Download Chapter 22 Great Depression Begins

Chapter 22
The Great Depression Begins
Black Tuesday: Oct. 29, 1929
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On October 24, the
market took a
plunge and many
investors sold their
shares.
On October 29 –
Black Tuesday –
shareholders
dumped over
16.4million stocks
with many not being
able to sell
This signaled the
start of the Great
Depression.
Bank and Business Failures
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Many rushed to the banks to get their
money but banks did not have
enough money because they
invested in the stock market causing
many them to close.
The Gross National Product – the
measure of output of goods and
services – was cut from $104 billion
to $59 billion.
Thousands of industries went
bankrupt such as automobiles and
railroads.
Unemployment went from 3% in
1929 to 25% in 1933. One out of
four workers were out of a job.
“Cycle of Disaster” – many businesses went bankrupt
Businesses cut
production
Workers suffered
from wage cuts
and lay offs.
Demand for
goods fell.
People had
little or no
money to spend.
A foreclosure sale in Iowa in the early 1930s when "the bottom
fell out of everything." Military police were on hand to keep
farmers from disrupting the auction. ca. 1935.
World Wide Shock
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America could not import
many goods making it difficult
for the US to sell their
products.
1930: Hawley-Smoot Tariff
Act passed the highest tariff
in history to protect against
competition.
However, it stopped other
countries from earning
American money to buy our
goods making unemployment
worse.
Congress did not understand
that we had become a
GLOBAL ECONOMY
Hardships & Suffering
During the Great Depression
Effects on Employment
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Many people found themselves out of
jobs for years
African-Americans and Mexican
Americans were discriminated
against in the workplace and were
targets of hostility
In 1933, 24 African-Americans were
lynched and thousands of Mexican
Americans were relocated to Mexico
voluntary and others deported
Men were not used to being
unemployed long-term and about
300,000 became hoboes who
wandered the country and slept in
boxcars.
Effects on Housing

Many
unemployed
people lost their
homes.
 Many homeless
lived streets or
set up
shantytowns
 Dug through the
garbage, went to
soup kitchens
and breadlines
Effects on Farming
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Decreases in farm prices forced many farmers to lose
their farms
Farmland was exhausted from overproduction and
was hit with drought and wind. This turned the land
into the Dust Bowl
Many farmers packed up and went west to be tenant
farmers and were called Okies
Effects on Women

The Depression
strengthened family
ties, but increased
tensions
 Women worked outside
the home, but were
discriminated and
received less money
 Faced great pressures
to provide for
themselves and their
families
Effects on Children
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Poor diets and lack of
money for health care led
to rise in health problems
Falling tax revenue forced
schools to shorten the
session and close
Teenagers hopped on
freight trains to escape
the suffering to search for
work and see America.
They were called Hoover
tourists.
Many riders were beaten
and jailed by freight yard
patrolmen.
Effects on Emotional Health
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Many people so demoralized that suicides and
admissions to mental institutions rose dramatically
Many Americans had to make financial compromises
such as seeing doctors or going to college.
Primary focus in many American’s lives became
achieving financial security.
Families helped out other families and developed
habits of thriftiness.
Hoover Struggles
with the
Depression
Hoover’s Philosophy
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He believed that the primary function of government
was to facilitate cooperation between competing
groups. If labor and business were in conflict the
government should help negotiate a solution
Rugged Individualism - Americans valued
individualism and as a result he opposed direct
government relief, such as handouts, they should
instead help guide relief through private charities
Hoover’s initial reaction was caution. He urged
companies to not cut wages and not fire employees.
He asked unions to not demand higher wages or go
on strike. These efforts failed to stop the
Depression.
Hoover’s Philosophy
Hoover’s Philosophy
America Responds
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People living in
shantytowns began
calling them
Hoovervilles and called
newspapers they
wrapped themselves in
Hoover blankets to
insult Hoover’s policies.
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In 1930, the Democrats
win control of the House
of Representatives
Hoover Responds
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Began a public works project to build
Boulder Dam in Nevada to jump start the
economy and provide jobs. Later
renamed Hoover Dam
 He passed in 1932 the Reconstruction
Finance Corporation (RFC) to give $2
billion to finance banks and other failing
businesses. Hoover believed that it
would trickle down to provide jobs and
improve the economy. However, more
businesses failed and the economy
worsened. It was too little, too late.
Boulder (Hoover ) Dam
The Bonus Army
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Hoover refused to give
WWI veterans bonuses
Vets marched into
Washington, D.C calling
themselves the Bonus
Army
Bonus bill failed to pass
and Hoover ordered the
Bonus Army to disband
Hoover sent in the army
who gassed more than
1,000 people and
caused a baby’s death.
Americans were
outraged at Hoover’s
action.