Causes of the Depression Flashcards
Name the principal cause of international depression at the beginning of the 1930s.
The Wall Street Crash (29th October, 1929)
Why were the consequences of the Wall Street Crash so severe for Britain?
Overdependence on the USA meant that what should have been purely an American crisis reverberated across the world, in many places worse than in the States (“when America sneezes, the world catches a cold.”)
Was the Wall Street Crash the greatest cause of The Great Depression?
No, it was simply the final burden in an already somewhat dysfunctional economy.
Which areas of Britain hosted growing prosperity during the 1920s?
Southern England and The Midlands.
What was the population trend of rural Britain during the late 1920s?
A decline, as manpower was replaced by technology.
What were Britain’s greatest market rivals?
Japan, the USA, and even Germany.
Where was much of Britain’s early 20th century industry developed?
Around Northern coalfields, because many old industries remained dependent on steam power.
What were the old industries?
- Coal.
- Iron and steel.
- Textiles.
- Shipbuilding.
What was the main problem affecting the old industries?
That they depended on exports.
What was the comparative scale of foreign manufacturing?
Much larger than in Britain, meaning that they could produce goods at a much lower cost.
What were the principal causes for the decline of British industry?
- Competition from abroad.
- Lack of new markets.
- Obsolete methods.
Why was it becoming harder to find new markets?
Because of higher prices, largely due to tariffs, which were not reciprocated in the UK’s policy of free trade under a Conservative government.
How many tonnes of shipping were built in Britain in 1930? How does this compare to 1933?
1,400,000 (1.4 million), compared to just 133,000 in 1933,
How did Britain react to America’s pioneering of mass production?
Slowly, while switching resources at a bad rate from old industries to new emerging ones such as chemicals, rayon, and automobiles.
How did the price of coal from the USA compare with that of British coal in the mid 1920s?
While coal cost 65 pence per tonne in the USA, it was £1.56 in the UK (over double the price).
Why did Wales’ mining industry lose the entirety of its European market?
Because Germany was making much of its repayments in coal, thus undercutting us with virtually free fuel. Furthermore, France had by this point begun importing their coal from the USA, despite the disparity in distance.
How high was unemployment in Dowlais, a Welsh mining town in 1933?
80%. In the same year, it had also arrived at 25% in both Merthyr Tydfil and Swansea.
In what year did steelmaking cease in its entirety in Ebbw Vale?
1929.
What year did most steel manufacture in Dowlais, and how many did it leave unemployed? - not needed
1930, with 3,000 unemployed as a result.
What were the principal reasons for the rapid decline of shipbuilding in the 1920s?
- The conclusion of WW1, and treaties of disarmament meant that fewer warships were needed internationally.
- Trade fell swiftly following WW1, lowering merchant demand.
- As in other major industries, British prices were simply no longer competitive.
Unique to cotton and wool manufacture, what new crisis threatened prosperity in the 1920s?
The dawn of man-made fibres.
Which nation represented the greatest threat to Lancashire’s cotton exports in the late 1920s?
India.
By what percentage did Britain’s exports drop between 1929 and 1931?
By 50%.
What was the extent of the reversal of our trade surplus between 1928 and 1931?
A surplus of £104 million became a deficit of £114 million.
What were unemployment levels in Britain in 1932 and 1933?
2 million in 1932 rose to 3 million in 1933, in a nation of 46 million.
What percentage of Brits were unemployed in 1928, compared to 1932?
6.6% and 14.7%.
What was the unemployment rate amongst insured males in 1932?
42.8%.
