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1930s The Great Depression

1930s The Great Depression. U.S. History Unit 5. I. The Great Depression. A. Economy of the 1920’s - farmers and lower class were only people not to benefit from booming economy, high demand of consumer goods led to more stock sales 1. Bull Market and Bear Market

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1930s The Great Depression

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  1. 1930s The Great Depression U.S. History Unit 5

  2. I. The Great Depression • A. Economy of the 1920’s • - farmers and lower class were only people not to benefit from booming economy, high demand of consumer goods led to more stock sales • 1. Bull Market and Bear Market • - rise and decrease in stock prices • 2. Speculation • - buying and selling stocks to make a quick profit

  3. 3. Margin Buying • - buying stocks on borrowed money • 4. Margin Call • - demanding that a loan be paid back immediately • a. speculation was out of control and only worked if demand was high, by the end of 1929 there were no new customers

  4. B. The Stock Market Crash • - even when it crashed people didn’t believe it would be that bad, it had been slowly slipping for a month • 1. Black Thursday Oct. 24, 1929 • - a panic among “big time” investors • 2. Black Tuesday Oct. 29, 1929 • - biggest dive in history • a. within a month the losses totaled over $30 billion (equal to earnings of all wages for the year)

  5. 3. Reasons for the Crash (Depression) • (1) excessive borrowing of $ due to low interest rate • (2) rich were getting richer and poor were getting poorer • (3) frauds, swindlers, and poor economic advice • (4) over production and over speculation • (5) world economic slump

  6. 4. Results of the Crash • (1) GNP cut in half and incomes cut in half • (2) unemployment reaches 25% (7 mil. by 1930, 12 mil. By 1932) • (3) businesses and factories shut down • (4) banks shut down • (5) credit purchasing almost completely disappeared

  7. C. Unemployment • - new technologies made it hard to find work, now depression makes it near impossible for some • 1. ¼ of the workforce lost jobs, minorities & immigrants first to lose jobs, women workers actually increased

  8. D. Family Life • - there was little or no help from the gov., families helped each other by moving in together, also less marriages & births, and more divorces • 1. People across the country waited in breadlines for bread and soup • a. riding the rails was a way for hobos to get from place to place • 2. Shantytowns began to appear around most cities (Hoovervilles)

  9. 3. Rice Barrels (Chinese Americans) & Rent Parties (African Americans) • 4. Farmers were hit hardest, food was needed but nobody could pay for it, farmers tried to raise prices by destroying crops • a. penny auctions were to help farmers keep their land • 5. Famous criminals – Bonnie & Clyde, Al Capone, John Dillinger, Baby Face Nelson, Pretty Boy Floyd, Bruno Hauptmann

  10. E. Entertainment • 1. Radio, Movies, Books, Card Games, Board Games • - popular way to escape the troubles of the depression & they were cheap • a. movies about gangsters, confident women, Disney cartoons, drive-in theatres • b. radio heroes like the Lone Ranger, & Little Orphan Annie sent a positive message to listeners, soap operas • c. dance marathons, stickball, stoopball, marbles, monopoly

  11. II. Hoover and the Depression • A. Rugged Individualism • - success should come from individual effort and hard work • 1. Hoover refused to give any direct federal aid to Americans, stimulating economy was most important to him • a. stimulating business while creating jobs (Hoover Dam & public works)

  12. b. Reconstruction Finance Corporation (RFC) 1932 • - the RFC lent large sums of $ to insurance companies, banks, railroads, etc. in order to reduce bank failures & increase jobs by stimulating the economy • 2. $ was supposed to “trickle down” to people but government intervention was too little, too late

  13. B. Attitudes Toward Hoover • - he was the most hated man in the U.S. by 1932 • 1. Communist Party called for action and helped to expose Hoover’s faults as well as racial discrimination in U.S. • a. Scottsboro Boys Rape Case • - 9 African-American boys convicted of rape & assault, acquitted, then convicted again, then later acquitted • b. Hunger Marches – people demanding jobs & food, one march was aimed at Henry Ford in Dearborn, MI • c. Bonus Army • - WWI vets march on D.C. for bonus bill that would have paid early pensions, MacArthur was sent in with tanks & tear gas

  14. C. Election of 1932 • - “In Hoover we trusted and now we are busted.” • 1. Franklin D. Roosevelt is elected, campaigned in favor of direct federal relief for individuals, most votes for FDR were votes against Hoover

  15. III. The New Deal • A. “Hundred Days” • - 15 parts to New Deal passed into law, relief was short-term goal, recovery was long-term goal, reform was designed to prevent another depression • 1. “Fireside Chats” • - people listened to New Deal on radio by the fireplace • 2. Bank Holiday closed down all banks to stop massive withdrawals of cash and only allowed capable banks to reopen • a. “I assure you that it is safer to keep your money in a reopened bank than under the mattress.”

