The Great DepressionThe Great DepressionBy the end of the 1920s, life in By the end of the 1920s, life in general was getting much better.general was getting much better.There were huge medical There were huge medical advances with immunizations advances with immunizations and cures.and cures.Result: # of infant deaths greatly Result: # of infant deaths greatly decreased and life expectancy decreased and life expectancy jumped a great deal.jumped a great deal.

Men: 59 years old.Men: 59 years old.Women: 63 years old.Women: 63 years old.* Unemployment was at an all time * Unemployment was at an all time

low, under 4%.low, under 4%.Herbert HooverHerbert Hoover was elected was elected

president in 1928 & optimism president in 1928 & optimism was at an all time high.was at an all time high.

Danger SignsDanger Signs• The 200 largest companies The 200 largest companies

controlled ½ of all our controlled ½ of all our wealth.wealth.

• Only 1% of our population Only 1% of our population made at least $100,000.made at least $100,000.

• 71% earned less than 71% earned less than $2,500.$2,500.

• 80% of the U.S. families 80% of the U.S. families had 0 savings.had 0 savings.

• Most people borrowed to Most people borrowed to buy modern appliances.buy modern appliances.

• Most importantly, people Most importantly, people were spending everything were spending everything they had, and even they had, and even borrowing money, to buy borrowing money, to buy stocks.stocks.

Danger SignsDanger Signs More people were practicing More people were practicing

speculationspeculation in the stock market, in the stock market, meaning they were spending meaning they were spending their money on high risk stocks their money on high risk stocks hoping to get a higher return.hoping to get a higher return.

Another new dangerous practice Another new dangerous practice was was Buying on MarginBuying on Margin, which , which means you only pay for a small means you only pay for a small percentage of the value of a percentage of the value of a stock and borrow the remaining stock and borrow the remaining value from a stock broker.value from a stock broker.

Catch: The loans were attached Catch: The loans were attached to high interest rates and the to high interest rates and the broker could demand a broker could demand a repayment at any time.repayment at any time.

More ProblemsMore Problems

Assembly lines had been Assembly lines had been overproducing causing warehouses overproducing causing warehouses and car lots to be filled.and car lots to be filled.

Cars were being overproduced Cars were being overproduced forcing Ford and GM to cut back on forcing Ford and GM to cut back on production and employees.production and employees.

This also forced cutbacks in other This also forced cutbacks in other industries like iron, steel, rubber, industries like iron, steel, rubber, glass, wood, and construction co.glass, wood, and construction co.

Housing construction dropped 25% Housing construction dropped 25% from 1928 to 1929.from 1928 to 1929.

Problems in Farming

During good times, farmers were also buying more land and machinery and borrowing to do so.

But in the late 20s, production went way up, but demand for crops like cotton & wheat dropped.

What can the farmers do?

They either drop their prices or cut back on planting as much land. Either way, profit dropped greatly

Result: Farmers couldn’t repay loans. Banks had to either take the farms or close their doors.

Stock Market Crash, 1929Stock Market Crash, 1929 By Sept. of 1929, the value By Sept. of 1929, the value

of stocks in many companies of stocks in many companies had risen higher than the had risen higher than the actual value of the company.actual value of the company.

Stock values have peaked Stock values have peaked out.out.

Then they slowly started to Then they slowly started to drop.drop.

Wed., Oct. 23Wed., Oct. 23rdrd, was the first , was the first really big dip in stocks, a big really big dip in stocks, a big warning sign.warning sign.

The next day, investors The next day, investors began selling quickly & at began selling quickly & at very low prices.very low prices.

This day was called This day was called Black Black Thursday.Thursday.

Stock Market CrashStock Market Crash On Friday and Monday, a group On Friday and Monday, a group

of rich bankers invested large of rich bankers invested large amounts of money into the amounts of money into the market to try to stem the tide.market to try to stem the tide.

But on Tuesday, Oct. 29But on Tuesday, Oct. 29thth, a , a record 16.4 million shares of record 16.4 million shares of stock were sold at record low stock were sold at record low prices. (Normal sales were prices. (Normal sales were about 4 million a day.)about 4 million a day.)

