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The Government Response to The Great Depression

The Government Response to The Great Depression. The Situation. 1/4 were unemployed Migrant families 2/3 of children in NYC were hungry 1 million people lost farms. 3 Different Ideologies.

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The Government Response to The Great Depression

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  1. The Government Response to The Great Depression

  2. The Situation • 1/4 were unemployed • Migrant families • 2/3 of children in NYC were hungry • 1 million people lost farms

  3. 3 Different Ideologies • Say that civilization is a tree which, as it grows, continually produced rot and dead wood. The radical says: “cut it down.” The conservative says: “don’t touch it.” The liberal compromises: “Let’s prune, so that we lose neither the old trunk nor the new branches.”

  4. Hoover’s Approach Hoover = Republican, conservative ideology • Refused to give individuals direct money for relief • $ would undercut self reliance and pride • Theory of ‘Rugged Individualism’ • Hoover did try to stop the slide • Some public works programs (Hoover Dam) • Gave to private orgs, voluntary contribution • Gave money to companies • trickle down theory • Reconstruction Finance Corporation

  5. “This campaign is waged to teach the country to march upon its appointed course…avoiding alike the revolution of radicalism and the revolution of conservatism.” • FDR 1932

  6. The New Deal Franklin Delano Roosevelt (FDR)

  7. The First New Deal: AKA “Alphabet Soup” • FERA • SEC • CCC • AAA • CWA • FHA • NIRA • PWA • TVA • WPA • FDIC

  8. FDR’s “New Deal” FDR = Democrat, Liberal ideology • First Hundred Days / “Brain Trust” • Provided hope: gov’t was trying something • “Fireside chats” : Optimistic, confident, personal • Measures taken to stop the GD: focusing on Relief, Recovery and Reform • Relief = to alleviate immediate need, aimed at people • Recovery = aimed at business, overall economy • Reform = to never let this happen again

  9. FDR uses Keynesian Economics • John Maynard Keynes • Deficit spending is necessary to revive the economy • “priming the pump”

  10. “Pump priming the economy” • Gov’t spends $ • Govt. Lowers taxes • People will spend $ • Businesses will prosper again **opposite of trickle – down theory! Gives $ to bottom level, and it flows upwards • Wanted to implement policies “that built from the bottom up and not from the top down, that put their faith once more in the forgotten man at the bottom of the economic pyramid”

  11. Restructuring the Financial Sector • Emergency Banking Act • Banking Act 1933 • FederalDepositInsurance Corporation • Insured bank deposits (today $250,000) • Glass–Steagall Act • Separated savings banks from investment banks • Repealed in 1999 by 3 Republican “deregulators” • SEC • Reformed the stock market insider trading

  12. National Recovery Administration • Fair competition (anti big business) • Limit production • Establish prices • Public works portion • Union Rights

  13. Agricultural Adjustment Act • Gov. encouraged farmers to grow less • Gov. paid farmers to reduce acreage • Loans to farmers • Controversial, ultimately passes

  14. Tennessee Valley Authority • Regional Planning • Construct dams to: • Control floods • Generate electricity

  15. Civilian Conservation Corps • Provided young men with jobs • 2.5 million employed • Bridges, dams, reservoirs, fire towers, trails

  16. The CCC in CT Rocky Neck State Park New Deal Around the Nation

  17. Works Progress Administration • Work – relief organization • 3M to work • Bridges and art / musicians

  18. Rights of Workers • *Wagner Act: • Rights of workers to organize, bargain etc. • Protection through the Nat’l Labor Relations Board • *Labor now has power to combat big business • *Fair Labor Standards Act: • Set a federal minimum wage (Today $7.25) • Banned Child Labor (working papers)

  19. *Social Security Act • Milestone act • Establishes retirement (67), disability and unemployment insurance

  20. What does this say about public perception of the New Deal?

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