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What impact did the Great Depression have on the way government set policy?

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calvinavant-38 | eNoter

Posted August 31, 2013 at 4:47 PM via web

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What impact did the Great Depression have on the way government set policy?

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Ashley Kannan | Middle School Teacher | (Level 3) Distinguished Educator

Posted August 31, 2013 at 5:06 PM (Answer #1)

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The Great Depression impacted a more active role for government in setting policy.  For what amounted to be the entire decade of the 1920s, federal government did not envision its role as being an agent of action.  Non- interventionist governments left it up to market forces and other commercial elements to drive policy.  Yet, with the economic crisis that precipitated the Great Depression, government had to take a more active role in setting policy.  Even President Hoover sought to increase the role of government in setting policy to help the nation deal with the economic challenges it faced.  Hoover's creation of the Federal Farm Board and passing the Hawley- Smoot Tarriff represent how he envisioned government as having to set policy as a direct response to the economic crisis the nation endured.  Establishing the Reconstruction Finance Corporation  in 1932 was another example of how Hoover sought to reconfigure the role of government in setting policy.  

An argument could be made that Hoover's example set the stage for President Roosevelt's New Deal, which dramatically transformed how government set policy.  In the extension of the federal government seen in the 1930s, one can see how the Great Depression impacted the way in which government set policy.  Government understood its need to set policy in an active manner that both addressed the conditions that caused the financial collapse and to prevent another one happening in the near future.  The Great Depression transformed the way government set policy in its advocacy of a hands- on approach that encouraged assistance and intervention in multiple domains.  Government was seen as an agent of change and action, something that was not as evident in the time period leading up to the Great Depression.

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