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Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
Chapter 23
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Chapter 23

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  • 1. The Great Depression and the New Deal
  • 2. Hoover and the Crash
  • 3. Signs of Weakness Older industries declining  Coal mining, railroads, & clothing manufactures Agriculture in prolonged downturn Stock prices soared  Margin buying: people bought stocks at ta fraction of the cost at the outset & owing the balance  Gambled that prices would be higher when they were ready to sell
  • 4. The Stock Market Crashes May 1928-September 1929  Industrial stocks doubled Wednesday October 23rd  6 million shares of stock changed hands  Falling prices caused losses of $4 billion  Brokers who lent $ for people to buy on margin now recalled their loans  Investors who could not pay had to sell their stocks  Caused prices to drop even more October 29, 1929  Black Tuesday  Stock market crumbled completely  Panicked traders rushed to sell (there were no buyers)  Investors who thought they had valuable stock had worthless pieces of paper (millionaires lost their fortunes overnight)  Stock prices plunged over the next 2 weeks
  • 5. The Great Depression Begins Stock markets crash marked the start of a 12-year economic & social disaster
  • 6. Troubled Industries Major cause of the Great Depression  Overproduction: a situation in which the supply of manufactured goods exceeds the demand  Factories produced more than people bought (prices for goods increased) Housing & automobile manufacture were in decline  Supports prosperity during 1920s  Between 1926-1929 spending on construction fell from $11 billion to $9 billion  1st nine months of 1929 car sales dropped by more than 1/3
  • 7. Crisis in Banking Nationwide banking crisis contributed to depression Struggling farmers could not repay loans  When farms failed, banks also went out of business City banks also invested in the stock market or loaned $ to speculators  When market crashed people rushed to banks to withdraw their savings  More than 5,500 banks closed between 1930 & 1933  Many depositors were left penniless
  • 8. The Downward Spiral W/ people unable to buy factory products, many factory workers lost their jobs  Had less $ to make purchases  Led to declining sales, which led to more factories closings & layoffs  Many companies forced into bankruptcy (financial failure caused by a company’s inability to pay its debts)  These caused even more layoffs Worldwide Issue  European countries defaulted on their loans owed to the U.S. from WWI due to decline in international trade  As crisis worsened, investors cut back loans to Europe  Process of production cuts, layoffs, & bankruptcies repeated in Europe
  • 9. The Unemployed 1929-1933  Unemployment went from 3% to 25%  13 million people nationwide  Toledo, Ohio: 4 out of 5 workers had no work  Those that had jobs had hours & wages cut
  • 10. Growing Poverty Spirits crushed because of poverty Jobless waited in long lines for food Communities of rundowns shack built on outskirts of big cities  Called Hoovervilles (blamed President Hoover for failing to solve the crisis)
  • 11. Impact on Families Many fathers left families in search of work  Others were too ashamed to be apart of the family & left Marriages were less common  Also had fewer children if married Children faced hardships & uncertainty  Suffered lifelong health problems  Education suffered  1 million rural children under the age of 13 did not attend school
  • 12. Hoover Responds Hoover’s advisers wanted him to do nothing  Hoover disagreed Government Aid  Hoover wanted business leaders & local gov’t to take the lead  Encouraged city & state gov’t to create public works projects  Urged private charities to et up soup kitchens 1932  Voluntary action was not enough  Reconstruction Finance Corporation formed  RFC gave $ to local gov’ts to fund public –works projects  Economic situation did not improve
  • 13. The Bonus Army June 1932  Protest began that would end Hoover’s career 8 years earlier Congress approved a bonus of $1,000 for every vet of WWI  Vets demanded payment as Depression grew worse  Was not paid until 1945  Hoover refused & 20,000 vets marched to Washington  Congress also refused (many marchers left)  2,000 stubbornly remained in tents or abandoned buildings  Gov’t forces used tear gas, tanks, & machine guns  1 killed, 100 injured (Americans were outraged)
  • 14. Roosevelt & The New Deal
