Great Depression Unit US History Paul Dunn Instructor – Spring ‘05.
-
Upload
miranda-mcgee -
Category
Documents
-
view
213 -
download
1
Transcript of Great Depression Unit US History Paul Dunn Instructor – Spring ‘05.
Great Depression Unit US History
Paul Dunn
Instructor – Spring ‘05
Economic Troubles
• Excessive use of Credit– Consumers abused the
idea of “buying on time”
• Playing the market– Speculation – buy low and
sell high. Speculators did not look at things like profit and loss when purchasing stocks
– Purchasing stocks on credit (margin buying)
Economic Troubles
• High inventories for business• Decreased demand for goods as
consumers reached credit limits• High Tariffs
– Smoot/Hawley Tariff• Tried to protect American Industry• European Nations imposed retaliatory tariffs and
stopped importing our goods.• Everyone loses in this scenario• All goods became more expensive
Economic Troubles
• Income Gap– Vast differences between incomes of the
wealthy and incomes of the poor
• Business Cycle– Cyclical nature of business activity causes
natural declines in profit and income
• The timing of all of these events set the country up for a big problem
Stock Market Crash
• Black Tuesday– Panic selling
• Market loses – 30 billion in one day – 16 million shares were
sold
The Depression Begins
Hoover’s Slow Response to Crisis
• President Hoover thought that the economy would fix itself
• Focused government response to the crisis on aiding business – Reconstruction Finance Corporation – loaned
money to troubled banks, corporations etc.• Was highly ineffective and layoffs and plant
closings continued
Hoover’s Slow Response to Crisis
• Opposed direct relief to citizens– Encouraged volunteerism
and charity for the poor and unemployed
– Started modest public works projects like the Hoover Dam in Colorado
• Widely criticized for lack of compassion for the masses
Effects of the Great Depression on Society
• Unemployment– 1929 1.5 million– 1933 15 million
Photo
Effects of the Great Depression on Society
• Income– Incomes fell as more
and more workers competed for few jobs
– $.10/hr was a common wage
• Dramatically decreased purchasing power of families
Effects of the Great Depression on Society
• Bank Failures– Bank runs
• Customers would hear rumors that a bank was out of money
• All would then go and try to withdraw money
• Banks would then run out of cash and fail
– Lack of Confidence– No Deposits– Default on Loans– No “safety net” Photo
Effects of the Great Depression on Society
• Homelessness– Foreclosure
• Default of home or farm mortgages caused families to leave homes
• Lack of affordable housing and low or non-existent incomes forced families to live on the street
Photo
Effects of the Great Depression on Society
• Shanty towns– People used any
means available to create living space – often using discarded lumber or steel to create makeshift housing
Effects of the Great Depression on Society
Effects of the Great Depression on Society
• Bread lines– Charitable
organizations tried to assist the public by supplying food
– As the depression wore on, the government also helped provide food to the homeless
Effects of the Great Depression on Society
• Family Life– Marriage rate declined
dramatically– Birth rate declined– Divorce rate
skyrocketed
Effects of the Great Depression on Society
• Family Life– School attendance
declined– Literacy rates dropped– Childhood disease
rates increased– Malnutrition health
problems increased dramatically
• Osteoporosis• Starvation
• Ricketts
Effects of the Great Depression on Society
• Psychological affects– Depression– Suicide rate increase– Abuse – Divorce rate– Sense of helplessness
Effects of the Great Depression on Society
• http://www.polleverywhere.com/my/polls#!/my/polls
Effects of the Great Depression on Society
• Farm Life– Poor farming practices
made land vulnerable to erosion
– Drought and the Dust Bowl
Effects of the Great Depression on Society
Farm Life (cont.)- Low Prices- Difficulty getting
product to market due to problems in other industries
- Foreclosure- Mass migration to
cities
Election of 1932
• Franklin Delano Roosevelt wins election in a landslide
• Offers his New Deal as an alternative to current governmental policy
The New Deal
• Series of programs that were aimed at restoring confidence
• Used greatly expanded executive power to accomplish goals
• Some programs later found to be illegal
The New Deal• Bank Holidays – Closed
every bank in the nation for a few days– Purpose was to stop
massive bank withdrawals and to stop the panic that was gripping the nation.
– Tried to explain that bank holidays were put in place to protect money….. Communicated through fireside chats
The New Deal
• Federal Deposit Insurance Corporation– Insured each deposit to $2500. (Today – each
deposit is insured to $250,000.)
• Home Owners Loan Corporation– Created to assist home owners who were
unable to meet mortgage payments– Saved over 1 million family homes buy
granting low interest, long term mortgages.
