The South's economic crisis In 1938, with the U.S. still
doggedly fighting to escape the Great Depression, FDR's
administration declared the Southern region to be "America's
Economic Problem Number 1." Although the country as a whole was
struggling, the pain was most acutely felt in the South, which
lagged by almost every economic measure: jobs, wage levels,
family income and more. Many of the reasons Roosevelt's experts
gave for the South's dismal situation were specific to the era,
like being "crushed" in the Civil War, the "vicious period" of
Reconstruction and tariffs on cotton and tobacco. The way
railroads were set up and subsidized in the late 1800s was still
conferring a big advantage to Northern businesses. Today, with
Southern states among the nation's leaders in population growth
and an influx of new industries, it's assumed the region has
left its "Economic Problem Number 1" status behind. Skyrocketing
unemployment in the Rust Belt and Western states like Nevada
show other regions face just as dau