1920's had been a period of good economic times Tues. Oct. 29th, NYC Stock market crashed, causing a depression that would last until 1942

1. Speculation: Buying on margin, people don’t actually own stocks. 2.Great Depression: 12 year economic downturn caused by overproduction, underconsumption, expanded credit, & weak government response. 3.Herbert Hoover: Did not adequately respond with direct relief. Promised a return to prosperity. 4.Hooverville: homeless communities. 5.Bonus Army: WWI Veterans seeking bonus payment for service in war. Hoover uses force against them. 6.Dust Bowl: 7 years of drought in the midwest. Deepens farmer’s depression.

7. FDR: 1932 elected president. Serves 4 terms. NEW DEAL. 8. The New Deal: Plan for Relief, Recovery, and Reform to end the Great Depression. 9. FERA: Federal Emergency Relief Administration, assistance to states. 10. PWA: Public Works Administration. Jobs. 11. CCC: Civilian Conservation Corps. 12. WPA: Works Progress Administration. 13. NRA: National Recovery Administration. UNCONSTIUTIONAL. 14. Wagner Act: Collective bargaining and unions to labor.

15. Schecter Poultry: declares NRA unconstitutional. Allows for intra state commerce regulation. 16. US v. Butler: AAA declared unconstitutional. Local, not national issue. 17. TVA: Tennessee Valley Authority. Electricity to rural areas. 18. Court Packing Plan: FDR attemps to “pack” the court by adding justices who agree with New Deal. 19. Social Security Act: provide retirement income for elderly 20. FDIC: Federal deposit insurance corporation.

7 CAUSES OF THE DEPRESSION: 1. Weakness in the Overall Economy: overproduction, underconsumption 2. Unequal Distribution of income: 65% of country under 2,000/year. 3. **Excessive buying on credit: leads to underconsumption as people pay loans. 4. Weak Corporate Structure: no competition. 5. Weak Banking Structure: 6,000 bank failures in the 1920s. Too little reserves.Banking

7 CAUSES OF THE DEPRESSION: 6. Inadequate government policy: Speculation unregulated, tax policy favors wealthy, ignore anti- trust laws. 7. Weak International Economy: WWI had caused depression in Europe. Tariffs hurt international trade.

President Hoover responds Hoover organized private relief agencies for the unemployed Europe could stop reparation payments. Should purchase American goods instead to stimulate American economy Believes economy will “fix itself” through laissez faire policy.

Hoover unpopular, Congress passes the RECONSTRUCTION FINANCE CORPORATION emergency loans to banks too little too late… NO POLICIES OF DIRECT AID TO INDIVIDUALS.

1932 ELECTION 1 out of 4 was unemployed… income was 50% of what it had been in 1929 Hoover  no hope winner by a landslide is FRANKLIN DELANO ROOSEVELT (Dem - N.Y. governor) Promises a NEW DEAL for America.

** RELIEF, RECOVERY, REFORM are the Goals of the NEW DEAL under FDR. Step 1 -BANKING HOLIDAY- banks shut down & inspected by Gov. Allowed to open when "healthy" people's confidence returned Redeposit $$.

Step 2 - Stock market reform- Security Exchange Commission Step 3 - to put more $ in circulation, U.S. OFF THE GOLD STANDARD Step 4: The “New Deal”. (Alphabet Soup)

NAMESummary FDIC Federal Deposit Insurance Corporation Reform1933 Insures Bank deposits up to $100,000 AAA Agricultural Adjustment Administration Recovery1933 Farmers paid not to grow certain crops. ****UNCON CCC Civilian Conservation Corps Recovery, Relief 1933 Provides jobs to young men to work in environmental jobs.

PWA Public Works Administration 1933Relief Ports, Schools, Airports NIRA National Industrial Recovery Act 1933Reform Set prices, wages, hours. ***** UNCON TVA Tennessee Valley Authority 1933 Built Dams to set power in Southeast FHA Federal Housing Administration 1934 Insure mortgages

Wagner Act: 1935 Guaranteed Labor Unions the right to form. Created NLRB. (National Labor Relations Board) Fair Labor Standards Act: Set minimum wage at 25 cents, and maximum hours at 44 per week. Banned child labor in interstate commerce. Social Security Act (1935)

**Schechter Poultry Corporation v. US (1935) declared NRA UNCONSTITUTIONAL. US v. Butler: AAA ruled Unconstitutional. Farming was state, not national issue. Court Packing Plan fails. ( add 6 judges )

ELECTION OF FDR won easily (v Repub. Alf Landon - Kansas governor) FDR given a mandate to continue New Deal policies Tries to reorganize the Supreme Court - they disallowed some New Deal legislation FDR wants # of judges changed from 9  15 (to "pack the court") - great opposition, so FDR w/drew this proposal but judges retired & FDR got to appoint new ones  they approved all New Deal legislation

**ELECTION OF FDR broke with tradition & ran a 3rd time FDR v. Wendell Wilkie - American support of the Allies (G.B.), now in WWII v. Nazi Germany. both U.S. pol. parties wanted to support England, but to remain neutral – both parties approved of (most) New Deal legislation & wanted an isolationist foreign policy- FDR won in 1940 (and again in 1944)

*More gov. involvement. Stretched S.O.P. and C&B… New Deal helped in stimulating the U.S. economy, but only WWII would solve the problem  unemployed found jobs in wartime factories & the military. U.S. becomes: **ARSENAL OF DEMOCRACY. (sell items to England for war) **LEND-LEASE ACT. Should US Join the War??? ** Impact of the New Deal and FDR