1. The Great Depression and the New Deal

2. Hoover and the Crash 3. Signs of Weakness Older industries declining Coal mining, railroads, & clothing manufactures Agriculture in prolonged downturn Stock prices soared Margin buying: people bought stocks at ta fraction of the cost at the outset & owing the balance Gambled that prices would be higher when they were ready to sell 4. The Stock Market Crashes May 1928-September 1929 Industrial stocks doubled Wednesday October 23rd 6 million shares of stock changed hands Falling prices caused losses of $4 billion Brokers who lent $ for people to buy on margin now recalled their loans Investors who could not pay had to sell their stocks Caused prices to drop even more October 29, 1929 Black Tuesday Stock market crumbled completely Panicked traders rushed to sell (there were no buyers) Investors who thought they had valuable stock had worthless pieces of paper (millionaires lost their fortunes overnight) Stock prices plunged over the next 2 weeks 5. The Great Depression Begins Stock markets crash marked the start of a 12-year economic & social disaster 6. Troubled Industries Major cause of the Great Depression Overproduction: a situation in which the supply ofmanufactured goods exceeds the demand Factories produced more than people bought (prices for goodsincreased) Housing & automobile manufacture were in decline Supports prosperity during 1920s Between 1926-1929 spending on construction fell from$11 billion to $9 billion 1st nine months of 1929 car sales dropped by more than1/3 7. Crisis in Banking Nationwide banking crisis contributed to depression Struggling farmers could not repay loans When farms failed, banks also went out of business City banks also invested in the stock market or loaned $ to speculators When market crashed people rushed to banks towithdraw their savings More than 5,500 banks closed between 1930 & 1933 Many depositors were left penniless 8. The Downward Spiral W/ people unable to buy factory products, many factoryworkers lost their jobs Had less $ to make purchases Led to declining sales, which led to more factories closings & layoffs Many companies forced into bankruptcy (financial failure caused by a companys inability to pay its debts) These caused even more layoffs Worldwide Issue European countries defaulted on their loans owed to the U.S.from WWI due to decline in international trade As crisis worsened, investors cut back loans to Europe Process of production cuts, layoffs, & bankruptcies repeated in Europe 9. The Unemployed 1929-1933 Unemployment went from 3% to 25% 13 million people nationwide Toledo, Ohio: 4 out of 5 workers had no work Those that had jobs had hours & wages cut 10. Growing Poverty Spirits crushed because of poverty Jobless waited in long lines for food Communities of rundowns shack built on outskirts ofbig cities Called Hoovervilles (blamed President Hoover forfailing to solve the crisis) 11. Impact on Families Many fathers left families in search of work Others were too ashamed to be apart of the family & left Marriages were less common Also had fewer children if married Children faced hardships & uncertainty Suffered lifelong health problems Education suffered 1 million rural children under the age of 13 did not attend school 12. Hoover Responds Hoovers advisers wanted him to do nothing Hoover disagreed Government Aid Hoover wanted business leaders & local govt to take the lead Encouraged city & state govt to create public works projects Urged private charities to et up soup kitchens 1932 Voluntary action was not enough Reconstruction Finance Corporation formed RFC gave $ to local govts to fund public works projects Economic situation did not improve 13. The Bonus Army June 1932 Protest began that would end Hoovers career 8 years earlier Congress approved a bonus of $1,000 for every vet of WWI Vets demanded payment as Depression grew worse Was not paid until 1945 Hoover refused & 20,000 vets marched to Washington Congress also refused (many marchers left) 2,000 stubbornly remained in tents or abandoned buildings Govt forces used tear gas, tanks, & machine guns 1 killed, 100 injured (Americans were outraged) 14. Roosevelt & The New Deal 15. Franklin D. Roosevelt Nominated by Democrats to run against Hoover in 1932 known as FDR was a wealthy New Yorker & distant relative of Theodore Roosevelt had served as assistant secretary of the navy & nominated as VP in 1920 got polio in 1921 & relied on steel leg braces to help him stand never allowed photographers to take his picture in a wheel chair 1928 elected governor of New York selected to run for President 4 years later 16. A Voice of Hope Pledged a new deal for the American people Later it would