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History Of The Great Depression


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Great Depression up to the New Deal

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History Of The Great Depression

  1. 1. The Great Depression Herbert Hoover and the American People During Hard Times *For more information on the economic causes of the Great Depression, refer to Mr. Kelly’s PowerPoint Economics of the Great Depression
  2. 2. The Coming of the Depression <ul><li>Feb. 1928 stocks rose upward for a year and a half </li></ul><ul><li>May 1928-September 1929 </li></ul><ul><ul><li>Average stock prices rose 40% </li></ul></ul><ul><ul><li>Dow Jones doubled </li></ul></ul><ul><ul><li>Trading rose from 2-3 million shares per day to 5 million </li></ul></ul><ul><ul><ul><li>Sometimes 10-12 million </li></ul></ul></ul>
  3. 3. The Great Crash <ul><li>October 21 and 24, 1929- alarming decline in stock prices </li></ul><ul><ul><li>Both followed by temporary recovery </li></ul></ul><ul><li>Black Tuesday </li></ul><ul><ul><li>October 29, 1929 </li></ul></ul><ul><ul><li>16 million shares traded </li></ul></ul><ul><ul><li>Index dropped 43 points- previous year’s gains gone </li></ul></ul><ul><li>By July 1932 the market was at 58 </li></ul><ul><ul><li>Down from high of 452 in September 1929 </li></ul></ul><ul><li>Not the cause of the Depression, only a sign </li></ul>
  4. 4. Causes of the Great Depression <ul><li>Debated by economists and historians </li></ul><ul><li>Lack of diversification in the economy </li></ul><ul><ul><li>Prosperity based on a few industries </li></ul></ul><ul><li>Disparity between rich and poor too great </li></ul><ul><ul><li>Many people too poor to buy goods to lift economy </li></ul></ul><ul><li>Credit structure in the economy </li></ul><ul><ul><li>Farmers in debt and prices were declining </li></ul></ul><ul><ul><li>Banks weakened by people defaulting on loans </li></ul></ul><ul><li>International trade declines </li></ul><ul><ul><li>European demand for goods declines </li></ul></ul><ul><li>World War I loans </li></ul><ul><ul><li>European nations could not repay their debts </li></ul></ul><ul><ul><li>America would not forgive the loans </li></ul></ul>
  5. 5. Progress of the Depression 1930-1933 <ul><li>Collapse of the Banking System </li></ul><ul><ul><li>9,000 banks closed their doors </li></ul></ul><ul><ul><li>Depositors lost $2.5 billion in deposits </li></ul></ul><ul><ul><li>Nations money supply decreases by 1/3 </li></ul></ul><ul><ul><ul><li>Deflation and decrease in purchasing power </li></ul></ul></ul><ul><li>Gross National Product </li></ul><ul><ul><li>Shrunk from $104 billion (1929) to $76.4 billion (1932) </li></ul></ul><ul><li>Consumer Price Index declined 25 % (1929-1933) </li></ul><ul><li>Unemployment was 25% by 1933. </li></ul><ul><ul><li>Averaged nearly 20% for the rest of the decade. </li></ul></ul><ul><ul><li>1/3 of workforce was underemployed. </li></ul></ul>
  6. 6. Unemployment and Relief <ul><li>Impacted industrial cities in the Northeast and Midwest </li></ul><ul><li>Unemployed turned to local & state relief agencies. </li></ul><ul><ul><li>They were ill-equipped to handle large numbers </li></ul></ul><ul><li>1/3 of farmers lost their land </li></ul><ul><li>Dust Bowl </li></ul><ul><ul><li>Area stretching from Texas to the Dakotas </li></ul></ul><ul><ul><li>Experienced decade long drought </li></ul></ul><ul><ul><li>Okies (often from Oklahoma) left the Dust Bowl to look for better jobs </li></ul></ul><ul><ul><ul><li>Worked as agricultural migrants. </li></ul></ul></ul>
  7. 7. African-Americans and the Depression <ul><li>By 1932- nearly 1/2 African Americans were unemployed </li></ul><ul><ul><li>Denied the limited amount of relief </li></ul></ul><ul><li>Many migrated to northern cities </li></ul><ul><ul><li>Conditions not much better there </li></ul></ul><ul><li>Scottsboro Case </li></ul><ul><ul><li>Nine African American boys were convicted of rape in Alabama </li></ul></ul><ul><ul><ul><li>Evidence shows that the rapes didn’t occur </li></ul></ul></ul><ul><ul><ul><li>8/9 sentenced to death </li></ul></ul></ul><ul><ul><li>Case went to the Supreme Court </li></ul></ul><ul><li>NAACP grew stronger as it broke down racial barriers </li></ul>
  8. 8. Hispanics and the Depression <ul><li>The Southwest part of the U.S. saw massive migration from Mexico </li></ul><ul><ul><li>They experienced immigration similar to African Americans </li></ul></ul><ul><li>Chicanos (as Mexican Americans were known) were primarily migrant farmers </li></ul><ul><ul><li>As whites headed west in search of jobs, they demanded those held by Chicanos </li></ul></ul>
