1. CHAPTER 15
Crash and Depression

2. CHAPTER 15: Crash and Depression
Section The Stock Market Crash
Section Social Effects of the Depression
Section Surviving the Great Depression
Section The Election of 1932

3. The Stock Market Crash
What events led to the stock market’s Great Crash in 1929?
Why did the Great Crash produce a ripple effect throughout the nation’s economy?
What were the main causes of the Great Depression?

4. Surviving the Great Depression
In what ways did Americans pull together to survive the Great Depression?
What signs of change did Americans begin to notice in the early 1930s?

5. Americans Pull Together
Farmers Stick Together: farmers worked together to minimize the impact of the Depression: when farmers were unable to pay their mortgage, banks would foreclose on the property and sell it at auction; in some farm communities, local farmers met secretly and agreed to keep bids low during the auction
known as penny auctions, farmers would bid mere pennies on land and machines auctioned by the banks in order to help their struggling neighbors, and buyers would then return the farms and machinery to the original owners

6. Americans Pull Together
Young People Ride the Rails: in the mid-1930s there were roughly 250,000 teenagers living on the road, illegally riding the rails of freight trains; some road the rails to find work while others looked for adventure
Called “hobos,” they faced danger every day: they were vulnerable to train-related injuries, the possibility of being arrested by police, or the possibility of being shot at by angry farmers

7. Americans Pull Together
Seeking Political Solutions: for some Americans, radical and reform movements offered solutions to the country’s problems
the Communist Party had about 14,000 members, mainly intellectuals and labor organizers, by promising a fairer distribution of wealth
Socialists called for gradual social and economic changes and did even better
Humor: jokes and cartoons helped people through their troubles

8. Prohibition Is Repealed The Empire State Building
Signs of Change
In February 1933, Congress passed the Twenty-first Amendment, which repealed the eighteenth amendment prohibiting the sale of alcohol.
Prohibition Is Repealed
2,500 to 4,000 people worked on the construction.
The cost of construction was about $41 million.
At that time, it was the world’s tallest building and had 102 stories and 67 elevators.
The Empire State Building
Many things that symbolized the 1920s faded away.
- Organized crime gangster Al Capone was sent to prison.
- Calvin Coolidge died.
- Babe Ruth retired.
The End of an Era

9. The Election of 1932
How did President Hoover respond to the Great Depression?
What did Roosevelt mean when he offered Americans a “New Deal”?
Why was the election of 1932 a significant turning point for American politics?

10. Hoover’s Limited Strategy
Voluntary Action Fails: Hoover believed voluntary controls by business leaders were best way to end economic crisis, so Hoover got business leaders to maintain wage rates
Hoover’s plan unattractive to Americans and they began to blame him for the crisis
The Government Acts:
Agricultural Marketing Act (1929): relief for farmers by creating a Federal Farm Board to stabilize the prices of farm crops; was a failure  losing over 150 million and sending farm prices on another downward spiral
As hardships continued and criticism increased, Hoover took more active approach: to create government jobs, the government spent more on new public buildings, roads, parks, and dams
1930: Boulder Dam (Hoover Dam)

11. Hoover’s Limited Strategy
The Government Acts:
Hawley-Smoot tariff (1930): passed by Congress in an attempt to protect domestic industries from foreign imports > highest import tax in history
Tariff backfired when European countries raised their own tariffs and international trade was brought to a sudden slowdown
Reconstruction Finance Corporation (RFC): gave government credit to institutions, such as large industries, railroads, and insurance companies; lent money to banks so that they could extend loans
Home Loan Bank Act (1932): discounted mortgage rates, helping homeowners save their homes and farmers to keep their farms

12. Hoover’s Limited Strategy
Hoover’s Unpopularity Grows: Hoover argued that direct federal relief would destroy people’s self-respect and create a large bureaucracy and insisted that state and local governments should handle relief
His refusal to provide direct aid brought bitter public reactions and negative publicity
In 1932, Hoover let the RFC lend the states money for unemployment relief, but it was too little too late

13. Hoover’s Limited Strategy
Veterans March on Washington: In the summer of 1932, 20,000 jobless WW1 veterans and their families (known as the Bonus Army) marched to Washington D.C., asking for immediate payment of a pension bonus that had been promised for 1945
House of Representatives agreed, but the Senate said no; most of the Bonus Army went home then, but a few thousand stayed and lived in shacks
Bonus marchers were generally peaceful, but a few violent incidents prompted Hoover to order General Douglas MacArthur to clear Pennsylvania Avenue
MacArthur used force to drive the marchers out of Washington > many people were injured

14. Veterans March on Washington

15. A “New Deal” for America
FDR promised a New Deal for the American people.
He was ready to experiment with government roles in an effort to end the Depression.
As governor of New York, Roosevelt had set up an unemployment commission and a relief agency.
FDR’s wife, Eleanor, was an experienced social reformer. She worked for public housing legislation, state government reform, birth control, and better conditions for working women.
When the Roosevelts campaigned for the presidency, they brought their ideas for political action with them.

16. The Election of 1932 Franklin Roosevelt Herbert Hoover
Believed that government had a responsibility to help people in need.
Called for a reappraisal of values and more controls on big business.
Helped many Americans reassess the importance of “making it on their own” without any help.
Much of his support came from urban workers, coal miners, and immigrants in need of federal relief.
Roosevelt won 57 percent of the popular vote and almost 89 percent of the electoral vote.
Herbert Hoover
Believed that federal government should not try to fix people’s problems.
Argued that federal aid and government policies to help the poor would alter the foundation of our national life.
He argued for voluntary aid to help the poor and argued against giving the national government more power.
Hoover gave very few campaign speeches and was jeered by crowds.