3 minutes 38 seconds
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The Great Depression sucked for a lot of people. When it's discussed, it's often only in reference to the United States or Germany and the impact that it had on their societies. But what about the other major powers in the world? How much, if at all, did the Great Depression affect them, and how did their leaders try to deal with it? So, as you'll probably know, the Great Depression began in the late 1920s.
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This led to businesses collapsing, people losing their jobs, those people then had less money to spend, meaning other businesses couldn't sell stuff, meaning theirs went bust, and so forth. This led to a downward spiral that saw international trade collapse. So how did it affect the great powers? Polar opposite to the United States was the Union of Soviet Socialist Republics, 1 of the 2 communist countries in the world at this point. And given that they were under international sanction and barred from most cross-border trade, the Great Depression had very little effect on it.
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In fact, being able to point to declining capitalist economies was a massive propaganda boon, especially when combined with the 100, 000 US citizens that went to the Soviet Union for a better life, just in time for the coming purges. The lack of opportunities in the rest of the world saw many technical experts head to the USSR to help set up factories, which meant that as a result the USSR saw substantial economic growth whilst the rest of the world declined, an effect which helped to bolster support for communism across numerous countries. In Britain, the Great Depression was different to the United States in that the British government had cleverly prepared for it. You see, it's impossible to enter an economic depression if you never left 1. Which was the case for the UK, which had been in a prolonged economic downturn since the end of the First World War.
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The British government panicked and sought to balance its budget because it was running out of gold reserves. As such, Prime Minister Ramsay Macdonald sought to raise taxes and cut spending, which his party, the Labour Party, couldn't countenance. As such he quit the Labour Party and then formed a new Labour Party and governed with the Conservatives. Britain would recover from the Depression by 1935, because the only way was up at that point. This was mostly due to it leaving the gold standard and thus being able to devalue the pound to boost exports.
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And unemployment went down fairly quickly after Britain began a programme of mass rearmament, just in case that new German government got up to something. France avoided the worst of the crisis because it was much more self-sufficient in things like agriculture and manufacturing. There was a mild effect on employment, but France's decline was mild compared to Italy's, America's or Germany's. It did, however, take a long time for France to recover from this decline relative to other nations because it fiercely held onto the gold standard. Many in France hated the idea of devaluing the franc, and so it wasn't until 1936 that they actually came off the gold standard and devalued their currency to boost exports.
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Italy was similar in that it also fiercely stuck to the gold standard, but the government there also saw the Great Depression as an opportunity. When important businesses collapsed, the government stepped in and Given that it ran a surplus, it was able to use excess money to continue paying wages and producing goods. Italy's economy was the second in Europe to recover after Britain's, and the crisis gave Italy's government near complete control over its economy, which it would soon turn to war. Outside of Europe, Japan was the first major economy to recover from the Great Depression. This was because its government opted to immediately devalue its currency and spend a bunch of it on keeping businesses open.
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This led to Japan's economy growing quite rapidly whilst the European powers were still stagnant, meaning that the Japanese economy was much better prepared for… foreign adventures. The major powers had mostly recovered by the beginning of the Second World War, but it wasn't until the mid-1950s that all of them had beaten their pre-Depression metrics. I hope you enjoyed this episode and a special thanks to my patrons Jerry Lambdin, Jordan Longley, Adam Stalter, Marcus Arsner, YN Hockey, Spencer Lightfoot, Rod D. Martin, Words About Books Podcast, Captain Psydog, Gustav Swan, Marvin Casal, Camoon Yoon, Winston K. Wood, Boogily Woogily, Daniel Tobian, Miss Isette, Aaron the White, Corey Turner, The McWhopper, Alex Schwin, Anthony Beckett, Copper Tone, Maggie Plaskowski, Shuenin, Spinning 3 Plates and Charles I.
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