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Depression and New Deal
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Causes of the Great Depression
Section 1
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Economic Weaknesses GNP – Rose quickly Stock Market – expanded rapidly
⦿ Prosperity GNP – Rose quickly Workers spent freely Stock Market – expanded rapidly People invested freely Laissez-faire government
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Cont… 70% low income uneven Bought stocks on credit Saw a crash coming
⦿ Wealth distribution 70% low income uneven ⦿ Buying stock on margin Bought stocks on credit ⦿ Fed Board Saw a crash coming
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Stock Market Crashes Selling started slowly but caught on quickly
Began on a Thursday On Friday bankers bought back stocks to help Black Tuesday 16 million shares of stock dropped Eventually $16 Billion
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Failures Failed loans based on stock market Banks failed and closed
⦿ Banking Crisis Failed loans based on stock market Banks failed and closed Investors lost money ⦿ Business Businesses cut spending Consumers stopped buying Unemployment rose ⚫ Less money in circulation to stimulate economy
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Cont… Overproduction 25% GNP – dropped 40% Could not sell Prices fell
⦿ Farms Overproduction Could not sell Prices fell Banks foreclosed on farms ⦿ Unemployment 25% GNP – dropped 40%
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Cont… ⦿ People Hooverville's Shantytowns Hoboes Traveling workers
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Dust Bowl Led to dust storms Ok, Tx,Ka, Nm,Co
⦿ Drought and Poor Farming Practices Led to dust storms ⚫ Earth pulled into the air Ok, Tx,Ka, Nm,Co
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Hoover’s Presidency Section 2
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Election of 1928 ⦿ Herbert Hoover ⦿ Republican
⦿ Very highly thought of by people ⦿ WINNER! ⦿ Alfred Smith ⦿ Democrat ⦿ Catholic
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Hoover’s Presidency Small government Let people fix it
⦿ Rugged Individualism Small government Let people fix it ⦿ Associative State Voluntary association of business and government ⦿ Hoover Dam Colorado River Provide electricity to west coast Paid for by government
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Cont… Farmers Encouraged businesses not to lay off workers
⦿ Response to the Great Depression Farmers Pushed for cooperatives Encouraged businesses not to lay off workers Reconstruction Finance Cooperation First action by Hoover 2 Billion to help banks
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Cont… Smooth-Hawley Tariff Lost favor of people Bonus March
Europeans responded with tariff ⦿ Nation Responds to Hoover Lost favor of people Bonus March Congressional Election of 1930 Democrats took control
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FDR Section 3
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Election of 1932 ⦿ Franklin D. Roosevelt ⦿ Democrat
⦿ Direct relief for people in NY ⦿ WINNER! ⦿ Herbert Hoover ⦿ Republican ⦿ Attempted to warn people of Roosevelt
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FDR Polio Few people knew Talked directly to people Social reform
⦿ Disease Polio Few people knew ⦿ Fireside Chats Talked directly to people ⦿ Eleanor Roosevelt Social reform
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Roosevelt and the Great Depression
⦿ Banks Closed all banks Emergency Banking Act Banks must be sound to re-open Glass-Steagall Act Created the FDIC
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New Deal Section 4
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New Deal New Deal CCC AAA NIRA Relief Recovery Reform
⦿ The Hundred Days New Deal Relief Recovery Reform CCC Civilian Conservation Corps AAA Agricultural Adjustment Act NIRA National Industry Recover Act
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Cont… PWA Federal Securities Act SEC TVA CWA
Public Works Administration Federal Securities Act SEC Securities and Exchange Commission Stock market regulation TVA Tennessee Valley Authority CWA Civil Works Administration
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Cont… Huey P. Long Courts FDR too friendly to banks and businesses
⦿ Critics of the New Deal Huey P. Long FDR too friendly to banks and businesses Courts Limited New Deal programs Did no hurt FDR’s popularity
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2nd New Deal Section 5
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2nd New Deal Emergency Relief Appropriations Act WPA Social Security
Works Progress Administration Social Security ⦿ Organized labor Wagner Act Outlawed anti-labor practices National Labor Relations Board
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Cont… CIO GM Strike FDR attempted to increase # of judges
Congress of Industrial Corporations GM Strike Sit-down strike ⦿ Court packing FDR attempted to increase # of judges ⦿ Deficit Growing too big John Maynard Keynes Deficit spending was ok
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Election of 1936 Republican Reformer Anti-New Deal
⦿ Alf Landon Republican Reformer ⚫ Same as FDR mostly ⦿ Union Party Anti-New Deal ⦿ FDR ⦿ Democrat ⦿ Easy Winner!
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Legacy of the New Deal Section 6
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Popular Entertainment
⦿ Movies The Grapes of Wrath Mr. Smith Goes to Washington Wizard of Oz ⦿ Radio The Lone Ranger The War of the Worlds ⦿ Music swing
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End of the New Deal Minimum wage FDR could not longer pass new laws
⦿ Support dwindled towards 1938 Minimum wage FDR could not longer pass new laws Mixed reviews on sucess ⦿ More focus on Europe
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