Although economic indicators, such as GDP and personal income, clearly mark periods of economic decline or growth in modern times, economic data has not always been available to accurately measure these indicators. In such cases economist turn to proxies to try and glean information about the economy of a certain time period. One such proxy is the State of the Union Address, given annually by the president of the United States. The President consistently addresses the economic situation during his speech and economist can attempt to use his description to gage whether a period in time was economically prosperous or sluggish.
Economic data shows a steady decline in GDP occurring in the early 1930’s followed by a rapid rise in GDP beginning …show more content…
Income fell rapidly in the early 1930’s as businesses went bankrupt and other employers cut wages and employees in order to save money and remain afloat. As the New Deal began to take shape in the late 1930’s and early 1940’s personal income began to rise steadily among the American people. The beginning of World War II continued the increase in personal income as more and more men and women entered the workforce to provide for the war. The government and citizens spent a lot of money to fund the war and this increased wages, as military manufacturers were able to increase wages because the military kept purchasing their equipment. The following graph shows Personal income falling in the 1930’s and rising in the late 1930’s and …show more content…
Looking at the State of the Union Addresses written by Herbert Hoover in 1932 and Harry Truman in 1947, both Presidents give similar reports on the economy. In Hoover’s 1932 letter to Congress (Presidents have the option to write a letter or give a speech), he is optimistic about the future of the economy but concedes it is in dire straights at the present moment. He informs the Congress, “the situation developed during last fall and winter into a series of most acute crises.” Hoover claims the country has been saved from the precipice of disaster stating, “The unprecedented emergency measures enacted and policies adopted undoubtedly saved the country from economic disaster.” The Great Depression was nearing its trough and the economy would begin to recover in the next couple years and Hoover is accurate for the most part in his depiction. Hoover goes on to call for legislation concerning the banks and balancing the budget. This legislation is the result of the Great Depression as banks collapsed during the crisis and the government attempted to create legislation that would prevent this in the future. The government spent tremendous amounts of money to try and stabilize the economy and was therefore going into debt, which is why Hoover proposed legislation to balance the budget. Hoover’s State of the Union is in line with the economic data from the era of the Great
Economic data shows a steady decline in GDP occurring in the early 1930’s followed by a rapid rise in GDP beginning …show more content…
Income fell rapidly in the early 1930’s as businesses went bankrupt and other employers cut wages and employees in order to save money and remain afloat. As the New Deal began to take shape in the late 1930’s and early 1940’s personal income began to rise steadily among the American people. The beginning of World War II continued the increase in personal income as more and more men and women entered the workforce to provide for the war. The government and citizens spent a lot of money to fund the war and this increased wages, as military manufacturers were able to increase wages because the military kept purchasing their equipment. The following graph shows Personal income falling in the 1930’s and rising in the late 1930’s and …show more content…
Looking at the State of the Union Addresses written by Herbert Hoover in 1932 and Harry Truman in 1947, both Presidents give similar reports on the economy. In Hoover’s 1932 letter to Congress (Presidents have the option to write a letter or give a speech), he is optimistic about the future of the economy but concedes it is in dire straights at the present moment. He informs the Congress, “the situation developed during last fall and winter into a series of most acute crises.” Hoover claims the country has been saved from the precipice of disaster stating, “The unprecedented emergency measures enacted and policies adopted undoubtedly saved the country from economic disaster.” The Great Depression was nearing its trough and the economy would begin to recover in the next couple years and Hoover is accurate for the most part in his depiction. Hoover goes on to call for legislation concerning the banks and balancing the budget. This legislation is the result of the Great Depression as banks collapsed during the crisis and the government attempted to create legislation that would prevent this in the future. The government spent tremendous amounts of money to try and stabilize the economy and was therefore going into debt, which is why Hoover proposed legislation to balance the budget. Hoover’s State of the Union is in line with the economic data from the era of the Great