This day is referred to as This day is referred to as Black Black TuesdayTuesday and more commonly and more commonly remembered as the day of the remembered as the day of the famous Stock Market Crash.famous Stock Market Crash.

Stock Market CrashStock Market Crash Within 1 month $30 billion had Within 1 month $30 billion had

been lost on the stock market.been lost on the stock market.

Initially this only affected stock Initially this only affected stock owners, but within months, owners, but within months, everyone felt the effects which everyone felt the effects which sparked the sparked the Great DepressionGreat Depression..

The Depression lasted from Oct., The Depression lasted from Oct., 1929, until Dec. of 1941. Why?1929, until Dec. of 1941. Why?

Hundreds of thousands of people Hundreds of thousands of people lost their jobs or at the minimum, lost their jobs or at the minimum, took huge pay cuts to keep work.took huge pay cuts to keep work.

Great DepressionGreat Depression By 1932, over 12 million By 1932, over 12 million

people were unemployed, people were unemployed, about 25%.about 25%.

Henry Ford was forced to Henry Ford was forced to stop production, which stop production, which immediately put 75,000 immediately put 75,000 people out of work.people out of work.

Thousands of small family Thousands of small family owned businesses closed.owned businesses closed.

Thousands of farmers lost Thousands of farmers lost their farms because of their farms because of drastically falling prices.drastically falling prices.

The Great Depression• When the stock market

crashed, thousands of people rushed to their banks to get their money.

• Results: Banks quickly ran out of cash on site. After that, everyone else simply lost their money. Your money was not guaranteed or insured.

• By 1933, over $9 million was lost because of bank closings.

World-Wide Depression Our depression was actually

part of a world-wide depression. Why?

France & England were unable to repay their war debts to us. Why?

Because Germany was unable to repay their war debts to France & England that were agreed to in the Treaty of Paris after WWI.

Depression in the U.S.Depression in the U.S.• The hardest hit people in the

U.S. were the middle and lower class.

• Some of these people would live together in communities & build makeshift towns they called Hoovervilles, to show who they blamed for their problems.

Dust Bowl To make matters worse, years of

farmers overusing the plains had completely used up the topsoil.

In the early 1930s, the plains were hit with a prolonged drought, then the winds came causing a huge Dust Bowl.

450,000 people left Oklahoma and another 300,000 left Kansas

Where did most go? California

Effects of the DepressionEffects of the Depression Psychological problems?Psychological problems? Men were failures.Men were failures. Health & mental issues with Health & mental issues with

children.children. Guilt of mothers/wives, for Guilt of mothers/wives, for

watching their children starve watching their children starve and for taking jobs from men.and for taking jobs from men.

Minorities were fired first in Minorities were fired first in the north and lost there the north and lost there sharecropping farms first in sharecropping farms first in the south.the south.

Soup and bread lines became Soup and bread lines became common sites in large cities.common sites in large cities.

Depression HumorDepression Humor Even during the Depression people Even during the Depression people

could find some humor.could find some humor. Satirists would draw cartoons of Satirists would draw cartoons of

homeless people sleeping on park homeless people sleeping on park benches covered by a newspaper. benches covered by a newspaper. What did they call the newspaper?What did they call the newspaper?

Hoover BlanketsHoover Blankets What were pockets turned inside What were pockets turned inside

out on a homeless person called?out on a homeless person called? Hoover FlagsHoover Flags There were also cartoons of people There were also cartoons of people

lining up to jump out of windows of lining up to jump out of windows of tall buildings.tall buildings.

Ending ProhibitionEnding Prohibition• Finally some goods news came

when in 1933, Congress passed the 21st Amendment which officially ended Prohibition after 14 years.

• It also greatly reduced the crime caused by gangsters and bootleggers.

• 8 states, including S.C., continued to ban alcohol as a state law for a few more years.

More Good NewsMore Good News• Some large projects were Some large projects were

begun in an attempt to give begun in an attempt to give jobs on a local or state level.jobs on a local or state level.

