Depression and New Deal

Causes of the Great Depression Section 1

Economic Weaknesses GNP – Rose quickly Stock Market – expanded rapidly ⦿ Prosperity GNP – Rose quickly Workers spent freely Stock Market – expanded rapidly People invested freely Laissez-faire government

Cont… 70% low income uneven Bought stocks on credit Saw a crash coming ⦿ Wealth distribution 70% low income uneven ⦿ Buying stock on margin Bought stocks on credit ⦿ Fed Board Saw a crash coming

Stock Market Crashes Selling started slowly but caught on quickly Began on a Thursday On Friday bankers bought back stocks to help Black Tuesday 16 million shares of stock dropped Eventually $16 Billion

Failures Failed loans based on stock market Banks failed and closed ⦿ Banking Crisis Failed loans based on stock market Banks failed and closed Investors lost money ⦿ Business Businesses cut spending Consumers stopped buying Unemployment rose ⚫ Less money in circulation to stimulate economy

Cont… Overproduction 25% GNP – dropped 40% Could not sell Prices fell ⦿ Farms Overproduction Could not sell Prices fell Banks foreclosed on farms ⦿ Unemployment 25% GNP – dropped 40%

Cont… ⦿ People Hooverville's Shantytowns Hoboes Traveling workers

Dust Bowl Led to dust storms Ok, Tx,Ka, Nm,Co ⦿ Drought and Poor Farming Practices Led to dust storms ⚫ Earth pulled into the air Ok, Tx,Ka, Nm,Co

Hoover’s Presidency Section 2

Election of 1928 ⦿ Herbert Hoover ⦿ Republican ⦿ Very highly thought of by people ⦿ WINNER! ⦿ Alfred Smith ⦿ Democrat ⦿ Catholic

Hoover’s Presidency Small government Let people fix it ⦿ Rugged Individualism Small government Let people fix it ⦿ Associative State Voluntary association of business and government ⦿ Hoover Dam Colorado River Provide electricity to west coast Paid for by government

Cont… Farmers Encouraged businesses not to lay off workers ⦿ Response to the Great Depression Farmers Pushed for cooperatives Encouraged businesses not to lay off workers Reconstruction Finance Cooperation First action by Hoover 2 Billion to help banks

Cont… Smooth-Hawley Tariff Lost favor of people Bonus March Europeans responded with tariff ⦿ Nation Responds to Hoover Lost favor of people Bonus March Congressional Election of 1930 Democrats took control

FDR Section 3

Election of 1932 ⦿ Franklin D. Roosevelt ⦿ Democrat ⦿ Direct relief for people in NY ⦿ WINNER! ⦿ Herbert Hoover ⦿ Republican ⦿ Attempted to warn people of Roosevelt

FDR Polio Few people knew Talked directly to people Social reform ⦿ Disease Polio Few people knew ⦿ Fireside Chats Talked directly to people ⦿ Eleanor Roosevelt Social reform

Roosevelt and the Great Depression ⦿ Banks Closed all banks Emergency Banking Act Banks must be sound to re-open Glass-Steagall Act Created the FDIC

New Deal Section 4

New Deal New Deal CCC AAA NIRA Relief Recovery Reform ⦿ The Hundred Days New Deal Relief Recovery Reform CCC Civilian Conservation Corps AAA Agricultural Adjustment Act NIRA National Industry Recover Act

Cont… PWA Federal Securities Act SEC TVA CWA Public Works Administration Federal Securities Act SEC Securities and Exchange Commission Stock market regulation TVA Tennessee Valley Authority CWA Civil Works Administration

Cont… Huey P. Long Courts FDR too friendly to banks and businesses ⦿ Critics of the New Deal Huey P. Long FDR too friendly to banks and businesses Courts Limited New Deal programs Did no hurt FDR’s popularity

2nd New Deal Section 5

2nd New Deal Emergency Relief Appropriations Act WPA Social Security Works Progress Administration Social Security ⦿ Organized labor Wagner Act Outlawed anti-labor practices National Labor Relations Board

Cont… CIO GM Strike FDR attempted to increase # of judges Congress of Industrial Corporations GM Strike Sit-down strike ⦿ Court packing FDR attempted to increase # of judges ⦿ Deficit Growing too big John Maynard Keynes Deficit spending was ok

Election of 1936 Republican Reformer Anti-New Deal ⦿ Alf Landon Republican Reformer ⚫ Same as FDR mostly ⦿ Union Party Anti-New Deal ⦿ FDR ⦿ Democrat ⦿ Easy Winner!

Legacy of the New Deal Section 6

Popular Entertainment ⦿ Movies The Grapes of Wrath Mr. Smith Goes to Washington Wizard of Oz ⦿ Radio The Lone Ranger The War of the Worlds ⦿ Music swing

End of the New Deal Minimum wage FDR could not longer pass new laws ⦿ Support dwindled towards 1938 Minimum wage FDR could not longer pass new laws Mixed reviews on sucess ⦿ More focus on Europe