Great Depression Problems New Deal Solutions Causes of

Great Depression Problems New Deal Solutions

Causes of the Great Depression �Uneven distribution of wealth- workers not paid enough to buy what they produce �Low interest rates->Businesses overborrow money->over-produce goods beyond market demands �Market flooded with goods that can’t be sold= businesses lay off workers and shut down

Causes of the Great Depression �Speculation in the stock market= crash causes loss of money and bank collapse �Cyclical effect of laying off workers who can’t afford the products, then laying off workers because products can’t be sold

Life During the Great Depression �Record-high Unemployment �Loss of homes= increased homeless population builds shantytowns (Hoovervilles) �Anger of people affected by the Depression= hunger marches, protests �Rise of entertainment (movies, music, radio shows, etc) to distract people �Federal government programs to help citizens in need

The New Deal �Federal Government programs designed to help people in need and stimulate the national economy �Many current assistance programs either based on or continued from the New Deal

Banking and Finances �Emergency Bank Relief Act (EBRA)regulated banks �Federal Deposit Insurance Corporation (FDIC)- Insured bank deposits �Farm Credit Administration (FCA)refinanced farm mortgages �Home Owner’s Loan Corporation (HOLC)financed homeowners’ mortgages

Agriculture and Industry �Agriculture Adjustment Administration (AAA)- paid farmers to limit overproduction �National Industrial Recovery Act (NIRA)limited federal production, set prices �National Labor Relations Act (NLRA)- right for workers to form unions and bargain collectively �Tennessee Valley Authority (TVA)- Rural modernization, developed seven states

Work and Relief �Civilian Conservation Core (CCC)- created forestry job for young men �Federal Emergency Relief Administration (FERA)- founded city and state relief programs �Public Works Administration (PWA)created work programs for public project (roads, bridges, schools)

Social “Safety Net” �Social Security Act (SSA) • Provided income for senior citizens, handicapped, and unemployed • Monthly retirement benefit for people over 65