Comparing The Great Depression To The Great Recession

1230 words - 5 pages

Comparing the Great Depression to the Great Recession
The Great Depression and the Great Recession of the early 21st Century have many things in common. The Great Depression and the Great Recession both experienced good economic times before they crashed. Prior to the Great Depression, (1921-1929) the annual real economic growth was at 4.4 percent. Though less, the annual real economic growth prior to the Great Recession was at 3.2 percent. The banks before both times moved into new business lines. In the 1920s banks increased real estate lending and also increased investment banking. Prior to the Great Recession, (1990s-2000s) banks increased real estate lending and the ...view middle of the document...

Though they both said the budget needs balancing, they were under the mindset that the massive spending helps the economy.
Comparing and Contrasting Presidential Programs
A program that F.D.R put in place is F.H.A (Federal Housing Administration) in 1934. F.H.A is a program that provides mortgage insurance on loans on single family and multifamily homes. F.H.A provides protection to home owners from defaulting on the owner’s mortgage loans and if the home owner defaults on their on their payment F.H.A will pay the claim. Another program that F.D.R put in place is the Home Owners Loan Corporation (H.O.L.C) in 1933 to try to combat the Depression. The H.O.L.C is a corporation that’s job is to refinance homes that were to be foreclosed or to default on their payments due to the 1929 crash. The loans that came from H.O.L.C only apply to non-farm houses and for houses worth under $20,000.
A program that Obama put in place in the Great Recession is H.A.R.P (Home Affordable Refinance Program) this program was put in place in 2009. H.A.R.P is also a refinancing program that lets homeowners who are upside-down on their mortgages refinance when other companies would not. These programs goals are to re-spark the economy by increasing residence real estate. They all do this by helping people who could not normally afford a house or keep up with their payments. F.H.A is for people who are going to buy a house but can’t afford the house that they need, H.A.R.P is for people who have a house and would like to refinance to have a better interest rate, while H.O.L.C. would be when a person cannot make the payments to keep that house.
The Agricultural Adjustment Administration (AAA) is a program put in by president F.D.R in 1933. The A.A.A purpose was to increase the cost of farm goods by paying farmers not to plant as many crops so the demand for the farmer’s crops would increase. The A.A.A put out $1,500,000,000 to farmers in the span of 3 years. Though the program did not accomplish much, it was however favored by many farmers. Later the A.A.A was declared unconstitutional. President Hoover on the other hand was in support of farmers and created the Federal Farm Act. With a $500 million budget the act would loan money to farmers to increase the strength and efficiency to create more production. In comparison to the A.A.A program the Federal Farm Act, both gave money to farmers to try to help...

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