Great Depression

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					The Great Depression
An economic crisis grips the nation during the
Great Depression. President Herbert Hoover’s
conservative response to the nation’s problems
         costs him many supporters.
        Section 1
      The Nation’s
     Sick Economy
As the prosperity of the 1920s ends,
severe economic problems grip the
    Economic Troubles on the Horizon
   Problems began threatening economic prosperity by the end of
    the 1920s
   Farm debt - many farmers were forced to sell in the 1920's
   Consumer debt - many people were buying goods on credit
   More goods then buyers - prices rose faster than wages
   Declining Trade - 1920's U.S. raised tariffs other countries
    raised tariffs to retaliate
   Important industries struggled
   Income disparity - Consumers & farmers went steadily deeper
    into debt
                Industries in Trouble
   Key industries like railroads, textiles, steel barely made profit
   Replaced by other forms of transportations
   Mining, lumbering expanded during were no longer in high
   Coal especially hard-hit due to availability of new energy sources
    - Hydroelectricity, fuel oil, & natural gas
   Boom industries - automobiles, construction, consumer goods
   Housing starts declined
    - Affected many related industries
                    Farm Troubles
   International demand for U.S. grain declined after war
    - prices dropped by 40% or more
   Farmers boosted production to sell more
    - Caused prices to drop further
   Farm income declined & farmers defaulted on loans
   Rural banks failed
   Congress attempted to pass the McNary- Haugen bill to help
    - Price-supports - government bought surplus crops at
    guarantees prices
    - President Coolidge vetoed price-support bill
              Consumers Problems
   1920s - rich got richer & poor got poorer
   Prices rose faster that wages
   70% of families earned less than minimum for decent standard
    of living
    - $2500 annually
   Most couldn’t afford flood of products factories produce
   Many people had been purchasing goods on credit (buy now,
    pay later)
   Businesses gave easy credit & consumers piled up large debts
   Consumers had trouble paying off debt & cut back on spending
               The Election of 1928
   Democrat Alfred E. Smith -
    four times governor of New
   Republican Herbert Hoover
    has served as secretary of
    commerce under Warren
    Harding & Calvin Coolidge
   U.S. had experienced
    prosperity under Republicans
    in 1920s
   Hoover won an
    overwhelming victory
    Dreams of Riches in the Stock Market
   Late 1920s – Some economist warning of weaknesses
    in the economy
    - Most Americans ignored them
   People began investing in stock market
    - Looked like an easy way to make money
   Dow Jones Industrial Average was used as barometer
    of the market’s health
    - Measure based on the stock of 30 representative large
    firms trading on the New York Stock exchange tracks
    state of stock market
    Dreams of Riches in the Stock Market
   1920s - stock prices rose
    steadily “Bull Market”
   People rushed to buy stocks
    & bonds to make a quick
    - Many engaged in
    speculation - buy on
    chance of a quick profit
    - Began Buying on margin
    - pay small percent of price,
    borrow rest
         The Stock Market Crashes
   September 1929 stock
    prices peaked & then fell
    Many investors lost
    confidence & began
   October 24, 1929 -
    Market took plunge &
    many panicked investors
    unloaded their shares
           The Stock Market Crashes
   October 29, 1929 - Stock
    market crashed (Black
    - Shareholders sold frantically
    - Millions of shares had no
    - People who bought on
    credit were left with huge
    - Others lose most of their
                  Financial Collapse
   Great Depression - economy plummeted & unemployment
    - lasted from 1929–1940
   After crash, people panicked & withdraw money from banks
   Banks that invested in stocks failed& people lost their money
   1929 to1932 - gross national product was cut nearly in half
    - 90,000 businesses went bankrupt
   1933 - 25% of workers were unemployed
    Those with jobs received cuts in hours & pay
           Worldwide Shock Waves
   Great Depression limited U.S. ability to import
    European goods
   Hawley-Smoot Tariff Act set highest protective tariff
    ever in U.S.
