THE GREAT ECONOMIC DEPRESSION 1929 – 1933

THE GREAT ECONOMIC DEPRESSION 1929 – 1933

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THE GREAT ECONOMIC DEPRESSION 1929 – 1933

This is an economic crisis within the capitalist economy which is caused by over production starting from 1929 – 1933.


Characteristics / Features of G.E.D of 1920 – 1933.


1. Existence of high inflations.

2. Mass unemployment due to lack of economic activities.


3. Low purchasing power among the population because of unemployment.

4. Protectionism policy; whereby different nations adopted various policies to domestic market protection.


5. It characterized by famine, starvation and hunger hence death of many people.

6. Low production of industrial goods and general fall prices in a long run.


7. Closure of financial institutions i.e. banks and insurance companies.

8. Poor provisional of social services and closure of industries.


Causes of G.E.D


1. Effects of the WWI of 1914 – 1918.

This led to the decline of European nation while economy of U.S.A was gain momentum at the end of the war the purchasing power of European nations declined while production of raw materials and commodities increased. In U.S.A production become non sellable and profitless which accelerated to price fractuation in U.S.A hence this led to G.E.D of 1929 – 1933.


2. Over production.

U.S.A produced manufactured goods because U.S.A thought that her markets were stable as it was before and during WWI e.g. U.S.A produced more food, zinc, copper, cocoa etc. This led to the fall of process in U.S.A and European nation were not able to absorb all manufactured goods this led several industries bankrupt and closed, farmers also were not producing more because they had no money to run agricultural activities, all these led to profit less among the formers and industrialist hence the G.E.D in U.S.A.


3. Socialist revolution of 1917.

Russia introduced the socialist revolution after the Bolshevik revolution of 1917 whereby began to spread different parts of the world, this led imperialist nations to lose markets to those socialist nations, hence over production of raw materials and manufactured goods in USA and the fall prices which led to the occurrence of G.E.D.


4. The effect of protectionist policy.

Immediately after the WWI U.S.A was economically stable which helped other European countries to revive their own economies, however the European countries used the loans from U.S.A to restrict their industries and stabilize the economy & at the same time European nations initiated protectionist policy to defend their industries and agricultural production, this led USA to lose market in European nations hence it increased agricultural productions and industrial productions in U.S.A leading to overproduction, profitless among the farmers and industrialist hence the G.E.D in U.S.A.


5. The collapse of the New York exchange in Oct 1929.

Because this had a lot of impacts on U.S.A economy e.g. the poor people spend their savings to buy few shares while shares were not sold due to lack of money among the traders and workers. Also stock exchange lost value whereby shares were sold on credits, banks were run bankrupt due to the fact did not return the money because shares were not sold as a result links were closed, this led to unemployment to the people worked in industries and financial institutions, also farmers who borrowed money from the banks to buy shares did not return the money to banks because shares lost value and were not sold, asa result of farmers to undergo crisis and their farms were taken by bankers due to the failure of paying back the debt hence G.E.D in U.S.A


The struggling mother of a migrant family at a temporary camp in California during the Great Depression


Effect of G.E.D World Wide


1. Industrial production dropped severely.

This is because there was the fall of industrial and agricultural production hence industries and agricultural sector were producing under their capacity.


2. Fall of process of raw materials and manufactured and goods which accelerated to propping of agricultural production and commodities.


3. Unemployment where by many workers were sucked or taken away from their work so as to reduce the cost of production.


4. Low wages and salaries to those few remained employed.


5. Fall of international trade; this is due to protectionism policy but also accelerated same countries to reduce custom duties in order to attract traders.


6. Currencies lost their values e.g. German Dutch Mark.


7. Most of the imperialist countries started to adopt protectionism policy in order to protect their domestic market, industries and agricultural sector.


8. The fall of purchasing power because many people had unemployed and countries declined their economy.


9. The rise of dictatorship in the world especially in Italy, Germany and Japan where by directors in those nations used the effect of G.E.D to mobilize people and get to leadership.


