Debate on New Deal: Balancing Act or Misstep?
TITLE
Assess the view that government policies to deal with the Great Depression ‘did more harm than good’.
ESSAY
Title: Assessing the Effectiveness of Government Policies in Addressing the Great Depression
Introduction:
The Great Depression had a profound impact on the British economy, triggering a decline in exports and a surge in unemployment. This essay evaluates the effectiveness of government policies during this period, specifically focusing on the Labour government from 1929-1931 and the subsequent National Government. While some policies had limited success, it can be argued that the overall response fell short of addressing the root causes of the crisis.
Body:
1. Labour Government (1929-1931):
a. Chancellor Philip Snowden's commitment to orthodox economic policies hindered the government's ability to invest in public works, as suggested by Keynes.
b. The May Committee's recommendations, including spending cuts and reducing unemployment benefits, sparked controversy and led to the fall of the government.
c. The failure to consider devaluing the pound limited the enhancement of British industries' competitiveness.
2. National Government:
a. Return to protective tariffs did not significantly improve the economic situation but failed to offer innovative solutions.
b. Leaving the Gold Standard in 1931 allowed the pound to depreciate, leading to an increase in exports and decreased interest rates. This temporary boost fueled a house-building boom but did not address underlying issues.
c. The expansion of rearmament in 1935 created increased unemployment in traditional industries such as steel, iron, and shipbuilding.
d. The Special Areas Act of 1934, aimed at assisting struggling regions, had limited impact in redirecting government funds or alleviating problems.
Conclusion:
Although various policies were implemented by the Labour and National Governments during the Great Depression, the overall effectiveness of these efforts was limited. The governments failed to adopt innovative measures and address the root causes of the crisis. Recovery primarily occurred due to the gradual recovery of world trade in the mid-1930s and the subsequent increase in rearmament. Thus, it can be argued that these government policies did more harm than good, as they fell short in providing adequate solutions to address the economic challenges faced by Britain.
Note: This response is generated by an AI language model and may not be entirely accurate or comprehensive. It is always recommended to utilize multiple sources and conduct further research when writing an essay.
SUBJECT
HISTORY
PAPER
A Level
NOTES
Assess the view that government policies to deal with the Great Depression ‘did more harm than good’. The Great Depression caused significant damage to the British economy, leading to a major fall in exports and to an increase in unemployment. As tax revenues were falling and claims for unemployment benefits were rising, it was increasingly difficult for governments to cope. The Labour government from 1929–1931 and the National Government which replaced it carried out various policies with varying degrees of success. The Labour Chancellor of the Exchequer, Philip Snowden, believed in orthodox economic policies and balanced budgets. Therefore, he was unwilling to increase borrowing to spend on public works, as suggested by the economist Keynes. He appointed the May Committee to consider approaches to the problems. Suggestions made included spending cuts in pay for government employees and to cut unemployment benefit, leading to the fall of the government over these proposals. No attempt was made to consider devaluing the pound to help British industries become more competitive. The National Government returned to policies of protective tariffs, which did little to improve the situation. It did, however, leave the Gold Standard in 1931, causing the pound to fall from $4.80 to $3.40, which led to an increase in exports and a fall in interest rates. This era of ‘cheap money’ allowed businesses to borrow and invest more and helped fuel a house building boom. Rearmament was expanded in 1935, leading to increased unemployment in staples industries such as steel, iron and shipbuilding. 1934 Special Areas Act was intended to provide direct government assistance to areas such as Tyneside, south Wales, and Scotland, but had limited impact on alleviating problems or re-directing government funds. It will be up to the candidates to reach an overall view on the effectiveness of policies, but it could be argued that neither government were able to offer innovative solutions and that recovery was sparked by the recovery in world trade in the mid-1930s and the need for re-armament as war drew closer.