So let’s discuss the reconstruction finance corporation APUSH (Advanced Placement United States History). Advanced Placement United States History gives us different aspects of how the reconstruction finance corporation dismantled. Different stories and facts throughout our academia. If you have heard about the Great Depression that happened during the 1930s, then you must know the Reconstruction finance corporation.

The Great Depression? A Tragedy


    • The effects of the Depression broadened across the US economy, millions of people lost their jobs.
    • By 1930, 4.3 million became unemployed.
    • By 1931, 8 million.
    • During 1932, the score had risen to 12 million.
    • By early 1933, nearly 13 million people couldn’t get themselves employed. And the figure of unemployment rose to 25 percent.

The Reconstruction Finance Corporation APUSH

The Reconstruction Finance Corporation was formed during the Emergency act in 1932. The organization was government-administered. It remained in the business till 1957. The major aim of RFC was to provide fiscal and financial support to the local administration and small-level businesses. Also, provide interest-based loans to individuals and minor-level needy businesses. It also assisted in providing financial support to state and local governments and made loans to banks, railroads, mortgage associations, and other businesses.

  • Reconstruction Finance Corporation [PIN POINTS]

    • RFC got established just to stay for only 10 years. After ten years, it had to be dismantled.
    • RFC propagated by occupying authoritative organizations by becoming the key shareholder in the businesses.
    • It was also involved in assisting World War II by passing eight subsidiaries to aid the soldiers.

The Reconstruction Finance Corporation (RFC) Major Flaws

After the induction of The Emergency Relief Act, created in the summer of 1932. The same following year, The RFC started to act like god. It started broadening its power across the United States. Providing loans for small and large-level businesses from all types, it basically got support from the public. During the tenure of Herbert, The RFC wasn’t doing this at a clinical pace. But as soon as the Roosevelt took over, RFC worked in flash. Vigorous amounts of loans and tariffs were provided to RFC. The main source was the aid to World War II participants, this huge chunk made RFC more dominant in the society. Constructing and financing war plants, arms and ammunition for the soldiers and their deployment expenses all went into the RFC’s pocket.

Scandal and Dismantlement of the Reconstruction Finance Corporation

Congress made RFC to assist the public and to compensate for the economic crisis. But it worked opposite. Despite the political and economic turmoil and the WWI break out, The RFC worked in a passive fashion. The agency came up with many flaws. Despite being in the seat for more than 25 years, the organization didn’t work as it should have done.

The downfall of RFC came when Congress started a rigorous investigation against the RFC. Things started to spill out further. Like corruption in multitudes within the agency and within the linking partners. The Senate then ordered quick reconstruction from scratch and to catch those involved in the rampant form of corruption.

At the start, after the reinitiation of the agency, things work well. But as time passed, RFC again started showing its colors. Again the hollow of corruption and over-powered dominance started to appear. It only took one year for Congress to pass the bill for the liquidation of RFC under the act of Eisenhower. This took RFC by storm. All the lending power and functioning of the agency were taken and handed over into the custody of other agencies. And by the end of 1957, RFC got dismantled entirely.


So the ending remarks are neither in support nor against. RFC took some pretty good measures when the Great Depression hit the US. Like assisting low-income based individuals. Helping them in lifting their business. RFC also funded them. But as time passed, RFC became more of a villainy type. The corruption mafia took over the organization. These things made the RFC taken into account and the horizon of the law and the government.





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