Download Nada Abdullah APUSH Notes January 30, 2017 Chapter 24

Nada Abdullah
APUSH Notes
January 30, 2017
Chapter 24: The Great Depression and The New Deal
Causes and Effects of the Depression, 1929-1933:
● Wall street Crash
○ Stock markets were rising from March 1928 to September 1929
○ This all collapsed in October 1929 and millions of investors lost their money
● Black Thursday and Black Tuesday
○ October 24, 1929: ​Black Thursday
○ There was a large amount of selling done on wall street, stock prices “plunged”
○ October 29, 1929: ​Black Tuesday
○ Stock prices had just continued to fall ever since that day
○ Stock prices hit bottom three years later
● Causes of the Crash
○ There was an uneven distribution of income
○ Wages have risen a very small amount considering the amount of productivity
○ Top 5 percent of the richest Americans received over 33 percent of income
○ People began to “play the market” which meant they were no longer investing money
○ People began to wait for the price of a stock to go up
○ People borrowed cost of the stock making down payments of 10 percent
○ Investors depended on the stock prices to increase
○ When the market collapsed, investors lost everything they invested in
○ Farmers suffered from overproduction, high debt, and low prices since WWI
○ Overproduction of consumer goods
○ Because of international banking, manufacturing and trade, nations had become more
independant
○ Europeans never recovered from WWI, US was oblivious to this
● Effects:
○ The nation’s income declined by over 50%
○ 20% of banks were closed, which wiped out 10 million savings accounts
○ 13 million people were unemployed by 1933
○ Farmers and African Americans suffered the most
○ Poverty and homelessness increased
● Hoover’s Policies:
○ President Hoover encouraged:
■ No business cut wages
■ Unions not to strike
■ Private charities should increase their help with the needy and unemployed
■ Hoover believed that public relief should come from state and local governments
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Responding to a Worldwide Depression
○ Europeans success was closely tied to the United States
○ Hawley-Smoot Tariff (1930): Congress set taxes on foreign imports
○ Purpose: US believed that putting a high tariff would decrease their foreign competition
○ Europeans then began to enact higher tariffs on US goods
○ Both national and international economies suffered deeper depression
○ 1931, US and Europe were suffering so bad that the Dawes Plan couldn’t continue
○ Hoover proposed a suspension of international debts
○ Britain and Germany accepted, France denied
○ Many depositors withdrew money
Domestic Programs: Too Little, Too Late
○ Farm board was created in 1929
○ Board was allowed to help farmers make their prices stable by holding grain and cotton
○ Reconstruction Finance Corporation: Government owned corporation created in 1932
○ RFC was created to stabilize key businesses
○ Democrats believed it would only help the rich
Despair and Protests
○ Farmers banded together to stop banks from closing their farms and taking their homes
○ Farmers created the farm holiday association
○ This was created to attempt reversing the drop in prices
○ This was established by stopping the entire crop of grain harvested in 1932
○ Effort was stopped after violence erupted
○ Summer of 1932: Unemployed veterans marched to Washington D.C to demand
immediate payment of the bonuses promised them at a later day
○ Congress failed to pass the bonus build
○ President Hoover was seen as heartless and uncaring
The Election of 1932
○ Republicans renominated Hoover
○ Democrats nominated Franklin D. Roosevelt and John Nance Garner of Texas for vice
president
○ Roosevelt pledged the repeal of Prohibition, aid for the unemployed, and cuts in
government spendings
○ Voters were only worried about the depression, voters looked for a candidate who would
end the hard times
○ Roosevelt was chosen as president
○ Twentieth Amendment was passed in February 1933 and ratified by October 1933
Franklin D. Roosevelt’s New Deal
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F.D.R: The Man
○ Roosevelt expanded the size of government, scope of operations and enlarged powers of
presidency
○ Roosevelt was paralyzed by polio in 1921
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○ Continued his work in office, regained full power in upper body
○ FDR was elected governor of NY
○ He instituted number of programs to support minority and jobless
New Deal Philosophy
○ New deal programs were meant to protect the Three R’s:
○ Relief​ for people out of work
○ Recovery​ for Business and the Economy as a whole
○ Reform​ of American economic institutions
○ Louis Howe: Chief political adviser
○ Brain Trust: Rexford Tugwell, Raymond Moley, and Adolph A. Berle, Jr.
