The Great Depression lasted from 1929 to 1939, and was the worst economic downturn in the history of the industrialized world. It began after the stock market crash of October 1929, which sent Wall Street into a panic and wiped out millions of investors.

1. Chapter 25
The Great DepressionThe Great Depression
and the New Deal,and the New Deal,
1929–19411929–1941

2. Key words:
Suffering
Depression
Workers
“Make do”
Limited solutions
Government legislation
Economic recovery
First and Second New Deal

3. Ch. 25: Great Depression and
New Deal, 1929–1941
 FDR promise vigorous action because of:
 widespread suffering
 crisis of capitalism
 New Deal:
 = experimentation
 maintain existing economy/society
 Goal = save capitalism
 Many helped by New Deal:
 even if depression continue until WWII

4. Fig. 25-CO, p. 678

5. p. 680

6. I. Hard Times, 1929–1933
 GNP drop by 50%
 Profits fall from $10 to $1 billion
 100,000 businesses close
 Early 1933: unemployed = 25%:
 millions more only part-time
 Industrial wages cut by ⅓
 Millions suffer:
 hunger, malnutrition
 inadequate heat, poor housing
 Illness
 Starvation a real threat

7. I. Hard Times, 1929–33 (cont.)
 Families evicted
 Homeless form “Hoovervilles”
 Men seek work on railways and roads
 Couples delay marriage and parenthood
 Farm crisis (1920s) deepen with:
 overproduction and low prices
 drought and insects
 debt and foreclosures
 Many migrate

8. p. 683

9. Hard Times, 1929–33 (cont.)
 Industrial workers
 - rise in standard of living in 1920’s
 - every urban American had a job
 - workers spent on consumer goods
 - depression – less money to spend –
sales dropped – factories closed
 - One third of industrial workers
became unemployed
 - Wages fell by one-third

10. II. Marginal Workers
 Blacks suffer more than whites
 unemployment = 50% (1932)
 Whites take jobs from blacks and
Hispanics:
 USA deport 82,000 Hispanics (1929-35)
 ½ million more leave because of coercion
 Women suffer low pay/segregation:
 plus claim they take jobs from men

11. II. Marginal Worker (cont)
 Idea that men should be breadwinners
and women homemakers
 mixed impact on women:
 women in low-wage manufacturing jobs
were laid off before men
 domestic workers especially hard hit.

12. But
number of women working outside the
home rose
“women’s jobs” were not as hard hit as
“men’s jobs”

13. III. Middle Class
 Professional and white-collar workers did
not fare as badly as industrial workers
and farmers.
 Middle class families “Make do” with less.
Slogan: “Use it up, wear it out, make it
do, or do without.”
 Fall in income mitigated by falling cost of
consumer products, especially food
 Men blamed themselves for their
“failures”.
 Human toll of depression visible
everywhere.

14.  All face uncertainty/fear

15. p. 684

16. Read on your own.
IV. Hoover’s Limited Solutions
(pp. 683-685)
V. Protest and Social Unrest
(p. 685)
VI. Bonus Army (1932)
(pp. 685-686)

17. VII. FDR, the 1932 Election, and
Launching the New Deal
 Advocate direct relief and USG activity
 Win presidency and majorities in Congress
 Banking crisis
 Risky loans in 1920’s
 “Bank runs” threaten full collapse
 Promise “war” on Depression
 First break-through – Banking bill: saved
US banking system.
 People again keen to deposit money.

18. Map 25-1, p. 686

19. p. 687

20. VIII. First Hundred Days (1933)
 Federal government took on dramatically new
roles.
 Flood of legislation.
 Emergency Banking Relief Act:
 reopen solvent banks
 reorganize insolvent ones
 First fireside chat assure people banks safe
 Show New Deal’s conservatism
 FDR and Brain Trust lack coherent plan
 To spur economic recovery, experiment with:
 central planning
 direct relief

21. IX. National Industrial Recovery
Act (1933)
 Respond to “destructive competition” that
worsened industrial problems
 Rather co-operation
 Establish fixed prices and wages.
 Theory: if wages and prices were fixed,
consumer spending will increase.
 Industries will be able to rehire workers.

