The Great Depression 1929 1941 Ryan Bushorn and

The Great Depression, 1929 -1941 Ryan Bushorn and Brandon Austria

Timeline October 1929: Stock Market crashes March 1930: Near 4 million are unemployed June 1930: Smoot-Hawley Tariff passed July 28, 1932: Bonus Army marches on Washington November 1932: FDR elected President, starts work on the New Deal

Timeline (cont. ) April 1933: Civilian Conservation Corps is established May 1933: Federal Emergency Relief Administration and Tennessee Valley Authority established October 1933: Civil Works Administration established 1935: Work Projects Administration and Social Security Act passed 1941: Revitalization of the economy due to preparations being made for World War II, ending the Depression

The Causes of the Great Depression ● Many Americans played the market which caused stock prices to inflate to dangerous levels. ● Many of the Americans who did this also borrowed money in the form of credit rather than using actual money that they had. ● Taxes were considerably lower for the rich. ● The easy-credit policy of the banks contributed to the increasing deficit.

The Causes of the Great Depression ● Overproduction in the industrial area was also a main factor. ● However, wages remained the same for workers so that they could not buy goods. ● Failures of banks due to lack of money and inability to create loans. ● High tariffs and war debts were also a big contribution to the Great Depression.

Effects of Great Depression ● The crash happened on October 24, 1929. ● Also known as Black Thursday. ● Value of stock declined by $30 in mid-November.

Effects of Great Depression (cont. ) ● Farm product prices decreased massively, unemployment rose to levels near 25%, more than 5, 000 banks ran out of money and closed down. ● Cities that depended on heavy industry suffered the most. ● Additionally, crop prices fell by 60% making the farm and rural areas suffer.

Effects of Great Depression (cont. ) ● The Great Depression caused many industries to grind to a halt, forcing numerous shops and businesses to lay off the majority of their workers. ● Foreign trade and commerce slowed to a grind as well, given the manner in which Depression affected the entire world. This was because of the connections in international industries as well as massive debts due to wars and such. ● Contracted credit from years of consumer purchases without the use of actual money also denied businessmen the capital they needed in order to start new ventures, reinitiate their businesses, and help stimulate the economy and get the economy back on its feet.

Urban Effects ● There were little to no jobs available to the people. ● With no jobs available, families were not able to purchase goods. ● Many people lost their homes and much of what they owned ● Breadlines grew to be a common site on the streets. ● People built homes out of cheap materials and called them Hoovervilles. ● These reasons caused a substantial increase in the

Rural Effects • Adding to economic problems was the Dust Bowl, a phenomenon of topsoil caused by drought, exacerbating problems in the midwest. Farms suffered due to drought and lack of crop growth, causing farmers to abandon their fields. As a result, numerous farmer families moved to urban cities. •

Hoover’s Term ● 31 st President, March 4, 1929 - March 4, 1933 ● The Depression really hit hard several months into his term, causing many to put the blame on him. ● President Hoover’s commitment to private-sector initiative, limited government intervention, and balanced federal budgets handicapped when it came to dealing with the Depression. He feared government control would lead to socialism. ● He initially asked businessman to refrain themselves from laying off workers or impose further wage cuts; however, they eventually broke their promise. ● People blame him and his conservative attitude for not doing much about the Depression in terms of how to remediate it.

Hoover’s Term (cont. ) ● Congress approved the Smoot-Hawley Tariff Act in 1930. ● This raised tariffs on the thousands of imported items. ● This was supposed to encourage the purchasing of American made items to increase the cost of imported goods while raising revenue for the federal government and protecting farmers. ● However, other nations retaliated by increasing tariffs on American-made goods which worsened the Depression.

Hoover’s Term (cont. ) ● He tried to get the surviving banks to invest into the smaller banks that were failing to help them. ● However, they were reluctant to invest into failing banks. His faith in individual business and voluntary agreements to restart the economy eventually failed to convince the people that he was really doing anything to help them. ● His reputation further worsened when WWI veterans known as the Bonus Army marched on Washington demanding promised bonuses and he used the Army to get rid of them. ● Though he formed the Reconstruction Finance Corporation to make loans to businesses, the people wanted a President who would take action. •

Roosevelt’s Term • • 32 nd President, March 4, 1933 - April 12, 1945 “The only thing we have to fear is fear itself. ” Had much to do, as millions were unemployed, farm prices and industrial production rate fell by half and numerous banks nationwide were already closed. Though he pledged to have solutions to the nation’s problems, at first many of his promises were vague and hopeful. Despite this, people put their faith in him.