describe his entire political program FDR beat Hoover by a margin of 472 electoral votes to 59 Received 57.4% of the popular vote On March 4, 1933w/ the help of his son, he took the oath of office 17. Bank Holiday Day after taking office Declared a bank holiday (4 day closing of the nationsbanks) Goal was to halt nationwide epidemic of bank failures Gave FDR time to propose an Emergency Banking Relief Act (provided more careful govt regulations of banks) FDR restored Americans confidence in their banks bydelivering a fireside chat (radio talks; gave manyduring his presidency) When banks reopened many Americans re-depositedmoney 18. Relief for the Jobless FDR conferred w/ his advisors over what legislation to send to Congress They were nicknamed the brain trust because many ofthem were college professors During the 1st 100 days of FDRs administrationCongress passed & the President signed 15 new bills New Deal measures had 3 goals Relief for the jobless Economic recovery Reforms to prevent futures depressions 19. Unemployment Relief Some measures provided financial assistance Federal Emergency Relief Administration Granted funds to states so they could reopen shuttered relief agencies 20. Providing jobs Civilian Conservation Corps (CCC) Hired city dwellers to work in Americas national parks, forests, wilderness areas, & countryside Planted trees, built reservoirs, constructed parks, & dug irrigation canals CCC created jobs & protected the nations natural resources The Works Progress Administration (WPA) Put people to work building or repairing public buildings Schools, post offices, & govt offices Paved 650,000 miles of roads, raised more than 75,000 bridges, & built more than 800 airports Paid artists to paint murals in post offices & govt buildings Hired writers to write stories, state guides, & histories 21. Promoting Economic Recovery FDR needed to help industry & agriculture recover National Recovery Administration Aimed to keep prices stable while boosting employment& buying power Most of major industries agreed to pay workers a minimumwage, to stop hiring young children, & to keep wages andprices from falling too low NRA succeeded in raising prices Some critics charged them w/ favoring large businesses Also failed to improve the economy 22. Public Works Administration PWA Was granted more than $3 billion to build large public- works projects Improved the nations infrastructure & employed many people New Yorks Lincoln Tunnel, Floridas Key West Hwy, & the Grand Coulee Dam in Washington Nearly every county in the nation could boast at least one PWA project Even so, the Great Depression continued 23. Tennessee Valley Authority Formed in 1933 TVA Built giant dams along Tennessee River Dams could control flooding, provided cheap electricity, & increase jobs and prosperity in one of nations poorest rural areas 1945 Power from TVA plants lit thousands of farms that never had electricity Failed to relieve regions poverty Conservatives criticized TVA for driving some property owners off their land Also argued it was unfair for govt to compete w/ private powercompanies Other argued TVA disrupted the natural environment (increasedair pollution) 24. Reforming the Economic System Truth-in-Securities Act Required corporations to inform the public fully about their stocks Corrected one condition that caused stock market to crash Federal Deposit Insurance Corporation (FDIC) Protected bank depositors Guaranteed individual deposits up to $2,500.00 Other agencies set fairness & safety standards for variousindustries Federal Power Commission (FDC) Helped control the oil & gas industries Food & Drug Administration powers were also increased 25. Obstacles to the New Deal FDR was re-elected in 1936 Americans were enthusiastic about the New Deal New deal faced challenges in the Supreme court 26. Supreme Court 1935 & 1936 Supreme Court declared several New Deal measures, including NRA, to be unconstitutional FDR proposed appointing up to six new Supreme Court justices Was opposed by conservatives (saw FDRs plan to gain amajority of justices) Congress defeated FDRs plan He was able to win backdoor way 1937 a conservative justice resigned & FDR appointed a liberalone in his place 27. New Deal Critics Conservatives Thought New Deal went too far in regulating businesses & restricting individual freedom Liberals Some thought New Deal did not go far enough in helping the poor Biggest critics Huey Long: Democratic senator from Louisiana; argue d govt could end Depression immediately; proposed to tax the wealthy & distribute their wealth to the poor (Share Our Wealth plan) Francis Townsend: called for a system of govt pensions (retirement payments); retired Americans