The Great Depression Begins

The Great Depression Begins

• The U.S. economy struggled in the late 1920s.
• The stock market crash was not the sole cause of the Great Depression.
• Black Tuesday occurred on October 29, 1929.
• Over $30 billion was lost in 2.5 weeks following Black Tuesday.
• Herbert Hoover was president and received blame for the Great Depression.
• Hoover initially believed the depression was temporary and hesitated to intervene.
• Andrew Mellon, Secretary of the Treasury, advised Hoover against interfering with the "natural business cycle".

Causes of the Great Depression

• Uneven distribution of income: By the late 1920s, half of U.S. families lived below the poverty line.
• Advertising and industrial revolution encouraged increased consumption, leading to excess inventories.
• Easy credit through installment plans (with interest) and bank loans for stock market investment.
• After the crash, people could not repay loans, leading to bank closures and loss of life savings.
• Mechanization reduced the need for workers, decreasing consumer buying power.
• High tariffs prevented other countries from trading with the U.S.

Impact of the Great Depression

• 85,000 businesses closed.
• 400,000 farms were foreclosed or sold.
• 6,000 banks closed.
• 9 million savings accounts were lost.
• Unemployment reached 33% (26% for the year), with 16 million unemployed.
• No welfare, unemployment insurance, or Social Security existed at the time.
• Women were considered expendable in the workforce, especially married women.
• Children suffered from malnutrition, worked in sweatshops, and had no time for school.
• Farmers, burdened by WWI loans and overproduction, faced drought and the Dust Bowl.

Hoover's Response

• He urged business and union leaders not to cut payroll or strike, which was largely ignored.
• He asked farmers to voluntarily cut back production, but this failed due to fear and lack of cooperation.
• Hoover cut taxes and lowered interest rates, but with limited impact due to bank closures and unemployment.
• Congress allocated $800 million for public works projects, which was insufficient and not localized.
• 1930 congressional elections resulted in Democratic majority in the House, leading to gridlock.
• Hoover blamed Democrats for inaction, while advocating "rugged individualism."

1932 Election and the Bonus Army

• The Great Depression worsened, making Hoover unpopular.
• Democrats used public relations to create negative imagery, such as "Hoovervilles".
• WWI veterans demanded early payment of their bonuses, forming the "Bonus Army" and marching on Washington D.C.
• Congress initially offered to allow veterans to borrow against their bonuses, but it was rejected.
• Hoover ordered the army, led by General MacArthur, to remove the Bonus Army, resulting in violence and public outrage.

FDR's Nomination and Campaign

• Franklin D. Roosevelt (FDR), governor of New York, overcame polio with Eleanor's help to re-enter politics.
• FDR secured the Democratic nomination after John Garner agreed to be his running mate.
• FDR promised a "New Deal".
• His advisors ("Brain Trust"), led by Harry Hopkins, developed the New Deal policies in Albany.
• The Democratic platform advocated for the repeal of Prohibition, contrasting with the Republican stance of revising it.

1932 Election Results

• FDR won with 23 million votes (57.4%) and 472 electoral votes.
• Hoover received 16 million votes (39.7%) and 59 electoral votes.
• Democrats gained a majority in Congress.

FDR's First Actions

• The 20th Amendment changed the inauguration date to January 20 (effective 1937)
• In his inaugural address on March 4, FDR declared, "We have nothing to fear but fear itself".
• March 6- FDR declared a bank holiday and called a special session of Congress.
• The Emergency Banking Relief Act (EBRA) was passed, inspecting banks for solvency.
• FDR delivered his first "fireside chat", reassuring the public about the safety of reopened banks.

FDR's Cabinet and the First 100 Days

• FDR appointed a bipartisan cabinet, including Frances Perkins as the first woman Secretary of Labor.
• Congress passed significant legislation during FDR's first 100 days in office

The New Deal: Initial Programs

• Goals: Create jobs, increase purchasing power, and raise prices to a profitable level.
• Civilian Conservation Corps (CCC): Employed young men in camps for conservation projects, providing job training and wages, with most sent home to families.
• Federal Emergency Relief Act (FERA): Gave states money for clothing, blankets, and food.
• Believed in rugged individualism like Hoover
• Civil Works Act (CWA): Federal government gave money to local governments for projects.
• Public Works Administration (PWA): Government spent money on projects to create jobs.
• Federal Deposit Insurance Corporation (FDIC): Insured bank deposits up to $5,000.
• Agricultural Adjustment Act (AAA): Paid farmers to reduce production in order to raise prices.

Impact and 1934 Elections

• The New Deal helped, but did not solve the unemployment problem.
• By 1933, 4 million Americans returned to work, but 10 million remained unemployed.
• Democrats maintained their majority in Congress in the 1934 elections.

The Second New Deal (1935)

• Focused on unemployment.
• Works Progress Administration (WPA): A massive program led by Harry Hopkins.
• Thought to create meaningless jobs (boondoggle)
• Spent $9 billion (1936-1941)
• Employed 8 million.
• Built or repaired: Airports to distribute goods, roads, schools, libraries, and hospitals.
• Employed women in sewing circles, producing garments for the needy.

