THE GREAT DEPRESSION BEGINS Photos by photographer Dorothea
THE GREAT DEPRESSION BEGINS Photos by photographer Dorothea Lange
THE NATION’S SICK ECONOMY As the 1920 s advanced, serious problems threatened the economy while Important industries struggled, including: • • • Agriculture Railroads Textiles Steel Mining Lumber Automobiles Housing Consumer goods
FARMERS STRUGGLE • No industry suffered as much as agriculture • During World War I European demand for American crops soared • After the war demand plummeted • Farmers increased production sending prices further downward Photo by Dorothea Lange
CONSUMER SPENDING DOWN • By the late 1920 s, American consumers were buying less • Rising prices, stagnant wages and overbuying on credit were to blame • Most people did not have the money to buy the flood of goods factories produced
GAP BETWEEN RICH & POOR Photo by Dorothea Lange • The gap between rich and poor widened – income disparity • The wealthiest 1% saw their income rise 75% • The rest of the population saw an increase of only 9% • More than 70% of American families earned less than $2500 per year
HOOVER WINS 1928 ELECTION • Republican Herbert Hoover ran against Democrat Alfred E. Smith in the 1928 election • Hoover emphasized years of prosperity under Republican administrations • Hoover won an overwhelming victory
Young Hoover supporter in 1928
THE 1929 CRASH • In September the Stock Market had some unusual up & down movements • On October 24, the market took a plunge. . . the worst was yet to come • On October 29, now known as Black Tuesday, the bottom fell out • 16. 4 million shares were sold that day – prices plummeted • People who had bought on margin (credit) were stuck with huge debts
THE GREAT DEPRESSION Alabama family, 1938 Photo by Walter Evans • The Stock Market crash signaled the beginning of the Great Depression • The Great Depression is generally defined as the period from 1929 – 1940 in which the economy plummeted and unemployment skyrocketed • The crash alone did not cause the Great Depression, but it hastened its arrival
FINANCIAL COLLAPSE • After the crash, many Americans panicked and withdrew their money from banks • Banks had invested in the Stock Market and lost money • In 1929 - 600 banks fail • By 1933 – 11, 000 of the 25, 000 banks nationwide had collapsed Bank run 1929, Los Angeles
• The U. S. was not the only country gripped by the Great Depression • Much of Europe suffered throughout the 1920 s • In 1930, Congress passed the toughest tariff in U. S. history called the Hawley. Smoot Tariff • It was meant to protect U. S. industry yet had the opposite effect • Other countries enacted their own tariffs and soon world trade fell 40% HAWLEYSMOOT TARIFF
HARDSHIPS DURING DEPRESSION • The Great Depression brought hardship, homelessness, and hunger to millions • Across the country, people lost their jobs, and their homes • Some built makeshifts shacks out of scrap material • Hoovervilles - Before long whole shantytowns called Hoovervilles to mock the president sprung up
SOUP KITCHENS Unemployed men wait in line for food – this particular soup kitchen was sponsored by Al Capone • One of the common features of urban areas during the era were soup kitchens and bread lines • Soup kitchens and bread lines offered free or low-cost food for people
CONDITIONS FOR MINORITIES • Conditions for African Americans and Latinos were especially difficult • Unemployment was the highest among minorities and their pay was the lowest • Increased violence (24 lynchings in 1933 alone) marred the 1930 s • Many Mexicans were “encouraged” to return to their homeland As conditions deteriorated, violence against blacks increased
RURAL LIFE DURING THE DEPRESSION Between 1929 -1932 almost ½ million farmers lost their land • While the Depression was difficult for everyone, farmers did have one advantage; they could grow food for their families • Thousands of farmers, however, lost their land • Many turned to tenant farming and barely scraped out a living
THE DUST BOWL • A severe drought gripped the Great Plains in the early 1930 s • Wind scattered the topsoil, exposing sand grit • The resulting dust traveled hundreds of miles • One storm in 1934 picked up millions of tons of dust from the Plains an carried it to the East Coast Kansas Farmer, 1933
Dust storm approaching Stratford, Texas - 1934
Storm approaching Elkhart, Kansas in 1937
Dust buried cars and wagons in South Dakota in 1936
Okies Boy covers his mouth to avoid dust, 1935 • Kansas, Oklahoma, Texas, New Mexico, and Colorado were the hardest hit regions during the Dust Bowl • Many farmers migrated to California and other Pacific Coast states
