America’s Great Depression began in 1929, right after the great big Stock Market Crash that same year, and it was economic hard times on a grand scale, partly caused by the Crash itself. The other reason for the Great Depression, which lasted a full decade, was the unequal distribution of wealth in America during the 1920s, which was basically a non-distribution of wealth.
In the Twenties 58% of America’s total wealth was owned by the top 1% of the population. That would be the Fords and the Carnegies and the Mellons and the Rockefellers and all the other big movers and shakers, including all the barons of oil, coal, lumber, railroading and manufacturing.
Henry Ford’s personal annual income was more than $14 million in 1929 while the average American made a mere $750 that same year. In other words, Henry Ford made as much money in 1929 as 18,000 Americans combined, which drastically illustrates the unequal distribution of wealth in the United States at that time. Industry controlled most of the wealth in America the Beautiful and the farmers – the real producers of America’s great bounty – controlled zilch, nada, nothing. Although they fed everyone. And no one in America thought this gross inequity would cause any problems for them down the road. Boy, were they wrong.
Basically, there was no middle class in the United States during the 1920s, which was America’s biggest banner decade for making money and lots of it. The only trouble was that only 1% of the country’s people were making it and we already know who they were. It gets worse.
Not only did the rich and famous and powerful have just about all the money, they wanted it all for themselves. That’s why the people who worked for the rich didn’t earn enough to do much of anything with their pittances except buy things from the rich. Often at company stores owned and operated by their employers. The U.S. didn’t want Europe selling its goods to Americans, either, and to ensure that they put such an outrageous tariff on anything coming into America that nobody in Europe could afford to ship anything over. If the rich Yanks wanted anything from Europe, hell, they’d just go over there and get it for themselves.
The American rich also liked to play with their money and their favorite game was Wall Street. They traded over a billion shares in 1928 and artificially drove the stock prices up so high that the prices of stocks no longer reflected the actual economic and fiscal performance of the companies they represented. The stock market soared. It flew high on a wave of pure confidence in American big business. But that all came to a head in October 1929 when the moneylenders and the money tenders wised up and became afraid of what they’d been doing for the past decade. That fear drove the prices of stocks back down so fast that even the ticker tape couldn’t keep up. A nation built on confidence had suddenly gone belly up due to fear. Fear of being wiped out. A self-fulfilling prophecy, indeed.
Suddenly there was no money for investment and none for paying America’s mortgages. Farmers were kicked off their farms. Folks lost their homes. People were laid off. The only real money to be made was in crime.
But the real criminals were America’s moguls and magnates, the rich who always got richer by the sweat of someone else’s brow. And these barons of bullshit never did a single day of time in a federal pen and they were all just as guilty as Al Capone. Maybe even guiltier.
The only thing “great” about the Great Depression was that it was somehow a great big surprise to everyone when they should have heard it knocking on their front door all along. Then they could have booted it the hell out before it ever had a chance to enter.
