U.S. History Unit 3: The Great Depression

1. U.S. History Unit 3:The Great Depression THE BIG IDEA The economic surge of the 1920’s crashed in 1929 and the Great Depression began. Behind the destitution rose a “progressive” named FDR and his New Deal that increased the role of our government.

2. I.The Roaring 20’s A. “This is a time of great prosperity” -- Pres. Coolidge

3. 1. Radio a) 1920 – 20,000 homes, 1930 – 13,750,000 homes 2. Movies a) 1917 – silent movies become popular, 1930-- 100 mil sound movie tickets sold/week http://www.youtube.com/watch?v=wTtM2FazTOA 3. Professional Sports a) baseball, boxing most popular

5. 4. The Harlem Renaissance 1914-1930 a) A-A Migration North - pop in Harlem 14,000 - 200,000 b) A-A Jazz, Writing, Pride - Duke Ellington, Louis Armstrong, Langston Hughes

6. 5. Automobile a) Henry Ford’s assembly line = affordable cars b) 1920 – 8 mil sold, 1930 – 23 mil sold c) auto accidents, hotels, restaurants, suburbs

7. 6. Buy! Buy! Buy! Economy a) installment buying – paying for an item over time in small payments b) U.S. unemployment at 3% c) U.S. wages 40% d) Booming Stock Market - stock values 60% - Dow Jones Industrial Average (avg price of biggest stocks) 40% e) GNP 30%

8. II. Signs of Economic Trouble A. Rising Debt 1. Installment buying interest payments 2. Speculation in Stock Market “If a man saves $15 a week and invests in good stocks, at the end of 20 years he will have at least $80,000. He will be rich. And because income can do that, I am firm in my belief that anyone not only can be rich, but ought to be rich.” ~ John J. Raskob, leader of General Motors 1928 a) “get rich quick” mentality b) taking risks became popular c) buying on margin – borrowing $$ to buy stocks

9. B. Wealth Distribution 1. upper class = income 60% 2. middle class = income 8% 3. overall savings C. credit was being maxed out, purchasing power negative savings rate D. Overproduction 1. warehouses were filled w/products E. Farming Problems 1. during WWI bought new machines 2. post war slump a) farmers couldn’t pay back bank loans 3. 6,000 rural banks closed

11. III. The Stock Market Crashes, 1929 A. Sept 3, 1929 - Market reaches high point 1. Bankers asked for payments on loans 2. Investors, unable to payback loans, look to sell stocks 3. Stock prices slowly began to fall B. October 24, Black Thursday 1. “the most terrible stampede of selling ever experienced on Wall Street.” C.Oct 29, Black Tuesday 1. Dow drops from 381 to 198 = $16 billion lost D. Effects of the Crash 1. Foreclosures – loss of possessions 2. Americans forced to buy less 3. Businesses forced to lay off workers or wages 4. By 1933 -- Unemployment rate was at 25% 5. Many banks were forced to close 6. European economy is hurt too 7. Pres. Hoover downplays the effects “Prosperity is just around the corner.”

13. IV.Everyday Life During the Depression A. Homelessness 1. 1931 -- 15,000 homeless in NYC 2. “Hoovervilles” “Here were all these people living in old, rusted-out cars…There were people living in shacks made of orange crates. One family with a whole lot of kids was living in a piano box.” ~Homeless Oklahoma woman in 1931 B. Emotional Toll “The biggest scar left on me was my pride, my pride.” ~ Homeless South Dakota Father in 1937 1. suicide rates, mostly men

16. “Hoovervilles”

19. V. The Election of 1932 A. Herbert Hoover vs. Franklin D. Roosevelt 1. Hoover – laissez-faire “hands off” approach a) believed “rugged individualism” would be lost if gov’t intervened b) “Blame it on Hoover!” developed “Hoover is my Shepherd, I am in want, He maketh me to lie down on Park benches, He leadeth me by still factories, He restoreth my doubt in the Republican Party.” 2. FDR – progressive approach a) believed it is the duty of gov’t to help people “For at least two years after the crash, the only efforts made by Hoover to cope with the distress of unemployment were to deny its existence.” ~FDR campaign speech in 1932 B. FDR wins a “landslide” victory 1. FDR -472 electoral votes, Hoover -59 Hoover Roosevelt

20. Election of 1932

21. “I assert that modern society, acting through its Government, should prevent the starvation or the dire want of any of its fellow men and women who try to maintain themselves but cannot.” ~ FDR in 1932

23. VI. Roosevelt’s First 100 Days as Pres. A. Restored Confidence- “The only thing we have to fear is, fear itself.” 1. Emergency Banking Act a) Closed banks for 1 week for a “bank holiday” b) Government will now “oversee” banks c) 4 weeks later, $1 billion in new deposits were put into banks 2. Fireside Chats B. The New Deal 1. “Relief, Recovery, Reform” 2. Public Works Programs (alphabet soup) a) NIRA – National Recovery Act - gov’t controls wages, working conditions, production and prices b) CWA – Civil Works Admin. - jobs building roads, sewer lines, parks, airports, etc. 3. Lasting legacy a) FDIC – Federal Deposit Insurance Corp - insures money in banks b) SEC – Securities and Exchange Commission - monitors the stock market c) Social Security - provides benefits to the retired

24. C. Criticism of FDR’s New Deal 1. Is FDR a threat to capitalism? 2. Does FDR have too much power? 3. National Debt “You can’t spend your way into prosperity.” ~ former Pres. Herbert Hoover