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World History Chapter 28. The Great Depression. The Red Scare. At the end of WWI, fears about communism taking over swept the U.S. Became known as the “ Red Scare ” Many government officials houses were bombed Persecution of immigrants increased
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World History Chapter 28 The Great Depression
The Red Scare • At the end of WWI, fears about communism taking over swept the U.S. • Became known as the “Red Scare” • Many government officials houses were bombed • Persecution of immigrants increased • Example: Sacco-Vanzetti Case – 2 Italian immigrants put to death for robbing a store and killing 2. Both were anarchists.
The Ku Klux Klan • After WWI, KKK membership was sold for $10 • Had new differences • The Klan now hated African Americans, Jews, Roman Catholics, and amoral individuals • By 1925 = 5 million members • Stolen membership $ and the Indiana killing and raping of a young lady, membership dropped to 9,000
Prohibition and Suffrage • 18th Amendment: prohibited sale of alcohol • Al Capone – famous leading mobster that gained wealth off selling alcohol and prostitution • Was sent to prison for tax evasion • 19th Amendment: gave women the right to vote • Only affected white women
The Great Depression • On October, 24 1929 (called Black Tuesday), the stock market crashed • The Great Depression began and this economic downturn would last throughout the 1930s • Causes of the Depression: • Workers laid off; consumers buying less; surplus was adding up • American business unbalanced (no one was buying cars and houses)
Black Tuesday 16 million shares of stock “dumped” on the market
Great Depression continued… • Pay increases not keeping up with the economy • Many people were in debt • All nations of Europe owed U.S. money from WWI • In 1930, 9,000 banks were forced to close because loans were not being paid back • High unemployment (urban and rural) • The Dust Bowl hit – little rainfall fell which led to dust storms making farming impossible
President Herbert Hoover • Hoover tried to restore confidence in the economy • Many blamed Hoover for the economy but Hoover was insensitive to the needs • Created Hoovervilles – shelters outside of towns where people lived when they got evicted • The Depression affected the world – some countries were worse off than the U.S.
A New Deal • Franklin Delano Roosevelt (FDR) defeated Hoover in the 1932 election • Created the “New Deal” – FDR’s plan to get out of the depression • New Deal Legislation: • Agricultural Adjustment Administration – paid farmers NOT to produce on ¼ of their land (driving prices up); declared unconstitutional • Tennessee Valley Authority – built dams, generate electrical control, establish flood control, and sell fertilizer; brought cheap power to TN
New Deal continued… • National Industrial Recovery Act – an act designed to increase wages, lower unemployment, balance consumption and surplus • Public Works Administration – publicly funded construction on dams, bridges, roads, and public buildings (to provide jobs) • Federal Deposit Insurance Corporation (FDIC) – guaranteed bank deposits up to $2,500 to encourage investing
New Deal continued again… • Social Security Act – created to have the government be responsible for people over 65 funded by people currently working • Works Progress Administration – similar to the PWA; provided jobs for the unemployed • Court-packing Plan – Roosevelt’s solution for the Supreme Court striking down New Deal legislation; allowed him to appoint people to the Supreme Court that supported his New Deal
New Deal Aftermath • The New Deal was very controversial • The Social Security Plan led to modern welfare • Farm subsidies became modern federal involvement in agricultural pricing and production • Despite the New Deal, the only thing that would really get the world and the U.S. out of the Great Depression, was World War II…