over the age of 60 would receive $200 each month as long as they pledged to spend all the money; plan was never approved by Congress, but later helped set the stage for the Social Security system Charles Coughlin: used radio to attract followers; Catholic priest from Michigan; distrusted FDRs policies on banking & money; called for govt to take over banks Supporters of the Big Critics joined forces to back a third-party candidate in 1936 (were not strong enough to combat FDRs popularity 28. Life in the Great Depression 29. Women in the Depression Many Americans felt women should stay at home During the Depression women had to help supporttheir families By the end of the Depression more women wereworking outside of the home than before theDepression 30. Women in the Workplace 2 advantages for women in the workplace Female salesclerks & secretaries faced little competition from men Jobs of women less likely to disappear, unlike factory jobs Most women w/ jobs still struggled Women trained in certain professions (teachers, librarians, etc.) had to compete against men who had lost their jobs Women factory workers were more likely to lose their jobs or have wages cut Maids, seamstresses, & housekeepers lost their jobs because people could not afford their services African American women suffered the most because they held the majority of domestic jobs To save money more women found themselves sewing clothes,canning fruits & vegetables, & baking bread instead of buying 31. An Active First Lady Eleanor Roosevelt Most famous working lady After FDR was stricken w/ polio she began to speak & travel on his behalf Transformed the role of First Lady She served as the Presidents eyes & ears In 1933 alone she logged 40,000 miles including a tripdown into a WV coal mine Also made frequent radio speeches & wrote a dailynewspaper column Used her position to fight for womens rights 32. African Americans in theDepression Hit hard by the depression Suffered more unemployment, homelessness, illness, & hunger than whites 33. South & North South Plunging cotton prices forced African American sharecroppers off their land Move to southern cities (found traditional jobs done by blacks (i.e. cleaning streets) were now done by jobless whites) 1932 more than African Americans in South were unemployed North African Americans migrated north Still hard to find work Were last hired & first fired from jobs In New York 50% of blacks were jobless 34. FDRs Mixed Record Most blacks backed FDR despite his mixed record on civil rights Example: FDR failed to support a federal antilynchingbill W/ his wifes prodding, FDR appointed at least 100 blacks to govt posts Mary McLeod Bethune, a friend of Eleanors, becametop ranking African American in govt Member of FDRs Black Cabinet; advised FDR on AfricanAmerican issues (William Hastie also a member of cabinet,later became 1st black federal judge) 35. A Symbolic Moment 1939 Daughters of the American revolution (DAR) refused to allow African American singer Marian Anderson to perform at their hall Eleanor resigned as a member of DAR in protest Arranged for Anderson to sing on the steps of the LincolnMemorial on Easter Sunday (drew crowd of 75,000; became asymbol of the struggle for civil rights) 36. Mexican Immigrants Are Deported Mexican immigrants Lived in SW as migrant workers Welcomed during good time by farmers (worked for lowpay & harsh conditions) Whites flooded the area during the Depression looking forwork American wanted govt to force Mexican out of the country They rounded up 100s of thousands of people & deportedthem (some were actual U.S. citizens born in the U.S.) 37. The Indian New Deal 1924 Native Americans were granted citizenship When Depression hit, 170,000 Indians lived in poverty on reservationsadministered by the govt John Collier Commissioner of Indian Affairs A white man who lived among Pueblo Indians of New Mexico Developed a program called Indian New Deal w/ federal agency funding: NA hired to build schools, hospitals, & irrigation systems Also wanted reservations under Indian control, stop sales of their lands, & encouraged schools to teach Native American history & the arts 1934 Congress approved part of the Indian Reorganization Act (IRA) Did restrict tribal land sales, but failed to bring self-govt or education promotion 38. The Dust Bowl 1930 Little rain fell, drought caused crop failure & dust storms Lasted 5 years, 100 million acres of farmland became a wasteland 39. Black Blizzards Modern farming contributed to Dust Bowl Large plots of land containing native grasses & sod wasremoved by farmers (this held the soil in place) Little rain caused rootless soil to blow away like powder Dust Storms were