The United States had participated only marginally, and only late in the day, in the First World War. All of this added up to a witches’ brew of economic illness, ideological paralysis, and consequent political incapacity. To those abundant physical and institutional ills might be added the psychological maladies of near-religious faith in laissez-faire and the gold standard as the most sacred of orthodoxies, the economic equivalents of the Nicene Creed. What was more, memories of the war’s bitter fighting and vengeful conclusion rendered the post-war international atmosphere toxic, poisoning the wells of traditional diplomacy and dooming any efforts at concerted multi-lateral action to deal with the gathering crisis. The lingering distortions in trade, capital flows, and exchange rates occasioned by the heedlessly punitive Treaty of Versailles, as the economist John Maynard Keynes observed at the time, managed to perpetuate in peacetime the economic disruptions that had wrought so much hardship in wartime. The fighting had taken a cruel toll on key economies like those of Britain, France, and Germany, the core societies of the advanced industrialized world. Though economists and historians continue to this day to debate the proximate causes of the Great Depression, there can be little doubt that the deepest roots of the crisis lay in the several chronic infirmities that afflicted the post–World War I international economic order and touched every country on the planet. “The primary cause of the Great Depression,” reads the first sentence of Hoover’s Memoirs, “was the war of 1914–1918.” Much legend to the contrary, the Great Depression was not entirely, perhaps not even principally, made in America. Herbert Hoover got many things wrong about the great economic calamity that destroyed his presidency and his historical reputation, but he got one fundamental thing right.
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