Great Depression and New Deal

Great Depression and New Deal

Great Depression and New Deal • Introduction • General Conditions • Reactions • Great Depression • FDR • Recovery • Relief • Challengers • Reform • SEC • FDIC • New Deal (1933-1940) • Legacy

Themes • Conditions faced during the Great Depression • Roosevelt’s New Deal: Three R’s • Recovery • Relief • Reform • Challengers to Roosevelt • Evaluating the New Deal’s legacy

Statistics of Hard Times

Human Toll • Unemployment • 1933: 13 million were unemployed • 1933: 25% unemployment • Many others had pay and hours cut

Stock Market Crash • It began on October 29, 1929 as prices plummeted. This day was known as “Black Thursday” • a record 16 million stocks were sold • By mid-November losses were estimated to be about $30 Billion • $378,000,000 in today’s dollars • At it’s lowest, the market lost 80% of its value.

Problems Facing Farmers • Farmers in the midwest faced financial ruin • Drought, Dust storms and low prices caused by overproduction

Problems facing Farmers • Dust storms occurred during the summers of 1934-39 • Dust drifts were often several feet deep • Dust destroyed crops and property

Traveling Westward • Many Americans from the Midwest traveled westward in hope of finding farming jobs • Over 350,000 traveled to California • Often referred to with the slur “Okies”

Bonus March 1932 • In 1924 Congress rewarded veterans of the WWI with a bonus to be paid in the 1940s • Veterans demanded their bonus early; 10,000 marched to Washington, D.C. • Congress and President Hoover refused their demands • The military destroyed the tent-city and the movement disbanded

Anger with Government • Many focused their anger at President Hoover • Hoovervilles: Names for shanty towns where many homeless built shelters and lived • 1932 was an election year and many American wanted a new president.

Hooverville

New Deal President • FDR – Franklin D. Roosevelt • Served as Governor of New York • President1933-1945 • Suffered from Polio as an adult and had limited use of his legs

FDR’S PLan • “It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something.”

FDR’S PLan • Keynesian Economics • Use gov. spending to grow economy • Deficit spending

FDR’s plan • Recovery: Bring about economic recovery of the United States

FDR’s plan • Recovery: Bring about economic recovery of the United States • Relief: Provide immediate direct economic relief to the American people through jobs.

FDR’s plan • Recovery: Bring about economic recovery of the United States • Relief: Provide immediate direct economic relief to the American people through jobs. • Reform: Reform the system to avoid another Great Depression in the future.

Recovery Measures • Goal: Bring about economic recovery of the United States • Examples: • EBA

Emergency Bank Act (EBA) • By early 1933, more than 5,000 banks had closed their doors

Emergency Bank Act (EBA) • Law enacted in 1933 • Banks were required to take a four day holiday • Banks were inspected to ensure soundness • Weak banks restructured and healthy banks re-opened right away • Significance: restored faith in banking system

Recovery Measures • Goal: Bring about economic recovery of the United States • Examples: • EBA • AAA

Agricultural Adjustment Act (AAA) 1933 • Background • Farmers produced a surplus which undercut the ability of farmers to turn a profit. • Farmers paid to restrict crop production • Government bought surplus

AAA $ Quantity

Recovery Measures • Goal: Bring about economic recovery of the United States • Examples: • EBA • AAA • TVA

Tennessee Valley Authority (TVA) 1933 • Built dams in the Tennessee Valley • Deigned to end erosion and promote flood control • Brought cheap electric power to areas • Encouraged long term economic growth in the region.

Tennessee Valley Authority (TVA) 1933

Relief Measures1933-1935 • Goal: Provide direct economic relief to the American people through jobs. • Examples: • WPA and PWA

Federal Emergency Relief Act (FerA)/ Works Progress Administration (WPA) 1935 • Umbrella agency that directly employed over 8 million workers • 125,000 buildings were constructed; hospitals, schools, post offices, etc. • Money for the arts was allocated to employ writers, performers, and artists

Public Works Administration (PWA) • Spent $6 Billion for private contractors • Built large-scale public works such as dams, bridges, hospitals, and schools.

Relief Measures1933-1935 • Goal: Provide direct economic relief to the American people (jobs) • Examples: • WPA and PWA • CCC

Civilian Conservation Corps (CCC) • Put men to work and helped the environment • Types of work • Planted trees • Built campgrounds • Hiking trails • Average pay • $35.00/ month

Check Up! • How did Roosevelt utilize the philosophy of Keynesian Economics to provide the nation with relief and recovery? • Evaluate this policy.

Check Up! • What does this cartoon reveal about the changing role of government under FDR’s leadership?

Bellwork • Why would some people oppose FDR’s plans of Recovery, Relief, and Reform?

Great Depression and New Deal