DECLINE OF EUROPE CAPITALISM.
REASONS FOR THE DECLINE OF EUROPEAN CAPITALISM
- European power were active participants in first and second world war (1914 -1918,1939-1945)
edu.uptymez.com
The wars left the European economy was serious catastropher. The imperialist nation included Britain, German, France and Belgium.
- The Western European imperialist states were battle field. That means the war was fought on the land field. That means the war was fought on the land of European nations therefore there was mass killings of the people and destruction of properties
- The post second world war, left the European states highly in debted particullary by the U.S.A billion dollars were given to Britain from 1941 to the end of the second world war in 1945. Through the land lease act of 1941, caugress authorized the safe exchange or lease of arms and other equipments to Britain.
- The Great depression of 1929-1933 before this Britain had suffered a number of depression such as economic depression of 1837/38 and 1873/1950. Which weakend her economy. Therefore, the Great depression of 1929-33, Re European Economy in serious catastropher Eg: In France the Great depression arrived later and last longer than any where in the western world. On the older land U.S.A despite the fact that she was badly affected the implemented immediate measured to solve the problem by imposing New deal policy.
- The decline of colonial system after WWII in 1945 Africa there were the rise of mass Nationalism and also at the same time in Asia many colonies started to demand independence Eg: British lost India (1947), Pakistan(1948) and Burma (1948) also had invested much in the colonies like Canada, Australia India and Newzeland. So the independence of these colonies meant that Britain has to lose her market and invest.
- Too many colonies. So it was burden to them according to the U.S.A policy eg:Portugal had Angola, Mozambique, Guinea Bissau e.t.c.
edu.uptymez.com
IMPACTS OF DECLINE OF EUROPEAN CAPITALISM
- The rise of U.S.A as a super power of the world. This is due to the fact that U.S.A was not active participate in first and second world war.
- Decolonization of African countries due to fail of colonial officers to run their colonies.
- Spread of democracy in the world. Many African countries introduce liberal democracy with multipartism.
- Introduction of new policies in third world countries such as structural adjustment program (SAP)
edu.uptymez.com
U.S.A ECONOMIC PROGRAM TO EUROPE i.e. MARSHALL PLAN – 1947
Marshall Plan was European economic recovery programmed proposed by George C. Marshall (The secretary of the state in 1947 with the aim of helping (aiding) the war affected (ruined) European nations to revive their economics.
OR
War an American plan to spread dollar imperialism by providing economic assistance to revive the economies of the European who was affected by the war.
ORIGIN
The plan was drafted in June 1947 by George C. Marshall who called it a policy of cooperative European revive i.e. The European economic recovery program.
OBJECTIVE OF MARSHALL PLAN
1.The plan needed to reconstruct the devastated (affected) European economy because the war demonized industries, farms, transport, schools, banks, hospitals, Miner , trader etc.
2.The American needed to strengthen her markets for her manufactured goods abroad because at home (U.S.A) was facing over production crisis and she needed a place to dump her manufactured goods and capital.
3.The plan helped European economies with the intention of making European nations not to follow under communism or socialism.
4. The plan aimed to retail the Western European country as a health trading particular with U.S.A in the capitalist world.
TERMS / CONDITION OF THE PLAN
1. U.S.A gave/provided a lot of money approximately more than 22 US billion dollars to western European nations in terms of grants and loans, also U.S.A provide and manufactured goods with the intention of reviving European economies in return Western, European countries world pay back the debts on agreed period of time with interest.
2. The European colonial masters were persuaded to decolonize their colonies as a condition to get loans and grant otherwise they would not get the loan from U.S.A.
SIGNIFICANCE OF THE MARSHALL PLAN / LOAN
1. The plan consolidated US economic domination over Europe which made us to strengthen her imperialism with all her multinational co-operations, financial institution and military organization in Europe.
