Depression / New Deal

Objectives Look at effects of the Depression Examine pictures to visual the impact of the depression

1920’s in the U.S. Consumer Economy: an economy that depends on a large amount of spending by consumers People began to buy on credit Industries boomed because people were buying so much.

People began to invest in the Stock Market People would borrow money to purchase stocks (buying on margin) Speculation: purchasing high risk stocks

HOWEVER… Uneven prosperity: not everyone was enjoying the economy Falling farm prices put farmers into trouble, they couldn’t pay debts. People over purchased on credit, couldn’t pay bills

Black Tuesday: The Great Crash On October 29, 1929, the stock market crashed. Prices fell, stocks were worthless Businesses couldn’t pay their bank loans. Factories shut down, people lost jobs People couldn’t pay personal loans

People couldn’t purchase products More stores and factories closed People tried to get their money from the banks Banks closed

RESULT… The Great Depression

President Herbert Hoover (Republican) believed that the natural process of the cycle would lead to correction. Asked businesses to voluntarily cooperate Laizze Faire Economics

Effects: Bank runs Savings were wiped out Cuts in production Rise in unemployment

And then to make things worse… It stopped raining in the mid- west. Referred to as the “Dust Bowl” Nothing would grow Primarily affects: Kansas, Oklahoma, Nebraska

People packed all their belongings in their trucks Moved to California Created cardboard towns called Hoovervilles Named for Pres. Herbert Hoover

Images From The Great Depression

A man selling apples on a New York City street corner, just trying to make ends meet.

“Hooverville”

Unemployed Chicagoans during Great Depression.

Famous photo taken by Dorthea Lange. This is a picture of an immigrant mother who just sold the tires from her car to buy food. Before this day, her family had been living on frozen vegetables and birds that the children had killed.

Unemployed men vying for jobs at the American Legion in Los Angeles during the great depression.

Iowa – A farm foreclosure sale

Breadline.

Breadline New York City. The corner of 6 th Avenue and 42nd Street.

Ladies in the food line – Kensington, Pennsylvania.

Soup Line

The Dust Bowl

What do you think? From the images you have just seen, how do you think the mood the country was at the time?

Objectives Examine FDR’s response to the Great Depression Examine & assess the effectiveness of New Deal policies We will assess the impact of the New Deal

Happy Days are Here Again 1932: Franklin D. Roosevelt (Dem.) is elected President

New Deal “Relief” Help people now “Recovery” Jobs, econ… “Reform Change econ. policy, gov. role….

The New Deal

KEY GOALS OF THE NEW DEAL

First Hundred Days Restore the nation’s hope Provide relief to the people Create jobs Stimulate economic recovery

The Second Hundred Days Social Welfare benefits Stricter controls over business stronger support for unions higher taxes on the rich Pass new labor laws

First Half of New Deal 1933 FDR Keynesian Economics Defecit spending 1933 FDIC Federal Securities Act Public info on stock market & regulation NIRA NRA Codes for businesses WPA CCC

FDIC established in 1933

Second Half of N.D Wagner Act Form unions & strike SOCIAL SECURITY Workers & employers pay “old age” benefits (65) Unemployment insurance

New Deal Expanded the role & power of the Federal GOVERNMENT

Reactions to the New Deal 1. Huey Long Louisiana populist “Share our wealth” Anyone w/ $5 mil. In bank gov should take it & distribute it 2. Charles Coughlin Charles Coughlin National Union for Social Justice Attacked bankers “Radio Priest” of Detroit Borderline fascist 3. F. Townsend Over 60 yrs. Old  $200/mo and you must spend it Circulates $

Reading After filling in the graphic organizers, read FDR: Opportunistic Architect of Big Gov. (Robert Higgs) Create 3 questions of your own from the reading 1. How does his view of FDR & the New Deal differ from most? Why? 2. According to Higgs what impact did FDR have upon American History? 3. What is your opinion?

Discuss What impact did the New Deal have? Positive, negative…? Are there any comparisons one can make between Obama’s recovery plans and the New Deal?

Social reactions: People left their homes, westward movement Increased discrimination against minorities, many lost their jobs Men left families

Women lost jobs Increased union membership and riots (Wagner Act) Many thought FDR was a Communist Others said he wasn’t doing enough

Recovery People returned to work 1937 Recession FDR was reelected in ’36, ’40, and ’44. Welcome to WWII