An Overview of the Great Depression

Classic Photo Taken from Photograph by Dorothea Lang

Why can’t you give my dad a job? Taken from Minnesota Historical Society

Living on the streets Take from Think Quest Economic History Site

Roosevelt Library Photo Take from Eleanor Roosevelt National Historic Site Also shown on National Park Service, U.S. Department of the Interior

Jobless Men unable to care for their families Taken from Pensito Review

USA Work Program Taken from American Life Histories, manuscripts from the Federal Writers’ Project, Manuscript Division Library of Congress

Homeless Beggar Taken from Bergen County Technical Schools, Teaching American History Grant, Funded by U.S. Department of Education

1920’s Problems Factories making Too Much, Farms growing too much Factories Fire Workers (Don’t need them) Farm Prices fall (Farmers can’t make $$) Farmers & Factory Workers can’t pay back loans to Banks: DEFAULT!! Banks Close because they have no money: Loans have not been paid back, can’t give people their savings BANKS Have NO $$ PEOPLE LOST SAVINGS & JOBS NO ONE TO HELP!

10 The 1920s was known as a prosperous time, but not for everyone Installment buying, using credit and paying back in small amounts, was introduced which allowed people to buy cars, radios and other new products of the 1920s. Farmers, however, were in a depression throughout the whole decade.

11 RURAL POVERTY IN THE 1920’S

12 Although the nation's wealth grew by billions throughout the 1920s, it was not distributed evenly. The top 1% received a 75% increase in their disposable income while the other 99% saw an average 9% increase in their disposable income. 80% of Americans had no savings at all. UNEQUAL DISTRIBUTION OF WEALTH Disposable income is money remaining after the necessities of life have been paid for. Happy Feet song

13 The chart shows that 99% of the population received a 9% increase in their income, while the top 1% saw their income rise by 75%. 1,230,000 Americans 121,770,000 Americans

14 The economy grew by billions throughout the 1920s. Total realized income rose from $74.3 billion in 1923 to $89 billion in 1929

15 Chart showing wages of unskilled workers. Notice how little the wages changed during the supposed prosperity of the 1920’s.

16 HIGH TARIFFS AND WAR DEBTS At the end of World War I, European nations owed over $10 billion ($115 billion in 2002 dollars) to their former ally, the United States. Their economies had been devastated by war and they had no way of paying the money back. The U.S. insisted their former allies pay the money. This forced the allies to demand Germany pay the reparations imposed on her as a result of the Treaty of Versailles. All of this later led to a financial crisis when Europe could not purchase goods from the U.S. This debt contributed to the Great Depression. In 1922, the U.S. passed the Fordney-McCumber Act, which instituted high tariffs on industrial products. A tariff is a tax on imports. Other nations soon retaliated and world trade declined helping bring on the great depression.

17 Factories were producing products, however wages for workers were not rising enough for them to buy them. Too few workers could afford to buy the factory output. The surplus products could not be sold overseas due to high tariffs and lack of money in Europe. OVERPRODUCTION IN INDUSTRY

18 FARM OVERPRODUCTION Due to surpluses and overproduction, farm incomes dropped throughout the 1920’s. The price of farm land fell from $69 per acre in 1920 t0 $31 in Agriculture was in a depression which began in 1920, lasting until the outbreak of World War II in In 1929 the average annual income for an American family was $750, but for farm families it was only $273. The problems in the agricultural sector had a large impact since 30% of Americans still lived on farms. Surplus ears of corn

Real output (GDP) fell 29% from 1929 to Unemployment increased to 25% of labor force. Consumer prices fell 25%; wholesale prices 32%. Some 7000 banks failed. How Great was the Great Depression?

Stock Market Boom and Bust S&P Composite Index

The Collapse of World Trade $ value imports of 75 countries

Bank Failures 7000 banks failed -- many during “panics” Number of banks fell from 25,000 in 1929 to 15,000 by 1934 Possible Channels: Loss of deposits  decline in expenditures Customer relationships broken  harder to borrow Money supply contraction

Describe how the Great Depression affected people. Who was the president when it started, and what did he do to help? Who tried to help the poor and what problems did they have? How did people try to escape the Great Depression? Affects of the Depression A. Jobless / Homeless – Jobless goes from 4 to 12 million 2. Houses are lost, people become homeless 3. People are Desperate!!!! B. Hatred for President Hoover 1. Say’s it is NOT Government’s job to fix the Poor a. Say Churches and other groups should help b. PROBLEM: People too poor to help churches so churches can’t help as much!!! 2. People name Poor Places after Hoover a.*Hooverville- Shanty towns / Hoovermobile- cars pulled by mules b. HOBOS- look for jobs*Hooverblankets- newspapers used as traveling the railsblankets by homeless

Affects of the Great Depression 3. Bonus Army a. WWI veterans who were promised a $ bonus in 1945, * Veterans want it NOW (1932) b. Veterans go to Washington and “camp out” c. Hoover sends in Army (Eisenhower, MacArthur), used tear gas, machine guns, and burned the camp down

Affects of the Great Depression C. Escaping the Depression 1. Radio- Comedies, Soap Operas 2. Movies- Shirley Temple, Child Actors a. Snow White (first full-length animation) b. Wizard of OZ *Small girl escaping the Dust Bowl 3. Literature a. Steinbeck, Grapes of Wrath *About a family of ‘Okies’ escaping the Dust Bowl and how horribly they were treated Wizard of OZ

Describe the natural disaster that affected the U.S. during the Great Depression. What was the disaster’s nick-name? What caused the disaster? Where did the people go to try and escape their troubles and how were they treated (nick-names for these people)? Natural Disaster “The DUST BOWL” A. Great Plains suffers a huge Drought (1931) 1. Causes: a. Drought...no rain b. New technology, tractors and steel plows tear-up extra sod that was holding onto soil, drought turns open soil into sand box 2. Huge Dust storms cover ‘Great Plains B. Results 1. Can’t pay banks- Banks take Farms 2. Many Great Plains farmers move to California, a. Try to get jobs on large farms b. Treated poorly in Calif. - *‘Oakies’ & ‘Arkies’-Not wanted in West