10. GED finalized almost the decline of Britain super powerness.


11. It led to reduction of public servicesin order to reduce the cost of administration.

12. Rise of dictatorship in Europe and Japan.


Effect of G.E.D in Africa


1. The fall prices of raw materials.


2. Massive unemployment because Africans who were employed in colonial sectors majority of them were sucked because colonialist faced crisis.


3. Low wages paid to few employed people in colonial sectors.


4. It led to intensification of exploitation/high exploitation of Africa resources because the colonialist exploited more the African resources in order to compensate the problem of crisis in their countries.


5. Reduction of social services in the colonies in order to reduce the cost of administration.


6. The increase of taxation in order colonialist to get money from colonies to revive their economy.


7. The fall of purchasing power in the colonies.

8. The rise of prices of manufactured goods in the colonies.


9. Increased the struggle for independence in Africa due to the effects of G.E.D in the colonies like exploitation.


10. The formation of cooperative unions/societies in order to demand for their rights like high wages, good working condition, high prices for their raw material etc.


Effect of G.E.D in Impact in U.S.A


1. Farmers of medium and small sizes were affected following the fall prices of their raw materials, thus led them to fail to pay the rent they took from the bank hence forced them to sell their land and remain tenants.


2. The financial system were also affected which led to the collapse of New York stock exchange and bankrupt of many banks reg. It was estimated that by 1932, ½ of the total bank had run bankrupt.


3. Unemployment, Many Americans were unemployed due to the effects of G.E.D whereby it was estimated that almost 17 mill of people were jobless in America & in New York alone 25 mill were jobless.


4. The fall process of raw materials. This caused farmers to reduce quantities productivity e.g. wheat and barley so as to create the scarcity of raw materials.


5. The decline of industrial period, this led industries to start producing under their capacity fearing over production of manufacturing goods.


Unemployment



Qn: Why Russia was not Affected by G.E.D of 1929 – 1933?


1. Withdrawing of Russia from WWI of 1914 –1918.

This led Russia to concentrate on production and building her own economy for so long and stopped Russia to spend more in the war likewise but also Russia did not pay for war damage.


2. Protection policy.

Russia did not import and export goods from any capitalist nation. It avoided the direct contact with capitalist in trading system.


3. Good leadership of Russia leaders like Lenin, Joseph Stalin.

The policy of these leaders was to build Russia and use resources available effectively and not depending from the capitalist nation.


4 No over production of goods for competition with the capitalist. This enabled Russia to produce goods which could be used by only Russians in order to build their own economy and not otherwise.


5. The Bolshevik revolution of 1917. This brought socialism and useful shearing of production, this led Russia to use production for all people in Russia societies and not for the capitalist.


6. Russia had no colonial empire. This avoided Russia to have more over production to spend in the colonies as the capitalist produced hence Russia had to produce for the consumption of all people in Russian society which did not learn to over production of manufactured goods.

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FORM FIVE:NOTES FROM COLONIALISM TO THE FIRST WORLD WAR (1880S-1914) COLONIAL RIVALRY IN AFRICA

FORM FIVE:NOTES FROM COLONIALISM TO THE FIRST WORLD WAR (1880S-1914) COLONIAL RIVALRY IN AFRICA

history A level form 5 topic 4

FORM FIVE:NOTES  FROM COLONIALISM TO THE FIRST WORLD WAR (1880S-1914) COLONIAL RIVALRY IN AFRICA

TOPIC 4: FROM COLONIALISM TO THE FIRST WORLD WAR (1880S-1914) COLONIAL RIVALRY IN AFRICA

The development of capitalism in Europe led to the development of the industrial revolution which started in Britain in 1750 and by the end of the18 th century Britain was the only industrialized nation in the world. However in the 19 th century, other European countries such as France, Belgium, Germany and Italy also industrialized.