• On May 1, 1931, the 102 story On May 1, 1931, the 102 story Empire State BuildingEmpire State Building was was completed which had given completed which had given almost 4,000 jobs, many of almost 4,000 jobs, many of which were permanent, at a which were permanent, at a cost of $41 million.cost of $41 million.

• They made a profit by charging They made a profit by charging $1 a ticket to ride to the top $1 a ticket to ride to the top and experience the view.and experience the view.

Hoover Dam Hoover supported a federally funded

project that would build a huge dam on the Colorado River. It was originally called the Boulder Dam, but was changed years later to be called the Hoover Dam, which was begun in 1930.

Result: Thousands of jobs were given for construction, then more permanent jobs for maintenance and other related jobs.

Other Negative News.Other Negative News. 1932, Al Capone is arrested.1932, Al Capone is arrested. 1935, Babe Ruth retires.1935, Babe Ruth retires. 1933, ex-President Calvin 1933, ex-President Calvin

Coolidge dies.Coolidge dies.

1932, the biggest story hit the 1932, the biggest story hit the newspapers, the kidnapping of newspapers, the kidnapping of the 2 year old Lindbergh baby.the 2 year old Lindbergh baby.

In broad daylight, someone In broad daylight, someone stole the baby from the 2stole the baby from the 2ndnd story of their home in New story of their home in New Jersey.Jersey.

Bruno HauptmannBruno Hauptmann, a new , a new immigrant in the area was immigrant in the area was arrested, tried, convicted, and arrested, tried, convicted, and executed, despite maintaining executed, despite maintaining his innocence the whole time. his innocence the whole time.

Smoot-Hawley TariffSmoot-Hawley Tariff

► Hoover also pushed through the Hoover also pushed through the Smoot-Hawley TariffSmoot-Hawley Tariff, which was , which was the highest tax on imports in our the highest tax on imports in our history.history.

► It was supposed to generate It was supposed to generate more income and protect U.S. more income and protect U.S. industry.industry.

► What it actually did do was it What it actually did do was it caused European countries to caused European countries to raise their import taxes to us, raise their import taxes to us, almost completely stopping almost completely stopping foreign trade.foreign trade.

Bonus ArmyBonus Army The final public relations blow to The final public relations blow to

Hoover’s name happened in the Hoover’s name happened in the summer of 1932, when 25,000 summer of 1932, when 25,000 jobless WWI veterans and their jobless WWI veterans and their families marched to Washington, families marched to Washington, D.C. to demand payment on a D.C. to demand payment on a pension they were promised after pension they were promised after the war.the war.

The catch is they weren’t supposed The catch is they weren’t supposed to get it until 1945, but because of to get it until 1945, but because of the Depression, they wanted it now.the Depression, they wanted it now.

They called themselves the They called themselves the Bonus Bonus Army.Army.

Bonus ArmyBonus Army After Congress narrowly voted After Congress narrowly voted

against payment, riots followed.against payment, riots followed. Hoover then sent out Hoover then sent out Douglas Douglas

MacArthur MacArthur and Dwight and Dwight Eisenhower as commanders in Eisenhower as commanders in charge of a full infantry division charge of a full infantry division with tanks and machine guns to with tanks and machine guns to disperse the crowd.disperse the crowd.

Several were killed and hundreds Several were killed and hundreds were injured by an army that the were injured by an army that the veterans thought were coming to veterans thought were coming to support them.support them.

End result: Hoover’s political End result: Hoover’s political career was over.career was over.

Election of 1932Election of 1932 The Republicans once again The Republicans once again

amazingly nominated Hoover.amazingly nominated Hoover. The Democrats, knowing a popular The Democrats, knowing a popular

name would win the election, name would win the election, nominated Franklin D. Roosevelt, nominated Franklin D. Roosevelt, commonly called F.D.R.commonly called F.D.R.

His was a distant cousin to Teddy His was a distant cousin to Teddy Roosevelt, and his wife, Eleanor, was Roosevelt, and his wife, Eleanor, was Teddy’s niece.Teddy’s niece.

