Book Review: The Great Depression

I heard a story on NPR two weeks ago about how our current recession resembled the Great Depression. For example, the guest on the show feared we might have a dip in the road to our current economic recovery just like in 1937-38. Dip? What dip, I thought.

Up to this point, my knowledge of the Great Depression centered on my grandmother’s stories of growing up in Chicago, making beer in the bathtub and the gangsters killing each other in the streets. Or the stories of my other grandmother about how precious shoe leather was, the long walks to school in the snow, and “save-a-sole”. I also read most of The Grapes of Wrath; saw pictures of breadlines, heard stories of hobos, hunger riots and stories of farmers burning crops and killing their herds while cities were starving because the price of shipping the food was too expensive, and how FDR’s New Deal delivered America from the Depression – or was it WWII.

So, I set out to educate myself about this critical time in America’s history and went to the library in search of a book that would tell me the causes of the Great Depression and what the government did to get us out of it.

I found 10 books on the Great Depression. Most of them had to do with eyewitness accounts of people who lived through the depression, but I wanted more analysis. Two had to do with new theories about the Great Depression. I didn’t want new theories, I wanted the old ones. The ones people thought about at that time. Just the facts please. Another dealt with the international aspect of the Great Depression. That piqued my interest, but it was long and I first wanted to hear solely about America. Finally, I decided upon The Great Depression by David A. Shannon, 1960. Yes, 1960. What captured my interest was that the book was a collection of engaging newspaper and magazine articles, excerpts from Congressional and Senatorial hearings, portions of studies and reports that included in-depth interviews with all types of people and even a passage from The Grapes of Wrath.

For example, the first article is by The New York Times, October 25,1929 “Worst Stock Crash Stemmed by Banks. The second, “Stock Collapse In 16.410,030-Share Day, But Rally at Close Cheers Brokers.” Needless to say there were no more cheers for many years after that. I was hooked.

The book is broken up into 8 sections: Crash, The Farmer in the Depression, America’s Shame: The Crisis of Relief, Nomads of the Depression, The Middle Classes: Bank Failures and Unemployment, The Depression and Education, Will There Be a Revolution, Some Case Histories.

The ideas explored, the analysis and the personal stories I found extremely engaging. My favorite sections were Crash, The Crisis of Relief, and Will There Be a Revolution.

Below are some quotes/ scenarios that I particularly enjoyed:

“The capitalists are responsible for the present recession (37-38), just as they were responsible for the 1930 depression. Big business tried to run the country but made a mess of it; President Roosevelt tries to straighten out the mess and they are bucking him…the depression will continue until the industrialists are pulled into line.” Mr. Renick interview for the The Dubuque Study.

From George Soule, “Are We Going To Have a Revolution?” Harper’s CLXV (August 1932) –
“Most of those who really suffer from the depression are, according to the best-informed reports, simply stricken dumb by it. Like the Republican administration, they are awaiting nothing more drastic than the return of prosperity.”

George Soule, “Are We Going To Have a Revolution?” Harper’s CLXV (August 1932) – What if “all businesses shut down, all railroads stopped running, all banks are closed. All stocks and bonds, all deeds to real estate become worthless. Everybody is unemployed, nobody has a cent of income. What would happen?” If they are still imbued with habits of trading, of individualistic competition, of accumulation, they would immediately start to rebuild capitalism…”

Shannon collected articles from the point of view of those who were solid middle class to poorest of the poor. I would have liked to have read at least a couple of articles from a captain of industry or extremely wealthy individual to hear their take and perspective on the Depression. That’s my only knock on the book.

So are there similarities between the Great Depression and our current recession?

After reading The Great Depression, I’d agree—in part. Speculators (including banks) took stocks to unreasonable levels and then the bottom dropped out. Fortunately, American government and society has changed much since the 30’s. We now have a relief system, unemployment, social security, medical care for the poor and the federal government now has been providing relief to states early on in this crisis – unlike during the 30’s when relief was entirely left up to local communities and states that were bankrupt. But check this out, between 1929 and mid 1931, the federal government had poured money into the financial system to stabilize it, while letting the average American languish. The first real aid by the federal government didn’t arrive to the states until fall of 1931 and FDR’s policies didn’t start until after he was in office in 1932. It was at this point, from what I read, that there seemed to be a turn around in people's minds, the talk of revolution died down, people sensed a floor to the Depression. It sounds eerily reminiscent of our current situation where the government quickly bailed out the banks, left homeowners to languish and has only now started sending additional relief to states and lengthening unemployment benefits.

Good book.