World History Chapter 28

 At the end of WWI, fears about communism taking over swept the U.S.  Became known as the “Red Scare”  Many government officials houses were bombed  Persecution of immigrants increased  Example: Sacco-Vanzetti Case – 2 Italian immigrants put to death for robbing a store and killing 2. Both were anarchists.

 After WWI, KKK membership was sold for $10  Had new differences  The Klan now hated African Americans, Jews, Roman Catholics, and amoral individuals  By 1925 = 5 million members  Stolen membership $ and the Indiana killing and raping of a young lady, membership dropped to 9,000

 18 th Amendment: prohibited sale of alcohol  Al Capone – famous leading mobster that gained wealth off selling alcohol and prostitution  Was sent to prison for tax evasion  19 th Amendment: gave women the right to vote  Only affected white women

 On October, (called Black Tuesday), the stock market crashed  The Great Depression began and this economic downturn would last throughout the 1930s  Causes of the Depression: 1. Workers laid off; consumers buying less; surplus was adding up 2. American business unbalanced (no one was buying cars and houses)

3.Pay increases not keeping up with the economy 4.Many people were in debt 5.All nations of Europe owed U.S. money from WWI 6.In 1930, 9,000 banks were forced to close because loans were not being paid back 7.High unemployment (urban and rural) 8.The Dust Bowl hit – little rainfall fell which led to dust storms making farming impossible

 Hoover tried to restore confidence in the economy  Many blamed Hoover for the economy but Hoover was insensitive to the needs  Created Hoovervilles – shelters outside of towns where people lived when they got evicted  The Depression affected the world – some countries were worse off than the U.S.

 Franklin Delano Roosevelt (FDR) defeated Hoover in the 1932 election  Created the “New Deal” – FDR’s plan to get out of the depression  New Deal Legislation: 1. Agricultural Adjustment Administration – paid farmers NOT to produce on ¼ of their land (driving prices up); declared unconstitutional 2. Tennessee Valley Authority – built dams, generate electrical control, establish flood control, and sell fertilizer; brought cheap power to TN

3. National Industrial Recovery Act – an act designed to increase wages, lower unemployment, balance consumption and surplus 4. Public Works Administration – publicly funded construction on dams, bridges, roads, and public buildings (to provide jobs) 5. Federal Deposit Insurance Corporation (FDIC) – guaranteed bank deposits up to $2,500 to encourage investing

6. Social Security Act – created to have the government be responsible for people over 65 funded by people currently working 7. Works Progress Administration – similar to the PWA; provided jobs for the unemployed 8. Court-packing Plan – Roosevelt’s solution for the Supreme Court striking down New Deal legislation; allowed him to appoint people to the Supreme Court that supported his New Deal

 The New Deal was very controversial  The Social Security Plan led to modern welfare  Farm subsidies became modern federal involvement in agricultural pricing and production  Despite the New Deal, the only thing that would really get the world and the U.S. out of the Great Depression, was World War II…