SSUSH17 The student will analyze the causes and consequences of the Great Depression.

Great Depression The Great Depression was the greatest economic crisis in U.S. history. The depression was caused by the stock market crash, which was caused mainly by: overproduction, under-consumption, and stock market speculation

Causes of the Great Depression Cause 1: Agricultural Overproduction -Switch to mechanized farming allowed farmers to increase their production of crops -Cycle: Overproduction led to major price reductions, causing farmers to lose money and the inability to pay back farm loans; leads to bank failures -High tariff rates in the U.S. and internationally hurt demand for agricultural products

Under-consumption People had less money to purchase consumer goods for two main reasons: decline in credit available from banks because of so many unpaid loans (credit freeze) and a general decline in wages for manufacturing workers Under-consumption resulted in the loss of money for farmers and business owners = layoffs (cycle again)

Stock Market Speculation -Many speculators bought stock on margin - borrowed money to buy stocks – up to 90% of the stock’s value! -If the stock price began to fall, you would then have to pay back the money you borrowed-which many speculators didn’t have! -The high stock values were inflated beyond their actual value

Hoovervilles- Communities of the homeless Social impacts of the Great Depression Hoovervilles- Communities of the homeless 1932 – Fortune Magazine reported that 34 million people belonged to families with no regular, full-time wage earner; Homeless population = 2 million Women and minorities fired first Private charities over-whelmed; no government social safety nets in place Men left families to find work President Herbert Hoover’s response? Too little too late

Political impacts of the Great Depression The power of Democrats grow b/c of their response to the Depression; “Hoover doesn’t care about us” New Deal Coalition – 1930s – late 1960s; Democrats only lose to Dwight Eisenhower (’52, ‘56) until 1968 sees a surge of conservatism Coalition consisted of: labor unions, blue collar workers, minorities (racial (African Americans), ethnic, religious) farmers, white Southerners, people on relief

b. Explain the impact of the drought in the creation of the Dust Bowl.

Dust Bowl and the Okies Midwest region experiences wet/dry cycles – people drawn by 1862 Homestead Act 1930s- 75% of country in drought Over-production (WW1) = soil depletion; dust storms Soil Conservation Act (1938) encouraged better plowing methods

Dust Bowl