Great Depression & the New Deal

1. The Great Depression
And the New Deal

2. Herbert Hoover
Republican Herbert Hoover became president in 1929.
He opposed too much government interference in business.
Unfortunately for Hoover he took office at a time when the US economy was
about to collapse and was ultimately blamed for the Great Depression and lost
the 1932 election for Franklin Roosevelt.
In 1928, the new Republican president, Herbert Hoover confidently stated, "We in America today
are nearer to the final triumph over poverty than ever before in the history of any land.” He also
promised the American people a chicken in every pot and a car in every garage.

3. Great Depression
Worse economic crisis in US history that led to massive unemployment and left
many US citizens without jobs or money.

4. Causes of the Great Depression
Overproduction and under consumption that led to falling prices.
Buying risky stocks on Speculation and “Buying on the Margin”
Stock Market Crash of 1929 ("Black Tuesday")

5. Overproduction
Producing more goods than consumers can buy, thereby causing a fall in
prices.

6. Under Consumption
When consumers don't consume enough in relations to how many goods
have been produced and are available.

7. Buying Stock on Speculation
High-risk investments people made in the stock market during the 1920s in
hopes of making large returns on their money.
Such investments eventually contributed to the start of the Great Depression.

8. Buying on the Margin
Practice in which investors purchased stocks for only a portion of what they cost.
They then borrowed the difference and paid interest on the loan.

9. Black Tuesday
October 29, 1929, the day the stock market crashed. It is generally
acknowledged as the beginning of the Great Depression.

10. Stock Market: Before and After “Black Tuesday”

11. US Economy Following the Stock Market Crash of
1929
People rushed to withdraw money from banks, causing them to close.
 Back then, the government did not insure bank accounts and if a bank
closed and went out of business, anyone who had money in the bank
lost all their savings.

12. Economic Conditions During the Great Depression
1. Unemployment- 13 million people were out of work.
2. Industrial production dropped by 45 per cent between 1929 and 1932.
3. House building fell by 80 per cent between 1929 and 1932.
4. The entire American banking system reached the brink of collapse.
5. From 1929 to 1932, 5,000 banks went out of business.
Although many people went hungry, the number of
recorded deaths from starvation during the
Depression was 110, although many other illnesses
and deaths were probably related to a lack of
nutrition.

13. Hoovervilles
" Unable to pay rent, many families were evicted from their former homes and
forced to crowd into shantytowns called “Hoovervilles” (named after president
Herbert Hoover). These areas sprung up from coast to coast, crowded with the
homeless who erected shacks out of whatever construction materials they could
salvage.
Many people lived in primitive conditions close to famine. One New York family moved into a cave in
Central Park. In St Louis, more than 1,000 people lived in shacks made from scrap metal and boxes.
There were many similar Hoovervilles all over America. Between 1 and 2 million people traveled the
country desperately looking for work.

14. How Farmers Were Affected:
From 1909 through the war years, farmers did well due to the high demand for
their products.
New machinery, such as tractors, allowed farmers to produce far more than
needed.
This resulted in overproduction and caused agricultural prices to drop
drastically in the 1920s.

15. Mechanization
Increased use of machinery for production.
Farmers refused to harvest crops because prices were so low as a result farmers were hurt the
most and many lost their land.

16. Droughts
Lack of rain that results in not enough water for farming.

17. Dust Bowl
A series of storms that hit the Midwest during the early '30s, causing enormous
clouds of dust to be created by the high winds.
These black clouds would blanket farms, and even entire cities, as they
destroyed areas and left them uninhabitable.

18. Bonus Army (1932)
Facing the financial crisis of the Depression, WW I veterans tried to
pressure Congress to pay them their retirement bonuses early. Congress
did not approve so angry veterans marched on Washington. Hoover
mobilized the U.S. Army, under General Douglas MacArthur, to suppress
the angry veterans by using aggressive tactics that summarized the crisis
and unrest taking place all over the nation.

19. Franklin Delano Roosevelt
Elected president in 1932.
Roosevelt helped instill confidence and was a much-needed image of hope
for a nation battered by the Great Depression.
Franklin D. Roosevelt: Offered
hope and a way out of the
depression.
Franklin D. Roosevelt served
13 years, the longest time for
any U.S. President. After his
death, Congress passed an
amendment limiting the time in
office of a U.S. President to no
more than two full terms.

20. Eleanor Roosevelt
Franklin Roosevelt's wife and one of the most influential first ladies in US
history.
She worked for reforms in government and campaigned for legislation
regarding public housing, fought for the rights of working women, and
supported the distribution of information about birth control.

21. Fireside Chats
Roosevelt believed that unless Americans were confident about the economy,
the crisis would remain. Therefore, he went directly to the people in the first
of his radio "Fireside Chats", boldly explaining his actions and coming out
for direct support from the people. This demonstrated that Roosevelt was
bold enough to take action. His actions proved successful, as restored people’s
faith in the economy.

22. Key Quotes: FDR’s Inauguration Speech
The only thing
we have to
fear… is fear
itself.

23. New Deal
Roosevelt's domestic programs that involved government spending and were
designed to give the nation relief from the Great Depression.
Goals of the “New Deal”
Relief- provide relief for those Americans in need of financial assistance.
Recovery- Spur the economy to promote recovery.
Reform- Prevent future depressions.

