Tariffs and 1929 US Economic Troubles
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How significant were tariffs as a reason for economic problems in the USA by 1929? Explain your answer.
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Tariffs were a significant reason for economic problems in the USA by 1929. The introduction of US tariffs led other countries to retaliate with their own tariffs on American imports, resulting in reduced ability to export surplus goods and farming produce. This led to overproduction in several industries as the domestic market became saturated, leading to decreased prices and income for businesses. Furthermore, a tariff war with foreign nations ensued, causing lower wages, rising unemployment, and a slow down in the economy. The loss of confidence from big investors was also a result of these economic challenges. However, other factors such as unregulated lending from banks, easy credit, rising consumer debt, Republican policies that did not regulate the stock market or lending, market saturation, income inequality, and overspeculation also played a significant role in the economic problems faced by the USA in 1929.
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How significant were tariffs as a reason for economic problems in the USA by 1929? Explain your answer. Yes US tariffs led other countries to introduce retaliatory tariffs on American imports; led to overproduction in many industries when the domestic market became saturated by the late 1920s; reduced the USA's ability to export surplus consumer goods and farming produce; led to a tariff war with foreign nations; led to decreased prices and income for businesses in the USA; lower wages and rising unemployment as economy slowed down; loss of confidence from big investors, etc. No More significant – unregulated lending from banks; ‘buying on the margin’; easy credit and rising consumer debt due to hire purchase schemes; Republican policies did not regulate stock market or lending; long-term slowdown in the economy due to market saturation; inequality of income – about 50% on less than $2000 a year and so below poverty line; problems in farming and older industries; overspeculation and overconfidence created an economic bubble, etc.