Example exam question: Federal Government policies extended the agonies of the depression 1929-33
A mindmap on an example question for A2 history, the blue boxes are key phrases/definitions.
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- Created on: 07-01-13 19:36
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- Example exam question: Federal Government policies extended the agonies of the depression 1929-33
- Money Supply/Gold Standard
- Interest rates too high
- Made borrowing very difficult
- Hoover refused to stop tying the dollar to the Gold Standard
- Interest rates too high
- Help for Germany
- Hoover froze war repayments
- Step in the right direction
- BUT...
- The freeze on payments was not permanent
- Germany's economy was already in a bad way
- Germany would be able to buy US goods
- BUT...
- Step in the right direction
- Hoover froze war repayments
- Balancing the budget
- Hoover very old fashioned
- Believed money should not be spent that the US government did not have
- Did not follow Keynesianism
- Hoover very old fashioned
- Reconstruction Finance Corporation
- DEFINITION: U.S. government agency established (1932) to provide loans to railroads, banks, and businesses.
- Loaned money to large businesses
- Money should theoretically 'drip down'
- Most of the money never reached the small businesses
- This policy was unpopular with the public who saw it as unfair and corrupt
- Money should theoretically 'drip down'
- Voluntarism
- Hoover contacted the 'key players' in America including:
- Business leaders
- Promised not to cut wages or the amount of people emplyed
- Banks broke pledge
- A year later many of the large corps. cut workforces and wages
- Banks broke pledge
- Promised not to cut wages or the amount of people emplyed
- State Governments
- Attempted to start projects to employ those out of work e.g. road works
- Some State Governments did go ahead with the projects
- Many refused to spend money on things that weren't needed
- Some State Governments did go ahead with the projects
- Attempted to start projects to employ those out of work e.g. road works
- Contacted large banks to establish the NCC
- Large banks reluctant to establish the NCC
- Increased Government spending
- Initially cut taxes
- Business leaders
- Hoover contacted the 'key players' in America including:
- Help for farmers
- Government tried to stabilise/raise prices by buying goods above market value
- Government bought grain at 80c a bushel compared to market value of 32c
- Seen as a waste of money and very unpopular with tax payers
- Government bought grain at 80c a bushel compared to market value of 32c
- Government tried to stabilise/raise prices by buying goods above market value
- Success?
- Confidence in the economy was lost
- Banking system still badly needed reform
- Unemployment failed to decrease
- Hoovers reputation decreased
- Especially after the Bonus Marches in which veterans campaigned for pensions and were eventually forced to move on with military intervention
- In total $2 billion was given to state/local government
- $750 billion put aside for business
- Tariffs and Taxes
- Introduced import tax to increase revenue
- Hawley-Smoot Tariff
- This policy backfired
- Raise in taxes damaged the economy when foreign countries would not pay the tariffs to buy American goods
- Introduced import tax to increase revenue
- Help for Unemployed
- $500,000,000 made available for unemployment agencies
- But much of this was squandered by state government and was a drop in the ocean as far as the no. of unemployed was concerned
- $500,000,000 made available for unemployment agencies
- Money Supply/Gold Standard
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