Introduction to The Great Depression and the New DealPresentation Transcript
The New Deal
Blessing or Curse?
J. MARSHALL, 2008
Reasons for the Crash and other
factors that led to depression
• The stock market was a relatively new thing stocks vs. gold (traders and buyers were
• Buying on margin - a license to print money
• Panicked selling over almost a week caused
the Wall St. market to collapse on Black
Tuesday, Oct 29, 1929
Other economic problems
• The price of wheat had been falling since 1927:
over-production didn’t drop so prices did farmers’ mortgages suffered: no cash means no
• Manufacturers were over-producing consumer
goods = few consumers = layoffs = less
spending money = fewer consumers
• USA protectionist tariffs = trade barriers for all
• Germany’s inability to pay reparations affected
the Allies’ ability to repay loans to USA
The Beginning was Worst:
Looking at Canada
• Canada’s economy was very closely connected to
the USA - trading/branch plants/investors:
– Wheat (40% of world supply)
– Newsprint (65% of world supply)
• As the economy failed people lost their jobs and
the ability to pay rent: vagrancy meant jail time
• To collect POGEY or the “DOLE” (Relief
vouchers) one had to publicly declare her poverty:
why would so may do without relief?
• Private charity/soup kitchens
Laissez Faire - let it be
men looked for
“riding the rods”
• Blindsided by the
• Didn’t want to threaten
the “American Way of
Life” (free enterprise)
On the eve of
Franklin D. Roosevelt
• Called Keynes a “fool”
• “Nothing to fear…”
• New Deal - 3 Rs
• First 100 Days
FDR listened to the
WAY OUT OF
John Maynard Keynes
govern e problem
l with t
Herbert Hoover vs.
• Hoover’s strategy was to lower interest rates the problem was too big!
• FDR’s 100 days in 1933
Close banks for three days
New Deal = “alphabet agencies”
Every letter to the President will be answered
create CONFIDENCE and give LEADERSHIP
nal Recovery Ad
W o r ks
• Fireside Chats the soap box is dead!
• All letters to the
President will be
answered! (1000s / day)
Millions were Suffering
• Sharecroppers were displaced
ex. Grapes of Wrath
• Success was
What did they do?
• Is a minimum wage
a good thing?
• Predict outcome for workers?
…for the country?
Separating myth from reality…
“Just in case
Mar 5, 1936
1937 saw a new recession.
Meanwhile What About the Main Line Express?
When did the debt rise the most?
Search for arguments on the
The New Deal:
Statistics New Deal
Effectiveness New Deal
Criticism New Deal
New Deal Extended the
• Benefits of the New Deal
• Damage of the New Deal