Photographer Dorothea Lange captures a family headed west to escape the dust storms
• The 1930 s created the term “hoboes” to describe poor drifters • 300, 000 transients – or hoboes – hitched rides around the country on trains and slept under bridges (thousands were teenagers) • Injuries and death was common on railroad property; over 50, 000 people were hurt or killed HOBOES TRAVEL AMERICA
HOOVER STRUGGLES WITH THE DEPRESSION • After the stock market crash, President Hoover tried to reassure Americans • He said, “Any lack of confidence in the economic future. . . Is foolish” • He recommended business as usual Herbert Hoover
HOOVER’S PHILOSOPHY Hoover believed it was the individuals job to take care of themselves, not the governments • Hoover was not quick to react to the depression • He believed in “rugged individualism” – the idea that people succeed through their own efforts • People should take care of themselves, not depend on governmental hand-outs • He said people should “pull themselves up by their bootstraps”
HOOVER’S SUCCESSFUL DAM PROJECT • Hoover successfully organized and authorized the construction of the Boulder Dam (Now called the Hoover Dam) • The $700 million project was the world’s tallest dam (726 feet) and the second largest (1, 244 feet long) • The dam currently provides electricity, flood control and water for 7 western states
Any dam questions?
HOOVER TAKES ACTION: TOO LITTLE TOO LATE Hoover’s flurry of activity came too late to save the economy or his job • Hoover gradually softened his position on government intervention in the economy • He created the Federal Farm Board to help farmers • He also created the National Credit Organization that helped smaller banks • His Federal Home Loan Bank Act and Reconstruction Finance Corp were two measures enacted to protect people’s homes and businesses
Hoover had little chance to be re-elected in 1932
A NEW DEAL FIGHTS THE DEPRESSION • The 1932 presidential election showed that Americans were clearly ready for a change • Republicans renominated Hoover despite his low approval rating • The Democrats nominated Franklin Delano Roosevelt
FDR LAUNCHES NEW DEAL • FDR promised a “new deal” for the American people • He took office with a flurry of activity known as “The Hundred Days” • The 100 Days lasted from March to June 1933
CONGRESS GETS BUSY • FDR’s philosophy was to get people help and work through “deficit” spending • During the 100 Days, Congress passed more than 15 major pieces of legislation that significantly expanded government’s role in the nation’s economy and welfare
TO DO LIST: #1 HELP BANKS • First order of business was to get the banking system in order • On March 5, one day after taking office, FDR declared a bank holiday • He persuaded Congress to pass the Emergency Relief Act, which authorized the Treasury Department to inspect the nation’s banks
AMERICANS GAIN CONFIDENCE IN BANKS • Next, FDR passed the Glass-Steagall Act which established the Federal Deposit Insurance Corporation • The FDIC insured account holders up to $5, 000 and set strict standards for banks to follow (today = $100, 000)
MORE 100 DAYS ACTIVITY • Federal Securities Act: Required stock info to be accurate and truthful • Agricultural Adjustment Act: (AAA) Raised crop prices by lowering production • Tennessee Valley Authority: (TVA) Focused on direct relief to hard hit area– created ambitious dam projects
T V A
ALPHABET AGENCIES • CCC – Civilian Conservation Corps put young men to work • Men ages 18 to 25 worked building roads, parks, planting trees (200 million trees in Dust Bowl areas) • By 1942 three million men worked for the CCC
ALPHABET AGENCIES PWA workers construct a public building in • PWA – Public Works Administration was part of the NIRA (National Industrial Recovery Act) • The PWA provided money to states to construct schools and community buildings
ALPHABET AGENCIES • CWA – Civil Works Administration built 40, 000 schools and provided salaries for 50, 000 teachers in rural America • Also built 500, 000 miles of roads CWA School in
ALPHABET AGENCIES Repaired business in Childersburg, • FHA – Federal Housing Administration provided home loans, home mortgages and repairs
ALPHABET AGENCIES • FERA – Federal Emergency Relief Agency provided $500 million in direct relief to the neediest Americans Citizens wait outside a FERA in Calipatria, CA for
