Review causes of the Great Depression - Farming Crisis Overproduction = Surplus Crops NOT sold Demand & Prices Fall = Can’t Pay Loans & Lose Farms - Living on Credit Living beyond means = False Sense of Prosperity Credit Easily Available = Business Support Consumer Debt - Unequal Distribution of Wealth Rich got richer in the 1920’s while the Poor got poorer

- Less Consumer Spending - Industrial Issues Key Industries NOT making much profit in the 1920’s Coal Mining down due to new sources of energy Boom Industries (automobiles, construction) weaken - Less Consumer Spending Rising prices, idle wages, overbuying = Less Spending - Stock Market Bull Market in the 1920’s = Rush to buy Stock (3% buy) Market Speculation  buy with idea to make a quick buck while ignoring the risks Buying on Margin  pay for stock with a down payment and borrowing the rest to pay

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Great Depression Starts September 1929 - Stock prices peak then begin to fall October 24, 1929 - Stocks plunge & investors unload shares - Result: Stock Market Panic October 29, 1929 “Black Tuesday” Stock Market Crashes (16.4 million shares dumped and stock prices plummet)

Financial Collapse - Banks run out of money - Rush on the Banks People withdraw their money Result  “failure of banks” Result: - Banks run out of money - Millions of Americans lose life savings 1929 = 600 banks close 1933 = 11,000 banks fail

Financial Collapse - U.S. Economy Falls Business's go Bankrupt (90,000 close) Gross National Product is cut in half (104 to 59 billion) Workers lose jobs (1 in every 4) Unemployment Rate Rises (25% in 1933)

Hardships & Suffering - People lose homes People cant afford food Shantytowns created Nicknamed  “Hoovervilles” People cant afford food Find food at Soup kitchens and in Bread Lines

Hardships & Suffering African Americans & Latinos Women Children Face highest level of unemployment Face violence and discrimination Women Targets of resentment for having jobs Children Poor diets & malnutrition Lack of healthcare Had to drop out of school Ruse in child labor

but then……. Hardships & Suffering Farmers and Rural Areas Could grow their own food Faced foreclosure of farms Many turned to tenant farming but then……. The Dust Bowl (1933-1936) Overproduction + Drought = No Crops Winds + Drought + Bad Soil = Dust Storm Outcomes  - cannot grow food = evictions - farmers leave their land & homes

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4/28 Reading/Notes page 437-438

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FDR (Franklin Delano Roosevelt) Not to be confused with Teddy Roosevelt. Watch this video http://www.biography.com/people/franklin-d-roosevelt-9463381

Franklin D. Roosevelt’s Appeal In 1932 presidential election, FDR was perceived as a man of action. Hoover was viewed as a “do-nothing president.”

Purposes of the New Deal Relief: to provide jobs for the unemployed and to protect farmers from foreclosure Recovery: to get the economy back into high gear, “priming the pump” Reform: To regulate banks, to abolish child labor, and to conserve farm lands Overall objective: to save capitalism

First New Deal (1933-1934) Emphasis: reform Political Position: conservative Primary aim: economic recovery Philosophy: economic nationalism and economic scarcity (i.e., raise prices by creating the illusion of scarcity) Objectives: higher prices for agriculture and business Beneficiaries: big business and agricultural business

National Recovery Act (NRA) Purpose: recovery of industry Created a partnership of business, labor, and government to attack the depression with such measures as price controls, high wages, and codes of fair competition

First Agricultural Adjustment Act (AAA) Purpose: the recovery of agriculture Paid farmers who agreed to reduce production of basic crops such as cotton, wheat, tobacco, hogs, and corn Money came from a tax on processors such as flour millers and meat packers who passed the cost on to the consumer

Federal Emergency Relief Admin (FERA) Purpose: relief Gave money to states and municipalities so they could distribute money, clothing, and food to the unemployed

Civilian Conservation Corp (CCC) Purpose: relief Gave outdoor work to unemployed men between the ages of 17 and 29 They received $30 per month, but $22 went back to the family

Second New Deal (1934-1941) Emphasis: reform Political Position: liberal Primary aim: permanent reform Philosophy: international economic cooperation and economic abundance Objectives: increased purchasing power and social security for public Beneficiaries: small farmers and labor

Social Security Act Purpose: reform Gave money to states for aid to dependent children, established unemployment insurance through payroll deduction, set up old-age pensions for retirees.

National Labor Relations Act Purpose: reform Put restraints on employers and set up a National Labor Relations Board to protect the rights of organized labor to bargain collectively with employers.

Second Agricultural Adjustment Act Purpose: recovery for agriculture Paid farmers for conservation practices, but only if they restricted production of staple crops.

U.S. Housing Authority Purpose: recovery and reform Used federal funds to tear down slums and construct better housing.

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