The Great Depression Brother Can You Spare A Dime? Chapter 33
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1 The Great Depression Brother Can You Spare A Dime? Chapter 33
2 Main causes: Uneven distribution of income Easy credit Unbalanced foreign trade (Hawley Smoot Tariff) Mechanization Overproduction by farms and factories Stock Market crashes
3 Women Children and Malnutrition-60% Farmers and the Dust Bowl Contributing factors: Drought, dry-farming techniques, soil erosion, cultivation of marginal farmlands on the Great Plains
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5 Coolidge refuses to run Papa thinks a depression is coming and doesn t want to be around when it happens. Mrs. Coolidge Republicans nominate Herbert Hoover. Democrats nominate Al Smith (New York accent, against Prohibition, Catholic) Hoover wins in an electoral college landslide 444 to 87 (58% of popular vote).
6 Speculation The buying of something (stocks, property, real estate) with the expectation that it will go up in value and be sold for a profit. Buying on margin The practice of buying stock for only a portion of its value. Pooling The (illegal) practice of a group of people buying and selling large amounts of stock then dumping the stock on other investors.
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8 October 24, 1929 The stock market took a deep plunge and most investors tried to unload stock. October 29, 1929 (Black Tuesday) The market took another huge drop. By mid-november investors had lost over $30 billion.
9 The crash of the stock market marks the start of the Great Depression which lasts from 1929 to Between 1929 and 1932 the GNP (Gross National Product = total output of goods and services) fell by almost 50% By 1933 approximately 25% of all the banks in America had failed. There was no deposit insurance at this time.
10 Unemployment would jump from 3% to 25% (a conservative estimate = could be closer to 40%). The depression would quickly spread throughout the rest of the world. Congress would make things worse by passing a huge increase in the tariff (Hawley- Smoot Tariff). Why did this make things worse? Unemployment line in Pennsylvania
11 Hoover believed that aid was the responsibility of individuals, charities and local organizations not the federal government. Hoover believed in Rugged Individualism which pushed individual initiative.
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14 Rep- Hoover Dem- FDR - won by a landslide He campaigned on the promise of experimenting with bold new programs for economic and social reform Blacks shifted allegiance to the Dem. Party Hoover became the object of anger and scorn
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16 Ratified Feb Moved the Presidential inauguration from March to January
17 Afflicted with infantile paralysis Compassionate and Strong Pragmatic Wife- Eleanor -Helped poor/minorities -Champion of the dispossessed -Openly advised the Pres. Inauguration Speech New Deal-provide moderate -Social reform without radical revolution or facism -created biggest federal deficits in U.S. History past and current
18 Chose Francis Perkins Sec. of Labor Harry Hopkins- Chief Administrator Believed in work relief not monetary relief
19 Shantytowns Small towns consisting of shacks that sprang up on the outskirts of cities. Later called Hoovervilles. Soup kitchens and Bread lines Places where needy people could get food. Hobos Men who jumped trains riding from town to town looking for work. Direct relief Giving direct aid (food, money, etc) to the needy. Schools shut down. Why? The suicide rate increased by 30% between 1928 and 1932.
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21 The Dust Bowl The economic collapse was worse on the plains where the farm economy had been in decline and then a severe drought hit in the early 1930s. Factors leading to Okies- migrant workers many from Oklahoma fled the drought mainly for California. During WWII Okies worked in the defense industry
22 Story of the Okies is immortalized in John Steinbeck s: The Grapes of Wrath
23 FDR used the time between his election and inauguration to meet with a group of advisers that came to be known as the Brain Trust (experts from many professions)- they came up with the programs FDR called The New Deal
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25 The New Deal would focus on 3 general goals (the 3 Rs): Relief for the needy Economic Recovery Financial Reform Relief was the most Important to New Dealers The unemployed selling apples on the streets of New York
26 A special session of Congress Congress passes 15 major bills that were aimed at creating jobs. These laws would greatly expand the government s role in the nation s economy.
