Great Recession V Great Depression Essay
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Depression V Recession
The Great Recession of 2009, which in economic terms lasted two quarters but for many people stretched out quite a bit longer, was billed as the worst economic event since the Great Depression. This provides us with an opportunity to examine the two events, their respective time periods, and what sort of similarities and differences we can determined between them.
The 1920s were known as the roaring twenties, and were considered a boom time. The period after the First World War saw significant shifts in American life, in terms of standard of living and how people lived. The 20s saw a significant shift towards urbanization, fueled by job opportunities that were emerging in white collar sectors. The term urban is juxtaposed against rural -- in many cases these areas were what we would consider small country towns. But the shift away from the farm was a profound thing, and many major cities did begin to grow rapidly during this period.
Technological change drove many lifestyle changes. The automobile was just starting to become mass technology at the start of the war, but with newfound prosperity and increased production capacity it went from a luxury to a life necessity in the 1920s. Movies were another technology that gained in social importance during this period, as did radio, these emerging as the two most popular forms of entertainment. Music evolved during this period as well, again fueled by technology, both the radio and the phonograph, and the introduction of jazz marked a move toward modern musical forms (Sullivan, 2014).
In Winter Dreams, Fitzgerald captures some of these themes, in particular the theme of upward mobility and the American Dream. The main character, Dexter Green, is ambitious, and pursues a pretty girl initially as the embodiment of his ambitions. He
eventually moves to New York, where he makes a lot of money in business. There is a moment where he realizes that his old dreams are not relevant anymore. The themes of wealth, upward mobility, of a new wealthy class, and of urbanization all play in this story.
So the 1920s are reflect upon as an era of excess, where wealth is not only possible but relatively easy for the ambitious, and society is changing in some very significant structural and sociological ways. From an economic perspective, the excesses were fuelled in part by very loose economic policy, known as laissez-faire economics (or "let it be"). This approach creates high levels of risk and volatility, such that boom periods as in the 20s are very strong, but bust periods can be just as strong (Investopedia, 2014).
World War I contributed significantly to the boom of the 1920s, because of the destruction it wrought on Europe. The war brought about a reshuffling of the power bases in Europe. Older, weaker empires like the Ottoman fell, Germany collapsed, and many other countries were forced into prolonged periods of rebuilding. Britain was the strongest empire left in Europe, but America was now the world's most significant power, having sat out most of the war and in the 1920s now both selling goods to Europe and lending the Continent money for rebuilding.
There some irony in the fact that the Great Depression saw the introduction of more structure and regulation to the economy, and the 2000s began with the removal of some of that structure, in the unwinding of the Glass-Steagall Act. The removal of banking restrictions in 1999 led within just a few years of the same kind of…
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