  9. 9. Women and Families in the Great Depression <ul><li>Depression reemphasized the belief that a woman’s place was in the home. </li></ul><ul><li>Men moved into jobs that were traditionally held by women </li></ul><ul><li>Female industrial workers were more likely to be laid off or have reduced hours </li></ul><ul><li>Nonprofessional jobs held by women were less likely to be laid off </li></ul><ul><li>By the end of the 1930s feminism was at its lowest point in a hundred years </li></ul>
  10. 10. Values and Culture <ul><li>Social values changed very little during the Depression </li></ul><ul><ul><li>Maintained the traditional individual success ethic </li></ul></ul><ul><ul><li>Some people thought the economic problems were society’s fault </li></ul></ul><ul><ul><ul><li>Photographers documented the extreme conditions of the rural poor </li></ul></ul></ul><ul><ul><ul><li>Books such as John Steinbeck’s The Grapes of Wrath (1939) pointed out the injustices in society </li></ul></ul></ul><ul><li>Radio and the movies provided light and diverting entertainment </li></ul>
  11. 11. The Allure of the Left <ul><li>Appealed to intellectuals, artists, workers, African Americans and other disenchanted with American life </li></ul><ul><li>American Communist party saw a rise in numbers </li></ul><ul><ul><li>100,000 during mid-1930s </li></ul></ul><ul><ul><li>It helped organized black sharecroppers in Alabama </li></ul></ul><ul><ul><li>Its close supervision by the Soviet Union hurt it in the U.S. </li></ul></ul><ul><li>Socialist party saw membership go below 20,000 by 1936. </li></ul>
  12. 12. The Hoover Program <ul><li>Attempt to restore confidence in the economy </li></ul><ul><li>Summoned business, labor and agricultural leaders and urged voluntary cooperation for recovery </li></ul><ul><ul><li>This system did not work </li></ul></ul><ul><li>Asked Congress to increase spending for works programs </li></ul><ul><ul><li>It didn’t spend enough or last long enough to work </li></ul></ul><ul><li>As the crisis continued, he tried proposed a tax increase to balance the budget </li></ul><ul><li>Attempted to help farmers </li></ul><ul><ul><li>Farm Board created to help maintain prices </li></ul></ul><ul><ul><li>Smoot-Hawley tariff set up to protect 75 farm products from competition </li></ul></ul>
  13. 13. The Hoover Program <ul><li>1930 midterm elections </li></ul><ul><ul><li>Hoover’s popularity declining </li></ul></ul><ul><ul><li>Democrats took substantial control of the House </li></ul></ul><ul><ul><li>Democrats made gains in the Senate </li></ul></ul><ul><li>1931 international financial panic </li></ul><ul><ul><li>Showed that the downturn wasn’t ending soon </li></ul></ul><ul><li>Hoover tried new measures </li></ul><ul><ul><li>Reconstruction Finance Corporation (RFC) </li></ul></ul><ul><ul><ul><li>Created to provide federal loans to struggling banks, railroad and other businesses </li></ul></ul></ul><ul><ul><ul><li>Made funds available to support public works programs </li></ul></ul></ul>
  14. 14. The Rise of Popular Protest <ul><li>Farmers’ Holiday Association </li></ul><ul><ul><li>Wanted to withhold farm products from the market (a strike) </li></ul></ul><ul><li>Bonus Army </li></ul><ul><ul><li>WWI veterans demanding their bonus be paid </li></ul></ul><ul><ul><li>June 1932- 20,000 veterans march to Washington </li></ul></ul><ul><ul><li>The military, using machine guns and six tanks, forced the veterans out of the city. </li></ul></ul><ul><ul><li>100 marchers were inured and 1 baby died </li></ul></ul>
  15. 15. The Election of 1932 <ul><li>Hoover was unenthusiastically renominated by the Republicans </li></ul><ul><li>Franklin Delano Roosevelt nominated by the Democrats </li></ul><ul><ul><li>Was governor of New York. </li></ul></ul><ul><li>Roosevelt won </li></ul><ul><ul><li>472-59 in electoral votes </li></ul></ul><ul><ul><li>57.4%-39.7% in popular votes </li></ul></ul>
  16. 16. Waiting for FDR <ul><li>Four months between the election and inauguration </li></ul><ul><li>Hoover tried to work with FDR to slow the worsening crisis </li></ul><ul><ul><li>FDR would not commit to anything </li></ul></ul><ul><li>In February the American banking system was close to collapse </li></ul><ul><ul><li>Hoover asked FDR to declare he would not </li></ul></ul><ul><ul><ul><li>tinker with the currency </li></ul></ul></ul><ul><ul><ul><li>Borrow heavily </li></ul></ul></ul><ul><ul><ul><li>Unbalance the budget </li></ul></ul></ul><ul><ul><li>Roosevelt refused </li></ul></ul>