   Other countries couldn’t earn American currency to
    buy U.S. goods
    - Many countries retaliated by raising their own tariffs
   International trade dropped & unemployment soared
    around world
     Causes of the Great Depression
   Factors leading to Great Depression:
   Declining Trade - Tariffs & war debts cut down the
    foreign markets for American goods
   Farm problems - Many farmers were forced to sell
   Easy credit – Borrowed money to invest in market
   Income disparity
   Federal government kept interest rates low &
    encouraged borrowing
      Section 2
Hardship and Suffering
During the Depression
   During the Great Depression
Americans do what they have to do to
    The Depression Devastates People’s
   People lost jobs & were
    evicted from homes
   Had to live in parks or
    sewer pipes
   Shantytowns -
    settlements consisting of
    shacks, arose in cities
    The Depression Devastates People’s
   People dug through garbage
    & begged
    - Soup kitchens offered free
    or low-cost food
    - Bread lines - people lined
    up for food from charities &
    public agencies
   African Americans &
    Latinos had higher
    unemployment & lower pay
   Minorities were also targets
    of violence (Lynching or
      The Depression in Rural Areas
   Most farmers could grow
    food for their families
   About 400,000 farms
    were lost through
    - Many became tenant
                  The Dust Bowl
   Farmers in Great Plains
    exhausted land through
   1930s - drought &
    windstorms scattered for
    hundreds of miles
   Dust Bowl - area from
    North Dakota to Texas
    that was hardest hit
                  The Dust Bowl
   Many farm families
    migrated to Pacific Coast
    states (Route 66)
    - California towns
    became overcrowded
    - Many people who
    moved west were from
    Oklahoma (Okies)
     Effects on the American Family
   Family was source of
    strength for most Americans
   Believed in traditional values
    and emphasized the
    importance of family unity
   Many families entertained
    themselves with board games
    & radio
    - Monopoly was invented in
   Some families broke apart
    under strain of making ends
                    Men in the Streets
   Many men used to working
    & supporting families had
    difficulty coping
       Couldn’t find jobs
       Manny stopped trying
   Some men even abandoned
    their families
    - About 300,000 hoboes
    wandered country on railroad
    box cars
   No federal system of direct
    relief - cash or food from
         Women Struggle to Survive
   Women worked hard to
    help their families
    survive the adversity
    Homemakers budgeted
    carefully, canned food, &
    sewed clothes
   Women worked outside
    home & were resented
    by unemployed men
        Women Struggle to Survive
   Early 1930s – Some
    cities refused to hire
    married schoolteachers
   Many women suffered in
    silence & were ashamed
    to stand in bread lines
          Children Suffer Hardships
   Poor diets & health care led
    to serious health problems in
   Lack of tax revenue led to
    shortened school year &
    school closings
   Teenagers left home & rode
    trains in search of work &
    - Many died or were beaten
     Social and Psychological Effects
   1928 to 1932 – suicide rate rose over 30%
   Admissions to state mental hospitals tripled
   People gave up health care, college
   Put off marriage & children
   Stigma of poverty didn’t disappear & financial security
    became goal
   Many people showed great kindness to strangers
    - Gave food, clothing & a place to stay
   People developed habit of saving and thriftiness
     Section 3
Hoover Struggles with
  the Depression
President Hoover’s conservative response to
 the Great Depression draws criticism from
             many Americans.
    Hoover Tries to Reassure the Nation
   President Herbert Hoover
    told Americans the economy
    was sound
   Many experts believed
    depressions were normal part
    of business cycle
    - Believed that it was best to
    do nothing & let the
    economy fox itself
   Hoover believed
    government should foster
    cooperation between
    competing groups
Hoover Tries to Reassure the Nation
   Many believed that people should succeed through their
    own efforts
   People should take care of own families & not depend
    on government
   Hoover opposed any form of federal welfare or direct
    relief to the needy
    - Believed that hand-outs would weaken people’s self
    respect & moral fiber
    - Said that charities & local organizations should help
    the less fortunate
      Hoover Takes Cautious Steps
   Hoover called meeting of business, banking,
    labor leaders to solve problems
    - Asked them to work to together to solve the
   Created organization to help private charities
    raise money for poor
       Hoover Takes Cautious Steps
   Hoover’s authorized the
    construction of the
    Boulder Dam on
    Colorado River w
    - later renamed Hoover
    - Provided electricity,
    flood control, water to
    states on river basin
    Democrats Win in 1930 Congressional
   People began blaming Hoover & Republicans
    for the economic problems
   Democrats won House of Representatives
   Republican Senate majority down to 1 vote
   People Grew frustrated with the Depression
    Democrats Win in 1930 Congressional
   Farmers tried to create
    food shortages to raise
        Burned fields rather than
         sell crops at a loss
        Some declared a farm
   People began calling
               Hoover Takes Action
   Hoover softened his stance
    on no government
    intervention in the economy
   Hoover negotiates
    agreements among private
   Backs Federal Farm Board
    (organization of farm
    - buy crops, keep off market
    until prices rise
             Hoover Takes Action
   Got large banks to establish National Credit
     - Loaned money to smaller banks to prevent
   Late 1931 - Hoover persuaded Congress to pass
    measures reform banking, provide mortgage relief, &
    funnel federal money into business investment
    - Federal Home Loan Bank Act lowered mortgage
            Hoover Takes Action
   Reconstruction Finance Corporation –
    Authorized emergency funds for businesses
    - Hoover believed that the money would tickle
    down to average citizens through job growth &
    higher wages
    - Critics said people couldn’t wait for the money
    to trickle down
   Hoover’s measures didn’t improve economy
    before presidential election
           Gassing the Bonus Army
   1932 – Incident with World
    War I veterans further
    damaged Hoover’s image &
    public morale
   1924 – Congress agreed to
    pay a bonus to WWI vets
    who had not been
    adequately compensated for
    wartime service
    - Bonus was to be paid in
    1945 in the form of cash & a
    life insurance policy
          Gassing the Bonus Army
   Bonus Army – WWI
    veterans went to D.C.
