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THE GREAT DEPRESSION

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Title: THE GREAT DEPRESSION


1
THE GREAT DEPRESSION
  • Unit VIIIB
  • AP U.S. History

2
Fundamental Question
  • Analyze how the Great Depression changed
    Americas political and economical structures.

3
Past Major American Recessions
  • Panic of 1807
  • MAJOR CAUSE Embargo Act of 1807
  • Panic of 1819
  • MAJOR CAUSES End of War of 1812 and First Bank
    of U.S. not rechartered
  • MAJOR LEGACY Second Bank of U.S. chartered,
    first example of business cycle contraction
  • Panic of 1837
  • MAJOR CAUSES Second Bank of U.S. not rechartered
    and Specie Circular
  • Panic of 1873
  • MAJOR CAUSES Land and railroad speculation
  • Panic of 1893
  • MAJOR CAUSES Railroad speculation and Sherman
    Silver Purchase Act
  • MAJOR LEGACY J.P. Morgan bailed out government
    with 65 million in gold bullion
  • Panic of 1907
  • MAJOR CAUSES Stock market speculation and bank
    runs
  • MAJOR LEGACY Led to Federal Reserve System
  • Depression of 1920-1921
  • MAJOR CAUSES War economy to peace economy,
    influx of laborers, overproduction in
    agricultural sector

4
Republican Policies of 1920s
  • Harding-Coolidge-Hoovers laissez-faire policies
  • Banks and corporations increased questionable or
    corrupt financial tactics
  • Mellons Tax Bill
  • Revenue Acts of 1824, 1826, 1828 decreased tax
    rates
  • Inspired massive consumer and investment spending
  • Fordney-McCumber Tariff (1922)
  • Heavily favored industries and factories
  • Farmers suffered with limited foreign markets

5
A Boom Economy during 1920s
  • Mass Consumerism
  • Scientific management and assembly lines spurred
    production
  • Welfare capitalism led to wage increases and
    consumer confidence
  • Installment plans led to consumer debt
  • 1920s Socioeconomics
  • Socioeconomic gap widened further than Gilded Age
  • 5 wealthy class owned 33 of income
  • Top 1 owned over 35 of the nations wealth
  • Bottom 20 owned 4 of the nations wealth
  • Agricultural Sector
  • Overproduction
  • Price decreases after World War I
  • Increased farming resulted in poor environmental
    conditions

6
The Stock Market and the Crash of 1929
  • Background
  • Speculation
  • Buying on Margin
  • The Crash of 1929
  • 381.17 (9/3/29)
  • Concern over high stock prices led to massive
    sell-off
  • Thursday, October 24
  • 299.50
  • Monday, October 28
  • 260.64
  • Tuesday, October 29
  • 230.07
  • 41.22 (7/8/32)

7
Causes of the Great Depression
  • Unequal Distribution of Wealth
  • Industrial Overproduction
  • Agricultural Crisis
  • Overextension of Credit
  • Bank Failures
  • Stock Market Crash of 1929
  • High Tariffs
  • Dawes Plan and Foreign Loans

8
Hoover and the Republicans
  • Given the chance to go forward with the policies
    of the last eight years, we shall soon with the
    help of God, be in sight of the day when poverty
    will be banished from this nation. -
    Inauguration, March 4, 1929
  • There is no cause to worry. The high tide of
    prosperity will continue. Sec. Of Treasury
    Andrew Mellon, Sept. 1929
  • While the crash only took place six months ago,
    I am convinced we have now passed the worst and
    with continued unity of effort we shall rapidly
    recover. Pres. Hoover, May 1, 1930
  • The worst is over without a doubt. Sec. Of
    Labor James Davis, June 29, 1930
  • Hoovers Economic Philosophy
  • Promote voluntarism, restraint, and self-reliance
  • Limited federal government involvement
    facilitate with business sector and banking
  • Hawley-Smoot Tariff (1930)
  • Historical increase in tariff rates to protect
    domestic industries
  • EPIC FAIL - since foreign nations enacted high
    tariff rates on U.S. goods
  • Federal Farm Board
  • Increased power to temporarily hold crop
    surpluses to curb overproduction
  • FAIL - since government would not limit
    production
  • Reconstruction Finance Corporation (RFC)
  • Government-backed private corporation to offer
    loans to banks, corporations, insurance
    companies, and railroads
  • FAIL - did not offer relief to individual
    Americans

9
Depression by Numbers
  • Bank Failures
  • 1929 659 banks (200,000,000)
  • 1930 1,300 banks (853,000,000)
  • 1931 2,294 banks (1,700,000,000)
  • Income
  • National income fell 80B to 50B
  • Salaries declined 40
  • Manufacturing wages down 60
  • Farmers income declined 55
  • Industrial production
  • Down 26 in 1930 51 by 1932
  • Investments
  • 10B in 1929 1B in 1932
  • Fertility Rates
  • 1928 93.8
  • 1933 76.3
  • Suicide Rates
  • 1920-1928 12.1
  • 1929 18.1
  • Dow Jones Industrial Average
  • 1929 381.17
  • 1932 41.22
  • The average of stock prices dropped over 90
  • Price Indices
  • Consumer prices feel 25
  • Wholesale prices fell 32
  • Unemployment
  • 1929 3.2
  • 1933 24.9
  • Unemployment rates higher in specific regions,
    among different groups
  • Toledo, OH 90
  • GDP
  • 1929 103.6B
  • 1933 56.4B

