Question

Compare the responses of the federal government in 1929 and 2008. How did we respond in both of those events and why was our response in 2008 so much more effective?

Answer 1

The problem with the Great Depression of 1929 and the subsequent years was that actually government did nothing to intervene. President Herbert Hoover believed that government should interfere and that the market will balance itself out. That is one of the reasons that President Roosevelt won with a landslide with his promise of the New Deal.

In 2008 the government took a much active role in combating the Great Recession.  For example, the government even bailed out some banks that were in trouble as well as provided emergency help. They also proposed and passed many laws that would help prevent this kind of situation in the future.