He was a Harvard grad who served in He was a Harvard grad who served in the Wilson administration.the Wilson administration.

He was struck by polio in the early He was struck by polio in the early 20s and eventually became 20s and eventually became wheelchair bound.wheelchair bound.

New Deal ProgramsNew Deal Programs• Once he was elected he needed to personally

sell the public on his economic reform programs.• He did this by talking over the radio regularly in

what were called his Fireside Chats.

F.D.R.F.D.R. Roosevelt easily won the election.Roosevelt easily won the election. He won the popular vote by over He won the popular vote by over

7 million votes and he won 89% 7 million votes and he won 89% of the electoral vote, with Hoover of the electoral vote, with Hoover winning only 6 states.winning only 6 states.

During his inaugural speech he During his inaugural speech he had the famous quote of “The had the famous quote of “The only thing we have to fear is fear only thing we have to fear is fear itself.”itself.”

Even before the election Even before the election Roosevelt had developed his plan Roosevelt had developed his plan to end the Depression. It was to end the Depression. It was called the called the New DealNew Deal..

Irony: Until he was inaugurated Irony: Until he was inaugurated on March 5, 1933, he only had a on March 5, 1933, he only had a name, but not the plan.name, but not the plan.

The Hundred DaysThe Hundred Days

From inauguration day in March From inauguration day in March until mid June almost every until mid June almost every program that Roosevelt proposed program that Roosevelt proposed passed. Why?passed. Why?

This was called the This was called the Hundred Days.Hundred Days.

It also was known by the nickname It also was known by the nickname of “the alphabet soup of legislation.”of “the alphabet soup of legislation.”

Emergency Banking Act (EBA)Emergency Banking Act (EBA)• The first challenge for Roosevelt

was to regain the public’s trust in the banking system.

• According to the E.B.A., all banks were ordered to close on March 5, 1933 and had to stay shut a minimum of 4 days.

• Only banks that were inspected and proven to be stable were allowed to reopen.

• Within 10 days 2/3 had reopened, while some took months and some never did reopen.

F.D.I.C.F.D.I.C. In order to insure the stability In order to insure the stability

of banks, Roosevelt got of banks, Roosevelt got Congress to pass the Congress to pass the Federal Federal Deposit Insurance Corporation,Deposit Insurance Corporation, or F.D.I.C.or F.D.I.C.

It insured every bank deposit It insured every bank deposit up to $5,000 and is still the up to $5,000 and is still the backbone of banking today.backbone of banking today.

Civilian Conservation Corps Civilian Conservation Corps (CCC)(CCC) March, 1933, the most popular program passed to help give March, 1933, the most popular program passed to help give

thousands of jobs and help with conservation, called the C.C.C.thousands of jobs and help with conservation, called the C.C.C. Single men between the age of 18-25 would be paid $1 a day in Single men between the age of 18-25 would be paid $1 a day in

areas like building roads and parks, fighting fires.areas like building roads and parks, fighting fires. All expenses were covered, restoring forests and beaches, etc. All expenses were covered, restoring forests and beaches, etc.

National Recovery National Recovery Administration-NRAAdministration-NRA

This agency was supposed to This agency was supposed to oversee the entire restructuring of oversee the entire restructuring of our industrial operations.our industrial operations.

It would control wages, hours, It would control wages, hours, conditions, prices, and a minimum conditions, prices, and a minimum wage.wage.

In reality, it allowed the larger In reality, it allowed the larger companies to set the standards for companies to set the standards for all industry in our country.all industry in our country.

Because of this, the N.R.A. was Because of this, the N.R.A. was later challenged and ruled to be later challenged and ruled to be unconstitutional.unconstitutional.

Public Works Administration-P.W.A.Public Works Administration-P.W.A. This program was most responsible for rebuilding the This program was most responsible for rebuilding the

infrastructure of our country, which means the dams, major infrastructure of our country, which means the dams, major rivers, railroads, and highways.rivers, railroads, and highways.

The biggest example of this was the construction of the The biggest example of this was the construction of the Grand Coulee DamGrand Coulee Dam on the Columbia River in the state of on the Columbia River in the state of Washington.Washington.