2. U.S.A was able to rescue war affected economy of Western Europe whereby Western countries were able to rehabilitate their economies. In this plan U.S.A with her open door policy towards investment and trading activities in free zones abroad become practical whereby the plan managed to make the colonialist to change their way of exploiting the colonies due to the fact that through this plan US come with another way of exploitation under the Neo – colonialism whereby all the former colonies were exploited by U.S.A under the back door of neo – colonialism.
3. The plan made U.S.A to start different military organizations abroad to safeguard invests in different parts of the world e.g. SEATO, CENTO, OCAS, NATO, OAS, and military bases established in Mombasa Kenya, Kuwait, and Pakistan.
4.The capital from U.S.A to European nations started to be re-invested in European nations to recover the effect of the war, also others were reinvested in colonies so as to recovery from economic crisis in the metropolitan and to enable the metropolitan countries to payback the debt to U.S.A hence it increase exploitation in the colonies.
5. The plan made U.S.A economic strength in the world which accelerated her to assume as a leading position in the capitalist world (superior power) replacing Britain. This led the financial center to move from London to Washington.
6. The plan made U.S.A to start offering not only money but also machinery, technical assistance and raw materials in different parts of the world especially in capitalist nation which all these strengthen the economy of U.S.A.
FACTORS LEADING THE GREAT BOOM ON 1920,s IN U.S.A
During the period of 1919 up to 1924 the economy of USA in comparison to other nations was much stable this is because of the benefits she got during the WWI of 1914 – 1918 hence U.S.A benefited much in the WWI because of the followings.
1. USA was not participating full in the WWI. This made USA to increase her production because there was no fought in American land.
2. During the war U.S.A was the supplied of food stuffs, war equipment and raw materials to fighting nations. Being paid a lot of money U.S.A enjoyed a big and good market for fighting nations during war time hence she government a lot of money or interest.
3. During the war U.S.A exports increased from 2.4 billion us dollar to 7.4 bill us dollar.
4. By 1920 U.S.A had half output of the world coal extraction, ¾ of the world steel, 2/5 of the world oil oxidation etc. these enabled U.S.A to get a lot of money and profit from her selling, this increased the wealth in U.S.A and expanded market for US minerals.
5. From 1924 – 1929 U.S.A enjoyed economic boom, because of a lot of elements in the field of manufacturing industries and agricultural industries like Electronic motorbike, film industry, Radio industry and agricultural production also increased which led U.S.A to start looking for markets for her agricultural production in the world hence from 1920’s – 1929 U.S.A economy was much stable and led U.S.A to be known as a period of economic boom.
EFFECTS OF U.S.A GREAT BOOM OF 1920’s
From 1920’s – 1933 after U.S.A had enjoyed the economic boom, the following of U.S.A started to face some crisis and was not stable due to economic depression. Economic depression in U.S.A was resulted by the followings:-
1.
Over production of commodities and agricultural production (raw materials).
USA continued to produce more and more because of the market was not stable due to the impact of the war, hence they fail to get market to absorb all manufactured goods and commodities from USA. These lead to over production of raw materials and goods.
2.
Protectionism policy.
European nations which were the main markets for U.S.A manufactured goods and raw material started to adopt protectionism policy. In order to protect their industries and their farmers who had started to produce again by using the loan from U.S.A, U.S.A Learned markets in European countries which led U.S.A her economy to undergo depression.
3. The loss of market.
U.S.A loss market for her manufactured goods and raw materials due to different reasons including adaptation of protectionism policy for European countries hence over production in U.S.A.
4. Unemployment.
Due to occurrence of this U.S.A industries were closed, farmers were not producing in high capacity fearing of over production; traders, business men were not also trade here and there all these led to depression in economy of U.S.A.
5. Close of financial institutions.
Financial institution was closed because people who borrowed money from the bank did not pay back as a result of banks to undergo bankrupt.
6. Closure of industries.
Great depression led to close of industries because industrialist feared loss over period of manufactured goods which had caused lack of market among the industries hence industries was closed.
7. Poor provision of social services.