The industrialization of almost all European countries meant that there was no area to expand within European hence there was the need to find colonies. From 1870 monopoly capitalism demanded for the following:-

(a) Markets

(b) Raw materials

(c) Cheap labor

(d) Investment areas

(e) Areas to resettle surplus labor force.

Therefore the demands made capitalism to change to its monopolistic stage called imperialism. Colonialism was therefore linked with the development of capitalism in Europe, in the sense that it was undertaken to meet the demands of capitalism.

THE SCRAMBLE FOR AND PARTITION OF AFRICA

The scramble for Africa refers to the way European powers struggled among themselves to acquire colonies in Africa while the partition of Africa refers to the different steps taken by the European powers to divide Africa into territories and fixing colonial boundaries.

The major European powers that were involved in this exercise were Britain, Germany, France, Portugal and Belgium.

By 1880’s it was only Africa which was not colonized therefore it became the centre of imperialist attention which was driven by the development of capitalism.

FACTORS THAT DETERMINED THE CONFIGURATION OR THE PATTERN OF THE SCRAMBLE FOR AND PARTITION OF AFRICA

During the scramble and partition of Africa; there were some areas that witnessed serious conflicts among the imperialist powers for example the Congo Niger basin. There were various factors that determined the pattern of the scramble for and partition of Africa.

(a) Accessibility into the interior of Africa.

The imperialist powers scrambled for those areas that offered means of transport into the interior of Africa. These powers were interested in the interior because they wanted raw materials and markets where they can sell their manufactured goods. This explains why the Congo River was competed from the Belgium, France, and Portugal and the Niger River were competed for by France, Britain and Germany.

(b) Strategic factors.

This is one of the factors that determined the pattern of the scramble and the partition of Africa. Britain controlled Egypt because of the Suez Canal which was used to transport raw materials and manufactured goods into and outside Africa.

Britain also controlled Uganda because it wanted to protect the source of river Nile which is found in Uganda.

(c) Agricultural potentialities.

The imperial powers struggled for areas that had fertile soils that could support the growth of cash crops. Various powers struggled for the Congo and Niger rivers because the areas around the rivers were very fertile and therefore suitable for cash crop production.

(d) Mineral potentialities.

The imperials powers struggled for areas that had minerals in large quantities. Colonies such as Zimbabwe was very vital because it had large amounts of gold and diamond. Many imperialist powers were also interested in the Congo (DRC) because of the existence of large quantities of copper.

(e) Population

Population was one of the major factors that determined the nature of the scramble and partition of Africa. The colonial powers struggled for those areas with high population because they ensured constant supply of cheap labor and ready markets for the European manufactured goods.

ESTABLISHMENT OF COLONIAL RULE OF AFRICA

The partition of Africa marked the end of Africa’s political independence and the beginning of subjection to foreign rule. In the event of establishing colonial rule, the European powers used different methods depending on nature and attitude of the nature population. Sometimes the methods depended on the prevailing circumstances on the ground such as geographical location of the colony.

The tactics that were used to establish colonial rule include the following:-

(a) Treaty signing

(b) Use of military force

(c) Alliances

(d) Gun butt diplomacy

(e) Mercenary technique

(f) Berlin conference

(a) Treaty signing.

This was one of the most common techniques that were used to establish colonial rule in Africa. The European powers urged African leaders to sign treaties with the European claiming to give protection against their local and foreign enemies. Karl Peters signed treaties African chiefs in Tanganyika which put Tanganyika under German control.

Moffat an Anglican Missionary encouraged Lobengula.

(b) Use of Military force.

Sometimes direct military confrontation was used to establish colonial rule in Africa. The military was used in areas that resisted the establishment of colonial rule. The British used military force against the Nandi in Kenya and the Germans used force against the Hehe and Abushiri in Tanganyika.

The colonial powers used force because they were determined to establish their rule in Africa so as to exploit African resources.

(c) Alliances.

This method was used in areas were two societies were in conflict, that is situation of enmity. The colonial powers allied with one society against the other one and then controlled all of them together. In Tanganyika the German sided with Sango and Bena against Hehe and in central Africa, the British allied with chief Lewanika of lozi Kingdom against lobengula of the Ndebele people in Zimbabwe.

