1. Shannon Slaughter St. Clair Co. High
THE GREAT DEPRESSION
Shannon Slaughter
St. Clair Co. High

2. THE GREAT CRASH

3. What caused the Great Depression?
GUIDING QUESTION
What caused the Great Depression?
the federal government during the 1920s?
PERSPECTIVE – did government intervention cause the depression? Or did lack of government intervention cause the depression?
(from 1983)

4. STOCK MARKET CRASH May 1928-September 1929, prices doubled in value
Stock Market Prices, 1921–1932
May 1928-September 1929, prices doubled in value
beginning in Sept 1929, gradual slide
Black Thursday (Oct. 24)
largest sell-off in NYSE history
Black Tuesday (Oct. 29)
$40 billion in stock value lost by Dec.
The Great Depression
Response of bankers, Hoover and business leaders
Faragher, Out of Many, 3rd Ed.;
Black Tuesday Wall Street, Oct. 29, 1929

5. John Maynard Keynes Economic Theory
When investments > savings = inflation
When savings > investments = recession
In the midst of an economic depression, the correct course of action should be to encourage spending and discourage saving.

6. UNDERLYING CAUSES OF THE DEPRESSION Keynesian Theorists
Overproduction - Massive business inventories (up 300% from 1928 to 1929)
Lack of diversification in American economy
prosperity of 1920s largely a result of construction & auto industries
Underconsumption -- Widened gap between rich and poor – lack of purchasing power among consumers
Farm income down 66% in 20s
By 1929 the top 10% of the nation's population received 40% of the nation's disposable income
Faragher, Out of Many, 3rd Ed.;

7. UNDERLYING CAUSES OF THE Depression Keynesian Theorists
Consumer Debt – middle class installment loans; buying on margin
Overspeculation in Stock Market – by wealthy and upper middle class
Laissez – Faire Economy –
Republican Presidential Economic Policy

8. Monetarism Theory Opposition to the Gold Standard
Restriction of the money supply (in accordance with the Friedman rule) to tame inflation in the economy.
Governmental control of the supply of the money will stabilize prices.

9. UNDERLYING CAUSES OF THE DEPRESSION Monetarists Theories
Weakness of Banking Industry
bank failures in late 1920s (farmers)
many had small reserves
low margins encouraged speculative investment by banks, corporations, and individual investors
Total money supply
closing of over 9,000 American banks between 1930 and 1933 – mostly small banks
Federal Reserve system – reduction in monetary supply causes deflation
Consumer Debt, 1920–1931
Faragher, Out of Many, 3rd Ed.;

10. UNDERLYING CAUSES OF THE DEPRESSION Monetarists Theory
Federal Reserve –
Did not do what it was supposed to – which is to protect small banks
Previously (before the Fed) LARGE banks stepped in to help small banks, but after creation of the Fed, those large banks no longer felt responsible for assistance
Decline in demand for American goods in international trade
European industry and agriculture gradually recovered from World War I
Germany so beset by financial crises/ inflation that could not afford to purchase US goods
High American protective tariffs

11. IMPACT ON SOCIETY

12. How did the Great Depression change American society in the 1930s?
GUIDING QUESTION
How did the Great Depression change American society in the 1930s?
(from 1996)

13. Effects on Business & Industry
GNP – $104 billion in 1929 to $56 billion in 1933
Total national income – fell by over 50%
Corporate profits - from $10 billion to $1 billon
Business failures: 100,000 between 1929 and 1933
Brinkley 10e

14. Effects on Business & Industry
Bank failures
about 20% all banks (over 6000) between 1929 and 1933)
over 9 million savings accounts lost($2.5 billion)
Depositors gathering outside a bank, April 1933
Bank Failures,
Graph: Divine America Past and Present Revised 7th Ed.
Outside Bank:
American Journey Online
1932

15. Effects of the Crash Great Crash World Payments Investors
Businesses and Workers
Investors lose millions.
Businesses lose profits.
Consumer spending drops.
Workers are laid off.
Businesses cut investment and production Some fail.
Banks
Businesses and workers cannot repay bank loans.
Savings accounts are wiped out.
Bank runs occur.
Banks run out of money and fail.
World Payments
Overall U.S. production plummets.
U.S. investors have little or no money to invest.
U.S. investments in Germany decline.
German war payments to Allies fall off.
Europeans cannot afford American goods.
Allies cannot pay debts to United States.
Pathways

