Great Depression and Cold War: Making of Modern America

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Table of Contents

The Making of Modern America
The Causes of the Great Depression
New Deal’s Three Ways to Address the Great Depression
The Cold War Tensions
Reference

The Making of Modern America

The US in the twentieth century, as well as the whole world, was impacted by economic crises, world wars, political shifts, and civil rights movements that have shaped modern America. The aftermath of World War I induced economic instability and increased European debts to the US. A combination of interrelated economic, banking, political, and commercial factors contributed to the emergence of the Great Depression, which adversely affected the whole world, causing deflation, unemployment, bankruptcy, and panic. The government implemented its New Deal policy to solve the problem and reform the legislature on a federal level. The aftermath of World War II also had dramatic outcomes for the USA, which entered the geopolitical Cold War with the Soviet Union for global dominance. This paper will explore the causes of the Great Depression, the measures implemented within the New Deal, Cold War tensions, and the changes to the American society by the civil rights movement.

The Causes of the Great Depression

The Great Depression that started in 1929 was a global economic crisis that caused significant monetary losses, economic and political instability, and ultimately an armed conflict between the leading countries of the world. The preceding events played their role in the emergence of the Great Depression. The first cause of this global economic disaster was the crash of the stock market. At the beginning of the 1920s, the American stock prices increased rapidly; the intensified interest of the population to the stocks led to increased loans for their purchasing, which ultimately caused a decrease in share prices. People started to take away their assets, causing panic. Indeed, the panicking became the second cause of the Great Depression. In particular, it was the banking panics when people started to withdraw cash from their accounts to save their belongings out of fear of economic failure. This led to diminished bank solvency and monetary incapability.

Finally, the debt of European countries to the US in the aftermath of World War I was another trigger of the Great Depression. Indeed, as Norton et al. (2008) state, during World War I, the USA “became a creditor nation and the financial capital of the world” (p. 781). The European countries needed re-loans, which were repeatedly provided by American investors. This vicious circle led to international economic tensions and the continuously increasing debt that crashed the US economy.

New Deal’s Three Ways to Address the Great Depression

The New Deal was the program initiated in 1933 by the candidate and later President Franklin Roosevelt. The program anticipated structural reforming of the legislature, economic, and social securities to eliminate the burden of the Great Depression on a federal level. Firstly, Roosevelt’s New Deal aimed at implementing several recovery programs to boost industrial and agricultural spheres. This way of addressing the Great Depression was manifested through the National Industrial Recovery Act and the Agricultural Adjustment Act (Norton et al., 2008, p. 754). It was anticipated that the entities would cooperate, and the lack of competition will help maintain stable prices. Secondly, work relief programs were initiated as a method of providing help and insurance to the unemployed and the elderly. Social Security Act was a legislative measure that initiated pension taxes to ensure citizens’ financial support upon retirement. Finally, in terms of new organizations, the President’s administration initiated special institutions, for example, the Civilian Conservation Corps that employed young people to do paid outdoor jobs (Norton et al., 2008). This helped create more workplaces and reduce unemployment on a federal scale.

The Cold War Tensions

Arms Race

The Cold War followed World War II and marked a highly tense relationship between two powerful nations, the USA and the Soviet Union. After the war, the USA possessed the industrial capacity for nuclear weapon production that had been anticipated a competitive advantage over the Soviet Union. However, the US’s rival also had the potential power to withstand the pressure and join the nuclear arms race (Norton et al., 2008). Both countries invested billions of dollars in the nuclear industry and weaponry production, concentrating the national economies around the need to exceed the rival’s efforts.

Differing Ideologies

Another aspect of the Cold War is the difference in the ideologies that were implemented in the two countries. The communist views of the Soviet Union were aimed at disrupting the capitalistic political ideology of the USA. And the US criticized the Soviet Union’s communistic political order and the totalitarian regime that was manifested through a dictatorship. On the contrary, the USA claimed to be a democratic nation that prioritizes human rights and freedom.

The Effect of the Cold War on American Culture and Domestic Policies

The Cold War lasted for several decades that has significantly shaped American culture and policies. As for the policies, economic growth was facilitated by government programs aimed at increasing the share of war-related industries (Norton et al., 2008). Due to the opposition in the ideologies and political views of the two rivals, Americans’ cultural life was impacted by the continuous dichotomy between democracy and dictatorship capitalism and communism.

Changes Influenced by the Civil Rights Movement

In the 1960s, the segregation of the African-American population in the US remained a legal issue. The increasing social movements were aimed at eliminating the problems related to diminished human rights. One such movement was the Civil Rights Movement, the leader of which, Martin Luther King, advanced African Americans’ rights to be lawfully treated with dignity and equality (Norton et al., 2008). The first change of this movement was the Civil Rights Act of 1964, which denied segregation based on race or religion. The second change was the cultural and social shifts in the mindsets of the white population of the USA, who started being more respectful toward racial minorities.

Reference

Norton, M. B., Kamensky, J., Sheriff, C., Blight, D. W., & Chudacoff, H. (2008). A people and a nation: A history of the United States. Cengage Learning.

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