The New Deal
• Direct Relief– Aid or monies that went directly to the 13
million unemployed workers
• Federal Emergency Relief Administration– $500 million was funneled to state and local
agencies that then passed this on to the unemployed
– By 1935 $3 billion in direct aid had been distributed.
The New Deal
• The Civilian Conservation Corps – Employed 250,000
young men ages 18-25 in 1933
– Worked in National Parks and Forests
• Plant trees• Fight Fires• Cleared underbrush• Built trails • Cleared beaches, etc.
The New Deal
• CCC (cont.)– Workers earned $1 a
day for their labor – and were provided with room and board
– 2.5 million people were employed during the 10 year existence of the program
The New Deal
• Industry– National Industrial Recovery Act
• Tried to stimulate the economy through government spending and federal loans
– Public Works Administration
» Built roads, public buildings, other public works projects like dams, bridges etc.
– National Recovery Administration
» Encouraged business to draw up “codes of fair competition”
» Set wages, prices, production levels, hours
» Suspended anti-trust laws and allowed workers to organize in unions
The New Deal
• Agricultural Adjustment Administration– Paid farmers to limit
output of corn, cotton, dairy products, hogs, rice, tobacco, wheat and other commodities
– Money came from taxes on food processors
The New Deal
• Tennessee Valley Authority– Tried to revitalize
Tennessee River Valley
– Flooding, Deforestation, Poverty, Illiteracy etc.
• Built a series of dams to provide power and provide jobs
• Improve schools and provide health care
FDR’s Second Term
• Even though there were many critics of the FDR’s policies – he was elected to a second term in 1936
• The Democrats won a series of seats in the congressional elections in 1934 that solidified FDR’s power.
2nd New Deal
• Second wave of programs that tried to “jump-start” the economy– Responded to
criticisms of the New Deal
– Tried to reach more people faster
2nd New Deal
• Works Progress Administration– $5 billion in job creation programs– Employed 8.5 million people– Focused on national infrastructure
• Built or rebuilt 350 airports• 100,000 public buildings• 78,000 bridges – Old Cass Ave. Bridge• 500,000 miles of roads• Research projects• Teaching Jobs
2nd New Deal
• National Youth Administration– Provided high school
and college-aged kids with part-time work that allowed them to stay in school
• Employed 500,000 people
• Was a secondary branch of the WPA
2nd New Deal
• Social Security Act– 3 parts
• 1. Provided unemployment insurance to workers who lost their jobs
– $ for this came from a payroll tax on businesses
• 2. Provided pensions to retired workers over the age of 65
– $ come from payroll tax on employers and a tax on employee wages
2nd New Deal
• Social Security (cont)• 3. Provide payments to
people with disabilities, the elderly, and the wives and children of male workers who have died
– This program really aided the folks hit hardest by the depression
– Is still a program that is controversial and very expensive today
2nd New Deal
• Rural Electrification Administration– Attempted to bring electricity to rural America
• Allowed Gov’t to regulate the price of electricity to keep costs low.
• In 1930 10% of rural residences had electricity• In 1940 50%+ had electricity
• Agriculture Adjustment Act (II)– Continued process started by the 1st AAA
• Linked soil conservation program to it to prevent problems in the Supreme Court
Roosevelt and the Supreme Court
• Roosevelt became disgusted with the court as it kept declaring his programs unconstitutional– Attempted to “pad” the
court by adding 1 justice for every justice over the age of 70.
– Congress failed to pass the measure and Roosevelt was forced to pass “constitution friendly” programs.
Life in the New Deal Era
• Hardship• Rise of Radical
Movements• Destitution• Anger• The Search for Hope
People
• Crime was on the rise– Kidnapping– Robbery– Murder
• Laws were relaxed to give cops more freedom to track down criminals
• Public outcry over crime
Sports and Games
• Card Games• Puzzles• Gambling
– Bingo– Slot Machines– Horse Racing
• Movies• Pinball Machines• Baseball – Sat. Day off• Olympics – 1936 Berlin
Science and Technology
• Transportation– Commercial Air Travel– Trains– Autos
• Aided by road construction projects
• Skyscrapers– Empire State Building– Mega Structures –
Tunnels/Bridges
• Dams– Colorado River/ Tennessee
River Valley
Entertainment
• Radio– Amos and Andy– 1 in 3 owned a radio
• Reading– Corner news stand– Cheap magazines– Comics
• Movies– Larger than life movie stars– “Feel Good” Shows
Depression Ends
• The economy and the country did not fully recover throughout the 1930s.– The only thing that truly erases the effects of the
Great Depression is WWII.• Massive production requirements from America's factories
during the war was the only thing that could put America back to work and fully restore confidence in the economy.
– The Great Depressions legacy continues with us today in the form of many continuing government programs that provide a “safety net for citizens, “just in case.”