The Great Depression
From 1929 to 1939, a worldwide most critical economic recession in history occurred. This economic collapse, known as the Great Depression, was induced by the stock market crash, a phenomenon that jeopardized Wall Street by driving away most investors. As an outcome of this stock market crash, there was a notable reduction in spending and production, which leads to laid-off workers. Millions of people lost their jobs.
The Rise and Fall of the Stock Market
The Great Depression began mounting up in the 1920s. From 1920 to 1929, the US economy increased at a very high rate. Many people started to invest in the stock market, no matter their professional occupation. Consequently, the prices shot to unprecedented levels with the peak period being 1929. Further, a rapid stagnation in the economy followed suit, leading to a fall in production of goods. Despite the visible decline in the economic events, stock prices continued to rise, until they got to unjustifiably high levels that caused investors to panic and sell their shares indiscriminately. Most investors were economically incapacitated by the sudden turn of events, and most others quit the stock market in despair. Confidence in the stock market vanished, leading to its crash. Production declined, and as a result, people were rendered jobless in droves. Moreover, wages decreased significantly and life became intolerable for many as they survived in debts. Overall, the country became chaotic in an economic mess that ran indiscriminately.
The Rise of the Labor Movement
With the soaring the Depression, the labor movements could not manage to protect the vulnerable workers. It could neither protect the jobs nor tame the wage rates. However, it is at this time that the labor unions were able to successfully demonstrate their power and the manner in which they could vouch for democracy. The Great Depression, therefore, greatly contributed to the rise of the labor union. As a result of the meltdown and the negative effects on the workers, most factory workers grew wary and opted to strike as a way of expressing themselves. The Committee for Industrial organization (cio) was founded in 1935 and later became the Congress of Industrial Organizations in 1938. By the time the Second World War ended, the union had amassed over 12 million members (Gregory, Para 4).
Political Involvement of Labor Unions
Some unions, like the AFLs would eventually turn to politics by seeking to protect wage levels and jobs in the unions through legislations. Members pushed for the amendment of a charter that made it compulsory to have a five-day week.
The New Deal
The Great Depression's menace was abated by the New Deal. The New Deal is a program that was supported by the Tennessee Valley Authority and that sought to provide electricity and control flooding by building dams and hydro power projects in the Tennessee Valley. Another program, The Works Program Administration (WPA), led to the creation of permanent jobs for millions of people by the year 1943. With time, the economy started improving gradually, with the GDP growing at a continuous rate. It, however, rescinded sharply in 19237, an effect that was fast rectified and came to a gradual normality towards the end of the decade. As a result of the Depression, political extremism was witnessed in various countries, a factor that led to more concerted efforts in the military. It, however, was closely followed by the start of the First World War.
Works Cited
Gregory, James. Strikes and Unions. The Great Depression in Washington State, 2009, http:\/\/depts.washington.edu\/depress\/strikes_unions.shtml. Accessed 24 Jul 2017.
