The Great Depression and the New Deal

The Crash of 1929 October 29, 1929 –Black Tuesday –One of the worst days in the history of the N.Y. Stock Exchange –Stocks dropped drastically –Many companies and banks went broke

Causes of the Great Depression –A few people were wealthy and everyone else was broke –Not enough gov’t involvement –Too much production- farms and manufacturing –Prices too high –Coal, textiles, RR- decline- lower demand and higher competition –There was too much debt, and credit –Banks- poor management, no oversight, closed

Impact of the Crash on Georgians Agriculture –Cotton prices dropped as textile mills closed –Farmers couldn’t make their payments on land and equipment Farms were lost and many became homeless Industry and Business –Textiles, kaolin, cotton econ gains lost –Businesses failed, lost jobs Unemployment –25% of working age people were unemployed, up to 70% –homelessness Banks –People tried to withdraw their savings, but the banks couldn’t pay out to meet the demand

Government Reacts President Hoover Tried to balance budget- cut gov’t spending and raised taxes Made it worse Volunteers should step up and help- solution “Hoovervilles”

The People React Election of 1932 Hoover didn’t react quickly enough July economy at all time low Franklin Delano Roosevelt- elected Promised that he would “do something” –Unclear as to what, but he would try

FDR and the Little White House FDR had polio (a crippling virus that causes paralysis in the legs) He went for treatments at Warm Springs, GA –Hot mineral spring waters –Built a second house there –He was GA’s adopted son

F.D.R. and the New Deal New Deal –A number of government programs set up by President Roosevelt to help bring the country out of the depression Roosevelt’s 3 R’s- (100 days) –Relief for jobless and homeless people –Recovery for agriculture and industry –Reforms to change how the economy worked

Civilian Conservation Corps CCC put young men to work in projects aimed at conserving the nation’s natural resources (soil conservation, tree planting, improving national parks, building dams, parks, etc.) Ex: Appalachian Trail Ga. had 100 camps

Agricultural Adjustment Act AAA During the 1920’s many crops had been overproduced and the price dropped (cotton and peanuts) Regulated farm production and promoted soil conservation Pay farmers subsidies(money) in order not to grow crops Restrict the amount, price goes up

Rural Electrification Act (REA) In 1935, only 3% of Georgia’s farms had power. offered low-interest loans to organizations to build power lines in rural areas By 1950, over 90% of GA farms had electricity

Social Security Act insurance-like program protect workers from losing wages/$ when unemployed Elderly (retired) benefits Disabled

Governor Eugene Talmadge and the New Deal Talmadge was Georgia’s governor that was opposed to the New Deal programs He restricted many of the programs in GA He felt people would not want to work the farms if they were given the option of working on a federal program – it would hurt GA economy