History The Great Depression Questions
The decline in government intervention during the Great Depression was primarily caused by the belief in laissez-faire economics and the idea that the market would naturally correct itself. This led to a reduction in regulations and a hands-off approach by the government.
The effects of this decline in government intervention were devastating. Without government oversight, banks engaged in risky lending practices and speculation, leading to the stock market crash of 1929. As a result, millions of people lost their jobs, businesses collapsed, and the economy spiraled into a deep recession.
Furthermore, the lack of government intervention meant that there were no safety nets or social welfare programs to support those affected by the economic downturn. This resulted in widespread poverty, homelessness, and hunger.
Overall, the decline in government intervention during the Great Depression exacerbated the economic crisis and prolonged the suffering of the American people. It highlighted the need for government regulation and intervention to prevent future economic disasters.