24. Direct Relief
Federal help to those hurting from the financial crisis.

25. Soup Kitchens and Breadlines
Provided food for the poor during the Great Depression.

26. “New Deal” Programs (Alphabet Soup)

27. Emergency Banking Relief Act (March 11, 1933)
By 1933, over 5000 banks had failed. So, in response to the banking crisis,
Roosevelt shut down all national banks on a four day holiday to prevent
people from withdrawing their money. During this time, Roosevelt and
Congress introduced the Emergency Banking Relief Bill which authorized
the government to examine the finances of banks that were closed during
the holiday and reopen those judged to be solvent. It also authorized the
use of federal funds to back private banks.

28. Federal Deposit Insurance Corporation (FDIC)
Established in 1933 under the Federal Reserve Act to insure bank deposits of
up to $100,000 in case of bank failure.
This insurance was intended to prevent people from withdrawing their money
out of panic.

29. Civilian Conservation Corps (CCC)
Established in 1933, it provided employment for unmarried men between the
ages of 18 and 25.
These young men worked in the national parks installing electric lines, building
fire towers, and planting new trees in deforested areas.

30. Agricultural Adjustment Act (AAA)
Passed in 1933, this act approved government loans to farmers and paid
farmers not to grow certain crops in order to increase the price of
agricultural products.

31. National Industrial Recovery Act (NIRA)
Passed in 1933, this law sought to bolster industrial prices and prevent US
business failures.

32. Public Works Administration (PWA)
Launched a number of public works such as the construction of dams,
highways, and bridges.
These projects helped provide citizens with desperately needed jobs.

33. Tennessee Valley Authority (TVA)
Established in 1933, the TVA built hydroelectric dams to create jobs and bring
cheap electricity to parts of the South that had previously been without power.
The southern Appalachians were historically one of the poorest areas in the
nation. With the help of the TVA, this region prospered as never before.
The TVA built 20 dams, conducted
demonstration projects for farmers,
and engaged in reforestation to
rehabilitate the area.

34. Share the Wealth
The Share the Wealth society was founded in 1934 by Senator Huey Long
of Louisiana. He called for the confiscation of all fortunes over $5 million
and a 100% tax on annual incomes over $1 million.

35. Huey P. Long
Huey Long served as the governor of Louisiana, supporting the common
people and criticizing Roosevelt for favoring businesses in the New Deal. In
response, he created the Share Our Wealthy Society.
Huey P. Long would run for president in 1936, however, he was assassinated
in 1935.
Carl Weiss
(The Assassin)
Huey P. Long

36. Second New Deal
Some thought the first New Deal (legislation passed in 1933) did too much
and created a big deficit, while others, mostly the elderly, thought it did
not do enough.
Most of the 1933 legislation was ineffective in stopping the Depression,
which led F. D. R. to propose a second series of initiatives in 1935,
referred to the Second New Deal.

37. National Labor Relations Act (Wagner Act)
Passed in May 1935 and created a board to monitor unfair management
practices such as firing workers who joined unions.
It protected the right of workers in the private sector to organize unions,
engage in collective bargaining, and go on strike.

38. Fair Labor Standards Act (June 1938)
Maximum hours and minimum wage.
Set maximum hours at 40 hours a week and minimum wage at 20 cents an
hour (gradually rose to 40 cents).

39. Social Security Act
Passed in 1935, this act established retirement income for all workers once
they reach the age of 65.
Social Security Act is funded by a tax on wages
paid equally by employee and employer.

40. Frances Perkins
She was the first woman in history to be appointed to a US president's
cabinet as Roosevelt's Secretary of Labor.

41. Revenue Act of 1935
This law raised taxes on those making above $50,000/year as well as corporate
and estate taxes.
It won the favor of many on the left and was nicknamed the "soak the rich
tax."

42. Court-Packing Scheme
Plan put forth by Roosevelt in February 1937 to enlarge the size of the
Supreme Court which would allow him to "pack" the Court with justices
favorable to his programs.
The Constitution did not specify the number of US Supreme Court
justices, the president proposed enlarging the Court from nine to as many
as fifteen judges.
When fierce opposition to the measure arose Roosevelt was forced to
withdraw his request.

43. Effects of the New Deal on Women and Minorities
• Programs tended to show favoritism towards men.
• Businesses paid women less money than male employees.
• As for minorities, what jobs African Americans did get were credited
to Roosevelt and his programs.
• As a result, the African American community began to shift its
political loyalty to the Democratic Party.

44. Tariffs
High taxes on foreign imports.

45. Neutrality Act
Law passed by Congress in 1935 which prohibited the sale of weapons to
warring nations and was meant to keep the US from forming alliances that
might drag the nation into war.

46. Criticisms of the “New Deal”
•Disliked by many businessmen and people with money.
•Government raised money to pay for the “New Deal” through taxes.
 People with the highest income had to pay the highest taxes.
•Many feared that the government was becoming too powerful.
•Critics claimed it was destroying the “American way of life.”
•Thought it resembled communism too much.
The outbreak of the Second World
War finally ended the Great
Depression.