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28 US ends the use of the gold standard 1 Day after taking office FDR declares a Bank Holiday The EBRA (Emergency Banking Relief Act ) Banks would be put into one of three categories: Sound banks would be allowed to immediately reopen. Those that were on the verge of failing would remain closed. Those that needed help would be given loans.
29 The Federal Deposit Insurance Corporation (FDIC) was created in 1933 and created an insurance program for individuals with bank accounts. The Securities and Exchange Commission (SEC) was established in 1934 to regulate the stock market.
30 FDR speaks directly to the American people First chat- tried to convince the public to redeposit their savings in the now safe banks.
31 1933 Repealed prohibition
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34 Agricultural Adjustment Act (AAA) raise farm prices by lowering production- raised the money that it paid to farmers not to grow crops by taxing processors of farm products Civilian Conservation Corps (CCC) Put young men (18-25) to work on conservation projects. - most popular Federal Emergency Relief Administration (FERA) Provided $500 million in direct relief to the needy.
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36 Public Works Administration (PWA) Provided money to states to create jobs. Most were construction projects such as schools and community buildings. Civil Works Administration (CWA) Provided 4 million immediate jobs during the winter of Boondoggle
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38 National Industrial Recovery Act (NIRA) This established codes for fair business practices toward labor and created the National Recovery Administration (NRA), which set prices on products to ensure fair competition. Federal Housing Administration (FHA) This agency is still around today and provides loans for home mortgages and repairs. Eleanor Roosevelt unveils the NRA logo.
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40 Conservatives were angry because they believed the government had too much control over agriculture and industry and interfered with workings of a free market economy. They stated that FDR was a traitor to his class.
41 In NIRA declared unconstitutional 1936-AAA unconstitutional FDR referred to the Supreme Court as the nine old men He tried to make the Supreme Court more sympathetic to New Deal programs Tries to convince Congress to allow him to appoint another justice for every justice that was over the age of 70. Be sure to read pages
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43 The Democrats would nominate FDR and the Republicans would nominate Alf Landon, the Governor of Kansas. FDR wins by a landslide. Landon even loses Kansas and only get 8 electoral votes Election reflected a bitter class struggle between the rich and the poor
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45 Congress would pass the Works Progress Administration (WPA) in an effort to offer wide spread assistance. Sewing groups that would make over 300,000 garments for the needy. And employed. Teachers, Writers, Actors, Artists, Musicians
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47 Deficit spending Spend more money than is taken in from taxes In the U. S. experienced a Recession (Yes- During the Depression) Called the Roosevelt Recession It is in 1937 that FDR adopted the policy of deficit spending
48 The NIRA was declared unconstitutional BUT Congress passed the Wagner Act, which reestablished NIRA provisions concerning collective bargaining. The federal government supports the right of workers to form unions. Companies prohibited from threatening workers who try to organize. Labor unions reborn and flourish during this period. Wagner Act contributed to a wave of militant strikes in 1937.
49 AFL- concentrated on all workers CIO-organized workers into whole industries Sit down strike declared unconstitutional in 1939
50 Established minimum wages and maximum hours in some industries No child labor under age 16 in some industries
51 One of the most important achievements of the New Deal. The act was created by a committee, headed by Secretary of Labor Francis Perkins, first women cabinet member The act had 3 major parts: Old age insurance for retirees 65 or older and their spouses. An unemployment compensation system. Aid to families with dependent children and the disabled.
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53 The Tennessee Valley Authority (TVA) It established a series of dams in the Tennessee River Valley. The TVA s purpose was: Flood control Cheap hydroelectric power Recreation areas George W. Norris Muscle Shoals
54 Most controversial aspect-electrical power Produced efficient electricity Government controlled But, did take into account environmental conditions And, benefited more than just the South Some thought it represented creeping socialism But, did not diminish capitalism at all
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56 Democracy survived People s view of Govt. assistance changed Increased scope and size of federal govt. and executive branch FDR s New Deal brought a large amount of government intervention: The economy, Labor relations, Rural life, Banking and finance
57 Achieved most of its objectives Had not won over most of the business people to its policies The national debt doubled States and local govt s retained power By 1938, the New deal had lost most of its momentum
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