This led to the defect of Lobengula and the final colonization of Zimbabwe by the British

(d) Gun butt diplomacy.

This was the tactique where the colonial powers had threatened to use force but they did not actually use force. This method aimed at forcing African into submission. This method was used by British against King Jaja of Opobo in West Africa.

(e) Mercenary Technique.

In this policy, colonial powers used Africans to establish their rule in Africa. Here they used people who had no blood ties with the people who are being invaded for example the Germans used the Rugaruga in Tanganyika.

(f) Berlin Conference.

This was one of the methods used to establish colonial rule in Africa. This conference legalized the scramble for and partition of Africa. It laid down the principles that were to be followed when controlling Africa. One of the principles was effective occupation of African territories.

THE COLONIAL STATE

The colonial state refers to the extension of the metropolitan state in the colony. The colonial state was established immediately after scramble for and partition of Africa. It was followed by the establishment of the colonial economy.

The colonial state was an instrument of the colonialists and not the African masses. It was responsible for the exploitation and oppression of the colonies.

Objectives of the colonial state:-

(a) The colonial state was supposed to provide a link between the colonies and the metropolitan state. It had to ensure that the demands of the capitalists are satisfied such as the acquisition of raw materials and markets.

(b) The colonial state was supposed to enforce laws and orders in the colony. These laws were supposed to ensure that the interests of the capitalists are protected.Laws concerning land alienation and taxation were meant to ensure the exploitation of African resources.

(c) The colonial state was supposed to suppress or control African resistance against colonial. The suppression of African resistance aimed at ensuring that there is a good atmosphere for the exploitation of African resources. This explains why resistances such as Maji maji in Tanganyika and Nandi in Kenya had to be defeated at any cost.

(d) The colonial state was supposed to construct physical infrastructure such as roads and railways. These establishments could not be established by individual capitalists thus it was the duty of the colonial state to establish them. The roads and railways facilitated the colonial economy by transporting raw materials and manufactured goods.

(e) The colonial state was supposed to supervise colonial production in the colonies. The Africans in the colonies were supposed to produce cash crops and minerals that were needed in the metropolitan capitalist countries. Primarily the colonial economy was supposed to respond to the demands of the metropolitan economies.

(f) The colonial state was supposed to provide security and protection to the white settlers. The colonial state established the judiciary, prisons and the police. The colonial state was imposed on the Africans thus it received state was imposed on the Africans thus it received resistance from the Africans, thus the colonial state had to ensure the safety of the Africans.

SIGNIFICANCE OF AGRICULTURE IN THE COLONIAL ECONOMY

Significance of agriculture in colonial economy within African colonies may be seen from the advantages which colonialists got after the establishment of agriculture and to less extent Africans also benefited.

1. Agriculture led colonialists to get raw materials such as (cotton, tea, sisal, Pyrethrum, cocoa.etc)that were needed in their capitalists industries for more development.

2. Expansion of market for European manufactured goods such as Agricultural tools.

3. It destroyed African technology in order to avoid competition with African technology.

4. Facilitated exploitation of African resources for the benefit of European capitalist, resources being both human and natural resources.

5.Agriculture boosted the development of industries in Europe because industries operated nicely because of enough availability of raw materials.

6. Agriculture led to the construction of social services infrastructure like schools which prepared African elites such Mwl. Julius Kambarage Nyerere, Jomo Kenyatta and hospitals.Other physical infrastructures like roads and railways were contracted for transporting raw material from productive areas to the coast to full fill the interests of capitalists.

HOW THE COLONIAL STATE WAS VIOLENT

The main objective of the colonial state was to establish the colonial economy that would respond to the demands of the metropolitan economies, in establishing such an economy. The colonialists used extreme violence and that is why many scholars such as Frants Fanon asserted that, the colonial state was the most violent.