called Black Blizzards Made noon seem like midnight, buried fences, houses,& killed people and animals 40. Okies Head West Ruined farm families abandoned their dusty homes to seek work elsewhere In some areas 1 in 3 families left Became known as Okies because many came fromOklahoma Conditions not better in California Not able to buy land, they had to compete w/ local workers topick crops Police closed some roads into California, but migrants keptcoming 41. Arts & Media of the Depression John Steinbeck Captured miseries of the Dust Bowl in The Grapes of Wrath Tells the story of the Joads, Okies who seek a better life inCalifornia 42. Visual Arts Photographers & painters usedthe Depression as a theme Under a New Deal programcalled the Farm SecurityAdministration, photographerDorothea Lange recorded theexperiences of the Dust Bowlmigrants Photograph remains the symbol the Depression WPA hired artists to paint murals on public buildings 43. Movies & Radio During the Depression Movies: dealt realistically w/ social problems The Grapes of Wrath & The Public Enemy Also helped people forget about their problems Mickey Mouse, King Kong, & Shirley Temple Radio: used to broadcast FDRs fireside chats Popular bands & comedians, continuing dramas sponsored by soap companies (soap operas) 44. Legacy of the New Deal 45. Social Security 1935 FDR signs Social Security Act Provided federal govt a major & lasting role in providing for the needy Social Security Act Old-Age Insurance: key part of SSA Guaranteed retired people a pension Funded by a payroll tax (a tax that removes money directly from workers paychecks Matching contributions were required by employers Business leaders opposed Old-Age Insurance 46. SSA included Aid to Dependent Children (ADC) Helped children whose father s were dead, unemployed, or not living w/ the family Granted federal $ to states to help mothers stay home to raise their children SSA also provided for disabled & gave states $ to maketemporary payments to the unemployed At SSA excluded some categories of labor Agriculture & domestic workers not required to pay Many African Americans, migrant workers, & poor rural whites did not benefit from SS 47. Lasting Labor Reforms Frances Perkins Member of FDRs committee who drafted the SSA 1st woman to serve in the Cabinet Back major labor reform 48. New Laws Favor Workers 1935 Congress passed the National Labor Relations Act Became known as Wagner Act Guaranteed workers rights to organize into unions &prohibited unfair business practices Upheld collective bargaining (right of a union to negotiatewages & benefits for all its members) National Labor Relations Board Required employers to participate in collective bargaining w/unions 49. 1938 Fair Labor Standards Act Set minimu wages at $.25 per hour & max weekly work hoursat 44 Established time and a half payment for overtime work & putan end to child labor in some businesses 50. A Powerful New Union John L. Lewis Head of the United Mine Workers Formed Industrial Organization renamed later the Congressof Industrial Organizations (CIO CIO Umbrella organization consisting of many other unions Differed from the older American Federation of Labor (AFL) AFL combined workers based on skills CIO combined all workers in particular industry (skilled &non-skilled) Opened union membership to more women & African Americans 51. 1936 United Auto Workers Members of CIO Launched sit-down strike (workers stay in the factory but stopproduction) @ nations largest auto factory After 6 weeks the strikers won their demands for higher wages& shorter hours Supreme Court later ruled sit-down strikes illegal 52. Scorecard on the New Deal SSA & other reforms permanently enlarged the role of the federal govt Not everyone agreed govt should take such an activeapproach to social problems 53. Arguments Against the New Deal Critics say New Deal gave too much power to thefederal govt Federal govt threaten individual freedom & freeenterprise Favor a return to the tradition of laissez faire Govt should interfere w/ the economy as little as possible Worried about a massive increase in the nations debt New Deal failed to fulfill its most fundamental goal Did not end the Great Depression Full recovery would not come until 1941 when the U.S.began producing goods in preparation for WWII 54. Arguments for the New Deal Employed millions of jobless people Ended banking crisis Reformed stock market Save poor families from losing their homes Improved working conditions Built dams & bridges, preserved 12 million acres of nationalparkland, brought electricity to rural America, & sponsoredthe creation of lasting works of art For many the New Deal also restored peoples faith in thegovt