16. Effect on workers and families
Unemployment ~25% in 1932?
Underemployment – loss of hours not jobs
patterns of reemployment and layoffs
hobos
“Depression mentality”
This photograph shows men lined up at the New York City Employment Bureau.  In the early years of the Great Depression, in the absence of federal jobs programs or of any sort of local or state unemployment assistance, people turned to agencies such as the New York City Employment Bureau to look for work.  Nationally, the unemployment rate had risen from 3 percent in 1929 to 6.3 percent in 1930 and to 16.5 percent in 1931; it stood at 29.4 percent in 1932, the year this photograph was taken.  [ajo]
Unemployment Graph: Faragher, Out of Many, 3rd Ed.;
Men Lined Up at the New York City Employment Bureau, 1932

17. Effect on workers and families
Malnutrition
Disease: tuberculosis, typhoid and dysentery.
City & state relief systems in industrial Northeast and Midwest collapse
soup kitchens and bread lines
Soup kitchen, Chicago, 1930
(Chicago)
Soup kitchen, 1931 (Cleveland)

18. Dorothea Lange “White Angel Breadline“ San Francisco 1933
White Angel Breadline" By Dorothea Lange, San Francisco, California, 1933 National Archives and Records Administration, Records of the Social Security Administration Copyright the Dorothea Lange Collection, Oakland Museum of California, City of Oakland, Gift of Paul S. Taylor. (47-GA )

19. Effect on workers and families
Women
Working - 25% more
New Deal – lower pay
Women’s Rights Movement - lowest point in a century
Families
Housing
Stress - divorce
Health – disease, suicide
Migrants - from South and Midwest to West
Women in Workplace: Brinkley 10e; This photograph was taken by Resettlement Administration (RA) photographer Carl Mydans (b. 1907) in March 1936.  It shows a woman and her two children in the abandoned chassis of a Ford automobile--their home--on U.S. Route 70 in Tennessee. [ajo]
Mother and two children living in an abandoned car in Tennessee, 1936
Women in Workplace

20. Effects on Farmers “Dust Bowl” “Okies” Grapes of Wrath Dust Bowl
Resettlement Adminstration
Pageant 13e
Dust Bowl
Dust storm, Springfield, CO, 1935

21.
Dust storm, Elkhart, KS, 1937

22. The Dust Bowl Aftermath of dust storms, South Dakota, 1936
Abandoned house, Haskell County, Kansas“, By Irving Rusinow, April 1941; National Archives and Records Administration, Records of the Bureau of Agricultural Economics, 83-G-41906)
Dust Bowl farm. Coldwater District, north of Dalhart, Texas. This house is occupied; most of the houses in this district have been abandoned. Lange, Dorothea, photographer June 1938 (LOC AmMem FSA-OWI(
Abandoned house, Kansas, April 1941
Dust Bowl Farm, Texas, 1938

23. Migrants “Okies” migrate west in 1939
A Destitute Family in the Ozark Mountains. 1935
“Okies” migrate west in 1939
This impoverished family in the Ozark Mountains region of northwestern Arkansas was photographed in October 1935 for the Resettlement Administration (RA) by Ben Shahn ( )
“Okies” -
“Covered Wagon” -
Dorthea Lange, “Covered Wagon Again” 1935

24. Migrants in California
"Cheap Auto Camp Housing for Citrus Workers“; By Dorothea Lange, Tulare County, California, February 1940; National Archives and Records Administration, Records of the Bureau of Agricultural Economics, (83-G-41555)
Migratory family in auto camp. California. Dorothea Lange 1936 (LOC Am Mem FSA/OWI)
"Cheap Auto Camp Housing for Citrus Workers“; Dorothea Lange, Tulare County, California, Feb. 1940
Migrant Auto Camp, California, 1936

25. “Migrant Mother” Florence Owens Thompson – taken at a pea pickers camp in N. California Family had sold their tent to pay for food. The photo was originally posted in San Francisco Examiner – US govt responded by sending $20,000 in aid to the pea pickers camp where this photo was taken. Thompson and family had already moved on by then. She never collected any royalties (was promised by Lange that the photos would not be published). Original of the photo sold at auction recently for $141, ~Dorothea Lange 1936~
Migrant Mother. Lange, Dorothea. 1936

26. Effects on African Americans
High Unemployment – up to 50%: Last hired, first fired
Competition for jobs
Exclusion from relief programs
Help from the New Deal?
Scottsboro Case -- nine African-American teenagers accused in Alabama of raping two white women on a train in 1931 – lack of evidence
This photograph, taken in January 1939 by Arthur Rothstein ( ), a photographer with the federal Farm Security Administration (FSA), shows a mother and child, their spring mattress propped up behind them, along U.S. Route 60 in New Madrid County, Missouri.  The woman and her family were sharecroppers evicted by their landlord at the height of winter. Evicted Sharecroppers along Highway 60 in Missouri. Rothstein, Arthur [ajo]
African American family during Great Depression in Scott’s Run, Virginia
Evicted Sharecroppers along U.S. 60 in Missouri, 1939