10
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11
Hoovervilles
Displaced Americans set up shanty towns Came to
be known as Hoovervilles
12
Public Reaction to Depression
  • Blame and Needs
  • Hoover and Republicans suffer public backlash
  • Public demands direct government action and
    intervention
  • Bonus March
  • WWI veterans marched on D.C. demanding early
    payments of pensions
  • Federal troops sent in to break up Hoovervilles
  • Burned down shacks and displaced veterans and
    families
  • Public backlash on Hoover increased due to
    perceived apathy by Hoover

13
Depression through Pictures
14
The Dust Bowl (1930-1936)
  • Causes
  • Overgrazing
  • Improper farming techniques
  • Increased cultivation
  • Drought in 1934
  • Effects
  • Dust storms
  • Black Sunday - April 14, 1935
  • 300 million tons of topsoil blown across southern
    Plains region
  • Plight for farmers
  • Migration west
  • Okies

15
Dust Turns Day Into Night
16
Election of 1932
  • Republicans
  • Herbert Hoover
  • Blamed and criticized for causing and
    exacerbating Depression
  • Democrats
  • Franklin Delano Roosevelt (FDR)
  • Campaign promise of a new deal and help for the
    forgotten man
  • Repeal Prohibition
  • Cut government spending and provide direct
    assistance for unemployed rather than businesses

17
Legacy of Election of 1932
  • Realignment election leading to the Fifth Party
    System
  • Twentieth Amendment (1933)
  • Lame-duck amendment
  • FDR expanded intervention and influence of the
    executive branch
  • Eleanor Roosevelt exemplified First Lady as more
    than just a hostess

18
Fifth Party System (1932-1968)
  • Democrats
  • New Deal Coalition
  • Catholics
  • Jews
  • Blacks
  • Progressive Intellectuals
  • Urban Machines
  • Populist Farmers
  • White Southerners
  • Labor Unions
  • Low-Income
  • Immigrants
  • Dominated Congress and American public for the
    next 36 years
  • Increased government involvement in economy and
    society
  • New Deal
  • Great Society
  • Civil Rights
  • Republicans
  • Pro-business
  • Northeast
  • Conservatives
  • Economic
  • Social

19
John Maynard Keynes
  • Before the New Deal
  • Classical economics
  • Supply and demand, laissez-faire
  • Economies will naturally recover in the long-run
  • Says Law
  • products are paid for by products
  • Keynesian Economics
  • In the long-run we are all dead.
  • Criticized Says Law supply creates its own
    demand
  • Strong aggregate demand drives economies
  • Mixed Economies
  • Some intervention from public sector to stimulate
    economy
  • Fiscal policy
  • Government spending/deficit spending
  • Monetary policy
  • Fed increasing or decreasing the money supply

20
FDRs Message of Hope
  • FDR had no specific plan for the Depression
  • Calming the nation
  • the only thing we have to fear is fear
    itself.
  • Fireside chats
  • The Three Rs
  • Relief
  • Recovery
  • Reform
  • Brain Trust
  • Capable advisers ordered to experiment, be
    pragmatic
  • Do something.

21
First New Deal - Alphabet Soup
  • Civilian Conservation Corps (CCC)
  • Agricultural Adjustment Act (AAA)
  • Federal Emergency Relief Act (FERA)
  • Civil Works Administration (CWA)
  • Tennessee Valley Authority (TVA)
  • Farm Credit Administration (FCA)
  • Home Owners Loan Corporation (HOLC)
  • National Industrial Recovery Act (NIRA)
  • National Recovery Administration (NRA)
  • Public Works Administration (PWA)
  • Federal Deposit Insurance Corporation (FDIC)
  • Glass-Steagall Act
  • Securities Exchange Commission (SEC)
  • Federal Housing Administration (FHA)
  • First Hundred Days
  • Bank Holiday
  • Emergency Banking Relief Act
  • Gold Reserve Act
  • 21st Amendment (1933)
  • 18th Amendment and Prohibition repealed

22
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23
The Second New Deal (1935-1938)
  • Resettlement Administration (RA)/Farm Security
    Administration (FSA)
  • Resettled poor farmers economic and educational
    programs for farmers
  • Revenue Act of 1935
  • Increased tax rates on wealthy, capital gains,
    gifts, inheritance
  • Works Progress Administration/Works Projects
    Administration (WPA)
  • National labor project for infrastructure and
    humanities
  • National Youth Administration (NYA)
  • Rural Electrification Administration (REA)
  • Public-private effort to electrify farms and
    rural areas
  • Social Security Act (1935)
  • Tax on employee income to be used for retired
    persons, disabled, dependents, unemployed
  • Wagner Act (1935)
  • National Labor Relations Board
  • Right to collectively bargain
  • Fair Labor Standards Act (1938)
  • Established national minimum wage
  • Maximum 40 hour workweek and overtime
  • Child labor under 16