The colonial state used various measures to ensure that the needs of capitalism are met; these measures show that the colonial state was violent.

(a) Colonial conquest.

The colonial state used the military during the establishment of colonial rule. Those African societies that put up stiff resistance against the colonialists, the colonial state responded by using force e.g. Force was used by the British against the Nandi in Kenya and by the Germans against the Hehe in Tanganyika.

(b) Exploitation, which included

· Introduction of taxes.

The colonial state introduced taxes such as the pole and hut taxes as ways of getting revenue to run the colonies. The collection of these taxes was done in a very brutal manner. Those Africans who failed to pay taxes were usually flogged and some were even killed, these actions show the violent nature of the colonial state.

· Acquisition of cheap labour.

The colonial state used violent means to acquire labour. It introduced various labor laws in Africa to ensure constant supply of labor on economic enterprises; these labor laws include the Kipande system in Kenya and the pass laws in South Africa and Zimbabwe. When the Africans failed to provide labor, punishment was meted out.

· The colonial policy of land alienation was associated with use of violence.

Land alienation was supposed to create room for cash crop production and mining activities. The police used to force people away from their land so that it can be used for colonial production.

(c) Suppression of African resistance against the colonial economy.

The colonial state used force to crash Africans, who resisted the establishment of colonial economy. The colonial state used the military against the Nama- Herero resistance in Namibia and the Majimaji in Tanganyika.

(d) Destruction of African traditional industries.

The colonial state destroyed African traditional industries to ensure that Africa remains a producer of raw materials and a market for European manufactured goods. The destruction of these industries involved the use of force. E.g. in Belgian Congo the colonial state decided it was illegal for Africans to engage in handcraft industries, those who are caught will have their hands chopped off.

(e) Distribution of colonial social services.

The distribution of colonial social services such as education and health involved the use of violence (psychological). These services were made available only in those areas where the production of raw materials took place. E.g. in Tanganyika there was mainly offered in Arusha , Morogoro etc. Those areas that had nothing to offer to the colonialists were danced education.

NOTE:-

Given the above scenario; one rightly assets that the colonial state was the most violent or ruthless because it used the element of force to satisfy the interests of the capitalists in the metropolitan countries.

FACTORS WHICH DETERMINED THE INTRODUCTION OF DIFFERENT SYSTEM OF AGRICULTURE IN THE COLONIES.

(i) Dense population made it difficult for and alienation to be practiced. Settler and plantation agriculture was impossible to develop, thus peasant agriculture was reinforced.

(ii) Centralized and strong kingdoms were preferred for indirect rule and a peasants economy rather than settle and plantation system were introduced. These kingdoms proved to be on the establishment of settler agriculture. In this regard, peasant agriculture was introduced. The notable examples are Buganda and Northern Nigeria.

(iii) Different governors preferred peasant agriculture. For example, Governor Harry John stone of Uganda and Governors Horrace, Byatt and Sir Donald Cameroon of Tanganyika preferred peasant agriculture.

(iv) Territorial and nationality problems. Before 1919, Tanganyika was ruled by Germans, but after the First World War, it was ruled by the British. Disagreements appeared regarding various issues of administration and the creation of a settler colony. Thus peasant agriculture dominated in many parts of Tanganyika.

(v) There was always a labour supply problem when the economy favored. only one crop.

(vi) Nature of the crops. Certain crops such as cotton, coffee and cocoa needed great care and could not be mixed easily with other systems of agriculture.

(vii) Climate condition. Some area were thought to be unfit for the European settlement as far as climate condition was concerned. The notable examples are Nigeria and Uganda. In these areas, peasant agriculture was encouraged.

(viii) In case for mandate territories after the world War II, colonies would be granted independence. Therefore, no settle could be invited because they were preparing for majority rule. The notable examples are Tanganyika and Cameroon.

(ix) soil fertility favour plantation agriculture to cultivate different crops. Hence plantation agriculture encouraged fore example: Morogoro in Tanganyika.

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