  • 15. Franklin D. Roosevelt Nominated by Democrats to run against Hoover in 1932  known as FDR  was a wealthy New Yorker & distant relative of Theodore Roosevelt  had served as assistant secretary of the navy & nominated as VP in 1920  got polio in 1921 & relied on steel leg braces to help him stand  never allowed photographers to take his picture in a wheel chair 1928 elected governor of New York selected to run for President 4 years later
  • 16. A Voice of Hope Pledged “a new deal for the American people”  Later it would describe his entire political program FDR beat Hoover by a margin of 472 electoral votes to 59  Received 57.4% of the popular vote On March 4, 1933w/ the help of his son, he took the oath of office
  • 17. Bank Holiday Day after taking office  Declared a bank holiday (4 day closing of the nation’s banks)  Goal was to halt nationwide epidemic of bank failures  Gave FDR time to propose an Emergency Banking Relief Act (provided more careful gov’t regulations of banks) FDR restored Americans’ confidence in their banks by delivering a fireside chat (radio talks; gave many during his presidency)  When banks reopened many Americans re-deposited money
  • 18. Relief for the Jobless FDR conferred w/ his advisors over what legislation to send to Congress  They were nicknamed the “brain trust” because many of them were college professors During the 1st 100 days of FDR’s administration Congress passed & the President signed 15 new bills New Deal measures had 3 goals  Relief for the jobless  Economic recovery  Reforms to prevent futures depressions
  • 19. Unemployment Relief Some measures provided financial assistance Federal Emergency Relief Administration  Granted funds to states so they could reopen shuttered relief agencies
  • 20. Providing jobs Civilian Conservation Corps (CCC)  Hired city dwellers to work in America’s national parks, forests, wilderness areas, & countryside  Planted trees, built reservoirs, constructed parks, & dug irrigation canals CCC created jobs & protected the nation’s natural resources The Works Progress Administration (WPA)  Put people to work building or repairing public buildings  Schools, post offices, & gov’t offices  Paved 650,000 miles of roads, raised more than 75,000 bridges, & built more than 800 airports  Paid artists to paint murals in post offices & gov’t buildings  Hired writers to write stories, state guides, & histories
  • 21. Promoting Economic Recovery FDR needed to help industry & agriculture recover National Recovery Administration  Aimed to keep prices stable while boosting employment & buying power  Most of major industries agreed to pay workers a minimum wage, to stop hiring young children, & to keep wages and prices from falling too low  NRA succeeded in raising prices  Some critics charged them w/ favoring large businesses  Also failed to improve the economy
  • 22. Public Works Administration PWA  Was granted more than $3 billion to build large public- works projects  Improved the nation’s infrastructure & employed many people  New York’s Lincoln Tunnel, Florida’s Key West Hwy, & the Grand Coulee Dam in Washington  Nearly every county in the nation could boast at least one PWA project  Even so, the Great Depression continued
  • 23. Tennessee Valley Authority Formed in 1933 TVA  Built giant dams along Tennessee River  Dams could control flooding, provided cheap electricity, & increase jobs and prosperity in one of nation’s poorest rural areas 1945  Power from TVA plants lit thousands of farms that never had electricity  Failed to relieve region’s poverty  Conservatives criticized TVA for driving some property owners off their land  Also argued it was unfair for gov’t to compete w/ private power companies  Other argued TVA disrupted the natural environment (increased air pollution)
  • 24. Reforming the Economic System Truth-in-Securities Act  Required corporations to inform the public fully about their stocks  Corrected one condition that caused stock market to crash Federal Deposit Insurance Corporation (FDIC)  Protected bank depositors  Guaranteed individual deposits up to $2,500.00 Other agencies set fairness & safety standards for various industries Federal Power Commission (FDC)  Helped control the oil & gas industries Food & Drug Administration powers were also increased
  • 25. Obstacles to the New Deal FDR was re-elected in 1936  Americans were enthusiastic about the New Deal New deal faced challenges in the Supreme court
