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The Great DepressionThe Great Depression

• What was the Great Depression?What was the Great Depression?• Name 2 possible causes to the Great Depression.Name 2 possible causes to the Great Depression.• Do you think the government responsible for the Do you think the government responsible for the

depression?depression?• Put in order the following events.Put in order the following events.

– The Bonus Army arrives in Washington D.C.The Bonus Army arrives in Washington D.C.– The Treaty of VersaillesThe Treaty of Versailles– Buying on credit or “installment plan” sweeps the nationBuying on credit or “installment plan” sweeps the nation– Coolidge is elected PresidentCoolidge is elected President– Franklin Delano Roosevelt is elected presidentFranklin Delano Roosevelt is elected president– Herbert Hoover is elected presidentHerbert Hoover is elected president– The New Deal is put into actionThe New Deal is put into action

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The Great DepressionThe Great Depression

• Put in order the following events.Put in order the following events.– The Treaty of VersaillesThe Treaty of Versailles– Buying on credit or “installment plan” sweeps the Buying on credit or “installment plan” sweeps the

nationnation– Coolidge is elected PresidentCoolidge is elected President– Herbert Hoover is elected presidentHerbert Hoover is elected president– The Bonus Army arrives in Washington D.C.The Bonus Army arrives in Washington D.C.– Franklin Delano Roosevelt is elected presidentFranklin Delano Roosevelt is elected president– The New Deal is put into actionThe New Deal is put into action

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The Great Depression The Great Depression 1929-401929-40

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Sick EconomySick Economy• Economic Troubles on the HorizonEconomic Troubles on the Horizon

– Industries in troubleIndustries in trouble•Railroad due to new transportationRailroad due to new transportation•Coal mining due to new energy of Coal mining due to new energy of

hydroelectric, fuel oil and natural gashydroelectric, fuel oil and natural gas•New housing began to fall so did jobs New housing began to fall so did jobs

in related industries of furniture and in related industries of furniture and lumberinglumbering

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Sick EconomySick Economy

• Farmers Industry begins to struggle:Farmers Industry begins to struggle:– WWI prices rose and demand was high on the world WWI prices rose and demand was high on the world

marketmarket– Farmers took out loans to buy more land to meet Farmers took out loans to buy more land to meet

demanddemand– After war demand and prices dropped 40%After war demand and prices dropped 40%– 1919 to 1921 income declined from 10 billion to 4 1919 to 1921 income declined from 10 billion to 4

billionbillion– McNary-Haugen bill: price supports for key products McNary-Haugen bill: price supports for key products

such as wheat, corn, cotton and tobacco but was such as wheat, corn, cotton and tobacco but was vetoed by Coolidgevetoed by Coolidge• ““Farmers have never made money and I don’t think there is Farmers have never made money and I don’t think there is

much we can do about that” President Calvin Coolidgemuch we can do about that” President Calvin Coolidge

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Sick Economy ContinuedSick Economy Continued• Spiral Down Syndrome? Spiral Down Syndrome? • StagnationStagnation• Unbalanced distribution of incomeUnbalanced distribution of income

– 1920 to 1929 the rich got richer and 1920 to 1929 the rich got richer and you know the rest. Top 1% grew 75% you know the rest. Top 1% grew 75% compared to 9% for the rest. OUCH!! compared to 9% for the rest. OUCH!!

• Living La Vida Loca Living La Vida Loca • Credit Credit

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Hoover is our Man!! Hoover is our Man!!

• ““We in America are nearer to the final We in America are nearer to the final triumph over poverty than ever before.” triumph over poverty than ever before.” Herbert HooverHerbert Hoover

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Hoover as PresidentHoover as President• Election of 1928 defeated Alfred E. Election of 1928 defeated Alfred E.

Smith the first Roman Catholic to Smith the first Roman Catholic to run for president.run for president.

• Hoover was Secretary of Commerce Hoover was Secretary of Commerce under Harding and Coolidge. under Harding and Coolidge.

