FDR and the Great Depression 1932-1941 Unit Objectives: Analyze racial and ethnic conflict during the 1920s and 1930s in the state and nation. Assess the early years of the Great Depression including the causes of the Depression. Describe the impact of the Great Depression on American life. Compare Hoover and FDR’s response to the Great Depression. Examine FDR’s 3 Rs: relief, recovery, reform. Compare and contrast the first and second New Deals. Assess the successes and failures of the New Deal. Discuss the criticisms of the New Deal. Connect the policies of the New Deal to the rise of the welfare state. Analyze the impact of the New Deal on the changing role of the federal government. Text Chapters: o o Bailey, Thomas A. The American Pageant, 11th Edition. Chapters 35, 36 Brinkley, Alan. American History, A Survey. Chapter 25, 26 Assignments, Activities, & Projects: o The Grapes of Wrath character analysis o Relief, Recovery, Reform Chart o A&E Franklin E. Roosevelt biography o The Scottsboro Boys film o FDR’s inaugural address o Excerpt from Jimmy Carter biography –AAA o Examine Successes and Failures of FDR’s New Deal Suggested Flex-Point Opportunities: o REFERENCE FLEX-POINT INSTRUCTIONS FOR OTHER IDEAS o o o o o o Other as approved by teacher Mr. Smith Goes to Washington Any novels, readings referenced in notes outline Robert Penn Warren’s All the King’s Men Jimmy Carter’s An Hour Before Daylight Biography of any key figures from era Possible Free-Response Questions: FDR and the Great Depression 1932-1941 THE CRASH Poor Herbert Hoover “The poor house is vanishing from among us.” Other economic crises – 1893, 1907, 1920 Why the Crash? Conditions before High employment Prices stable Production soaring Manufacturing output doubled Real wages up 17% Those already in poverty Farmers Black Hispanic Appalachia Speculation Land in Florida Great Bull Market March 1928 Stock value up 10% 20% in one day 5 million shares exchanged Margin buying Federal Reserve Board Interest rates up then economy slows = possible job loss Interest rates down then speculation gets worse 1927 on – FRB does both!! BLACK TUESDAY Oct 21 – sharp dip Oct 23 – sharper dip Oct 29 – Black Tuesday 16 million shares traded $16 billion lost in October By November $30 billion lost BLACK TUESDAY AND THE CRASH - NOT THE CAUSE OF DEPRESSION!!! THE CAUSES First, the Signs Inventories 3 times as large in 1929 than in 1928 – consumption declining Wholesale prices dropping, production dropping Black Tuesday Now, the Causes Lack of diversification Maldistribution of purchasing power Credit Structure International Trade International Debt Structure The Crash? Did not cause – exposed and exacerbated Companies can’t get capital 9,000 banks fail 1930 to 1933 Depositors lost $2.5 million in deposits Money supply fell by 1/3 1930-33 Deflation – no one can buy Lower prices Lower productivity Lay-offs Could it have been prevented? Yes, if Federal Reserve Board had acted quickly and responsibly No, maldistribution and over production and debt structure = inevitable HOW BAD WAS IT? Gross National Product 1929 = $104 billion 1932 = $76.4 billion – 25% drop 1932 = 25% unemployment Steinbeck’s Grapes of Wrath John Maynard Keynes – dark ages Cities v. Farms Cities Cleveland = 50% unemployment Akron = 60% Toledo = 80% Public relief? Your fault? Not equipped Breadlines for blocks Farms Incomes decline by 60% - 1929 to 1932 1/3 lose land to mortgage companies Natural disaster “black blizzards” “Okies” Malnutrition and homelessness Black America ½ still in South Displaced by white workers Relief first to white families 400,000 leave for North Harlem incomes drop by ½ 1929 and 1932 Unemployment at least 50% Lynching continue Scottsboro boys case – March 1931 Hispanics and Native Americans ½ million leave US for Mexico! Similar plight of African-Americans 1930s – Indian Reorganization Act 1934 1934 – average income = $48 a year Women 1932 to 1937 – illegal for more than one family member to hold a federal civil service job 25% women worked Lowest ebb of feminism Impact on Families Marriage postponed; desertion not divorce; births decline Husbands second to wives Family incomes – 1929 = $2300; 1933 = $1500 Hopelessness How to Win Friends and Influence People (1936) Harry Emerson Fosdick – positive thinking Depression Culture Farm Security Administration Photographers, Stories Plight of the Farmer Literature Tobacco Road (1932) Let Us Now Praise Famous Men (1941) To Have and Have Not, For Whom the Bell Tolls Grapes of Wrath (1939) Escapism Amos and Andy Superman Dick Tracy Mr. Smith Goes to Washington Gone with the Wind American Communist Party – 100,000 HOOVER’S RESPONSE March 1929 to Oct 1929 all’s well “Jaw-Boning” Voluntary cooperation Sustain prices and wages