THE GREAT DEPRESSION Chapter 23

From Boom to Bust Bull Market: a period in which stock prices raise faster than what is typical Black Tuesday (October 1929): Stocks drop to the lowest prices ever Black Thursday: The Stock Market crashes

Causes of the Great Depression 1. Overproduction 2. Weak Banking System 3. Unequal Distribution of Wealth 4. Worldwide Depression 5. Lack of Diversification of Product

Overproduction Too many goods and too few buyers Prosperity of 1920s made business leaders too hopeful More goods being produced than being sold Under Consumption: people could not afford to buy goods

Weak Banking System Banks made loans to people who invested in stock market (margin buying) People could not pay back loans No trust in banks People lost all savings

Worldwide Depression 1920s US had made loans to Europe US could not pay back loans Europe’s banks began to fail Europe cannot buy goods from US anymore US cannot buy goods from Europe anymore

Unequal Distribution of Wealth Large gap between rich and poor Unbalance of wealth create unstable economy Henry Ford (14 million) vs average person ($750)

Lack of Diverse Products Prosperity dependent on a few key industries  Automobile  When these industries failed, no other industry could pick up the slack

Cycle of Disaster Domino Effect Stock Market crash Factories lay people off/reduce wages Banks fail No investment occurs Situation keeps getting worse Digging a hole country could not get out of

Impact of Stock Market Crash 9,000 banks closed Deflation: decline in the value of money and price of goods Cut backs in wages Cut backs in hours Unemployment

Industrial northeast and Midwest hit hardest by unemployment Unemployment seen as a personal failure Need for relief Unequipped to help all that needed help Private charities attempted to aid the unemployed

Dust Bowl

Migrant Mother Dorthea Lange photograph How old do you think she is? What do you notice about her? Why is this photograph so iconic?

Dust Bowl

Great Plains region Poor farming techniques and drought Okies and Arkies Migration Black Blizzards Grapes of Wrath

Life During the Great Depression High unemployment (1/4 people) Retreat from consumerism of 1920s Home businesses Many generation living together in one home Decline in divorce rate Marriage and birth rate decline Increase in suicide

Life During the Great Depression People looked to government for help Many Americans blamed self for situation Radio brought comfort  Radio “shows”  Radio stars  Direct access to public events  Shared experiences  Kept nation informed  Fireside Chats

Life During the Great Depression 1930s emerge of Walt Disney The Wizard of Oz (1939) Gone with the Wind (1939)

Hoover’s Response “Rugged Individualism” Feared direct government handouts Called on private charities, volunteers, and businesses to work together Vetoed Garner-Wagner Bill (federal funds to aid homeless)

Hoover Takes the Blame Hoovervilles Hoover Blanket Hoover Stew Hoover Flag

Hoover’s Actions Federal Farm Board (1929): created to stabilize farm prices by holding surplus crops in storage Public Works Program (1930): government hired people for public projects Reconstruction Finance Corporation (1932): government made loans to help save businesses

Forms of Protest Farmers go on strike: Farmer’s Holiday Association Bonus Army:  1924 Congress had promised $1,000 to all WW1 veterans to be received in 1945  1932, veterans demanded bonus early  20,000 marched to D.C demanding bonus  Congress refused  Violent Protests  2 deaths  Hoover declines in popularity

African Americans the Depression ½ of African Americans lived in South Many forced to leave First to lose jobs when GD hit 50% higher unemployment rate Black Shirts Organization  “No jobs for blacks until every white has a job”

Scottsboro Case black teenagers were taken off train in Alabama and arrested for disorderly conduct 2 white women accused them of rape Overwhelming evidence women had NOT been raped All white jury convicted them 8 of them sentenced to death Supreme Court overturned, last left prison in 1950 Role of NAACP

Scottsboro Boys

Mexican Americans and the Depression Farmers and industrial workers Mostly in West (CA, AZ, NM) Large communities in Detroit, Chicago and NYC Higher unemployment rates than whites Many left US for Mexico Most relief programs excluded Mexicans Segregation of public places (schools/hospitals) Migration to cities (LA)

Asian Americans Faced same problems at Hispanics and African Americans California had large Japanese and Chinese Population Japanese American Citizen League formed in 1930s to encourage Japanese to anglicize

Election of 1932 Republicans nominate Hoover again Democrats nominate governor of NY, FDR  Wealthy, well connected political family  Distant cousin of Teddy Roosevelt  Married to Eleanor Roosevelt  New York State legislature  Assistant Secretary of Navy  Polio  Landslide victory for FDR

1928

1932