Roosevelt’s Term (cont. ) • • He put the blame of the causes of the Depression on bankers and the need for profit and capitalism. Focused his efforts on immediate relief for the millions suffering from the depression, recovery of the economy, and reform by fixing the flaws in banking and business systems.

Roosevelt’s New Deal • • Was primarily focused on the immediate relief portion of Roosevelt’s plan. Established numerous federal agencies such as the Federal Deposit Insurance Corporation to help banks, the Civilian Conservation Corps to provide jobs on government projects to thousands, the Agricultural Adjustment Administration to regulate farm prices by cutting production, and the Tennessee Valley Authority, made with the direct purpose of modernizing agriculture to rebuild the famished Tennessee Valley.

Roosevelt’s Second New Deal • • Acted as a continuation of the New Deal due to considerable improvements. Made with the purpose of proposing long-term fixes (reform) to the problems that caused the Depression in the first place. Insured future foreign relations by implementing the Good Neighbor Policy and other plans with the League of Nations. Established the Social Security Act to protect the poor and the weak, and the National Labor Relations Act to protect the rights of workers and prevent bad working environments.

End of the Great Depression • • • Roosevelt’s policies helped the country massively, leading towards a slow but gradual improvement in the economy and society. However, a large part of what got rid of the Depression was World War II. Involved by Pearl Harbor. Government spending to help fund the war as well as opportunities created through jobs served to help the economy. Jobs to make war material were formed and factories were created to produce food and supplies. Furthermore, reductions in taxes and regulation at the end of the war continued to help.

End of the Great Depression (cont. ) • • • In the end, Roosevelt’s New Deal, the policies it introduced, and the following U. S. participation in World War II served as ways to get out of the Depression. These caused a significant rise in employment and the stabilization of business and production. As a result, unemployment fell and industries began to work again.

Quiz

Which of these acted more as a result of the declining economic conditions of the era, rather than a reason for the decline? a. The further use of credit in businesses. b. The closure of banks due to lack of money. c. High tariffs and war debts. d. Overproduction in factories and agriculture.

Which of these is NOT a main reason why the stock market inflated to such high levels and eventually crashed? a. Use of people’s money to finance stock loans. b. Overeagerness to invest in the stock market through margin buying. c. Huge increase in the selling of stock. d. Government regulation of the amount of money spendable on the stock market.

How many banks closed down nationwide due to a lack of money to create loans? a. 500 b. 1000 c. 2000 d. more than 5000

Which of the following is true concerning Hoover’s position towards the Depression? a. He progressively wanted to aid the economy through the usage of government-controlled conglomerates. b. He thought the Depression was an inside job. c. His conservative attitude prevented much progress from occurring in economic improvement. d. He believed socialism was the solution to the Depression.

Which of these was NOT one of the agencies and programs created by Roosevelt’s New Deal? a. Tennessee Valley Authority (TVA) b. Centers for Medicare and Medicaid Services (CMS) c. Federal Deposit Insurance Corporation (FDIC) d. Civilian Conservation Corps (CCC)

Citations Bonner, Patricia. "WHERE DID ALL THE MONEY GO? The Great Depression Mystery. " Economic Lesson Plans, Personal Finance Lesson Plans and Resources for Educators, Students and Afterschool Providers. Econ. Ed. Link, 3 Nov. 2009. Web. 08 Apr. 2014. Website. Link. Tags. Edit. Delete Brokaw, Tom. "The Great Depression. " History. com. A&E Television Networks, 2 Jan. 2011. Web. 07 Apr. 2014. Website. Link. Tags. Edit. Delete Flynn, Keith. "What Ended the Great Depression? " : The Freeman : Foundation for Economic Education. The Freeman, 3 Apr. 2011. Web. 06 Apr. 2014. Website. Link. Tags. Edit. Delete Folsom, Burt, Jr. "Did FDR End the Depression? " The Wall Street Journal. Dow Jones & Company, 12 Apr. 2010. Web. 07 Apr. 2014. Website. Link. Tags. Edit. Delete

Citations (cont. ) Glaser, Mark. "American Experience: TV's Most-watched History Series. " PBS, 2 Apr. 1996. Web. 07 Apr. 2014. Shepperd, A. "The 31 st US President - Herbert Hoover. " The 31 st US President - Herbert Hoover. N. p. , 2 Aug. 1999. Web. 08 Apr. 2014. Wilkison, K. "The Great Depression and New Deal, 1929 -1940 s. " HIST 1302 Online, 9 Nov. 2000. Web. 3 Apr. 2014.