The Great Depression
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Transcript of The Great Depression
Cash crops: the growth of a single crop indigo, tobacco, rice, cotton..thanks Ian
River valley provided arable land for plantations, and transportation route for
crops
Cash crops: the growth of a single crop indigo, tobacco, rice, cotton..thanks Ian
River valley provided arable land for plantations, and transportation route for
crops
1.1. Old industrial base is outdated, time for Old industrial base is outdated, time for new equipmentnew equipment
2. Crisis in the farm sector – 2. Crisis in the farm sector – OVERPRODUCTIONOVERPRODUCTION
3. Availability of easy credit (installment 3. Availability of easy credit (installment plans)plans)
4. Unequal distribution of income, too little 4. Unequal distribution of income, too little money in the hands of working people.money in the hands of working people.
Causes of the Great DepressionCauses of the Great Depression
Employment Employment LineLine
Idle FactoryIdle Factory
Cash crops: the growth of a single crop indigo, tobacco, rice, cotton..thanks Ian
River valley provided arable land for plantations, and transportation route for
crops
A haunting sense of failure and uncertainty A haunting sense of failure and uncertainty about the future – powerlessness and about the future – powerlessness and
helplessness….helplessness….
FarmingFarming-- prices fall constantly during the 1920’s post war
depression decreases demand. R
IndustryIndustry is becoming more concentrated/consolidated; Government is pro – business. Two hundred companies control 51%of the economy and it becomes stiff and rigid.
Growing concentration of wealth:Growing concentration of wealth: Per Capita income grows by 9%, but 75% of that growth goes to the top 1%
Integrated global economy has structural instability and chaotic volatility
Crash of 1929 reveals Crash of 1929 reveals weaknesses in the economyweaknesses in the economy
The GreatThe Great DepressionDepression
After the Stock Market Crash of 1929After the Stock Market Crash of 1929
1. 1933 6,000 banks have closed
2. Between 1929-1933 Nation’s total GNP drops from 104-59 billion
3. Unemployment leaped from 3% (1.6 million) in 1929 to 25% (13 million) in 1933
4. 1 Out of every 4 workers was out of a job
Employment Employment LineLine Idle Idle
FactoryFactory
What is an economic depression?What is an economic depression?
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1928 1929 1930 1931 1932 1933
Unemployment (in millions)
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1928 1929 1930 1931 1932 1933
Bank FailuresIn thousands
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1928 1929 1930 1931 1932 1933
Business failures (In thousands)
Idle Idle FactoryFactory
Bread lineBread line
Employment Employment LineLine
THE DUST BOWLTHE DUST BOWL
Causes? Effects?Causes? Effects?
““Necessity is the mother of invention”Necessity is the mother of invention”Taming the Great PlainsTaming the Great Plains
HomeworkHomework 19001900
In 18301830 it took 3 hours minutes to produce a bushel of grain, by 19001900 it took 10 minutes.
1830
The American Farmer is introduced to a variety of labor saving machines that
increased their efficiency and productivity. By 1890 there are 900
manufacturers of farm machinery.
The American farmers takes out loans to purchase new equipment. The efficient cultivation of crops leads to OVERPRODUCTION and a market OVERPRODUCTION and a market surplus!!surplus!!
Overproduction Overproduction drives the prices of crops down…..What does this mean for the American farmer??
C o rn P rice s C o rn P rice s
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5
1 0
1 5
2 0
2 5
3 0
3 5
4 0
4 5
1870
CentsPerBushel
"And then the dispossessed were drawn west- from Kansas,
Oklahoma, Texas, New Mexico; from Nevada and Arkansas, families, tribes, dusted out,
tractored out. Car-loads, caravans, homeless and hungry; twenty
thousand and fifty thousand and a hundred thousand and two
hundred thousand. They streamed over the mountains, hungry and
restless - restless as ants, scurrying to find work to do - to lift,
to push, to pull, to pick, to cut - anything, any burden to bear, for food. The kids are hungry. We got
no place to live. Like ants scurrying for work, for food, and most of all
for land."
The Dust BowlThe Dust BowlCausesCauses EffectsEffects
Homesteaders 1860’s Uprooted Farmers 1930’sUprooted Farmers 1930’s
Post Civil War land rush drew thousands of families west
search for free land and new opportunities
Unemployed farmers leave failed farms and the dust bowl
in search of work
HOOVER’s APPROACHHOOVER’s APPROACH
1. Insensitive towards the American people
2. Hoover believes in economic individualism and viewed government response as temporary supports “Associationalism”
3. Felt capitalism would fix itself …Prosperity is just around the corner
4. More of a cheerleader….
Cash crops: the growth of a single crop indigo, tobacco, rice, cotton..thanks Ian
River valley provided arable land for plantations, and transportation route for
crops
Bonus Army demonstrators are Bonus Army demonstrators are dispersed by armed guards and tear dispersed by armed guards and tear
gas on July 29, 1932.gas on July 29, 1932.
Cash crops: the growth of a single crop indigo, tobacco, rice, cotton..thanks Ian
River valley provided arable land for plantations, and transportation route for
crops
BONUS ARMY, 1932BONUS ARMY, 1932
1.1. WWI veterans owed bonus in 1945 and WWI veterans owed bonus in 1945 and 17,000 vets march on DC to petition for 17,000 vets march on DC to petition for an early bonus (Senate kills the bill)an early bonus (Senate kills the bill)
2.2. After defeat of bill 2,000 stay for the After defeat of bill 2,000 stay for the summer of 1932 and are dispersed by summer of 1932 and are dispersed by the US Army (PR nightmare)the US Army (PR nightmare)
Army coming in is a typical governmental Army coming in is a typical governmental response to labor unrestresponse to labor unrest
The The Election of Election of
19321932
Prosperity isProsperity isjust aroundjust around the cornerthe corner
I promiseI promise a New Deala New Deal!
FDR claims he will employ with bold consistent experimentation experimentation when he gets in office
INTRO to FDRINTRO to FDR
1. Americans ready for a change
2. Elected with 23 million votes (57% of voting population)
3. More of a quarterback…willing to experiment
Franklin D. Roosevelt First Inaugural AddressSaturday, March 4, 1933
So first of all let me assert my firm belief that the only thing we have to fear. . .is fear itself. . . nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.
Our greatest primary task is to put people to work. This is no unsolvable problem if we face it wisely and courageously.
Franklin D. Roosevelt First Inaugural AddressSaturday, March 4, 1933
RECOGNIZE the problem/crisis
ASSERTION - we will survive and prosper
LEADERSHIP – This nation asks for action, and action now.
.
The Great Depression fundamentally reshapes the way the American people think
about the role of government
#1#1 Creates security in the system to change the length and harshness of business cycle
#2#2 Changes the expectations about what government could and should do
Federal Budget: 1920 $3 billion 1930 $6 billion
President Hoover’s approach
to the Depression
