Crash and Depression

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Crash and Depression

• HUSH Unit 7

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Herbert Hoover

• Former Secretary of Commerce
• Millionaire
• Organized food relief in WWI
• Believed in limited government
• Elected president in 1928
• Republican

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The 1920s

• Infant mortality had declined
• Life expectancy was 59 for
• men and 63 for women
• Economy appears healthy
• Poverty will be banished from
• this nation
• President Herbert Hoover

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Economies in the 1920s

• High confidence in business
• Harding, Coolidge, and Hoover equated the
  interests of the nation with the interests of
  business
• Many wildly buying stocks on margin
• Welfare capitalism-meet workers needs without
  unions

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The Economic Danger Signs

• Uneven prosperity
• large corporations dominated industry
• 71 of families earned less than 2,500 a year
• 2. Buying on credit resulted in an increase in
  debt
• 3. Speculation in stock market
• buying on margin
• 4. Overproduction of goods industry slowed
• 5. Hardships for farmers prices fell debt
• 6. Trouble for workers
• low wages

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The Crash!

• Great Crash, collapse of the stock market
• Dow Jones Industrial Average
• Black Thursday, Oct. 24, market dropped, causing
  some panic
• Black Tuesday, Oct. 29, 16.4 million shares were
  sold
• Business cycle, periods in which the economy
  grows, then contracts
• World is affected
• Banks close
• World-wide investments fall

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Black Tuesday
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Causes of the Great Depression

• Stock Speculation
• People bought stock with borrowed money
• Government policies
• Federal Reserve system cut interest rates in the
  1920s to spur growth, then restricted the money
  supply to discourage lending.
• Hindered recovery
• Unstable economy
• Wealth unevenly distributed overproduction low
  wages for farmers and many workers

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Effects of the Great Depression

• Millions lose jobs, homes, farms
• ¼ unemployed by 1932
• Gross National Product (GNP) falls dramatically
  total value of goods and services produced
  annually
• Many banks fail
• 5,500 by 1933
• Poverty leads to problems
• Global economy suffers

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Social Effects of Great Depression

• Homelessness
• Hoovervilles shanty towns, built of tar paper,
  cardboard, or scrap material
• Farm Distress low prices caused many to lose
  farms
• milk dumped
• Impact on health
• Stress on breadwinners and homemakers
• Discrimination increases
• Lynching increase
• Many Hispanics and Asian-Americans deported
• Scottsboro Boys accused of rape

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Hoovervilles
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The Scottsboro Boys

• The Scottsboro case later inspired Harper Lee's
  famous work, To Kill a Mockingbird.

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Agricultural/Geographic Effects The Dust Bowl

• Region in the Great Plains where drought and dust
  storms took place during the 1930s
• Inappropriate farming techniques had been used
  for decades
• Extended over southeastern Colorado, southwestern
  Kansas, the panhandles of Texas and Oklahoma, and
  northeastern New Mexico.

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Migrant Mother

• Dorothea Lange
• Famous photographer of era
• Migrant Mother is her most famous picture

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The Highpoints of 1930s

• People pulled together to help each other
• Soup kitchens
• Political solutions
• Americans trusted the democratic process.
• Repeal of Prohibition Twenty-first Amendment
• Empire State Building built
• 102 stories

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21st Amendment

• The eighteenth article of amendment to the
  Constitution of the United States is hereby
  repealed.

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Hoovers Plan

• Voluntary business action
• Laissez-faire
• Unpopular with people
• Hoover blamed the depression on world-wide
  economic conditions beyond our control and said
  that prosperity was just around the corner
• Public works
• Hoover Dam
• Reconstruction Finance Corp (RFC)
• helped banks extend loans

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Hawley-Smoot Tariff

• Hoover did decide to protect American businesses
  from competition by enacting the Hawley-Smoot
  Tariff
• It was the highest tariff in history
• Many countries retaliated and American exports
  and imports plunged by more than half.
• The tariff was replaced by lower bilateral
  (2-country) agreements in the mid 1930s.

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Hoover Dam

• Highest concrete arch dam in the U.S., built on
  the Colorado River at the Arizona-Nevada border.
• The dam, completed in 1936, is used for flood and
  silt control, electric power, irrigation, and
  domestic and industrial water supplies.

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The Bonus Army

• In the summer of 1932, 20,000 jobless WWI
  veterans marched on Washington demanding pension
  bonus
• Hoover called on General Douglas MacArthur, who
  used force and caused injuries among the veterans
• The media reports helped to defeat Hoover in 1932

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Election of 1932

• Republican candidate
• Herbert Hoover
• Democratic candidate
• Franklin Delano Roosevelt

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Franklin Delano Roosevelt

• Democrat
• Governor of New York
• Had contracted polio in his 20s
• His wife, Eleanor, was 6th cousin
• and also related to TR!
• Eleanor Roosevelt worked for public housing
  legislation, birth control, and better conditions
  for working women
• Ready to experiment with ways to turn economy
  around

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FDR Wins

• FDR wins by 7 million popular votes
• Battle between those who felt government could
  not fix peoples problems and those who felt that
  the Depression required governmental help
• Supporters of FDR
• Urban workers/Coal miners
• Minorities (racial, ethnic and religious)
• Immigrants of Catholic and Jewish descent
• Southerners
• Liberal farm groups
• Intellectuals