Securities & Exchange Commission-S.E.C.

The number one job of this program was to regulate the stock exchange.

Now, if a company was selling stock on the stock exchange, they were required to release certain information about their company first.

It also made insider information illegal.

Agricultural Adjustment Agricultural Adjustment AdministrationAdministration

• The A.A.A. was set up to help The A.A.A. was set up to help farmers by allowing them to farmers by allowing them to take out a 2take out a 2ndnd mortgage at mortgage at much lower interest rates.much lower interest rates.

• Farmers were even paid to Farmers were even paid to NOT farm some of their land NOT farm some of their land and to even slaughter some and to even slaughter some of their cows and pigs. Why?of their cows and pigs. Why?

• Because this would hopefully Because this would hopefully raise prices by reducing raise prices by reducing supplies.supplies.

Tennessee Valley AuthorityTennessee Valley Authority The T.V.A. was Roosevelt’s The T.V.A. was Roosevelt’s

biggest and most successful biggest and most successful New Deal program.New Deal program.

Background: Every year the Background: Every year the Tenn. Valley in Kentucky, Tenn., Tenn. Valley in Kentucky, Tenn., Miss., and Ala., would flood in Miss., and Ala., would flood in the spring making thousands the spring making thousands of acres of land uninhabitable.of acres of land uninhabitable.

So Roosevelt had several dams So Roosevelt had several dams built along the Cumberland built along the Cumberland and Tenn. Rivers.and Tenn. Rivers.

What all did this accomplish?What all did this accomplish?

Tenn. Valley Authority 1) Control the flow of the river to

stop flooding and create thousands of acres of very fertile farmland.

2) New dams created hydroelectric power for electricity.

3) Jobs were created for the construction of dams and more permanent ones for maintenance.

4) Recreational activities were created by the new manmade lakes like boating, skiing, and fishing.

Women and MinoritiesWomen and Minorities FDR was the first president to hire a FDR was the first president to hire a

woman as the head of a cabinet woman as the head of a cabinet position. position. Francis PerkinsFrancis Perkins was named was named the Sec. of Labor.the Sec. of Labor.

Many other women held high Many other women held high government positions.government positions.

Over 100 African-Americans held key Over 100 African-Americans held key government positions with the government positions with the highest being highest being Mary McCleod Mary McCleod BethuneBethune who was the Director of who was the Director of Negro Affairs.Negro Affairs.

She was also from S.C., thus She was also from S.C., thus Bethune-Cookman College and the Bethune-Cookman College and the city of Bethune.city of Bethune.

Eleanor RooseveltBecause of his physicals limits FDR’s wife Eleanor Roosevelt became his eyes and ears around the country.

She totally changed the image of First Ladies and became involved in visiting factories, coal mines, schools, housing projects and many other places.

Many old-timers resented her for not being the traditional First Lady Hostess.

22ndnd New Deal New DealIn 1935, Roosevelt pushed In 1935, Roosevelt pushed through a second wave of through a second wave of legislation called the legislation called the 22ndnd New New Deal.Deal.The most important The most important legislation that came out of legislation that came out of this was the this was the Social Security Social Security Act.Act.This program offered 3 types This program offered 3 types of insurance.of insurance.

1)1) Old age & survivor benefits. Old age & survivor benefits. All workers would contribute All workers would contribute a small % of each pay check a small % of each pay check into the national insurance into the national insurance fund and he or his survivors fund and he or his survivors could begin receiving could begin receiving payments when he turns 65.payments when he turns 65.

2nd New Deal2) Unemployment insurance:Workers would receive payments

when they lost their jobs, which would be paid for by a tax place on all companies with 8 or more employees.

3) Wives and dependent children of men who were killed at work, and physically handicapped people would receive compensation funded by national and state programs.

Election of 1936Election of 1936

FDR easily won the election of 1936 FDR easily won the election of 1936 against the Republican candidate Alfred against the Republican candidate Alfred Landon, by winning every state except Landon, by winning every state except Maine and Vermont in the electoral votes.Maine and Vermont in the electoral votes.