Economic Depression: The 1930s

Recession or Depression? ►R►R►R►RECESSION: A significant decline in activity spread across the economy, lasting longer than a few months. Two consecutive quarters of negative economic growth ►D►D►D►DEPRESSION: A sustained economic recession in which a nation's Gross National Product (GNP) is falling and marked by low production and sales and a high rate of business failures and unemployment

Reasons for the Great Depression ►U►U►U►UNEVEN DISTRIBUTION OF WEALTH: 71% of Americans below poverty level. NO SAVINGS. Can’t afford to buy factory goods. ►I►I►I►INSTALLMENT BUYING: Not enough REAL $$ in circulation. ►O►O►O►OVERSPECULATION: Too many stocks bought in a market

Reasons, con’t. ► OVERPRODUCTION:  Businesses produced more goods than people could buy Factories closed. People lost jobs.  Farmers produced more crops. Borrowed $$ to buy new equipment & land. Prices fell. Couldn’t pay $$ back.

BANKS CLOSED Farmers & others can’t pay back loans. Banks make no $$. Banks close their doors. People can’t get to their savings.

Hawley-Smoot Tariff Act signed into law on June 17, 1930, that raised U.S. tariffs on over 20,000 imported goods to record levels. Other countries stopped buying U.S. goods in retaliation. Hurts our economy.

Herbert Hoover ► President from 1929 to ► Was President only a few months when the Great Depression beganDepression ► A Republican=reluctant to use the power of the federal government against the Depression.Republican ► Tried to persuade voters that private enterprise could turn the economy aroundprivate enterprise ► Lost the election of 1932 to Franklin D. Roosevelt.Roosevelt

Hoo·ver·ville (hōō'vər-vĭl') n. A crudely built camp put up usually on the edge of a town to house the dispossessed and destitute during the depression of the 1930s.

FDR & The New Deal ►T►The 32nd President ( ). ►R►Ran for President with the promise of a New Deal for the American people. ►A►Administration was marked by relief programs, measures to increase employment and assist industrial and agricultural recovery from the Depression ►O►Only U.S. President to be reelected three times (1936, 1940, and 1944). ►H►He died in office.

The New Deal ► The Great Depression of the 30s hit not only America but the rest of the world as well. ► Germany, Italy and Japan turned to dictator to deliver them from despair. ► The New Deal was significant because:  It proved that a democratic society could overcome the challenges presented by a severe economic crisis.

The First 100 Days: Relief, Recovery & Reform Roosevelt’s 3 Main Goals ► RELIEF: Provide immediate relief from the hardships of the depression ► RECOVERY: Achieve a long- term economic recovery. ► REFORM: Institute reforms to prevent future depressions.

The First 100 Days: New Deal Programs FFDIC NNRA CCCC PPWA AAAA TTVA

FDIC=Federal Deposit Insurance Insured bank deposits up to $5,000 NRA National Recovery Administration Administration Developed codes for fair competition in business/industry. Minimum wage for workers; minimum price for products CCC Civilian Conservation Corp Provided jobs for 2 million young men. Replanted forests, built trails, fought fires, dug irrigation ditches.

PWA= Public Works Administration Built bridges, dams, power plants & gov’t buildings. AAA Agricultural Adjustment Act Sought to end overproduction of agricultural goods. Paid farmers NOT to grow crops. TVA Tennessee Valley Authority Built dams in Tenn. River Valley to control floods & provide electricity. Also replanted forests & provided jobs.

The 2nd New Deal ► Addressed the problems of the elderly, the poor, and the unemployed ► Created new public-works projects public-works projects ► Helped farmers ► Enacted measures to protect workers’ rights. protect workers’ rights.

2 nd New Deal Programs ► SSA=Social Security Act ► WPA=Works Progress Administration ► REA=Rural Electrification Administration ► USHA=United States Housing Authority ► National Labor Relations Act=“Wagner Act” ► Fair Labor Standards Act ► Food, Drug, and Cosmetic Act ► NYA=National Youth Administration

The Second New Deal 1. S SA: Pension system & unemployment insurance. Payments to those injured on the job, the elderly and the disabled. 2. W PA: Employed millions of people in gov’t jobs. Highway construction to arts programs. 3. R EA: Brought electricity to isolated rural areas 4. U SHA: Low cost federal housing

The Second New Deal ► Wagner Act: Outlawed unfair labor practices. Granted workers right to organize unions & to collective bargaining. ► Food, Drug, & Cosmetic Act: Prohibited the mislabeling of food, drugs, & cosmetics. Ensured the safety of these products. ► Fair Labor Standards Act: Banned child labor, established a minimum hourly wage, established a 44-hour work week.

Chief complaint against New Deal Programs: It made government too

Court Packing FDR’s attempt to add 6 more justices to the Supreme Court in order to get support for his New Deal programs.