    in 1932 to support
    Patman Bill:
    - called for immediate
    payment of bonus to
    WWI vets        ($500
    per soldier)
           Gassing the Bonus Army
   Hoover opposed bill
   Believed they were
   He respected their right to
    protest (Provided food &
    supplies for shantytown)
   June 17, 1932 - Senate voted
    down Patman Bill
   Most veterans left
    About 2,000 stayed to speak
    to Hoover
          Gassing the Bonus Army
   Hoover feared violence
    & called on U.S. Army to
    disband Bonus Army
    - Led by General
    Douglass Macarthur &
    Major Dwight
           Gassing the Bonus Army
   Infantry tear gassed over
    1,000 people, including
    Many people were
    injured (11 month old
    baby died)
   Public was stunned &
    outraged by
    government’s actions
U.S. History Chapter 23
     The New Deal
   President Franklin D. Roosevelt’s New Deal
programs stimulate the economy and the arts. The
New Deal leaves a lasting, yet controversial mark on
              American government.
       Section 1
  A New Deal Fights
    the Depression
After becoming president, Franklin Delano
 Roosevelt uses government programs to
         combat the Depression.
                 Election of 1932
   Democrats nominated
    NY governor Franklin
    Delano Roosevelt
    - reform-minded;
    projected friendliness &
   Democrats
    overwhelmingly won
    presidency, Senate, &
                       Election of 1932
   Roosevelt had to wait 4 months to
    take over
   20th Amendment wasn’t rarified
    until 1933 (Move inauguration to
    FDR worked with advisors
    known as “Brain Trust,” to
    formulate policies to alleviate
   New Deal – FDR’s program to
    alleviate the problems of the Great
    Depression focused on 3 Rs
        Relief for needy
        Economic recovery
        Financial reform
               The Hundred Days
   March 9 to June 16, 1933
    - FDR took office &
    launched Hundred Days
   Congress passed over 15
    major New Deal laws
    that expanded the federal
    government’s role in the
    nation’s economy
                       Bank Holiday
   March 5, 1933 – one day after taking office FDR
    declared a bank holiday & closed all banks to prevent
    further withdrawals
   Emergency Banking Relief Act - Permitted Treasury
    Dept. to inspect banks
       Sound banks were allowed to reopen
       Banks that needed help received loans
       Insolvent ones remained closed (unable to pay bills)
   Bank Holiday revived public confidence in banks
   - Believed that the banks remained open were in good
        An Important Fireside Chat
   FDR gave fireside chats
    - radio talks explaining
    New Deal measures
   March 12, 1933 – FDR
    gave 1st fireside chat the
    day before the banks
    reopened after holiday
   - Discussed need for
    public support of
    government, banks
     Regulating Banking and Finance
   Congress took another step
    to reorganize the banking
   Glass-Steagall Act -
    Established Federal Deposit
    Insurance Corporation
       insured individual bank
        accounts up to $5000
       Regulates banking practices (
        forced them to act cautiously
        with money)
     Regulating Banking and Finance
   Federal Securities Act – Required companies
    must give all information on stocks
   Securities and Exchange Commission (SEC)
    created to regulate stock market
   FDR got law allowing production of some
    alcoholic beverages
   21st Amendment repealed prohibition by end of
       Helping the American People
    Roosevelt administration
    implemented programs
    aimed at helping farmers &
    other workers to stimulate
   Agricultural Adjustment
    Act (AAA) raised food prices
    by lowering supply
    - Government paid farmers
    not to plant crops
       Helping the American People
   Tennessee Valley
    Authority - Created
    jobs renovating &
    building dams
    - Also provided flood
    control & hydroelectric
    power to region
       Helping the American People
   Civilian Conservation
    Corps (CCC) - public
    works jobs for young
    men 18 to 25
    - Built road, planted trees
    & helped in soils erosion
    & flood control projects
    - Men sent $25 out of
    $30 home to family each
   National Industrial
    Recovery Act -
    established codes of fair
    practice for industries