27. Effects on American Culture
Reactions of most Americans
Effects on basic values (capitalism, democracy, individualism)
Alternatives: socialism, communism?
Whom to blame?
Popular Culture and Escapism
Frank Capra
Walt Disney
Gone With the Wind

28. Effects on Politics Republican domination of government ended
Power of federal government increased greatly – New Deal
Socialism and Communism - failed to become a major force in American politics. Why???
Socialist party of America - Norman Thomas
American Communist party of the 1930s
Lincoln Brigade
The Popular Front
Nazi-Soviet Nonaggression Pact (1939)

29. HOOVER’S RESPONSE

30. Federal Response Under Hoover
Herbert Hoover ( )
Philosophy: limited government, individualism – Trickle – Down effect – get business on the right foot FIRST
Initial response?
Hawley-Smoot Tariff (1930) – protective
tariff for American business -- HIGH
Debt moratorium
Stop countries from paying the US for WWI – to ease their burden
International Banking Crisis (1931)- gold standard – Britain came off the GS
Reconstruction Finance Corporation (1932) – give low interest loans to business to spur economic development
Library of Congress Brinkley; "Boulder Dam, 1942“, By Ansel Adams, Nevada; National Archives and Records Administration, Records of the National Park Service (79-AAB-4); PBS American Photography
"Boulder Dam, 1942“, Ansel Adams

31. Evaluation of Hoover’s Response
Contemporary popular opinion – Hoover gets blame
“Hoovervilles”

32. This cartoon by Clifford Berryman ( ) mocks Herbert Hoover's efforts to end the depression.  Hoover's farm-relief programs are depicted as a straw scarecrow designed to scare off hard times. [ajo]
“Hoover's Farm Relief”

33. Contemporary Political Cartoon
Republican cartoon showing Hoover trying to solve the country’s problems
Contemporary Political Cartoon

34. Response to Hoover’s Response
Farmers
“Farmers Holiday Association” – farmers from Midwest decided to withhold farm products from the government
“Bonus Expeditionary Force” – BONUS ARMY
Bonus Army camp, 1932
By an unknown Associated Press photographer, July 1932, NARA
"Bonus Marchers" and police battle in Washington, DC, July 1932

35. Evaluation of Hoover’s Response
Modern Evaluations:
reluctance to spend large amounts of federal funds, expand the role of the federal government.
willing to intervene in the economy to an unprecedented degree.

36. Bonus Army Bonus Army camp in the Anacostia flats
(all)
U.S. Army soldiers guarding Bonus Army camp
Douglas McArthur directing removal of Bonus Army marchers

37. Misery Sweeps Roosevelt into Office
1932 ELECTION
Misery Sweeps Roosevelt into Office

38. 1932 ELECTION Franklin D. Roosevelt philosophy “New Deal”
[ajo]
Franklin D. Roosevelt, 1920 Vice Presidential nominee for Democratic Party
Roosevelt Campaigning for Office in Kansas 1932

39. New Yorker 1/16/1932 Alfred Frueh

40. 1932 ELECTION Hoover Results “The Worst is Past"
"Prosperity is Just Around the Corner"
Results
Electoral Shift: Martin, America and its Peoples 5e
Electoral Shift, 1928 and 1932

41. 1932 ELECTION Lame-Duck Period (Nov. 1932-March 3, 1933)
banking industry collapse.
Twentieth Amendment
Bank Failures,
Graph: Divine America Past and Present Revised 7th Ed.
Franklin D. Roosevelt and Herbert Hoover on the way to FDR's inauguration, March 4, 1933
With little in common but their top hats, Herbert Hoover and Franklin D. Roosevelt ride to Roosevelt's inauguration on March 4, (Library of Congress)
Pagent 13e
Franklin D. Roosevelt and Herbert Hoover on the way to FDR's inauguration, March 4, 1933
(Library of Congress)

42. SOURCES Brinkley, American History: A Survey (10th ed)
Wadsworth-Thompson
Library of Congress American Memory Project
Rutgers Univ. Teaching Politics Image Bank
Divine America Past and Present Revised 7th Ed.
Faragher, Out of Many, 3rd Ed.;
Kennedy, American Pageant 13e