Hoodie Baron

More Devastating

“Great Depression” of the 1930′s

Up to this point in the competition, most of the two sides have been relatively evenly matched; Winter Olympics v. Summer Olympics, Star Wars v. Star Trek, and Stewart v. Colbert are all arguments in which either side could conceivably prevail.  But when asked which is more devastating, the Great Depression or this 21^st century mini-recession, the answer is blatantly clear.  Which economic crisis lasted longer?  Which had a stronger effect on countries around the world?  The Great Depression.

First of all, let us look at the names of the two crises; one is referred to as a depression, while the other is referred to as a recession.  A depression is the worst point in a financial panic, while a recession simply means that the economy is regressing.  Consider a hill, with a peak and a trough.  The depression would be located at the bottom of the trough, the lowest place in the visual analogy.  A recession would simply be located somewhere along the downward-sloping part of the hill.

No one is arguing that the recession is not a problem; I am the first to admit that it is.  The unemployment rate in the United States during the recession rose only 3%, reaching a maximum of 10.2%.  During the Great Depression, the unemployment rate rose to 25%.  In some countries, unemployment figures rose to 33%.Additionally, according to the latest Newsweek edition, we are already successfully coming to the end of the recession.  How long did it last?  Two or three years.  How long did the Great Depression last?  Ten years. 

The Great Depression had a greater impact on countries around the world, lasted longer, and represented a greater economic downturn.  While times may seem tough right now, it’s nothing compared to the economic devastation the Great Depression wrought.

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Gold Baron

More Devastating

“Great Recession” of the 2000′s 

 The economic state in both the Great Depression and Recession was horrendous, but it should be quite clear that the Recession was far more devastating to small, private-owned businesses, large corporations, and the American people.

In October 2009, the unemployment rate was at a massive 10.2%, meaning that about 1 in every 10 people was out of work.Small businesses often were destroyed during the Recession, because they simply could not afford to pay their employees, but could not run without their employees either.

The Recession is also infamous for the outrage that spawned towards large companies such as AIG. AIG had requested a whopping $170 billion dollar bail-out fund provided by American taxpayers, which was approved by the U.S. treasury. $1.2 billion of this bailout fund was given to select high-ranking executives, (the very same that has driven the company into the ground) as means of “motivation” for these executives to come up with ideas to save their company.

The thoughts of those that were supplying the bonuses were clearly completely skewed, as they were rewarding the atrocious business techniques that AIG was using. While these executives were on their luxurious vacations, the people that relied on AIG to fund their medical bills and insurance were not getting enough nearly money to cover their needs.There was also far too much greed for the financial system’s good, such as the financial companies that were selling loans that they knew could never be paid to other financial companies. The problem was, however, that various financial companies were all using this strategy and were thus running themselves into the ground. The final nail in the coffin was the fact that the government regulators that were supposed to notice problems did not do their jobs, thus allowing the madness to continue.