Challenges to the New Deal

• Schechter Poultry Corp. v. United States ("Sick Chicken Case"): Ruled the National Industrial Recovery Act (NIRA) unconstitutional because it tried to put limits on Interstate Commerce
• Congress passed the National Labor Relations Act (NLRA) protecting workers' rights.
• Congress passed the Fair Labor Standards Act (FLSA)- setting minimum wage, restricting child labor and requiring overtime pay.
• Butler v. United States: Ruled the AAA unconstitutional.
• Congress passed a second AAA to make up for it

Criticism of FDR

• Republicans: Viewed FDR as a dictator.
• Liberty League: Conservatives and wealthy individuals accused FDR of being a traitor.
• Upton Sinclair: Ran for governor of California, proposing to increase income tax on the wealthy and introduce inheritance tax.
• Dr. Francis Townsend: Proposed a plan for Americans over 60 to receive $200 per month, which led to Social Security.
• Father Coughlin: A Catholic priest with a radio show who called for nationalization of industries.
• Huey Long: Introduced "Share the Wealth," taking from the rich to give to the poor.

1936 Election

• FDR and John Garner ran for reelection as Democrats.
• Republicans nominated Alf Landon with Frank Knox as VP.
• FDR was criticized.
• FDR won with 28 million votes (60.8%) and 523 electoral votes.
• Landon received 16.5 million votes (36.5%) and 8 electoral votes.
• Democrats increased their majority in Congress.
• Most Black Americans voted Democratic.
• The president was inaugurated on January 20th.

FDR's Court Packing Plan

• FDR proposed that federal judges retire within 6 months of their 70th birthday
• President has the power to appoint new if not, trying to pack the court with his people.
• It did not pass, but the Supreme Court ruled the NLRA and Social Security Act constitutional.

Social Security Act

• Provides: financial support for retirees, unemployment benefits, aid for dependent children and disabled individuals and survivor's benefits

1938 Congress Elections

• People were angry with FDR trying to pack the courts
• 1937 recession reduced the economy for the first time since president
• Republicans regained their place in government
• No more new deal bills were passed after 1938
• Last two- second AAA and FLSA

Late 1930s Culture

• Marriage rate dropped by 25%
• Birth rate dropped by 15%
• 75% of households had radios
• Soap operas and kids shows were popular
• Swing music- Betty Goodman, Glenn Miller and Tommy Dorsey
• Margaret Mitchell wrote Gone With The Wind
• Eleanor Roosevelt fought for the minority groups
• Amelia Earhart was the first woman to fly solo across the Atlantic Ocean but disappeared in 1937

Rise of Hitler

• Born in Austria with an abusive dad and a loving mother
• Dad dies when Hitler was 13
• Mom dies when Hitler was 18, he was devastated
• Was an artist but was rejected from art schools and moved to Vienna to be a painter
• The start of Anti-Semitism blossoms for Hitler
• In 1914 joins the German army and never goes above corporal
• Germany loses
• Hitler believes it is not the Fault of Germany
• German generals and wealthy German industrialists caused them to lose the war
• He becomes a spy for the Nazi party
• He joins the become to leader and calls them the National Socialist German Worker's Party or Nazis
• in 1924- Beer Hall Putsch- trying to take over Bavoria
• Hitler runs and arrested
• He writes Mein Kampf or my struggle with four major themes about his dreams for Germany
• Germans are the master/superior race for all and should serve them
• All land was taken by the Treaty of Versailles such as Poland and Czecholslovakia
• Germany has been a empire throughout europe
• Jews because of Germany's problems and should be purged
• From 1924 to 1939 the Nazi's don't grow because the economy stabilizes
• This comes in 1929 during the Great Depression and hits Germany hard
• Get people to join the communist and Nazi groups
• In 1933 the president of Germany Paul Von Hindenburg appoints Hitler as the chancellor of Germany
• The rice tag is set on fire
• Hindenbury is angry and arrested top communist leaders and outlaws communism
• Nazis get the majority in the reichstag
• They make Hitler the supreme leader or dictator of Germany
• Slowly Jews and other undesirables are rights are taken away

Kristallnacht and Neutrality Act

• November of 1938
• the night of broken glass
• people are taken from homes and synagogues are burned
• a ship is sent to several countries but rejected and they go back to Germany to die at Auschwitz
• Once the state of War exists between countries traveling on passenger ships from other countries is done at your own risk
• the state of War exists between other countries where there can be no war or materials given to either side on passenger ships

Timeline Dates-

• Kristellnacht- November 1938
• Germany invades Poland- September 1939
• Bonus Army is attacked- July 1932
• First hundred days of FDR ends- June 1933
• FDR declares a national bank holiday- March 1933
• FDR is elected to his second term- November 1936
• Republicans win back seats in the house and the Senate- November 1938