Great Depression Problems New Deal Solutions

Causes of the Great Depression Uneven distribution of wealth- workers not paid enough to buy what they produce Low interest rates->Businesses over-borrow money->over-produce goods beyond market demands Market flooded with goods that can’t be sold= businesses lay off workers and shut down

Causes of the Great Depression Speculation in the stock market= crash causes loss of money and bank collapse Cyclical effect of laying off workers who can’t afford the products, then laying off workers because products can’t be sold

Life During the Great Depression Record-high Unemployment Loss of homes= increased homeless population builds shantytowns (Hoovervilles) Anger of people affected by the Depression= hunger marches, protests Rise of entertainment (movies, music, radio shows, etc) to distract people Federal government programs to help citizens in need

The New Deal Federal Government programs designed to help people in need and stimulate the national economy Many current assistance programs either based on or continued from the New Deal

Banking and Finances Emergency Bank Relief Act (EBRA)- regulated banks Federal Deposit Insurance Corporation (FDIC)- Insured bank deposits Farm Credit Administration (FCA)- refinanced farm mortgages Home Owner’s Loan Corporation (HOLC)- financed homeowners’ mortgages

Agriculture and Industry Agriculture Adjustment Administration (AAA)- paid farmers to limit over-production National Industrial Recovery Act (NIRA)- limited federal production, set prices National Labor Relations Act (NLRA)- right for workers to form unions and bargain collectively Tennessee Valley Authority (TVA)- Rural modernization, developed seven states

Work and Relief Civilian Conservation Core (CCC)- created forestry job for young men Federal Emergency Relief Administration (FERA)- founded city and state relief programs Public Works Administration (PWA)- created work programs for public project (roads, bridges, schools)

Social “Safety Net” Social Security Act (SSA) Provided income for senior citizens, handicapped, and unemployed Monthly retirement benefit for people over 65