Years Before The Depression
Years Before the Depression
In the years leading up to and the early years of World War I, the United States Federal Government still saw much value in the agricultural industry. With Europe having huge economical troubles and a majority of the the countries were war-ravaged and Europe turned to the United States for food and supplies. This caused the U. S. federal government to change its policies and subsidize many farmers. The government paid ridiculously high prices for wheat and other grains, and the government pushed farmers to spend large amounts of money to buy more land, produce a greater amount of food, and modernize their equipment. The subsidizes supported the farmers so heavily the government paid over $2 dollars a bushel: however, when the war ended the United States stopped all subsidizes and only paid 67 cents a bushel. Prices of wheat and grains dropped drastically, farmers fell into debt, and one of America’s large economical components went to ruins.
Another American policy before the depression was their favoring of the auto and radio industries. Throughout the 1920’s the auto and radio industries saw rapid growth and the government loved the income so they heavily supported them. The government did this in to main ways. First, the federal government eased credit and encouraged many people to invest in the auto and radio industries. Secondly, the government lowered the prices of the main goods that these two industries needed, which keep supply costs low and profits very high.
In the years before the Great Depression there were three main industries including agriculture, labor, and auto. Early in World War I, the agriculture industry saw large profits because of the tremendous demand in Europe; however, the agriculture industry was left out in the cold by the federal government with zero subsidizing and no help from investors. At this time, the labor sector was huge because of the huge profit gains in all areas of the American economy....
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