Causes, Consequences, and US Government Response to the Great Depression and New Deal, Slides of United States History

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The Great Depression and the New Deal The Causes and Consequences of America’s most significant economic downturn Mr. Sean McAtee Iroquois High School Elma, New York The 1920s had been a period of prosperity - good economic times Black Tuesday - Oct. 29, 1929 - Crash of the NY Stock Exchange Caused panic - and an economic depression that would last until World War II Causes of the Great Depression Weakness in the Overall Economy overproduction, underconsumption Excessive Buying on Credit Efforts to pay-off loans leads to underconsumption Weak Corporate Structure Lack of competition in many businesses Weak Banking System Banks were not required to hold adequate reserves ($) Unequal Distribution of wealth Big gap between “the rich” and common people; Farmers continue to struggle Causes of the Great Depression Inadequate Government Policy: Little regulation of markets, excessive speculation. Tax policy favors wealthy, lax enforcement of anti-trust laws Weak International Economy: WW I had caused depression in Europe. Tariffs hurt international trade. The Dust Bowl Kansas Farmer, 1933 A severe drought began in the Great Plains in the early 1930s Wind scattered topsoil, exposing sand and grit. The dust often traveled hundreds of miles One storm in 1934 picked up millions of tons of dust, and carried it to the East Coast. These hard times began in 1931 and lasted until 1939 Smoot - Hawley Tariff (1930) Representative Willis C. Hawley (left) and Senator Reed Smoot Put in place the highest tariff rate in American history. GOAL - Protect American businesses from foreign competition U.S. exports to Europe fell from $2.3 billion in 1929 to $784 million in 1932. U.S. imports from Europe declined from $1.3 billion in 1929 to $390 million in 1932 European nations respond by enacting high tariffs as well - reduced trade for all nations. Hoover’s Response to the Depression Believed the economy would “Fix Itself” Economic policy = laissez faire Organized private relief agencies Hoover did not believe that the government should provide direct relief to people in need Encouraged Americans to buy American-made products Goal - stimulate the economy Reconstruction Finance Corporation (1932) Loans to businesses Hooverʼs Trickle-Down Solution RFC $ to businesses make more goods Hire more workers People earn $ to buy goods Franklin D. Roosevelt at Harvard, 1903 - Senior Year Franklin D. Roosevelt, 1889 Age 7 Served as Assistant Secretary of the Navy during World War I Candidate for vice president (Democratic Party) - 1920 James Blaine was the Democratic candidate for president How else may polio have impacted FDR? |  Franklin Roosevelt and the New Deal ‘OF COURSE WE MAY HAVE ’ To CHANGE REMEDIES F WE) SED) DONT GET RESULTS __ J <> P . wt g -U CS ts “ > 4 A} ~ ~~ Ss. = { ——— Seis . ‘ 7, 7 j SS Name of Program Summary Federal Deposit Insurance Corporation (FDIC) Reform 1933 Insures Bank deposits up to $100,000 Agricultural Adjustment Administration (AAA) Recovery 1933 Farmers paid not to grow certain crops. Ruled Unconstitutional Civilian Conservation Corps (CCC) Recovery, Relief 1933 Provides jobs to young men who will carry out environmental conservation activities (ie: build parks) Public Works Administration (PWA) 1933 Relief Ports, Schools, Airports National Industrial Recovery Act (NIRA / NRA) 1933 Reform Set prices, wages, hours, etc in various industries Ruled Unconstitutional Tennessee Valley Authority (TVA) 1933 Built Dams to prevent flooding and produce electrical power in Southeast Federal Housing Administration (FHA) 1934 Insure mortgages The New Deal - More Programs The Wagner Act (1935) • Guaranteed labor unions the right to form • Created National Labor Relations Board Social Security Act (1935) • Benefits for retired workers • Unemployment insurance • Benefits for victims of industrial accidents • Aid for dependent mothers and children Fair Labor Standards Act (1938) • Set minimum wage (25 cents), maximum hours (44) per week and time and-a-half for working overtime • Banned child labor in interstate commerce LTT (| HU ii ee Ly THT pour pas He Whe a pe j } We — wie ta bili ad Ziti 2 it caccurivaticc f * ~—— sill Sh < —> a XS es Tf a s ~— LEGISLATIVE auUoICIAL FDR wins Re-Election in 1936 http://images2.dailykos.com/i/user/1638/1936-fdr-poster.jpg With his easy victory, FDR felt that he had been given a mandate to continue New Deal policies Court Packing (Re-organization) Plan • FDR believed that the court was slowing America’s economic recovery • Wants to increase the number of justices (to pack the court) from 9 to 15 • There was much opposition to this plan, so FDR withdrew it In time, sitting justices retired - FDR got to appoint new justices - (total of 8) that would approve New Deal Legislation! “e : TRYING TO CHANGE THE UMPIRING «. LISTEN- I DON’T LIKE Your DECISIONS= FROM MOW OA, YOU'RE GOING % HAVE 7O WORK WITH SOMEONE WHO CAM SEE THINGS MY WAYT?