of

02:10

products as usual there probably wouldn't be any good job

02:13

opportunities right What's more it could even lead to higher

02:16

prices as a reduced supply of something usually causes increased

02:20

demand which is known as the law of supply and

02:23

demand The combination of few jobs and high prices huh

02:27

Sounds like a recipe for disaster Industrial production fell by

02:31

fifty percent Production of automobiles dropped by two thirds The

02:35

steel plants operated at just twelve percent capacity Bad times

02:39

people all around These were big booming industries at the

02:43

time So it's a huge deal that they went sour

02:45

it be like apple suddenly stopping production on the ipad

02:49

The horror The unemployment picture is even nastier if you

02:52

can believe it Between nineteen twenty nine and thirty three

02:55

more than thirteen million americans lost their jobs Of those

03:00

sixty two percent found themselves out of work for longer

03:03

than a year forty four percent longer than two years

03:06

twenty four percent longer than three years and eleven percent

03:09

longer than four years Can you imagine being an adult

03:13

without a Job 4:4 years At that point you're basically

03:17

retired unemployment peaked at a staggering twenty four point one

03:22

percent in nineteen thirty three and never drop below fourteen

03:26

point three percent until world war two For context the

03:30

unemployment rate has never surpassed nine point seven percent in

03:33

all of the economic downturns since the economy got so

03:37

bad that even calvin coolidge who's business friendly presidency had

03:40

fueled the roaring twenties boom lost faith in the free

03:44

markets ability to fix itself A turning point came in

03:47

nineteen thirty two when franklin delano roosevelt was elected president

03:51

of the united states Shortly after taking office roosevelt made

03:54

it his mission to deliver relief recovery and reform the

03:58

so called three r's he allegedly wanted to include a

04:01

fourth our rodeo but his advisers counseled against it Roosevelt

04:05

christened his relief efforts the new deal This ambitious plan

04:09

begun during his first hundred days in office created a

04:12

host of new government programs including the civilian conservation corps

04:16

and works progress administration which provided work from millions of

04:20

needy americans Roosevelt also pushed through regulations like the nineteen

04:24

thirty three banking act that sought to rectify the structural

04:27

issues leading to the great depression Around nineteen thirty five

04:30

roosevelt launched another policy initiative known as the second new

04:34

deal a big part of the second round was making

04:36

permanent the first batch of temporary new deal measures but

04:39

the biggest part of it by far was the social

04:42

security act which created an american institution that remains a

04:46

key political issue today Of course not everyone loved the

04:50

new deal In particular conservative politicians thought that government spending

04:54

wouldn't stop the crisis and they weren't entirely wrong Although

04:58

the new deal stopped the flow of blood caused by

05:00

the great depression it ultimately didn't solve the crisis And

05:03

of course others argue that roosevelt's new deal policies weren't

05:06

progressive enough For instance advocates for socialism wanted more government

05:11

Programs for the working class Either way unemployment remained brutally

05:14

high throughout the thirties and it wasn't until roosevelt's third

05:17

term and the mobilization of u s forces in world

05:20

war two that the country finally reached full employment Of

05:23

course war is in a way a government sponsored economic

05:27

initiative which sort of proves roosevelt right Then again there

05:31

are plenty of valid arguments to the contrary worth examining

05:34

notice that we've hardly talked about the actual causes of

05:37

the great depression which is because they're kind of hard

05:39

to nail down legendary british economist John maynard keane's champion

05:43

1 major interpretation of the crisis in nineteen thirty six

05:46

is general theory of employment interest and money He suggested

05:50

that the great depression had been caused by something called

05:52

a failure of aggregate demand which basically means that we

05:55

had enough stuff just not the ability to buy it

05:58

In this interpretation widespread unemployment and economic stagnation were the

06:03

new normal a situation that might persist indefinitely in order

06:06

to get the economy moving again Keane's argued that the

06:09

government should increase spending even if it means running a

06:12

significant budget deficit As you can tell this philosophy was

06:15

influential on the new deal and similar stimulus programs In

06:18

contrast economies of the lays a fair tradition which emphasizes

06:21

the wisdom of free markets argued that the stock market

06:24

crash was a natural reaction to the decadence of the

06:27

nineteen twenties and would naturally revert back to a normal

06:30

state of affairs after a quick recalibration decades later a

06:33

third interpretation of the great depression would be championed by

06:36

milton friedman and anna schwartz In their nineteen sixty three

06:39