  16. 3. FDR restored confidence in banks in 1933 with the Federal Deposit Insurance Corporation (FDIC) which insured deposits up to $2,500 • 4. Securities and Exchange Commission (SEC) designed to regulate stock market and prevent fraud by providing truthful information • 5. Agricultural Adjustment Administration (AAA) paid subsidies to farmers if they reduced output of crops & livestock, fields were plowed up & livestock was slaughtered • 6. National Recovery Administration (NRA) controlled industrial production & prices with codes of fair competition (unconstitutional)

  17. 7. Tennessee Valley Authority (TVA) created to build dams and bring electricity to a 7 state region, also created jobs • 8. Public Works Administration (PWA) hired construction workers to work on gov. jobs • 9. Civil Works Administration (CWA) gov. directly employed people to build roads, clean up parks & playgrounds, etc. (was shut down after only 6 months) • 10. HOLC & FCA – gov. took over mortgages

  18. B. Critics of the New Deal • - too much cost, too much money poured into economy (deficit spending) • 1. Share Our Wealth (Huey Long) • - steal from the rich & give to the poor • 2. The Townsend Plan – would have forced everyone over 60 to retire and spend a $200 pension check every month

  19. C. The Second New Deal • - more emphasis on reform measures • 1. Works Progress Administration (WPA) replaced CWA to build roads, bridges, airports • a. National Youth Administration created so kids could stay in school while they work • b. Federal Project #1 (part of WPA) hired writers to • create travel guides and actors and musicians to perform in small towns

  20. 2. Social Security Act (1935) “No politician can ever scrap my social security program.” • a. provided unemployment insurance for workers • b. provided pensions for retired workers over 65 • c. provided funds for widowed and disabled • 3. Wealth Tax Act (1935) increased taxes on rich people & businesses

  21. D. Fair Labor Standards Act (1938) set minimum wage, working hours/week, & working age • 1. Wagner Act (1935) guaranteed right to form labor unions • a. Congress of Industrial Organizations (CIO) union for skilled & unskilled workers • b. GM sit-down strikes, UAW was formed as a result

  22. E. Election of 1936 • - FDR is re-elected easily due to success of New Deal programs, many people felt obligated to “reward” F.D.R. for their successes • 1. “Court Packing” • - S.C. ruled many New Deal reforms unconstitutional so FDR tried to get rid of some justices & add more, economy heads into recession in 1937 • a. Solution – more gov. spending (PWA, WPA)

  23. IV. Life in America in the 1930s • A. Racial Injustice • - New Deal benefited African Americans but only to certain extent • 1. Eleanor Roosevelt, Daughters of the American Revolution, & Marian Anderson • http://www.youtube.com/watch?v=mAONYTMf2pk • B. Indian Reorganization Act (1934) allowed for preservation on cultures and land, allowed for private gov. on reservations

  24. C. The Dust Bowl – dirt covered houses like snow • 1. Region of the U.S. that was hit by severe drought and high winds in mid 1930’s and stretched from ND to TX • a. migrant farmers hit hardest by the drought ($300/yr.) • b. “Okies” were forced to move, lived in cars & trucks to escape daily duststorms

  25. http://www.youtube.com/watch?v=wYFJmm0aK-8

  26. D. Education • 1. Job security made education more important, transportation made it more practical

  27. E. Entertainment • 1. Books and movies were popular like The Grapes of Wrath (1939) by John Steinbeck, and Gone With the Wind (1936 and 1939) • a. Groucho Marx, Jack Benny, Clark Gable, Jimmy Stewart • 2. Jazz and Swing music were popular, “It Don’t Mean a Thing if it Ain’t Got That Swing” by Duke Ellington • http://www.youtube.com/watch?v=8mM8iNarcRc

  28. 3. American Gothic (1930) by Grant Wood and War of the Worlds (1938) novel by H.G. Wells & broadcast by Orson Welles • 4. Baseball, boxing, Joe DiMaggio, Joe Louis, Jesse Owens • 5. Radio announcers & sports writers were very important figures • http://www.youtube.com/watch?v=Xs0K4ApWl4g

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