  • 26. Supreme Court 1935 & 1936  Supreme Court declared several New Deal measures, including NRA, to be unconstitutional  FDR proposed appointing up to six new Supreme Court justices  Was opposed by conservatives (saw FDR’s plan to gain a majority of justices)  Congress defeated FDR’s plan  He was able to win backdoor way  1937 a conservative justice resigned & FDR appointed a liberal one in his place
  • 27. New Deal Critics Conservatives  Thought New Deal went too far in regulating businesses & restricting individual freedom Liberals  Some thought New Deal did not go far enough in helping the poor Biggest critics  Huey Long: Democratic senator from Louisiana; argue d gov’t could end Depression immediately; proposed to tax the wealthy & distribute their wealth to the poor (Share Our Wealth plan)  Francis Townsend: called for a system of gov’t pensions (retirement payments); retired Americans over the age of 60 would receive $200 each month as long as they pledged to spend all the money; plan was never approved by Congress, but later helped set the stage for the Social Security system  Charles Coughlin: used radio to attract followers; Catholic priest from Michigan; distrusted FDR’s policies on banking & money; called for gov’t to take over banks  Supporters of the “Big Critics” joined forces to back a third-party candidate in 1936 (were not strong enough to combat FDR’s popularity
  • 28. Life in the Great Depression
  • 29. Women in the Depression Many Americans felt women should stay at home During the Depression women had to help support their families By the end of the Depression more women were working outside of the home than before the Depression
  • 30. Women in the Workplace 2 advantages for women in the workplace  Female salesclerks & secretaries faced little competition from men  Jobs of women less likely to disappear, unlike factory jobs Most women w/ jobs still struggled  Women trained in certain professions (teachers, librarians, etc.) had to compete against men who had lost their jobs  Women factory workers were more likely to lose their jobs or have wages cut  Maids, seamstresses, & housekeepers lost their jobs because people could not afford their services  African American women suffered the most because they held the majority of domestic jobs To save money more women found themselves sewing clothes, canning fruits & vegetables, & baking bread instead of buying
  • 31. An Active First Lady Eleanor Roosevelt  Most famous working lady  After FDR was stricken w/ polio she began to speak & travel on his behalf  Transformed the role of First Lady  She served as the Presidents eyes & ears  In 1933 alone she logged 40,000 miles including a trip down into a WV coal mine  Also made frequent radio speeches & wrote a daily newspaper column  Used her position to fight for women’s rights
  • 32. African Americans in theDepression Hit hard by the depression Suffered more unemployment, homelessness, illness, & hunger than whites
  • 33. South & North South  Plunging cotton prices forced African American sharecroppers off their land  Move to southern cities (found traditional jobs done by blacks (i.e. cleaning streets) were now done by jobless whites)  1932 more than ½ African Americans in South were unemployed North  African Americans migrated north  Still hard to find work  Were last hired & first fired from jobs  In New York 50% of blacks were jobless
  • 34. FDR’s Mixed Record Most blacks backed FDR despite his mixed record on civil rights  Example: FDR failed to support a federal antilynching bill W/ his wife’s prodding, FDR appointed at least 100 blacks to gov’t posts  Mary McLeod Bethune, a friend of Eleanor’s, became top ranking African American in gov’t  Member of FDR’s “Black Cabinet”; advised FDR on African American issues (William Hastie also a member of cabinet, later became 1st black federal judge)
  • 35. A Symbolic Moment 1939  Daughters of the American revolution (DAR) refused to allow African American singer Marian Anderson to perform at their hall  Eleanor resigned as a member of DAR in protest  Arranged for Anderson to sing on the steps of the Lincoln Memorial on Easter Sunday (drew crowd of 75,000; became a symbol of the struggle for civil rights)
  • 36. Mexican Immigrants Are Deported Mexican immigrants  Lived in SW as migrant workers  Welcomed during good time by farmers (worked for low pay & harsh conditions)  Whites flooded the area during the Depression looking for work  American wanted gov’t to force Mexican out of the country  They rounded up 100s of thousands of people & deported them (some were actual U.S. citizens born in the U.S.)