SUPREME COURT REACTS The Supreme Court -1935 • By the mid-1930 s, the Supreme Court struck down the NIRA as unconstitutional (citing too much government control over industry) • The Court also struck down the AAA on the grounds that agricultural was a local matter -- not a federal matter
FDR REGAINS CONTROL OVER SUPREME COURT • From the mid to late 1930 s, FDR was able to appoint 7 new judges to the Supreme Court, thus assuring that his programs would carry on unabated
THE SECOND NEW DEAL • Although the economy had improved during FDR’s first term (19321936), the gains were not as great as expected • Unemployment remained high and production still lagged
THE SECOND HUNDRED DAYS • FDR launches the “Second New Deal” also called the “Second Hundred Days” • First priority was the farmers – FDR reinvigorated the AAA which provided aid for migrants, sharecroppers, and poor farmers • FDR authorized more than $1 billion to help tenant farmers become landowners
Arkansas Tenant Farmers, 1936
WORKS PROGRESS ADMINISTRATION • Helping urban workers was critical to the success of the Second Hundred Days • The WPA set out to create as many jobs as possible as quickly as possible • Between 1935 -1943, the WPA spent $11 billion to give jobs to 8 million workers
WPA BUILDS AMERICA The Davis Street School Extension in Atlanta under construction as part of the Works Progress Administration Program, November 2, 1936 • WPA workers built 850 airports, 651, 000 miles of roads and streets, and 125, 000 public buildings • The WPA also hired artists, writers and photographers to create art
NATIONAL YOUTH ADMINISTRATION • The National Youth Administration (NYA) was created to provide education, jobs and recreation for young people • Getting young people off the streets and into schools and jobs was a high priority for the NYA
IMPROVING LABOR RELATIONS The NLRA was also called the Wagner Act • In the Second New Deal FDR helped pass the National Labor Relations Act (NLRA) • This legislation protected workers, ensured collective bargaining, and preserved the right to unionize
CONGRESS PROTECTS WORKERS • In 1938, Congress passed the Fair Labor Standards Act which set maximum hours at 44 per week and minimum wage at 25 cents per hour
SOCIAL SECURITY ACT • One of the most important achievements of the New Deal era was the creation of the Social Security System • The Social Security Act, passed in 1935, had 3 parts: ü Old-Age Pension ü Unemployment compensation ü Aid to families with dependent children & disabled (welfare)
NEW DEAL AFFECTS MANY GROUPS • First Lady Eleanor Roosevelt helped women gain higher political positions during the New Deal • Eleanor was influential in her role as advisor to the president • Frances Perkins became America’s first female cabinet member (Labor) Eleanor & Frankli n
AFRICAN AMERICANS DURING THE NEW DEAL • The 1930 s witnessed a growth of activism for black Americans • A. Philip Randolph became head of the nation’s first all-black union – the Brotherhood of Sleeping Car Porters
AFRICAN AMERICANS GAIN POLITICAL POSITIONS FDR appointed over 100 African Americans to positions within the government • Mary Mc. Leod Bethune headed the division of Negro Affairs of the NYA • Despite these gains, FDR was never fully committed to Civil Rights Bethun
NATIVE AMERICANS MAKE GAINS • Native Americans made advances during the 1920 s & 1930 s • Full citizenship granted in 1924 • The Reorganization Act of 1934 gave Natives more ownership of reservations • Policy was moving away from assimilation towards autonomy
Current locations of Native American reservations
FDR WINS IN 1936. . . AGAIN • FDR had wide appeal in the United States, especially in urban areas • African Americans, Jews, Catholics and immigrants all supported the popular president FDR & Eleanor
ROOSEVELT (RED) VS. LANDON (BLUE) 1936 ELECTION
ROOSEVELT’S FIRESIDE CHATS • FDR communicated to Americans via radio • His frequent “Fireside Chats” kept Americans abreast of the government’s efforts during the Depression
THE IMPACT OF THE NEW DEAL • Over time, opinions about the merits of the New Deal and FDR have ranged from harsh criticism to high praise – usually along partisan lines • Conservatives felt FDR made government too large and too powerful • Liberals countered that FDR socialized the economy because Americans needed help
LEGACIES OF THE NEW DEAL • FDIC – banking insurance critical to sound economy • Deficit spending has became a normal feature of government • Social Security is a key legacy of the New Deal in that the Feds have assumed a greater responsibility for the social welfare of citizens since 1935
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