   Created National
    Administration (NRA)
       NRA sets standards,
        prices, limits production
   1933 - Public Works
    Administration (PWA)
    was established as part of
    the NIRA
    – It provided money to
    states to create jobs
    chiefly in the
    construction of schools
    & other community
        Food, Clothing, and Shelter
   Home Owners Loan
    Corporation gave loans
    to prevent foreclosures
   Federal Housing
    Administration gives
    loans for mortgages &
    repairs (FHA)
        Food, Clothing, and Shelter
   Federal Emergency
    Relief Administration -
    direct relief to needy
    The New Deal Comes Under Attack
   Deficit spending - spending more money than
    government takes in
    - funded New Deal
    Opposition rose when the New Deal didn’t
    stop the Depression
   Liberals didn’t think New Deal did enough to
    help poor, & fix economy
   Conservatives believed Roosevelt used the New
    Deal to control business & socialize economy
        The Supreme Court Reacts
   Supreme Court struck down NIRA & AAA as
   FDR proposed “Court-packing bill”
     Change the Supreme Court from 9 to 15 justices
     Would enable FDR to appoint 6 new justices

    Congress & press protested
   Starting in 1937 - justices retire & FDR
    appointed seven new ones
     Huey Long Attacked the New Deal
   Governor of Louisiana "King
   Built schools and hospitals
   Ruled Louisiana like a dictator
   Wanted to be president
   Decided to challenge FDR
   Offered new deal       "Share our
    - Called for every family to get
    yearly income money to buy food
    and housing
    - Taxed the rich heavily
    Made enemies in his attempt to
    become president
    - Shot and killed in 1935
      Section 2
The Second New Deal
     Takes Hold
    The Second New Deal includes new
programs to extend federal aid and stimulate
          the nation’s economy.
        The Second Hundred Days
   By 1935, economic recovery not as great as FDR
    had expected
     Unemployment remained high
     Work programs & productions still behind 1920s
   FDR launched second phase
   Provided more relief for farmers, workers
          The Second Hundred Days
   First Lady Eleanor
    Roosevelt a social
    reformer prodded
       She traveled the country
        observing the social
        conditions & reminding
        FDR about the suffering
       She also pushed for him
        to appoint women to
        government positions
                   Election of 1936
   1936 - Democrats won
    presidency & large majorities
    in both houses
   First time most African
    Americans voted Democratic
   First time labor unions
    supported presidential
   Election was a vote of
    confidence in FDR & the
    New Deal
                Helping Farmers
   1936 - Soil Conservation and Domestic Allotment
    Act replaced AAA
    - Rewarded farmers for practicing soil conservation
   New Agricultural Adjustment Act avoided
    unconstitutional provision
   Resettlement Administration gave loans to small
    farmers to buy land
   Farm Security Administration - loaned to tenant
    farmers to buy land
    - FSA hires photographers to shoot pictures of rural
    towns & farms
             Roosevelt Extends Relief
   2nd New Deal established a series
    of programs to help youths,
    professionals & other workers
   Works Progress Administration
    (WPA) created many jobs for
    unskilled workers
    - WPA workers built airports,
    roads, public buildings
    - Women workers sewed clothes
    for the needy
    - WPA employed professional
    writers, artists, performers
    - Gave aid to students in exchange
    for part-time work
         Roosevelt Extends Relief
   National Youth
    Administration (NYA)
    - provided education,
    jobs, counseling &
    recreation to young
    Improving Labor and Other Reforms
   Wagner Act - replaced NIRA
    - Protected right to join unions & collective bargaining
    - Prohibited unfair labor practices (threatening workers
    or firing union members)
    - Established National Labor Relations Board that
    heard testimony about labor practices
    - Held elections to determine if workers wanted unions
   1938 - Fair Labor Standards Act sets maximum hours
    & minimum wage
    - 44 hrs per week decreasing to 40 in two years & 25
    cents per hr.