24
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25
Election of 1936
  • Democrats
  • Popularity of New Deal
  • New Deal Coalition
  • Republicans
  • Alfred Landon, Governor of Kansas
  • Pro-business and conservative criticism of New
    Deal

26
Federal government used posters, songs,
advertisements, literature to promote and support
FDRs New Deal programs among the American public
27
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28
New Deal Reactions
  • Majority of Americans approved of FDRs programs
  • Business leaders and corporations called him
    traitor or fascist or communist
  • Boondoggles
  • American Liberty League
  • Father Charles Coughlin
  • Radio broadcasts attacking FDR
  • Pro-fascist and anti-Semitic remarks
  • Huey Long Kingfish
  • Share the Wealth
  • 5000 for every family, 2,000 annually
  • Heavily tax wealthy

29
FDR and Court Packing
  • Supreme Court reversed several New Deal programs
  • Schechter Poultry Corp. v. United States (1935)
  • NIRA unconstitutional as violation of delegation
    of powers and commerce power
  • United States v. Butler (1936)
  • AAA unconstitutional as violation of Tenth
    Amendment
  • Justice Reorganization Bill
  • Appoint new justices for every justice over 70
  • 6 additional justices
  • Most of Congress defeated bill
  • Designed to pressure Supreme Court to approve New
    Deal programs
  • Compared FDR to fascists in Europe

30
New Deal and Labor
  • AFL strengthened by union-backed New Deal
    legislation
  • National Labor Relations Act/Wagner Act
  • Fair Labor Standards Act
  • Congress of Industrial Organizations (CIO)
  • Organize unskilled laborers in major industries
  • Industrial unionism
  • Strikes
  • Auto industry recognized United Auto Workers due
    to sit-down strikes
  • Republic Steel violent strike helped recognize CIO

31
End of the New Deal
  • Roosevelt Recession (1937-1938)
  • Contractionary monetary policy in lieu of
    economic expansion
  • FDR blamed big business
  • Midterm Election of 1938
  • GOP gained seats in House and Senate Democratic
    majority preserved
  • Recession of 1937-1938
  • FDRs controversial court-packing
  • Congress began to limit or eliminate spending for
    New Deal programs
  • Hatch Act of 1939
  • Limited politicians and campaign contributions
  • People who received federal assistance could not
    use money for campaign contributions
  • International Concerns
  • Totalitarian governments spawned defensive
    preparations

32
Women and Depression
  • Men left their families in search of work or
    worked more than one job
  • Limited income and absence of fathers placed
    intense pressures on mothers
  • Female labor force increased for female-based
    jobs
  • Wages remained low compared to men
  • Suffered backlash as a competitive workforce

33
Minorities and the Depression
  • Blacks
  • Suffered extreme poverty compared to other groups
    due to racism and worsening conditions
  • No jobs for niggers until every white man has a
    job! rally cry in South
  • FDR and New Deal
  • Lower wages in NRA AAA evicted thousands of
    blacks from tenant farms
  • WPA hired 1 million blacks in construction and
    educational projects
  • Mary McLeod Bethune in NYA
  • Scottsboro Boys Trial (1931)
  • Nine blacks youths accused of raping two white
    girls on a train in Alabama
  • Appeals showed lack of fair trial, impartial
    jury, fair sentencing, effective counsel
  • Natives
  • Indian Reorganization Act (1934)
  • Repeal of Dawes Act (1887) eliminating
    assimilation programs, return of native
    sovereignty, preservation of native cultures
  • Immigrants
  • Immigration was reduced by restrictive policies
    of 1920s
  • Suffered discrimination and prejudice with
    worsening economic conditions
  • Mexican Repatriation
  • With farming jobs limited, white Americans
    migrated west and policies established to push
    out Mexican immigrants

34
Federal One
  • Part of the WPA
  • Federal Writers Project
  • Federal Theatre Project
  • Negro Theatre Project
  • Federal Music Project
  • Federal Art Project
  • Historical Records Survey

35
EscapismGreat Depression in Arts and
Entertainment
  • Literature
  • John Steinbeck
  • The Grapes of Wrath
  • Of Mice and Men
  • Photography
  • Dorothea Lange
  • Music
  • Brother, Can You Spare a Dime?
  • Woody Guthrie
  • Radio
  • Comedies
  • Soap operas
  • Movies
  • The Wizard of Oz
  • Shirley Temple
  • Snow White and the Seven Dwarves
  • Marx Brothers

36
EscapismGreat Depression in Sports and Recreation
  • Sports
  • WPA
  • Athletic facilities
  • Athletic educational programs
  • Innovation, consolidation, and sacrifice of
    professional and college sports
  • College bowl games
  • NFL playoffs
  • Recreation
  • Games and Monopoly
  • Gambling
  • Rodeos
  • Dance halls and jazz
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