• Hoover had years of prosperity Hoover had years of prosperity under Republican administration under Republican administration since 1920since 1920

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My Man HooverMy Man Hoover

• Getting Rich Quick! Playing the stock Getting Rich Quick! Playing the stock market:market:

• Dow Jones Industrial AverageDow Jones Industrial Average: 30 representative : 30 representative large firms trading on the NYSElarge firms trading on the NYSE

• Used as the barometer of the stock market’s healthUsed as the barometer of the stock market’s health• ““Bull MarketBull Market” during the 20’s w/rising stocks and ” during the 20’s w/rising stocks and

bondsbonds• 1929 4 million or 3% of the country owned stock1929 4 million or 3% of the country owned stock• SpeculationSpeculation: buying on a chance to get rich quick: buying on a chance to get rich quick• Buying on MarginBuying on Margin: paying % of stock price as down : paying % of stock price as down

payment and borrowing the rest. Did NOT reflect payment and borrowing the rest. Did NOT reflect companies worth. If value of stock declined companies worth. If value of stock declined people had no way of paying it off. = debt! people had no way of paying it off. = debt!

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Black TuesdayBlack Tuesday

• October 29October 29thth 1929 1929 – 16.4 million shares dumped and additional 16.4 million shares dumped and additional

millions had no buyers. Many lost savings! millions had no buyers. Many lost savings! – Mid November investors lost 30 billionMid November investors lost 30 billion

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Causes of the Great Causes of the Great DepressionDepression

1.1. Tariffs and war debt policies that Tariffs and war debt policies that cut down the foreign market for cut down the foreign market for American good. American good. Hawley-Smoot Hawley-Smoot Tariff ActTariff Act in 1930 (protect farmers) in 1930 (protect farmers)

2.2. Crisis in farm sectorCrisis in farm sector

3.3. Easy CreditEasy Credit

4.4. Unequal distribution of wealthUnequal distribution of wealth

“ “Sound familiar?”Sound familiar?”

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The African American The African American PerspectivePerspective

• ““The Negro was born in depression. The Negro was born in depression. It didn’t mean too much to him, The It didn’t mean too much to him, The Great Depression… The best he Great Depression… The best he could be is a janitor or a porter or could be is a janitor or a porter or shoeshine boy. It only became shoeshine boy. It only became official when it hit the white man.” official when it hit the white man.”

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Hardship and Suffering Hardship and Suffering • Depression devastates people’s lives:Depression devastates people’s lives:

– Depression in the cities: (shantytowns, soup Depression in the cities: (shantytowns, soup kitchens and bread lines)kitchens and bread lines)

– Rural Lives: Farmers could grow food for family Rural Lives: Farmers could grow food for family but 400,000 farms were lost between 1929 and but 400,000 farms were lost between 1929 and 19321932

– Dust Bowl: drought in early 30’s wrecked havoc on Dust Bowl: drought in early 30’s wrecked havoc on Great Plains. Texas to N. Dakota farmers had Great Plains. Texas to N. Dakota farmers had destroyed the soil over millions of acres.destroyed the soil over millions of acres.

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Depression and the Depression and the American FamilyAmerican Family

• Many families adjusted and stayed strong. Many families adjusted and stayed strong. Playing board games (Monopoly 1933). Playing board games (Monopoly 1933).

• Men in the streets: use to working, pride and Men in the streets: use to working, pride and dignity was damaged. dignity was damaged. – 300,000 “hoboes” transients hitched rides on trains. 300,000 “hoboes” transients hitched rides on trains.

• No direct relief: cash or food provided by the No direct relief: cash or food provided by the government to the poor. Catholic churches government to the poor. Catholic churches and other churches in NYC paid $2.39 per and other churches in NYC paid $2.39 per week to families. week to families.

• Women Struggle: managed the family. Canned Women Struggle: managed the family. Canned food, worked odd jobs, penny pinched. Were food, worked odd jobs, penny pinched. Were resented if married. resented if married.

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Children of the Children of the DepressionDepression

• Malnutrition and diet related diseases.Malnutrition and diet related diseases.• Funding for child-welfare programs cut.Funding for child-welfare programs cut.• 2,600 schools shut down leaving 2,600 schools shut down leaving

300,000 kids without an education.300,000 kids without an education.– Children went to work instead in Children went to work instead in

sweatshopssweatshops

• ““Hoover tourists” teenagers who Hoover tourists” teenagers who jumped on trains in search of work, jumped on trains in search of work, adventure and escape from poverty. adventure and escape from poverty. Many beaten and or killed. Many beaten and or killed.