               Social Security Act
   1935 - Social Security
    Act created Social
    Security system
   Provided insurance for
    retirees 65 or older
   Unemployment
   Aid to disabled &
    families with children
     Expanding and Regulating Utilities
   Rural Electrification
    Administration (REA)
    brought electricity to
    - Rose from 12.6 % in
    1935 to 48% in 1945 to
    90% in 1949
   Public Utility Holding
    Company Act aims to
    stop financial corruption
     Section 3
The New Deal Affects
    Many Groups
New Deal policies and actions affect
 various social and ethnic groups.
           The New Deal Brings New
           Opportunities for Women
   Several women were named to important government positions
   Frances Perkins became first female cabinet member
    (Secretary of Labor)
    - FDR also appointed 2 women as diplomats & 1 as a federal
   Women still faced discrimination in workplace from male
   National Recovery Administration (NRA) set some lower
    minimum wages for women
   Federal work programs hired far fewer women than men
         African-American Activism
   FDR appointed more than
    100 African Americans to
   Educator Mary McLeod
    Bethune headed Division of
    Negro Affairs of NYA
   Helped organize “Black
   Group of influential African-
    American who advised FDR
    on racial issues
     The President Fails to Support Civil
   FDR was afraid of upsetting white Southern
    Democratic voters
   Refused to approve antilynching law & end to poll tax
   New Deal agencies discriminated against African
    - pay them lower wages & favored whites
   African- Americans generally supported Roosevelt
    administration & New Deal
    - Saw them as the best hope for the future
               FDR Wins in 1936
   New Deal Coalition - different groups that support
    Democratic Party
    - Helped the democratic party dominate national
    politics throughout the 1930s & 1940s
   Political organizations in large Northern cities
    supported FDR
   Urban, religious, & ethnic groups also supported FDR
    - FDR appoints officials of urban-immigrant
     Section 4
Culture in the 1930s

   Motion pictures, radio, art, and
literature blossom during the New
The Lure of Motion Pictures and Radio
   About 65% of
    population went to
    movies once a week
    - Movies were still
     - People watched them
    to escape real life
    - Grapes of Wrath
    - Gone With the Wind
    - The Wizard of OZ
The Lure of Motion Pictures and Radio
   90% of households had a radio
    Families listened together every
   Dramas, variety shows played in
    - Soap operas for homemakers
    broadcast in middle of day
    - Children’s shows after school
    - Immediate news coverage became
The Lure of Motion Pictures and Radio
   Orson Welles - actor,
    director, producer, &
     The Arts in Depression America
   Federal Art Project paid
    artists to make art, & teach in
   Aim to promote art
    appreciation & positive
    image of America
   Murals typically portrayed
    dignity of ordinary people at
   Federal Theater Project
    hired actors & artists
   Singer, songwriter Woody
    Guthrie sung songs about
    the of plight of poor
    Diverse Writers Depict American Life
   Federal Writers’ Project
    supported many who become
    major writers
   Richard Wright - African-
    American author who wrote
    Native Son
   John Steinbeck wrote The
    Grapes of Wrath about Dust
    Bowl migrants
       Section 5
   The Impact of the
      New Deal
  The New Deal affects American
society not only in the 1930s but also
      in the decades that follow.
            The New Deal Ends
   By 1937, economic improvement convinced
    many that Depression was ending
   Congress wanted to cut back programs
   By 1939 - New Deal was over
Supporters and Critics of the New Deal
   Supporters Believed the New Deal helped
    country recover from economic difficulties
   Conservatives though FDR made federal
    government too large
    - stifled free enterprise & individual initiative
   Liberals thought New Deal didn’t do enough to
    socialize economy* end inequalities
            Effects of the New Deal
   Expanded power of federal government & president
   Social Security Act - Federal government takes responsibility
    for citizens’ welfare
     - Provided aid for aged, disabled & needy
   FDIC still protects individual investors in case of bank failure
   SEC still monitors stock market, enforces laws on stock, bond
   New Deal laws set standards for wages & hours
    - banned child labor
    - Permitted unions
   Civilian Conservation Corps (CCC ) - planted trees, built
    hiking trails, & fire lookout towers
            Effects of the New Deal
   Soil Conservation Service taught farmers how to preserve soil
    - Contour plowing, terraces, & crop rotation
   1934 - Taylor Grazing Act reduced grazing on public lands
    - Grazing had contributed to erosion that caused the dust bowl
   Tennessee Valley Authority (TVA) created electricity, &
    prevented floods
   New Deal reduced suffering & gave people hope
    - Provided jobs, food & money
   New Deal didn't end depression WWII did

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