Great Depression Begins

“Mellon pulled the whistle, Hoover rang the bell, Wall Street gave the signal, and the country went to hell.”

Election of 1928Election of 1928 Herbert Hoover v. Alfred Herbert Hoover v. Alfred

SmithSmith Hoover wins with his Hoover wins with his

campaign: “closer to campaign: “closer to triumph over poverty than triumph over poverty than ever” (Hoover predicts the ever” (Hoover predicts the end of poverty)end of poverty)

20’s marked the reign of 20’s marked the reign of prosperity (although it was prosperity (although it was on a shaky foundation)on a shaky foundation)

Quite and reservedQuite and reserved ““Two cars in every garage”Two cars in every garage”

•Warning signs of Economic Downturn:• speculation (buying on chance of quick profit), •buying on margin (paying a small % down and borrowing the rest), •inflation of stock prices

Stock Market Crashes

• Oct. 1929: prices begin to fall = confidence in stock market waivers

• Oct 29, 1929: BLACK TUESDAY, bottom falls out of the market

Causes of DepressionCauses of Depression

Overproduction of goodsOverproduction of goodsToo much available creditToo much available creditLess consumption of goods (prices rise, Less consumption of goods (prices rise, widening of gap between rich and poor)widening of gap between rich and poor)Farm surplus (increase during WWI, then Farm surplus (increase during WWI, then decreased demand afterward but production decreased demand afterward but production remained the same)remained the same)High tariff (to protect American industry, but High tariff (to protect American industry, but hurts worldwide trade)hurts worldwide trade)No banking regulationsNo banking regulationsHawley Smoot Tariff:Hawley Smoot Tariff: 1930, highest tariff ever, 1930, highest tariff ever, designed to protect but does the exact oppositedesigned to protect but does the exact opposite

Hard Times Hit HomeHard Times Hit Home

Rural Areas: can Rural Areas: can grown own food, but grown own food, but many lose landmany lose land

Cities: jobs lost and Cities: jobs lost and evictionsevictions

People lost life People lost life savings in stock savings in stock markets and bank markets and bank closuresclosures

Soup kitchen: low cost or free foodSoup kitchen: low cost or free food

Many people can’t afford to buy Many people can’t afford to buy food or feed their families.food or feed their families.

BreadlinesBreadlines

Wait in line for hours Wait in line for hours to receive food, often to receive food, often bread, from charitiesbread, from charities

Hard Times Hit Hard Times Hit HomeHome

Family Life ChangesFamily Life Changes men on the move in men on the move in

search of jobssearch of jobs family as source of family as source of

strengthstrength some families break some families break

apartapart Social effects: Social effects:

increased suicide increased suicide (30%), increased (30%), increased mental illness, ethics mental illness, ethics change, dreams are change, dreams are forsaken, decrease in forsaken, decrease in overall health and overall health and nutritionnutrition

“Here were all these people living in old, rusted out car bodies…There were people living in shacks made of orange crates. One family with a whole lot of kids were living in a piano box…People living in whatever they could junk together.”

Shantytown visitor outside Oklahoma City

Men on the move in search of jobs, some abandon families altogether

Children suffer—malnutrition and poor health during the Great Depression

• Dust Bowl—severe drought in mid-west mostly caused by disregard for the land, few trees, and lack of soil erosion techniques

• Hard to grow food, land unusable, dust storms, etc.

• Farms destroyed

• Many will leave and head west in search of jobs

Picture yourself standing in a field, not an ordinary field of grass and flowers, but a barren field of dust.

You fix your eyes toward the horizon and a sigh comes over you as a dust storm rolls your way.

This was life during the dust bowl of the 1930's.

John Steinbeck

wrote “Grapes of Wrath” a novel

about the Dust Bowl and a

group of migrants or “Okies” that left to go west to California

Bonus Army Marches on Washington

Bonus Army is WWI veterans and their families seeking help

Came to Washington to support a bill under debate in Congress to compensate WWI veterans for their service

When the bill failed, Hoover called them squatters and order them to be removed

Eventually they are disbanned violently (over 1000 gased and 2 shot with many others injured) and their Hooverville is burned and destroyed

Bonus Army (WWI veterans and families) march on Washington and set up a Hooverville in the nation’s capital.

Hooverville being

destroyed in Washington,

D.C. after Hoover calls for

the Bonus Army to be

disbanned by Federal Troops

Hoover’s Resolve Rugged Individualism: people should

succeed through their own efforts and shouldn’t depend on government

Gave no direct relief (cash payments or food provided by gov’t)

Created gov’t agency to help business recover: RFC (Reconstruction Finance Corporation) provides emergency financing to business to prevent failure

All across the country Hoovervilles shantytowns emerge as people are disgraced at Hoover

Rugged individualism: people should

succeed through their own efforts,

without government help

Hooverville (Seattle): shantytowns are coined “Hoovervilles” b/c the American people are frustrated and disappointed in Hoover’s effort to

relieve the Great Depression

Election of 1932 Franklin D. Roosevelt (distant

cousin of Teddy Roosevelt), NY governor, pledged a “new deal” for the American people and help for the common man

Democrats win majority in Congress Hoover remains a lame duck for

several months until FDR takes office

Banking system is in crisis and the Great Depression drags on

Franklin Delano Roosevelt runs for

office in 1932 against Hoover promising a

“New Deal”

Hoover remains a lame duck after the November

1932 election in which FDR won.

The 20th amendment is passed changing the inaugural date for the

President and Congress from March to January

20th.