The Great Depression

1. Sections Two and Three The Great Depression

2. A period of severe reduced economic activity Sharp rise in unemployment Decrease in consumerism due to unemployment Black Tues, October 29th, 1929 was the start of the worst US depression What is a depression?

3. There was not one single cause of the Depression ….. There were many.

4. Factories produced a “great glut” of farm & factory goods Nation’s ability to produce surpassed its ability to consume Profits of big business went to wealthy who reinvested in factories rather than raising salaries & wages which would have stimulated more consumerism Installment & credit also encouraged overproduction while new technology added to unemployment Overproduction

5. Superficial prosperity shrouded weaknesses in the economy • RR, textiles, steel declined • RRs lost profits due to new forms of transportation • Coal Mining & Lumber down sharply from the war • Coal replaced with new forms of energy • Housing starts affected numerous other industries. Decline of major industries

6. During war demand was high Farmers bought more land & equipment to meet the demand. However, farm prices plummeted after WWI Surplus of food led to depressed prices. McNary-Haugen bill vetoed (artificial price supports) Foreclosures began Agriculture

7. Despite glut of plenty consumers were buying less due to • Rising consumer prices • Stagnant wages • Uneven distribution of wealth • Consumer debt Underconsumption

8. Credit contributed to some buying but it increased the overall “consumer debt” when businesses encouraged credit Consumers will eventually cut back on spending due to the consumer debt credit

9. 6% earn $5,000 or more 65% earn $2000 or less Unequal distribution of income=most Americans did not have the $ necessary to purchase the goods that factories produced. Uneven distribution of income

10. By 1929 3 percent of Americans owned stock Stock market was “bull market” Dow Jones Industrial Average – barometer of the stock market based on average of 30 representative companies Speculation – search of quick profit Buying on margin fueled more buying The stock market

11. Stock Market Crash (SMC) Shareholders frantically tried to sell Some couldn’t find buyers Those that bought on margins were deeply in debt Some lost entire savings Black Tuesday - oct 29, 1929

12. After SMC people panicked and withdrew from banks • Some banks lost everything because they had invested in the SM • Millions of “innocent Americans” lost their entire life savings • 1929 – 600 banks closed • 1933 – 11,000 of nations 25,000 closed banks

14. GNP – nation’s total output of goods & services GNP was nearly cut in half between ‘29 & ‘32 Approx 90,000 businesses went bankrupt Gross national product (GNp)

15. See next chart Millions lost work By 1933 – 25 percent of workers were unemployed compared to only 3% four years earlier. unemployment

17. Europe was already suffering from: • Wartime recovery • Reparations for Germany • HAWLEY-SMOOT Tariff (highest ever) • What did it mean? • Europeans weren’t able to export their goods to US to help their recovery • Europeans raised their own tariffs which limited what the US could export. • HURT worldwide trade which fell 40 percent. Worldwide shock waves

18. End section one

19. By 1933 ¼ of all people were unemployed AA lost their jobs first, followed by other minorities, then full time employees were asked to share their jobs with others People lost their homes, possessions Hoovervilles – temporary shelters Bread lines, soup kitchens Loss of hope Suffering & hardship in the cities

20. Hardships and suffering

22. Hooverville, USA

23. There was no federal direct reliefSome cities like nyc did provide some

24. The dust bowl • During the ‘20s tractors dug up the prairie grass to plant crops • Plowing removed the protective layer of grasses and exhausted the soil through overproduction. • When drought & winds came there was no grass or roots to hold soil down.

25. After decades of destroying the sod when the winds finally came all topsoil was removed Imagine seeing a wall of black dust up to a 1000 ft high Dust storms like these plagued the Great Plains between 1932-1939 Together with the Gt. Depression 1000s of farmers were wiped out Drought & Dust Storms

26. Dust Storm

27. Impact of Dust Bowl

28. Got Farm?

29. During 1920s – ’30s farm prices were falling Falling prices kept farmers from paying their mortgages Many lost their farms to foreclosure Penny Auctions took place in which friends bought the farm for a penny and then returned it to their friends Farmers in Distress

30. Okies were farmers who lost everything and abandoned their fields in search of new opportunities • Many came to CA where they worked for almost nothing • Not welcome by most, harassed by law enforcement, sometimes turned away at the border. The Okies

31. Okies Move West

33. As fed’l gov paid subsidies to landowners not to grow products so prices would rise So landowners evicted tenant farmers off the land Subsidies given to landowners were then used to buy new technology which further reduced the need for farm hands or tenant farmers AA tenant farmers were hit disproportionately hard Tenant Farmers Hit Hard

35. Faced discrimination 12,000 rounded up and deported to Mexico between 1931-1934 Many asked to be repatriated to Mexico In Texas, 60% of all people of Mex descent returned to Mex Mexican-Americans

36. Men lost status and self-esteem due to inability to support the family Women economized to keep families from starving & often took up home crafts Women faced discrimination in professional jobs but kept the traditional female occupations such as clerical jobs In the Family

37. Hoboes • Hoboes – in search of jobs across the country & ashamed to return home many deserted their families • Hoover tourists • 25,000 killed

40. Psychological and spiritual depression as well as economic People avoided socializing because ashamed of torn clothes Young people put off getting married Married couples put off having children Undernourishment Lack of hope & faith led to deep despair Left invisible scar Growing up in the ’30s

41. End chap 14: Sec 2

42. He tried to reassure the nation to go about their business as usual. • Believed the gov should play limited role only • Gov should facilitate and encourage cooperation between competing groups and interests • Help find solutions which are mutually beneficial but which are voluntarily arrived at • Opposed any form of federal welfare or direct relief • Hoover took a very cautious approach • His approach shocked many Americans Hoover’s philosophy

43. Boulder Dam

44. Federal Farm Board – cooperatives • National Credit Corporation • Federal Home Loan Bank Act • Reconstruction Finance Corporation • Unprecedented ex of fed’l involvement in peacetime economy but was too little too late Hoover takes action

45. Bonus Expeditionary Force arrives in D.C. Between 10-20,000 veterans Led by Walter Waters Came in support of Patman Bill – early bonus Hoover felt they were influenced by Communists When Patman Bill was defeated and veteran’s didn’t disband he had them gassed. Bonus army 1932

46. Double feature matinee Talkies Easy escape Ornate theatres Color film Gone With the Wind allowed people to escape 60-90 m people went to moves during average week in the ’30s Escape through Entertainment

47. Cars were status symbols Car shows continued to draw 1000s Tourism increased during the ’30s Auto industry continued to grow Car Craze Continues

48. The appliance revolution begun in the ’20s continued thru the ’30s. Made possible by gov programs that brought electricity to all regions Household chores became easier Electricity Transforms the Home

49. Radio was a piece of furniture which served as the visual focus & entertainment center in the home 10 m radios in 1929; 30 m by 1939 Mass media featured soap operas, quiz shows, children’s programming such as Superman, Lone Ranger Evenings featured comedy and variety shows or dramatic presentations Golden Age of Radio

50. First National Form of Entertainment