DO NOW: WHAT WERE THE PRIMARY CAUSES OF THE CRASH

Objectives: Examine and evaluate the reaction to the crash

FDR’S NEW DEAL

DEPRESSION STATS

1929– 3 million unemployed, family income 2300 1932-12.5 million (25%), family income 1400 683,000 vagrants thrown off trains People starving in NYC (Cameroon sent aid) By 1940 1.5 million married women living separate from

husband 200,000 vagrant children wandering the countryside Mexican Americans and African Americans hit especially

hard 70% Unemployment in Charleston among blacks

HOOVER OPPOSED WELFARE

Hoover believed that it was not the government responsibility to provide welfare.

He believed that giving money to the poor would crush their sense of self-worth and prevent them from reaching their potential as US citizens

Many saw him as callous Refused request for 25 million to

feed farmers but approved 45 million to feed their livestock.

Rejected a request to pay teachers and city workers in Chicago but approved a 90 million dollar loan to help the Central Republic Bank

HOOVERS REACTIONS CONTINUED

Hawley –Smoot Tariff Tariffs on farm and industrial goods

(RFC) Reconstruction Finance Corporation– 1932– Established to provide support to banks and corporations that provided public support such as low-cost housing. Created the largest peacetime deficit in history He attempted to thwart this by implementing the

Revenue Act of 1932 which raised taxes Home Loan Bank Board– Offered funds to mortgage

companies and financial institutions that would produce loans for homebuilding and mortgages

BONUS ARMY

WWI veterans were promised a 1000 dollar bonus that would mature in 45.

The Vets wanted their money early, hopped on empty train boxcars and headed for Washington.

20000 veterans and their families staged a protest at a camp at Anacostia Flats just southeast of the capital.

The Senate turned down their request Troops were sent in led by Douglas MacArthur and

George Patton to attack the encampment. Tents and shack were torched and protesters were

expelled. 100 injured and 1 infant killed. Hoover and the republicans were voted out of

office in 1932 in a landslide victory for the Democrats 472-59

Bonus Army– Attempt #1

1932– Hoover v RooseveltPhew– That was a close one!

FDR Born into a wealthy family Worried about super wealth and rift

between rich and poor Harvard, then Colombia Law Rode on shirttails of cousin

Theodore Polio at age of 39 changed him into

serious determined politician Empathy for suffering

GOVERNOR OF NEW YORK

Democratic Governor of New York Demonstrated his ability to initiate

reforms Surrounded himself with reformers

and liberals “Ours must be the party of liberal

thought, of planned action, of enlightened international outlook, and of the greatest good for the greatest number of citizens.”

NEW ADMINISTRATION

FDR was extremely progressive when establishing his new cabinet.

Frances Perkins– First woman to be appointed to a cabinet post Former progressive Appointed

Secretary of Labor Till 1945 she helped

provide jobs

African Americans were given jobs in more than 100 policymaking posts

Mary McLeod Bethune was appointed as director of the Division of Negro Affairs of the National Youth Administration

She advised FDR on programs to help African Americans

She also developed the Federal Council on Negro Affairs by organizing the black officeholders. They would meet to establish new ideas to help Af. Am.

ELEANOR ROOSEVELT

Traveled for her husband Reported to him on country’s condition and the

effects of the programs She often took controversial stances that

sometimes negatively impacted FDR Example– She sat between the whites and

blacks in the Jim Crow south during a meeting of the Southern Conference for Human Welfare

Many thought the first lady was suppose to be “lady like” but they eventually got use to her.

LAME DUCK AMENDMENT

FDR was elected in November but was not inaugurated until March (This was normal)

Hoover could not get anything done because he did not have support anymore (Lame Duck)

As a result– “Lame Duck” Amendment (20th) that moved inauguration to January 20th

Nevertheless, FDR needed to wait till March

A NEW HOPE2nd Bonus Army march

(a different reaction) Roosevelt offered a

spot to camp Eleanor (1st lady)

paid a visit to vets

Immediate “Fireside Chats” to help restore hope

A “New Deal” – promises of “bold, persistent experimentation”

FIRST 100 DAYS

Between March and June Roosevelt aggressively sought to enact legislation that would provide relief, stimulate the economy and provide jobs

