BELLWORK 1.What was the Reconstruction Finance Corporation ? 2.Explain the concept of moral hazard. 3.How is the government involved in our economy today? 4.THINKER: As you know, Hoover did not give money to individuals as it was not the government’s job to interfere with individual initiative. He believed that job loss and poverty was a sign of individual failure; therefore, the federal government should not intervene. To what extent do you agree with this? Is intervention in the economy the government’s job? Or should the government be “hands- off” when it comes to the economy? (Laissez-faire)

FEDERAL GOVERNMENT’S ROLE IN THE ECONOMY

GOVERNMENT ROLE IN THE ECONOMY Anti-Involvement We have a FREE market economy Individual ownership The opportunity to make profit gives people incentive to produce items efficiently Wide variety of goods available to consumers Competition and Self-Interest work together to regulate economy Makes government too involved in daily lives Pro-Involvement Everything is regulated by government Federal oversight – are companies abusing privilege? Transparency Bailouts for failing businesses/banks Provides social programs for those that need help Lack of equality in free-market Laissez-faire encourages self- interest and greed

PRESIDENT HOOVER AND THE DEPRESSION Hoover’s popularity as President was decreasing just as fast as the economy……. When he was elected in 1928, he was extremely popular, optimistic, and confident. “The United States is nearer to the final triumph over poverty than ever before in history” A few months later the stock market crashed “We have now passed the worst, and shall rapidly recover” The economy will fix itself (Laissez-faire = hands-off!)

PRESIDENT HOOVER AND THE DEPRESSION Depression deepens: 1929: 23,000 businesses fail 1932: 32,000 businesses fail Average income in 1929: $2,300 Average income in 1932: $1,600 Unemployment in 1929: 5% Unemployment in 1932: 25% Farmers feel the worst effects of the Great Depression: no government aide, no money to farm, no one is buying crops, dust storms ruin fields. Hoover’s establishment of the RFC was too little, too late.

HOOVER’S MAIN DOWNFALL In 1932, 20,000 jobless WWI veterans protested in Washington, D.C. Called themselves the Bonus Army Demanded immediate payment of a pension bonus that was promised. Things got violent so General Douglas MacArthur used guns, tanks, and tear gas to fight off the protestors. Hoover took responsibility for MacArthur’s actions

WHO WANTS TO GO TO PERU WITH ME???

THE ELECTION OF 1932  President Herbert Hoover  Governor Franklin Delano Roosevelt VS Two completely different men with two completely different ideas on government involvement

IDEAS ON GOVERNMENT HERBERT HOOVERFRANKLIN ROOSEVELT Minimal government action “The key to recovery is confidence” State and local governments should handle relief Start with prosperity at the top  foster economic growth Expand government roles Federal government should handle relief Government should oversee programs for recovery (New Deal!) Unemployment commission and relief administration Startled by uneven prosperity  help the lower classes first

DISCUSSION: CAMPAIGNING Make a prediction  How did the introduction of the radio influence campaign strategy? What do you think is the most effective campaign strategy? Should limits/guidelines be set on presidential campaigns? If so, what? Do you think candidates would follow these guidelines?

CAMPAIGNING HERBERT HOOVER FRANKLIN ROOSEVELT “Brother Can you Spare a Dime?” Once I built a railroad I made it run Made it race against time. Once I built a railroad Now it’s done Brother, Can you Spare a Dime? “Happy Days are here Again!” Happy days are here again, The skies above are clear again Let us sing a song of cheer again – Happy days are here again.

“This Campaign is more than a contest between two men.... It is a contest between two philosophies of government.” -President Hoover, 1932

Electoral Votes Roosevelt: 472 Hoover: 59 Hoover won six states, and FDR won by a huge margin of 7 million popular votes.

FIRESIDE CHATS

ROOSEVELT’S NEW DEAL To learn about Roosevelt’s New Deal policies, read pgs and take notes on the 3 R’s of FDR’s New Deal: Relief (Immediate response to bring stability) Recovery (Improvements made to the economic system to stimulate growth) Reform (Programs implemented to stop a future economic downturn)

YOU DECIDE!!! READING: IS THE GOVERNMENT RESPONSIBLE FOR THE ECONOMIC WELL-BEING OF ITS CITIZENS?

2014 WRITING ASSIGNMENT After you read the handout, you need to write a ¾ page letter from the perspective of a citizen during the Great Depression. Your letter needs to be written to either President Hoover or President Roosevelt from the perspective of a citizen impacted by the GD (urban unemployed, African American, Mexican American, Farmer, Banker, etc.) You need to make direct reference to the points and quotes made from the handout! Your opinion needs to be clearly reflected in the letter. 20 points! Due Friday!