  • 37. The Indian New Deal 1924  Native Americans were granted citizenship When Depression hit, 170,000 Indians lived in poverty on reservations administered by the gov’t John Collier  Commissioner of Indian Affairs  A white man who lived among Pueblo Indians of New Mexico  Developed a program called Indian New Deal  w/ federal agency funding: NA hired to build schools, hospitals, & irrigation systems  Also wanted reservations under Indian control, stop sales of their lands, & encouraged schools to teach Native American history & the arts 1934  Congress approved part of the Indian Reorganization Act (IRA)  Did restrict tribal land sales, but failed to bring self-gov’t or education promotion
  • 38. The Dust Bowl 1930  Little rain fell, drought caused crop failure & dust storms  Lasted 5 years, 100 million acres of farmland became a wasteland
  • 39. Black Blizzards Modern farming contributed to Dust Bowl  Large plots of land containing native grasses & sod was removed by farmers (this held the soil in place)  Little rain caused rootless soil to blow away like powder Dust Storms were called Black Blizzards  Made noon seem like midnight, buried fences, houses, & killed people and animals
  • 40. Okies Head West Ruined farm families abandoned their dusty homes to seek work elsewhere  In some areas 1 in 3 families left  Became known as Okies because many came from Oklahoma  Conditions not better in California  Not able to buy land, they had to compete w/ local workers to pick crops  Police closed some roads into California, but migrants kept coming
  • 41. Arts & Media of the Depression John Steinbeck  Captured miseries of the Dust Bowl in The Grapes of Wrath  Tells the story of the Joads, Okies who seek a better life in California
  • 42. Visual Arts Photographers & painters used the Depression as a theme Under a New Deal program called the Farm Security Administration, photographer Dorothea Lange recorded the experiences of the Dust Bowl migrants  Photograph remains the symbol the Depression  WPA hired artists to paint murals on public buildings
  • 43. Movies & Radio During the Depression  Movies: dealt realistically w/ social problems  The Grapes of Wrath & The Public Enemy  Also helped people forget about their problems  Mickey Mouse, King Kong, & Shirley Temple  Radio: used to broadcast FDR’s fireside chats  Popular bands & comedians, continuing dramas sponsored by soap companies (soap operas)
  • 44. Legacy of the New Deal
  • 45. Social Security 1935  FDR signs Social Security Act  Provided federal gov’t a major & lasting role in providing for the needy Social Security Act  Old-Age Insurance: key part of SSA  Guaranteed retired people a pension  Funded by a payroll tax (a tax that removes money directly from workers’ paychecks  Matching contributions were required by employers  Business leaders opposed Old-Age Insurance
  • 46.  SSA included Aid to Dependent Children (ADC)  Helped children whose father s were dead, unemployed, or not living w/ the family  Granted federal $ to states to help mothers stay home to raise their children SSA also provided for disabled & gave states $ to make temporary payments to the unemployed At SSA excluded some categories of labor  Agriculture & domestic workers not required to pay  Many African Americans, migrant workers, & poor rural whites did not benefit from SS
  • 47. Lasting Labor Reforms Frances Perkins  Member of FDR’s committee who drafted the SSA  1st woman to serve in the Cabinet  Back major labor reform
  • 48. New Laws Favor Workers 1935  Congress passed the National Labor Relations Act  Became known as Wagner Act  Guaranteed workers’ rights to organize into unions & prohibited unfair business practices  Upheld collective bargaining (right of a union to negotiate wages & benefits for all its members)  National Labor Relations Board  Required employers to participate in collective bargaining w/ unions
  • 49.  1938  Fair Labor Standards Act  Set minimu wages at $.25 per hour & max weekly work hours at 44  Established time and a half payment for overtime work & put an end to child labor in some businesses
  • 50. A Powerful New Union John L. Lewis  Head of the United Mine Workers  Formed Industrial Organization renamed later the Congress of Industrial Organizations (CIO CIO  Umbrella organization consisting of many other unions  Differed from the older American Federation of Labor (AFL)  AFL combined workers based on skills  CIO combined all workers in particular industry (skilled & non-skilled)  Opened union membership to more women & African Americans
  • 51.  1936  United Auto Workers  Members of CIO  Launched sit-down strike (workers stay in the factory but stop production) @ nation’s largest auto factory  After 6 weeks the strikers won their demands for higher wages & shorter hours  Supreme Court later ruled sit-down strikes illegal
  • 52. Scorecard on the New Deal SSA & other reforms permanently enlarged the role of the federal gov’t  Not everyone agreed gov’t should take such an active approach to social problems
  • 53. Arguments Against the New Deal Critics say New Deal gave too much power to the federal gov’t Federal gov’t threaten individual freedom & free enterprise  Favor a return to the tradition of laissez faire  Gov’t should interfere w/ the economy as little as possible Worried about a massive increase in the nation’s debt New Deal failed to fulfill its most fundamental goal  Did not end the Great Depression  Full recovery would not come until 1941 when the U.S. began producing goods in preparation for WWII
  • 54. Arguments for the New Deal Employed millions of jobless people Ended banking crisis Reformed stock market Save poor families from losing their homes Improved working conditions Built dams & bridges, preserved 12 million acres of national parkland, brought electricity to rural America, & sponsored the creation of lasting works of art For many the New Deal also restored peoples faith in the gov’t

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