The United States’ 5 Longest Recessions

An interesting deep dive into many of America’s lasting recessions.

As sure as the spring will follow the winter, prosperity and economic growth will follow recession.

-Bo Bennett

Source : The U.S. National Archives

mid our current recession that started February 2020, nearly a year ago, I would like to bring you all on a journey to discover America’s longest recessions and how they were solved. This way we will be able to learn ways on how we can solve our current predicament and have our economy prosper once more.

The Post Civil War Recession 1865–1867 (2 years 8 months)

After the American Civil War ended and the Confederacy had returned to the Union, the United States was in debt and ruin due to the war. Problems arose as the freeing of slaves left more people in need of a job, and most of the South’s economy needed to be rebuilt from scratch. However, The American economy was going through deflation and credit advances helped the economy stimulate growth. This and the fact that many African Americans and Land-Owners worked on sharecropping as a way of rebuild the economy helped the United States out of the recession.

4. The Depression of 1882–1885 (3 years 2 months)

This recession was not due to wrongful economic policy or extreme debt through government spending or war rather just an economic downturn through the gradual debt cycle. This three-year downturn was made worse due to the Panic of 1884, thus why it lasted longer than most recessions. The panic caused a credit shortage and lowered purchasing power which slowed the growth of the economy. However, with help from large banks like the New York Clearing House, extending credit, the recession soon faded and the country became prosperous once more.

3. The Great Depression 1929–1933 (3 years 7 months)

Source: Chinmaya S Padmanabha

Shocking right! Who would have guessed that the Great Depression, one of the most widely known recessions in American history, was not the longest recession seen by our nation. Besides this fact, the Great Depression was the worst economic downturn we did see in American history leading most Americans to bankruptcy. The cause of the major recession was due to the high economic prosperity with the housing market and stock market through the 1920s which lead to the large crash in these markets unforeseen by most Americans of the time along with bank failures in securing peoples’ cash reserves. The Great Depression was slowly solved by President Franklin D. Roosevelt and his New Deal plan in 1933 creating jobs and federal support which helped lift the United States from its deep recession. The United States did not fully recover, however, until their involvement in World War II.

2. Late 1839 — Late 1843 Recession (~4 years)

After the Panic of 1837, viewpoints on the future of economic policy split between parties and created political unrest. The national bank of the United States barred federal deposits and the supply of the nation’s currency dwindled. These actions made it hard for people to spend their money and lowered purchasing power. The new economy hit a low point and pushed Americans and Economists to learn how not to enter this monetary economic situation again. The American people got out of this recession through the government defaulting debt and entering more money into circulation to counteract the rise in deflation.

1. The Long Depression 1873–1879 (5 years 5 months)

Source : Frank Leslie’s Illustrated Newspaper, October 4, 1873.

The major economic downturn was started in 1873 by the largest bank in the U.S., Jay Cooke & Company, which collapsed when it supported the Northern Pacific Railway which soon lead to the Great Railroad Strike of 1877. The Resumption Act of 1875 helped in the exchange of U.S. notes which also negatively effected the United States’ economy by increasing inflation. The actions that took place pushed high unemployment and high inflation into the nation and no economic plan was being put in place. It was slowly fixed, however, by the creation of new jobs by industries slowly creating profit and banks being built back up overtime.

The United States economy is ever-changing and continues on a cycle of prosperity and downturn, but we must look together on our past mistakes and learn from them as we grow as a nation. To look into more information on recessions in United States history click here.

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Analyst and Undergraduate Student @University of South Carolina

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