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Social and Psychological Social and Psychological Effects Effects

• Suicide rate between 1928 and 32 rose Suicide rate between 1928 and 32 rose 30%30%

• Three times as many admitted to mental Three times as many admitted to mental hospitals.hospitals.

• Some quit their dreams of marriage, Some quit their dreams of marriage, family, college. family, college.

• Some made getting rich their primary Some made getting rich their primary function in life. function in life.

• Some showed kindness giving food & Some showed kindness giving food & shelter to people down on their luck. shelter to people down on their luck.

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Hoovers PhilosophyHoovers Philosophy• Government should facilitate cooperation Government should facilitate cooperation

between labor and employers to help find a between labor and employers to help find a solution. solution.

• ““Rugged individualism” idea that people Rugged individualism” idea that people should succeed through their own efforts. should succeed through their own efforts. They should take care of themselves and They should take care of themselves and their families, rather than depend on the their families, rather than depend on the government to bail them out. government to bail them out.

• Hoover opposed any federal welfare, or Hoover opposed any federal welfare, or direct relief to the needy. Believed it would direct relief to the needy. Believed it would weaken the “moral fiber” of peoples self-weaken the “moral fiber” of peoples self-respect. respect.

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AH DAM IT! AH DAM IT!

• Boulder Dam (Hoover Dam). Boulder Dam (Hoover Dam). Approved in 1929 it provides water Approved in 1929 it provides water to LA and Vegas as well as adding to to LA and Vegas as well as adding to the growth of California’s the growth of California’s agricultural economy. agricultural economy.

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Poor HooverPoor Hoover• ““HoovervillesHoovervilles:” were the shanty :” were the shanty

towns popping up all over in the towns popping up all over in the cities.cities.

• ““Hoover flagsHoover flags:” empty pockets :” empty pockets turned inside out.turned inside out.

• ““Hoover BlanketsHoover Blankets”: newspapers used ”: newspapers used to cover someone from the cold. to cover someone from the cold.

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Hoover Takes ActionHoover Takes Action• Hoover Backs Cooperatives:Hoover Backs Cooperatives:

– Federal Farm Board: helped members buy Federal Farm Board: helped members buy crops and keep them off the market until crops and keep them off the market until prices rose. prices rose.

– National Credit Corporation: loaned $ to National Credit Corporation: loaned $ to smaller banks to stave off bankruptcy. smaller banks to stave off bankruptcy.

• Direct Intervention:Direct Intervention:– Federal Home Loan Back Act: (1932) lower Federal Home Loan Back Act: (1932) lower

mortgage rates for homeowners and allow mortgage rates for homeowners and allow farmers to refinance farm loans. farmers to refinance farm loans.

– Glass-Steagall Act: after Hoover, separated Glass-Steagall Act: after Hoover, separated investment from commercial banking.investment from commercial banking.

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Hoover Takes ActionHoover Takes Action• Reconstruction Finance Corporation: Reconstruction Finance Corporation:

(RFC) $2 billion for emergency (RFC) $2 billion for emergency financing for banks, life insurance financing for banks, life insurance companies, railroads and other large companies, railroads and other large businesses. Hopes of Trickle Down! businesses. Hopes of Trickle Down! “Too little , too late.”“Too little , too late.”

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Bonus Army Comes A Bonus Army Comes A CallingCalling

• 1932 Patman Bill Denied: WWI veterans were 1932 Patman Bill Denied: WWI veterans were to get compensated adequately for their to get compensated adequately for their wartime services. Was to be paid out in 1945. wartime services. Was to be paid out in 1945. Patman wanted to give each $500 now!Patman wanted to give each $500 now!

• 10 to 20,000 vets and families marched on 10 to 20,000 vets and families marched on Washington D.C. Looking for aid.Washington D.C. Looking for aid.

• Hoover saw WWI vets as “Communists and Hoover saw WWI vets as “Communists and persons with criminal records” opposed persons with criminal records” opposed legislation and ordered 1,000 troops under legislation and ordered 1,000 troops under command of Gen. MacArthur and aide Major D. command of Gen. MacArthur and aide Major D. Eisenhower to clear the area. Eisenhower to clear the area. – 1,000 killed 1,000 killed

• Hoovers image was done! Here comes Hoovers image was done! Here comes Roosevelt! Roosevelt!