March-June of 1933- 15 pieces of legislation Bank Holiday=first order of business --an order

to all banks to close for 4 days. He then pushed through congress the

Emergency Banking Act (EBA) --inspected the financial health of all the banks Banks were found healthy which reassured

Americans This was followed by the Economy Act (EA)

which was established to balance the budget

MORE MEASURES

FDR also passed the Glass-Steagall Banking Act Federal Deposit Insurance Corporation (FDIC)

to insure deposits

Faith in the banking system began to rise Results---More deposits=More loans=More

jobs=More money=More deposits

STILL MORE LEGISLATION

Federal Securities Act passed in May of 1933 required to provide financial information if they were traded publicly

Securities and Exchange Commission (SEC) followed which regulated the sale of stock on margin

July of 1933 FDR dropped the gold standard which increased money supply =inflation =lower value of dollar =more exports =higher farm good prices

DO NOW

What was the “New Deal”

STILL MORE RELIEF

Federal Emergency Relief Administration (FERA)– support agencies that provide support

Also provided a great deal of money to public works programs– Government funded projects to build bridges, buildings, sidewalks, dams, etc.

CWA AND THE CCC

Civil Works Administration (CWA) established to build roads, airports, etc.= 4 million employed

The Civilian Conservation Corps (CCC) FDR’s favorite program established in March of 1933. Put 2.5 million unmarried men to work in parks, beaches, forests, etc. Earned $30 per month but provided food, healthcare and camps to live in.

Eleanor worked to establish a section of

the CCC for women as well

FDR KEEPS GOING

National Industrial Recovery Act (NIRA)

NRA National Recovery Administration to help stabilize the economy

Established codes to regulate wages, restrain competition, regulate prices, working conditions and production. Also established a minimum wage

Public Works Administration (PWA)

…AND GOING Indian Reorganization Act 1934= Part of

the public works programs Ended the sale of tribal lands that began under the Dawes Act of 1887

Home Owners’ Loan Corporation (HOLC)– Refinanced mortgages to make them more manageable to pay off

June 1933 to June 1936 more than 1 million low-interest loans

…AND GOING…

National Housing Act of 1934 established the Federal Housing Administration (FHA) which was established to improve housing conditions, insure mortgages and stabilize the real estate market.

Agricultural Adjustment Administration (AAA) paying subsidies for the reduction of

certain crop production. Farmers plowed under perfectly good crops which angered Americans

MORE PROBLEMS

Drought and misuse of farmland led to Dust Bowl

Government responded by establishing SCS (Soil Conservation Service) to push more responsible farming methods (crop rotation, terracing and building barriers)

AGENCIES CONT.

Works Progress Administration (WPA) provided work for more that 8 million Americans.

The National Youth Administration within the WPA did the same for 16-25 year-olds

AAA (Ag)– Ag. Adjustment Admin. Failed many farm workers because the farms stopped producing

FSA– Farm Security Administration established to loan more than 1 billion to farmers to set up camps for migrant workers.

…AND GOING…

Tennessee Valley Authority (TVA) was created in 1933 to create jobs in

the Tennessee River Valley. Operated in Tennessee, Mississippi,

Alabama, Georgia and North Carolina Jobs focused on power generation,

flood reduction and local industrial development

TVA

GRAND COULEE DAM AND BOULDER DAM (HOOVER)

THE 2ND NEW DEAL GETS UNDERWAY

Focused on the ordinary Americans. It included more social welfare business regulations union support higher taxes on the rich

MORE LEGISLATION

(REA) Rural Electrification Administration– Gave money to farm cooperatives and electric companies to build power plants and extend lines

1930—10% 1934—25% Eventually– 98%

LABOR NIRA

Wagner Act– Legalized collective bargaining and closed shops (workplaces only open to union members). Also outlawed spying and blacklisting

National Labor Relations Board (NLRB )established to enforce the provisions

Fair Labor Standards Act– No child labor and minimum wage.

SOCIAL SECURITY

Social Security System established to provide financial security to people who needed it. Pensions-- Regular payments to

workers or spouses over 65. Unemployment Insurance– those

employing 8+ paid tax to fund this program that would provide money for those who lost their jobs

Aid for children, blind and disabled