Depression / New Deal

Objectives Look at effects of the Depression Examine pictures to visual the

impact of the depression

1920’s in the U.S. Consumer Economy: an

economy that depends on a large amount of spending by consumers

People began to buy on credit

Industries boomed because people were buying so much.

People began to invest in the Stock Market

People would borrow money to purchase stocks (buying on margin)

Speculation: purchasing high risk stocks

HOWEVER… Uneven prosperity: not

everyone was enjoying the economy

Falling farm prices put farmers into trouble, they couldn’t pay debts.

People over purchased on credit, couldn’t pay bills

Black Tuesday: The Great Crash On October 29, 1929, the stock

market crashed. Prices fell, stocks were

worthless Businesses couldn’t pay their

bank loans. Factories shut down, people

lost jobs People couldn’t pay personal

loans

People couldn’t purchase products

More stores and factories closed

People tried to get their money from the banks

Banks closed

RESULT…

The Great Depression

President Herbert Hoover (Republican) believed that the natural process of the cycle would lead to correction.

Asked businesses to voluntarily cooperate

Laizze Faire Economics

Effects:

Bank runs Savings were wiped out Cuts in production Rise in unemployment

And then to make things worse… It stopped raining in the

mid-west. Referred to as the “Dust

Bowl” Nothing would grow Primarily affects: Kansas,

Oklahoma, Nebraska

People packed all their belongings in their trucks

Moved to California Created cardboard towns

called Hoovervilles Named for Pres. Herbert

Hoover

Images From The Great Depression

A man selling apples on a New York City street corner, just trying to make ends meet.

“Hooverville”

Unemployed Chicagoans during Great Depression.

Famous photo taken by Dorthea Lange. This is a picture of an immigrant mother who just sold the tires from her car to buy food. Before this day, her family had been living on frozen vegetables and birds that the children had killed.

Unemployed men vying for jobs at the American Legion in Los Angeles during the great depression.

Iowa – A farm foreclosure sale

http://www.ameshistoricalsociety.org/exhibits/bank_depression_ad.jpg

Breadline.

Breadline

New York City. The corner of 6th Avenue and 42nd Street.

Ladies in the food line – Kensington, Pennsylvania.

Soup Line

The Dust Bowl

What do you think? From the images you have just

seen, how do you think the mood the country was at the time?

Objectives Examine FDR’s response to the

Great Depression

Examine & assess the effectiveness of New Deal policies

We will assess the impact of the New Deal

Happy Days are Here Again

1932: Franklin D. Roosevelt (Dem.) is elected President

New Deal “Relief”

Help people now

“Recovery” Jobs, econ…

“Reform Change econ. policy, gov. role….

The New Deal

KEY GOALS OF THE NEW DEAL

1.

2.

3.

1.

2.

3.

First Hundred Days

Restore the nation’s hope

Provide relief to the people

Create jobsStimulate economic recovery

The Second Hundred DaysSocial Welfare benefitsStricter controls over business

stronger support for unions

higher taxes on the rich

Pass new labor laws

First Half of New Deal 1933 FDR

Keynesian Economics Defecit spending

1933 FDIC Federal Securities Act

Public info on stock market & regulation NIRA NRA

Codes for businesses WPA CCC

FDIC established in 1933

Second Half of N.D. 1935 Wagner Act

Form unions & strike

SOCIAL SECURITY Workers & employers pay “old age” benefits (65) Unemployment insurance

New Deal

Expanded the role & power of the Federal GOVERNMENT

Reactions to the New Deal1. Huey Long

Louisiana populist“Share our wealth”Anyone w/ $5 mil. In bank

gov should take it & distribute it

2. Charles CoughlinNational Union for Social JusticeAttacked bankers“Radio Priest” of DetroitBorderline fascist

3. F. TownsendOver 60 yrs. Old $200/mo and you must spend itCirculates $

Reading After filling in the graphic organizers,

read FDR: Opportunistic Architect of Big Gov. (Robert Higgs)

Create 3 questions of your own from the reading

1. How does his view of FDR & the New Deal differ from most? Why?

2. According to Higgs what impact did FDR have upon American History?

3. What is your opinion?

Discuss What impact did the New Deal

have? Positive, negative…?

Are there any comparisons one can make between Obama’s recovery plans and the New Deal?

Social reactions: People left their homes, westward movement

Increased discrimination against minorities, many lost their jobs

Men left families

Women lost jobs Increased union membership and riots (Wagner Act)

Many thought FDR was a Communist

Others said he wasn’t doing enough

Recovery

People returned to work 1937 Recession FDR was reelected in ’36, ’40, and ’44.

Welcome to WWII