Posted: November 27th, 2013
1. During the 1920’s it was just after the First World War and the times were hard since it was the beginning of the great depression. The food was scarce and the resources very hard to come across. Although this was the case, some of the American citizens did not feel the hard times as much as others and some even benefited from them. Big businesses benefitted from this period in that, the policies set by the National Industrial Recovery Act raised prices and wages throughout most of the nonagricultural part of the economy.
By doing this, they suppressed their main rivals and competitors. The big farmers and agricultural producers also benefitted greatly in this period since the Agricultural Adjustment Act was passed. This act required that farmers to limit their production in order to raise the prices of their produce. The scheme intended to raise prices that benefited the big producers that owned more land. The period also brought some good for those people who had anticipated it and had saved food and supplies in advance.
The effects of the depression were not that bitter for them. The period on the other hand had very dismal effects on the economy and brought severe hurt and suffering to those who were not prepared. The policies put in place by the American government to control these issues ended up having negative effects on other people. Economic output was greatly reduced and unemployment rates shot up. The poor and those people who had no skills continued to suffer after these policies were passed (Parrish, 1994).
Low wage black workers were majorly affected and the policies were supported by some white unionists since they hoped the competition from the black community would be stifled. The effects of the Agricultural Adjustment Act were to crush consumers and smaller competitors by raising food prices. This was occurring in the midst of a depression when many people already were suffering greatly and therefore malnutrition and poor diets was the order of the day for the less fortunate.
2. The New Deal had two effects; some parts of it were positive and beneficial, while some were just outright oppressive. The legislations made were quite damaging to the common citizen and powerful interest groups were the only beneficiaries of the New Deal. The new deal was therefore not a success. The goals of the new deal were to help alleviate the suffering of the American people, to raise the economy and to help create employment.
However, it did not achieve any of these and thus made the situation worse than it was initially. The New Deal had two major policies; the National Industrial Recovery Act and the Agricultural Adjustment Act. The National Industrial Recovery Act raised prices and wages throughout most of the nonagricultural part of the economy. This act negated the purpose the policy was formalized for. President Franklin D. Roosevelt, the then president, and his administration, did not fulfill the purpose of protecting the people from the harsh conditions of the depression (Parrish, 1994).
Most of the funds that were being used at the time were channeled to fund powerful interest groups who aided Roosevelt in re-election rather than help the poor and the needy. Only big farmers, big agricultural producers and big businesses benefitted from the policies of the New Deal. These two groups benefitted greatly due to the two major policies of the NRA and the AAA. The big agriculturalists and farmers benefitted since the policy required farmers to limit their production in order to raise the prices of their produce. Therefore the larger the farms they owned the more produce they were to sell due to the proportionality.
Parrish, Michael E. Anxious decades: America in prosperity and depression, 1920-1941. New York, NY: W.W. Norton, 1994. Print.
Place an order in 3 easy steps. Takes less than 5 mins.