which contributed to the struggles of the US economy in its recovery from the Great Depression.
There were several factors that contributed to the struggles of the US economy in its recovery from the Great Depression:
1. The Smoot-Hawley Tariff Act: This act was passed in 1930 and raised tariffs on thousands of imported goods, which led to retaliatory tariffs from other countries. This trade war reduced international trade and hindered economic recovery.
2. High unemployment: During the Great Depression, unemployment soared to nearly 25%. Even after the worst of the depression had passed, high unemployment rates persisted, making it difficult for the economy to fully recover.
3. Bank failures: Many banks failed during the Great Depression, wiping out the savings of millions of Americans. This led to a lack of trust in the banking system and reduced investment and spending.
4. Government policies: Some economists argue that various government policies, such as higher taxes and increased regulation, stifled economic growth and delayed recovery.
5. Lack of consumer confidence: The Great Depression created a pessimistic attitude among consumers, who were afraid to spend and invest. This lack of confidence further hampered economic recovery.
6. Weak international economy: The global economy was also struggling during this period. The economic downturn in other countries reduced demand for US goods and services, negatively impacting US exports.
7. Decline in agriculture: The agricultural sector was hit hard during the Great Depression, with farmers suffering from falling prices, oversupply, and drought conditions. The agricultural decline further weakened the overall economy.
8. Limited access to credit: Banks became cautious in lending money after the banking crisis, resulting in limited access to credit for businesses and individuals. This constrained investment and consumption, hampering economic recovery.
9. Limited government intervention: Initially, the US government took a hands-off approach to the economy, which some argue prolonged the downturn. It was not until later in the 1930s that President Franklin D. Roosevelt implemented more extensive government intervention through his New Deal programs.
10. Long-lasting psychological effects: The Great Depression left a lasting impact on people's attitudes towards finance and the economy. Many individuals became more conservative in their spending and saving habits, which affected economic growth for years to come.