By 1931, industrialists can’t Cheerleading Talk of recovery “hoovervilles”; “hoover flags”; “hoover blankets” Private sector should be responsible Hoover’s concerns Balanced budget Spirit of the “dole” Public Works Programs $423 million proposed 1932 – proposed tax increase to prevent deficit Agricultural Marketing Act – April 1929 Farm Board to buy surplus and raise prices Hawley-Smoot Tariff – 1930 75 farm products 925 manufactured goods Collapse of International Debt Structure Freeze payment of war debt and reparations Freeze international debt payment Too little, too late Federal land and home loan banks Glass-Steagall banking Act 1932 Reconstruction Finance Corp – 1932 Loans to RRs, banks, life insurance, etc. $2 billion – “trickle down” “breadline for big business” VERY conservative – only 20% used With no demand, looser credit doesn’t matter THE BONUS MARCH Farmers demand another McNary-Haugen bill 1932 – Farm Holiday Association – farmer’s strike 1924 – vets promised bonus to receive in 1945 Vets demand in 1932 June 20,000 Vets march on Washington General Douglas MacArthur “Nobody is actually starving” WELCOME FDR!! Election of 1932 57.4% to 39.7% 472 to 59 Who was FDR? His history His politics His coalition Inaugural address March 4, 1933 “the only thing we have to fear . . .” Special session of Congress War time executive powers THE NEW DEAL RELIEF, RECOVERY, REFORM First 100 Days The Banks March 5 – National Bank Holiday March 6 – Emergency banking Relief Bill March 12 – 1st Fireside Chat “Capitalism saved in 8 days” Glass Stegall Act FDIC $2500 deposits insured Gold Reserve Act – April 1933 The Farms May 1933 - Agricultural Adjustment Act Domestic allotment Subsidies to parity 6,000,000 pigs; 220,000 sows; ¼ cotton Impact of AAA Jan 1936 – Supreme Court ruling Soil Conservation and Domestic Allotment Act Resettlement Administration, Farm Security Administration, Rural Electrification Administration Industry June 1933 – National Industrial Recovery Act National Recovery Administration – Hugh S. Johnson Blanket code NRA – “blue eagle” Collective bargaining Public Works Administration – June 1933 Interior Secretary - Harold Ickes $3.3 billion Overall Assessment effectiveness 1935 – “sick chicken” case Regional Planning Tennessee Valley Authority – May 1933 Progressives Purposes New Deal’s one true success?? RELIEF Federal Emergency Relief Administration – May 1933 Harry Hopkins Spirit of the “dole” – “It is probably going to undermine the independence of hundreds of thousands of families.” Civil Works Administration – Nov 1933 Keynesian economics 4,000,000 employed; 400,000 projects; $1 billion spent Spring 1934 – Could this have worked?? Civilian Conservation Corporation – March 1933 Conservation and reforestation – “tree army” By 1942 2.5 million 18 to 25 year olds CRITICISMS Did it work? 1935 Political opposition “reckless spending”; “socialist reforms”; “that man in the White House” American Liberty League Public Protests Dr. Francis Townsend 5,000,000 members Over 60 yrs = $200 monthly in return for retirement $24 billion for 9% of population; total GNP = $40 billion Father Charles E. Coughlin Populism leftovers National Union for Social Justice Senator Huey Long (Kingfish) Share-Our-Wealth Plan 4,000,000 members THE SECOND NEW DEAL Summer of 1935 – FDR moves to the left Second 100 Day: Greater Focus on Reform “weed out over privileged”; “lift up under privileged” Social Security Administration “no damn politician can ever scrap my Social Security program.”; “sacred cow” Payroll deductions NOT “cradle to grave” Provisions Those not covered Tax reform Progressive 75% highest brackets LABOR National Labor Relations Act (Wagner Act) Labor’s Magna Carta? National Labor Relations Board Provisions Union Activity Philip Murray Walter Reuther John L. Lewis MORE RELIEF Works Progress Administration Harry Hopkins $5 billion Federal Writers Project; Federal Art Project; etc. National Youth Administration National Housing Act ELECTION OF 1936 – A mandate?? “Junkie Road” v. hidden taxes Roosevelt’s coalition WHO? WHY?? “the party of minorities created a majority” Landon or Hoover? (poor Hoover) 61% to 36%; 523 to 8 NOW – What to do with that Court? 3/2/4 Lochner Era Jurisprudence Attack on New Deal AAA NRA SSA Commerce and contract clauses Judiciary Reorganization Bill 6 over 70 West Coast Hotel v. Parrish Impact THE DECLINE OF THE NEW DEAL WHY?? Court Packing The Solid South The “purge” Crop reporting board of 1937 – cotton economy Public Weariness Roosevelt’s fundamental beliefs Labor troubles World War II – outward focus Severe Recession 1937 – it’s not working!! FDR’s Reaction Retract spending; balance budget By May 1938 – 4,000,000 jobs lost!
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