The Great Depression (AQA GCSE History): Revision Notes
The Great Depression and its impact on international peace
Introduction to the Great Depression
The late 1920s had been a time of economic prosperity, particularly in the United States where business was booming and employment was high. However, this period of growth came to an abrupt end in 1929, marking the beginning of one of the most devastating economic crises in modern history.
The Wall Street Crash of 1929 was the trigger that started the Great Depression. This financial disaster occurred when stock prices on Wall Street (New York's financial centre) collapsed dramatically. Banks failed, businesses went bankrupt, and millions of shares became worthless almost overnight.
The Wall Street Crash was so severe that it wiped out the savings and investments of countless Americans in just a matter of days. The psychological impact was as devastating as the financial losses, destroying confidence in the economic system.
By 1933, the economic situation in America had become desperate. Approximately 14 million Americans found themselves without work, and many families lost their homes. People were forced to live in extreme poverty, with some queuing for hours just to receive basic food supplies. This period of severe economic hardship became known as the Great Depression, and its effects would last throughout the 1930s.
The worldwide impact of the Great Depression
Although the Great Depression began in America, its consequences spread rapidly across the globe, affecting international trade and cooperation in several critical ways.
The Great Depression demonstrated how interconnected the global economy had become by the 1920s. What started as an American financial crisis quickly became a worldwide economic disaster.
International trade collapse: The United States had been one of the world's most important markets for goods from other countries. When Americans could no longer afford to buy foreign products, international trade suffered dramatically. Companies worldwide saw their profits disappear and unemployment rates soar in many nations.
Breakdown of international lending: American banks had previously provided crucial loans to help European countries rebuild after World War One. However, after the Wall Street Crash, these banks demanded immediate repayment of their loans, creating enormous financial pressure on European nations. This withdrawal of American financial support caused severe economic problems across Europe.
Rise of trade barriers: In a desperate attempt to protect their own struggling economies, governments began imposing higher customs charges on foreign goods. The US government significantly increased tariffs, hoping to encourage Americans to buy domestic products instead. This protectionist approach led to a dramatic fall in international trade - for example, Japanese exports dropped by 50% between 1929 and 1931, causing major hardship in Japan.
The rise of nationalism and political extremism
The economic despair caused by the Great Depression created perfect conditions for the rise of extreme political movements across Europe and beyond.
Appeal of nationalist leaders: As unemployment soared and people faced starvation, they became increasingly desperate for solutions to their problems. Extremist leaders like Adolf Hitler in Germany and Benito Mussolini in Italy gained popularity by promising simple answers to complex economic problems.
Nationalist promises and tactics: These leaders used several strategies to win support during the economic crisis. They promised to create state-run economies that would guarantee jobs for their citizens. They also pledged to seize land and resources from other countries to provide for their own people's needs. Perhaps most dangerously, they offered simple explanations for the economic disaster by blaming specific groups for the crisis.
Hitler's strategy of finding scapegoats was particularly dangerous because it allowed people to channel their anger towards specific targets rather than addressing the complex economic causes of the Depression. This approach of blaming minorities and foreigners became a key tactic used by extremist movements worldwide.
Scapegoating and blame: Hitler, in particular, used what he called "Bread and Work" campaigns to appeal to desperate Germans. He blamed Germany's economic problems on the Jews and the "foreigners" who had signed the Treaty of Versailles, claiming these groups were responsible for the nation's suffering. This strategy of finding scapegoats allowed people to channel their anger and frustration towards specific targets rather than addressing the complex economic causes of the Depression.
Impact on the League of Nations
The Great Depression had devastating consequences for the League of Nations' ability to maintain international peace and security.
Weakened collective security: The economic crisis made the League's system of collective security practically impossible to maintain. Countries struggling with massive unemployment and economic collapse were unwilling to take expensive military action to support other nations. The idea of working together for mutual security became unrealistic when each country was fighting for its own economic survival.
The League's main tool for punishing aggressive nations had been economic sanctions, but during the Depression, most countries were desperate to maintain any trade they could get. Nations were simply unwilling to reduce their trade further by imposing sanctions, making this diplomatic tool essentially useless.
Ineffective economic sanctions: The League's main tool for punishing aggressive nations had been economic sanctions - essentially cutting off trade with countries that broke international law. However, during the Depression, most countries were desperate to maintain any trade they could get. Nations were simply unwilling to reduce their trade further by imposing sanctions, making this diplomatic tool essentially useless.
Rise of aggressive dictatorships: The economic crisis had created conditions that allowed aggressive dictators like Hitler and Mussolini to gain power. These leaders were not interested in international cooperation or moral condemnation from the League. They were prepared to use violence to achieve their goals and saw the League's weakness as an opportunity to pursue aggressive expansion without serious consequences.
Military responses became impossible: The only remaining option for the League would have been to organise military action against aggressive nations. However, during the economic crisis, no country could afford the enormous expense of military intervention. This left the League essentially powerless to respond to international aggression.
The Great Depression revealed a fundamental weakness in the League of Nations system: international cooperation depended on economic stability. When countries faced domestic economic crises, they prioritised national survival over international responsibilities.
Timeline of key events
- October 1929: Wall Street Crash triggers the Great Depression
- 1930-1931: Global trade collapses; Japanese exports fall by 50%
- 1933: Peak of unemployment in USA (14 million unemployed)
- Early 1930s: Rise of Hitler in Germany and increasing popularity of Mussolini in Italy
- Mid-1930s: League of Nations proves increasingly ineffective against aggressive dictatorships
Remember!
Key Points to Remember:
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The Wall Street Crash of 1929 triggered a global economic crisis that lasted throughout the 1930s, creating mass unemployment and poverty worldwide.
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The Depression caused international trade to collapse and led countries to impose trade barriers, damaging global cooperation and economic recovery.
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Economic desperation created perfect conditions for the rise of extremist leaders like Hitler and Mussolini, who gained power by promising simple solutions and blaming scapegoats.
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The economic crisis made the League of Nations ineffective, as countries could not afford to impose sanctions or take military action against aggressive nations.
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The Great Depression demonstrated how economic problems could quickly become political and military threats to international peace and security.