Unit 11: The Great Depression 11:1 The causes of the Great Depression
1) The Great Depression was triggered by the US stock market crash of October 1929. 2) Reasons for the Great Depression: a) World War I caused countries to increase their industrial capacity thereby reducing post-war trade; b) High tariffs inhibited trade; c) Wealth was maldistributed-the masses had inadequate purchasing power; d) Too many people invested in the stock market without adequate capital to cover losses; e) There was no government regulation of the stock market or the financial system; f) The interdependent nature of world-wide loans caused the depression to spread throughout the world from the US. President Hoover's response to the Great Depression 1) While Hoover did attempt to respond to the depression, his actions were too little, too late to halt the continuing economic decline. 2) Hoover's order to the army to drive the veterans of the Bonus Army out of Washington, DC in the summer of 1932 illustrated his lack of rapport with the people. 3) In the 1932 presidential election the governor of New York, Democrat Franklin D. Roosevelt easily defeated the Republican Hoover.
11:2 the New Deal
1) Roosevelt immediately began attacking the causes of the Great Depression. He had Congress reorganize the banking industry, give government loans and subsidies to farmers (AAA), start relief through government subsidized jobs (FERA, WPA, CCC), create the Tennessee Valley Authority (TVA), save people's homes with the Home Owner's Loan Corporation, guaranteed bank deposits (FDIC), and establish federal regulation of the stock market (SEC). In 1935, to help his reelection campaign, rural America was electrified (REA), and under the National Labor Relations (Wagner) Act unions were guaranteed the right to collective bargain and strike. The Social Security Act insured workers against unemployment, injury on the job and old age. The Presidential election of 1936 1) Conservatives in the Liberty League and wealthy businessmen hated FDR. Roosevelt used anger at them because of the Great Depression to his political benefit. 2) Senator Huey Long (D-LA) led the fight against FDR. He started Share the Wealth Clubs that had great appeal to the most downtrodden members of American society. Assassinated in 1935. 3) Father Charles Coughlin was a Catholic priest with a popular radio show who attacked Roosevelt for his refusal to inflate the money supply. Censured by the Vatican. 4) Dr. Francis Townsend rallied the elderly with his proposal of a monthly payment of $200 to all Americans over the age of 60. Social Security undercut his appeal. 5) Roosevelt easily defeated the Republican nominee Kansas governor Alf Landon. 6) This election created the New Deal Democratic political coalition that kept Democrats in power until the 1960s: urban ethnic groups, northern blacks, union members, small farmers, and Southern whites. The end of the New Deal 1) The court packing scheme, in which FDR tried to add members to the Supreme Court, caused Roosevelt to lose public support, and allowed politicians who opposed his policies to safely attack them.
2) Sit down strikes in 1937 caused middle-class Americans to fear for the safety of private property. 3) The recession of 1937 caused people to lose faith with the New Deal. 4) Conservatives in Congress began to seriously oppose FDR's programs--the 40 hour week & minimum wage (40 cents an hour) increased alienation. Roosevelt tried to purge Southern conservative Democrats from Congress; when he failed a Southern Democratic-Republican conservative coalition controlled Congress after the 1938 elections-FDR could get little legislation passed. 5) World War II, which began in 1939, ended the Great Depression and the demand for new domestic social and economic programs. The impact of the New Deal on US society 1) With the creation of the Executive Office of the Presidency the President significantly increased his power. 2) The federal government became significantly more involved in people's lives. 3) Interest groups increased their influence on government. 4) The government guaranteed most citizens minimum economic standards (a "safety net"). 5) The New Deal helped protect America from a radical takeover during the 1930s.
11:3 Canada in the 1920s
1) During the 1920s Canada's industrial base increased and the US replaced Britain as Canada's number one trading partner. 2) The One Big Union (OBU) was similar to the IWW in the US. The failure of the 1919 Winnipeg strike hurt union membership during the 1920s. 3) Farmers demanded a New National Policy: a) Reduction of tariffs; b) Reduced property taxes; c) Higher income and profit taxes; d) Public ownership of railroads and utilities; e) The referendum and the initiative; f) Social Security; g) The abolishment of the Senate. 4) Farmers formed the Progressive Party to try and attain their goals. The party disappeared by the end of the decade. 5) After World War I Britain allowed Canada to have control of its armed forces. 6) With the 1923 US-Canadian Halibut Treaty Canada gained control of its foreign policy. The US and Canada exchanged ambassadors in 1927.
11:4 Canada during the Great Depression
1) Canada's economy underwent a severe decline during the Great Depression. Unemployment may have reached more than 50 percent. Between 1928 and 1933 per capita income declined by 48 percent ($471 to $247). 2) Prime Minister R. B. Bennett's Conservative government did not believe in public assistance. 3) In 1935 Bennett changed his policies and Parliament enacted unemployment insurance, minimum wages and a maximum work-week. The Supreme Court later declared most of the legislation unconstitutional. 4) Bennett's reforms were too little too late and in 1935 Mackenzie King of the Liberal Party became Prime Minister.
5) Beginning in 1938, the King government did attempt to stimulate the economy but it was World War II that ended the Great Depression in Canada. 6) Although minor reforms were made during the Depression, there was no "Canadian New Deal" to alleviate the hardships of the economic crisis.
New Deal Laws to Review
New Deal Laws: 1) Emergency Banking Relief Act (March 9, 1933). 2) Unemployment Relief Act (March 31, 1933)-created Civilian Conservation Corps (CCC). 3) Federal Emergency Relief Act (May 12, 1933) created Federal Emergency Relief Administration (FERA); National Industrial Recovery Act (June 16, 1933) created Public Works Administration (PWA). Executive Order 6420b (November 9, 1933) created Civil Works Administration (CWA); Executive Order 7034 (May 6, 1935) created Works Progress Administration (WPA). [Focus your report on the philosophy of work relief, and not so much on the specifics of each act]. 4) Agricultural Adjustment Act (May 12, 1933) created Agricultural Adjustment Administration (AAA), Second Agricultural Adjustment Act (February 16, 1936). 5) Tennessee Valley Authority Act (May 18, 1933). 6) Home Owners' Refinancing Act (June 13, 1933) created Home Owners' Loan Corporation (HOLC). 7) National Industrial Recovery Act (June 16, 1933) created National Recovery Administration (NRA) [include in your report the unconstitutionality of the Act and its impact on FDR's "court packing" plan]. 8) Glass-Steagall Banking Reform Act (June 16, 1933) created Federal Deposit Insurance Corporation (FDIC). 9) Securities and Exchange Commission (SEC) Act (June 6, 1934). 10) National Housing Act (June 28, 1934) created Federal Housing Administration (FHA), and the United States Housing Authority (USHA) Act (September 1, 1937). 11) Executive Order 7037 (May 11, 1935) and Norris-Rayburn Act (May 20, 1936) created and funded Rural Electrification Administration (REA). 12) Frazier-Lemke Farm Bankruptcy Act (June 28, 1934), and the Soil Conservation and Domestic Allotment Act (February 29, 1936) 13) National Labor Relations (Wagner) Act (July 5, 1935), 14) Social Security Act (August 14, 1935). 15) Fair Labor Standards Act (June 25, 1938).