book a monetary history of the united states Freed minute

06:42

schwartz We're big believers of the free market similar to

06:45

the lays a fair economists of the nineteen thirties but

06:48

their analysis differed on a few key points To them

06:51

The crash was caused by the policies of the federal

06:53

reserve as well as individuals hoarding of cash After the

06:56

bank started going bad This reduced the amount of money

06:59

circulating in the economy and kicked the crisis into top

07:02

year So who's right Well the real answer might be

07:06

all of the above Each of these analyses touch on

07:08

valid ideas but none of them tell a complete story

07:11

on their own Instead we have to look at all

07:14

Of them to gain a fully rounded view of the

07:16

situation Besides its impact on the economy the great depression

07:19

completely changed american society The crisis had the effect of

07:23

radicalizing americans and pushing them towards extreme positions Some became

07:27

supporters of charles e coughlin a catholic priest who was

07:30

launched into national stardom by his radio show which was

07:34

a novel thing at the time Coughlin was initial supporter

07:36

of roosevelt's new deal but he eventually swung hard to

07:39

the right and threw his support behind the fascist movement

07:42

in europe Strange as it sounds in hindsight many americans

07:45

at the time look to these authoritarian states for inspiration

07:49

in turning around their economy Another example is louisiana governor

07:53

huey p long who happened to be buddies with coughlin

07:56

Long too was launched into national prominence though he did

07:59

it through a simple slogans share our wealth He even

08:02

ran against roosevelt as a democrat in nineteen thirty six

08:05

by arguing that the new deal was too conservative So

08:08

why are we spending so much time talking about the

08:10

great depression when we all really want to talk about

08:13

is the grapes of wrath Well because it's important background

08:16

Information Although the novel isn't exactly about the great depression

08:19

the economic crisis hangs heavy over its plot If you

08:23

remember the joad family left home because of the dust

08:26

bowl a fearsome weather phenomenon primarily in the oklahoma area

08:31

naturally they hope to find work elsewhere But this little

08:34

thing called the great depression is wreaking havoc on the

08:36

rest of the country As a result the jobs are

08:39

rarely able to find jobs for themselves and when they

08:42

dio conditions are far from pretty We see further impact

08:46

of the great depression in the local residents of these

08:48

regions who being an economic hardship themselves hate interlopers like

08:53

the jobs stealing their jobs The joes even spent some

08:56

time at a government operated work camp which eludes the

09:00

new deal efforts made by president roosevelt there's also a

09:03

strain of anti bank sentiment in the novel At one

09:05

point a bank is described as a monster that can't

09:08

stop growing or it will die whether you agree with

09:11

this assessment or not It's clear that steinbeck's mistrust of

09:14

financial institutions is based on his view of the great

09:17

depression Unsurprisingly the great depression figured prominently in steinbeck's personal

09:21

Life in fact he was just starting his career as

09:24

a writer when the depression hit in thirty four he

09:26

spent time with two labor organizers in california who gave

09:29

him insight into the worker's rights movement Two years later

09:32

he traveled with a group of okies who had fled

09:35

the dust bowl just like joe ds and wrote a

09:37

newspaper article about them All in all steinbeck spent a

09:40

lot of time with poor folks who were crushed by

09:42

the great depression which helped solidify his own left leaning

09:45

political views Is it a coincident that this time was

09:48

also steinbeck's most productive time as an author Nah thirty

09:52

sawed the publication of steinbeck's most beloved books like tortilla

09:55

flat of mice and men and the grapes of wrath

09:58

of course to different extents and too varied purposes All

10:01

of these novels are shaped by steinbeck's personal encounters with

10:04

the great depression See what i mean when i said

10:07

that economic me real bomber even though it makes us

10:09

sad there are some really important lessons to learn about

10:12

the great depression First the depression was one of the

10:14

defining events of the twentieth century just as much as

10:17

any world war or cold one for that matter Because

10:20

of this the great depression shaped the world we live

10:21

in today even if we don't realize it After all

10:24

no depression means no social security And why is this

10:27

relevant for our purposes It's Because understanding the great depression

10:30

is crucial to understanding the grapes of wrath Not doing

10:33

so would be like watching a star wars movie without

10:35

knowing what the forces Finally the great depression helped shape

10:38

john steinbeck's political views which in turn helps us better

10:42

understand his fiction Which brings us to the end of

10:44

today's lesson I hope you've thought about how financial downturns 00:10:48.514 --> [endTime] makes us dollar bills feel it's depressing just depressing