22.  Guaranteed workers the right to strike.
HOWEVER
 Big businesses dominate code-writing
 Not deliver economic recovery
 Court found that NRA extended federal
power beyond it constitutional power.

23. X. Agricultural Adjustment Act
(1933)
 Pay farmers to cut production:
 Less overproduction should raise prices
 Implication:
 farmers destroyed cattle and crops
 Food destruction confused many.
 They could not understand the economic
theory behind the waste of food.
 Favour landowners but disastrous for
many tenants and sharecroppers
 They go to cities

24.  Subsidies helped many farmers
 AAA also unconstitutional however
popular amongst farmers.
 Subsidies continue into 21st century.

25. XI. Relief Programs (1933)
 Prefer “work relief” to dole
 Civilian Conservation Corps:
 jobs for young men (2.5 million)
 Public Works Administration:
 Major construction projects
 spur recovery and development via
infrastructure
 cut unemployment and business failures
 raise farm prices, wages/salaries
 FDR and New Deal very popular

26. p. 689

27. Fig. 25-1, p. 691

28. Fig. 25-1a, p. 691

29. Fig. 25-1b, p. 691

30. Fig. 25-1c, p. 691

31. Fig. 25-1d, p. 691

32. Fig. 25-1e, p. 691

33. XII. Opposition to New Deal
 As economy improve, businesses and
conservatives increase opposition
 Oppose:
 - regulation
 - taxes
 - deficit spending on relief and public
works
 On the one hand:
 Business leaders thus fought the new
deal;

34.  On the other hand:
 Populists claim FDR favours big
business.
 Government paid too little attention to
needs of the common people.

35. XIV. Shaping the Second New
Deal
 Pressure on Roosevelt for social justice
 Eleanor Roosevelt = key advisor:
 put social justice issues at the centre of
the New Deal agenda
 lead social justice activists
 “Black Cabinet”
 Different groups:
 Hard hit by depression: New Deal must
give them help and social justice;

36.  Those with a “tenuous hold on the middle
class: wanted security and stability;
 Those with more to lose: New Deal must
preserve American capitalism.
 Result: FDR extends New Deal, so called
“Second New Deal”
 - “Greater security for the average man”
 - $4 billion (deficit spending) to help poor

37. p. 693

38. p. 694

39. XV. Emergency Relief
Appropriation Act (1935)
 Resettlement Administration:
 housing for destitute families
 Rural Electrification Administration
 Works Progress Administration = 8.5
million jobs
 Include actors, writers, musicians, artists:
 provide jobs
 bring culture
 celebrate plain folk (slave narratives)

40. XVI. Social Security Act (1935)
 Initiate:
 federal pension system
 unemployment compensation
 aid to dependents
 More government responsibility, but
conservative:
 funded by taxes on workers and employers
 taxes regressive
 not including farm labor, domestic service,
public sector
 Often exclude people of color and women

41.  Despite limitations, the Social Security
Act was highly significant:
 government took responsibility for
economic security of aged, temporary
unemployed, dependent children and
people with disabilities

42. XVII. FDR’s Populist Strategies
 Criticize big business
 Wealth Tax: raise taxes on rich/corps
 Slight redistribution of income (Figure
25.2)
 1936 election: landslide
 Cement Democratic coalition:
 unions
 urbanities (new immigrants)
 Solid South
 northern blacks
 dominate US Government for next 30 years

43. Map 25-3, p. 704

44. XVIII. Assessment of New Deal
 FDR was passionately hated and loved
 He personified the presidency and built
trust
 Important role of Eleanor Roosevelt –
social justice and human rights
 Historians vary on FDR
 Some praise ability to inspire/experiment
 Others criticize for not doing more

45.  FDR = pragmatist who wanted to
preserve the system
 capitalist, not radical:
 reduce suffering and
 preserve capitalist economy
 Strengthen government, especially
presidency

46. XXV. Assessment of New Deal
(cont.)
 Government:
 more regulation
 some responsibility for people’s welfare
 stimulate economy
 Not end Depression
 Stay active so no repeat depressions
 Liberal reform, not revolution