1. Notes 3.4: Hoover and the Great Depression

2. Reality of the Great Depression
The Great Depression affected nearly everyone in America.
People’s lives were often unbearable, with few joys or escapes from constant fear of homelessness, hunger, unemployment.

3. Ways to Escape Reality

4. A few industries did prosper in the Depression Era, mostly those that allowed Americans to escape their lives for a brief time.
Movies
Radio
Books and Photographs

9. Ways to Escape Reality
A few industries did prosper in the Depression Era, mostly those that allowed Americans to escape their lives for a brief time.
Movies gave people a safe, sheltered area to sit and be warm and escape their troubles.
Gone with the Wind, Snow White and the Seven Dwarfs, Groucho Marx, Mr. Smith Goes to Washington
Radio began comedy shows, adventure hero shows, soap operas so people could escape their lives.
Jack Benny and George Burns, The Green Hornet, The Lone Ranger, Guiding Light
Also, many authors, artists, and photographers during this time.
Steinbeck, Faulkner, Grant Wood (American Gothic), Thomas Wolfe, Henry Luce, Dorthea Lange

10. Hoover’s Plan to Fix Reality
Voluntary efforts by industry
Promises not to close business or lower wages more
They back out as things worsen
Public works
Government financed building projects
Did some good but not enough

11. Spend More? Save More?
The only way to really fix the economic issues was to massively increase government spending.
Hoover would not do this.
Why?
Raise taxes to pay for the projects? = take money from consumers and hurt businesses more
Keep taxes low and run a deficit budget? = borrow from banks, less money for businesses to borrow to expand or consumers who want mortgages
Feared either would delay the recovery even more.

12. The Problem of Money
Hoover believed in trickle-down economics: the government had to ensure that banks could loan money to businesses so they could expand and hire more workers.
Step 1: More Money
Asked Federal Reserve to put more currency into circulation – refused
Step 2: Get Banks to Help Banks
Created National Credit Corporation (NCC) to lend banks money to lend to corporations (no enough money)
Step 3: Government Help Businesses
By 1932, government doing the lending. Reconstruction Finance Corporation (RFC) to loan money. Was overly cautious and failed to loan enough to stimulate economy.
Avoid relief spending. Congress overruled this in 1932 with the Emergency Relief and Construction Act. This gave money to public works and to states to help citizens directly.

13. The Problem of Money
Hoover believed in trickle-down economics: the government had to ensure that banks could loan money to businesses so they could expand and hire more workers.

14. Step 1: More Money
Step 2: Get Banks to Help Banks
Step 3: Government Help to Businesses
Always: Avoid relief spending. Congress overruled this in 1932 with the Emergency Relief and Construction Act. This gave money to public works and to states to help citizens directly.

15. Angry Americans
As the Depression continued without help, Americans became resentful and angry.
By 1931, open revolt began to occur…
Hunger Marches
Began in January in Oklahoma, spread to DC
Backed by Communist Party, mistreated by police
Resulted in little change
Farmers Revolt
Farm prices had steadily declined, so some farmers deliberately destroyed their crops to raise prices by limiting supply
Led to food shortages but not to price increases
Bonus Army Marches
All WWI veterans were to be given a bonus of $1,000 in 1945.
Want money early due to economic crisis
In 1932, marchers began in Oregon and marched to DC, picking up supporters along the way
Swelled to over 15,000 petitioners, Hoover refused to meet with them
Lived in Hoovervilles, abandoned builidngs until police force them out
Media coverage causes even more anti-Hoover sentiment

16. Angry Americans
As the Depression continued without help, Americans became resentful and angry.

17. By 1931, open revolt began to occur…
Hunger Marches
Farmers Revolt
Bonus Army Marches