Chapter 24

The Great Depression and the New Deal

1929-1939

Introduction• What were the causes of the 1929 stock market crash

and of the depression that followed?• What was the social and political impact of the crash and

depression?• What strategy did the New Deal employ and what

specific measures were passed to implement it?• Why did Roosevelt turn to a second New Deal in 1935

and what major legislation expressed the shift?• How did the depression and New Deal affect farmers,

workers, women and minorities?• Which New Deal programs failed and why? Which New

Deal programs still have an impact today?• How did the economic hard times affect American Art

and popular culture

Black Thursday and the Onset of the Depression, 1929-1932

• 1928- Wild Speculation, over 9 million Americans played the stock market

• Buying on the margin• 10/24/1929- Black Thursday- Stock Market

crashed• Farm Prices fell 60%, 5500 Banks failed,

25% Unemployment• Surplus Goods and Farm Commodities• Foreign Debt Repayment

Hoover’s Response

• Private Sector Initiative, Limited Government Intervention, Balanced Federal Budget

• Local Charity and Local Government

• Reconstruction Finance Corporation- Lend money to failing businesses

• “Rugged Individualism”

Mounting Discontent and Protest

• Hoovervilles

• Foreclosures

• Bonus Army

The Election of 1932

• Republican- Hoover

• Democrats- Franklin Roosevelt

• Roosevelt and Democrats took over White House and Congress

Roosevelt and His Circle, 1933-1935

• New Deal– Relief, Recovery, Reform– Eleanor Roosevelt– Brain Trust

The Hundred Days

• March 9th- June 16th 1933– FDIC- Federal Deposit Insurance

Corporation– CCC- Civilian Conservation Corps– Home Owners and Loan Corporation– Farm Credit Administration– TVA- Tennessee Valley Authority– PWA- Public Works Administration– Federal Emergency Relief

Administration– AAA- Agricultural Adjustment Act– NRA- National Recovery Act

Failures and Controversies Plague the Early New Deal

• Summer 1933 economic upturn and then slump again

• NRA ruled unconstitutional• AAA- Small farmers, sharecroppers and tenant

farmers were kicked off of their property, Dust Bowl, eventually ruled unconstitutional

• PWA- Harold Ickes slow to get work underway and slow to put money in the hands of unemployed

• FERA- Harry Hopkins distributed money much more quickly

1934-1935 Challenges From Right and Left

• First phase did not end Depression

• American Liberty League called the New Deal socialistic

• Charles Coughlin- National Union of Social Justice called for more radical measures

• Huey Long- “Share the Wealth” redistribution of wealth

• Roosevelt calls for more legislation

The New Deal Changes Course, 1935-1936

• Roosevelt calls for Second New Deal aimed at aiding the disadvantaged

Expanding Federal Relief

• Emergency Relief Appropriations Act- $5 billion for work-relief

• Work Progress Administration- Harry Hopkins, $11 billion for construction, clerical, professional jobs

• John Maynard Keynes- Deficit Spending is positive way to pump funds into the economy to relieve depression

Aiding Immigrants, Unions, Regulating Business, Taxing the Wealthy

• Resettlement Administration- loans to small farmers, sharecroppers and tenant farmers

• National Labor Relations Act (Wagner Act)- Unions right to bargain, NLRB to watch labor-management relations

• Revenue Act of 1935- boosted tax rates on corporations and upper income Americans

The Social Security Act of 1935, End of second New Deal

• Old Age Pension

• Families of deceased workers

• Unemployment benefits

• Dependent mothers and children

• Handicapped

• Government’s role changed

Election of 1936

• Republican- Alfred Landon• Democrats- Franklin Roosevelt• Coalition of South, Immigrants, Industrial

Workers, Farmers, African Americans and Women joined the Democrats

Environment, West and Indian Policy

• CCC built fire lookout stations, hiking trails and planted thousands of trees

• Department of Agriculture and Interior taught farmers about soil conservation

• National parks• Highways, Hydroelectric Power plants Flood

Control Dams• 1934 Indian Reorganization Act

– Stop further sale of Indian lands– Self-government to Indian tribes

End of New Deal 1937-1939

• 1937- Court-packing bill

• New Deal programs being ruled unconstitutional

• Congress refused to pass the bill

• Four Supreme Court Justices died or retired and Roosevelt replaced the with “New Dealers”

Roosevelt Recession

• 1937 Economy takes another downturn– Consumer spending is reduced– Congress cutbacks to balance the budget– Roosevelt asks for new spending

Final Measures

• Housing Act of 1937

• Fair labor Standards Act 1937

• Farm Tenancy Act 1937

• Second AAA

• Conservatives are elected in 1938 elections and New Deal Reforms end

Depression’s Psychological and Social Impact

• 14% Unemployment throughout the 1930’s• ¼ of all farm families received some type

of assistance• Women 20% Unemployment• Marriage and Birthrates decreased• Hobo’s• “Grapes of Wrath” • “Migrant Mother”

Industrial Workers Unionize

• AFL- skilled workers

• CIO- John L. Lewis- Industry-wide unions

• Union membership rose to over 8 million

• Many of the leaders were radicals

• Workers just wanted wages, hours and working conditions

Blacks and Hispanic Americans Resist Racism and Exploitation

• 77% of blacks still live in the South• NAACP organized against lynchings,

segregation and disenfranchisement• Urban league- “Don’t shop where you can’t

work”• Mexican-American workers were encouraged to

migrate back to Mexico• Discrimination and racism against Mexican-

Americans and Asian American workers

Avenues of Escape: Radio and the Movies

• Jack Benny, George Burns, Gracie Allen, Soap Operas

• Golden Age of Hollywood

• Fireside Chat

The Later 1930’s: Opposing Fascism; Reaffirming Traditional Values

• Cultural Nationalism– Rise of Aggressive Fascism– Communism– WPA Art Projects– American Jazz– Harlem Renaissance

• Langston Hughes• Zora Neal Hurston

World’s Fair

• New Technology

• Growing concern for war in Europe