○ High administrative positions were the most diverse containing: African Americans,
Catholics, Jews and Women
○ Frances Perkins: First woman to ever serve in a President's Cabinet
The First Hundred Days
○ Congress passed into law everything that the president requested
○ Over 5,000 banks had failed in 1933
○ Banks closed for a bank holiday on March 6, 1933
○ Congress passed the Beer-Wine Revenue Act (legalized the sale of beer and wine)
○ Twenty-first amendment repealed the eighteenth amendment bringing Prohibition to an
end
○ When the banks reopened, there was more money in the bank than there was withdrawn
Financial Recovery Programs
○ Emergency Banking Relief Act: government were allowed to examine the finances of the
banks when closed
○ Federal Deposit Insurance Corporation's (FDIC): guaranteed individual deposit of $5,000
○ Home Owners Loan Corporation (HOLC): provided refinancing of small homes to
prevent foreclosures
○ The Farmers Credit Administration: provided low interest farm loans and mortgages to
prevent foreclosure on the property of indebted farmers
Programs for relief for the unemployed
○ Federal Emergency Relief Administration: offered grants of federal money to state and
local governments that were operating soup kitchens
○ Public Works Administration: Allotted money to state and local governments for building
roads, bridges, dams and other public works.
○ The Civilian Conservation Corps: employed men and gave monthly sums to families
○ The Tennessee Valley Authority: hired thousands of people to build in Tennessee Valley.
TVA sold electricity to residents
Other programs
○ Industrial Recovery Program: combination of relief and long term reform. NRA was an
attempt to guarantee wages for companies and industries
○ Farm Production control program: Associated with the Agricultural Adjustment
Administration (AAA). Farmers were advised to reduce production. Farmers were
offered to pay government subsidies for ever acre plowed. Concluded as unconstitutional
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The Civil Works Administration: hired new laborers for temporary jobs in construction
sponsored by Federal government
The Securities and Exchange Commission: created to regulate stock market. Places strict
limits
The Federal Housing Administration: Insured bank loans to rebuild houses and build new
ones
The Second New Deal:
● Relief Programs:
○ Works Progress Administration: WPA employed 3.4 million people (men and women).
○ Most workers under the WPA worked on construction (buildings, roads, airports, bridges
etc.)
○ Unemployed artists (painting, writers, actors) were put to work by painting murals, write,
and perform.
○ Resettlement Administration: provided loans to sharecroppers, tenants and small farmers.
● Reforms
○ National Labor Relations (Wagner) Act (1935): Guaranteed a workers rights to join a
union
○ National Labor Relations Board: empowered to enforce the law and protect workers’
rights
○ Rural Electrification Administration: provided loans for electrical cooperatives to supply
power to rural areas
○ Federal taxes: Revenue act of 1935, increased the tax on wealthy.
○ Federal taxes also increased the tax on large gifts from Parent → child
● The Social Security Act
○ Created a federal insurance program based upon the automatic collection of taxes
○ Social Security would be to make monthly payments to retired people over the age of 65
● The Election of 1936
○ Roosevelt was nominated for a second term
○ Alfred Landon was the republican nominee
○ Roosevelt won every state except Maine and Vermont, 60% of the popular vote
○ Democrats consisted of African Americans mainly in the Northern Cities
○ Africans joined the Democratic party because of Roosevelt’s New Deal
Opponents of the New Deal
● Liberal Critics
○ Socialists and extreme liberals in the democratic party criticized the new deal
○ Claiming that the new deal was doing too much for businesses and less for the
unemployed and the working poor
○ Also claimed that the president failed to address the problems of women, ethnic
minorities, and the elderly
● Conservative Critics
○ Attacked the New deal for giving federal government too much power
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Conservative critics believed that WPA and labor laws bordered on communism and
socialism
○ Anti-new deal organization was created called the “American Liberty League”
○ It’s purpose was to stop the New deal from “subverting” the economic and political
development in the US
Demagogues
○ Charles E. Coughlin: Catholic Priest who founded the National Union of Social Justice
○ NUSJ called for issuing an inflated currency and nationalizing banks
○ He was Anti-semitic and Fascist
○ Dr. Francis E. Townsend: Retired Physician
○ Proposed that every retired person over 60 receives $200 a month
○ Huey Long: “Share our Wealth Program” promised a minimum of 5,000 for every family.
It was paid by taxing the wealthy
○ Long challenged Roosevelt by running for president
○ He was assassinated
The Supreme Court
○ Roosevelt didnt get to appoint any judges or representatives of his choice
○ Roosevelt proposed a judicial reorganization bill in 1937
○ It proposed that the president should be able to appoint an additional justice for each
current justice who was older than 70.5 yrs old.
○ Roosevelt would’ve been allowed to add up to 6 new judges
○ Republicans and Democrats believed this was an attempt to tamper with system of checks
and balances
○ Accusations that the President was trying to give himself the most power arises
Rise of The Unions
● Formation of the C.I.O
○ American Federation of Labor: made up of many unions dominated by skilled white
workers and were organized according to crafts
○ AF of L advocated for recruitment of workers despite their race and sex or their level of
skill
○ John L. Lewis: Leader of Committee of Industrial Organizations and the president of the
United States Mine Workers Union
○ 1936, AF of L suspended C.I.O. Unions and renamed it the ​Congress of Industrial
Organizations
○ AF of L became the CIO’s largest rival
○ Strikes were very often in the Depression time
○ Workers at an automobile shop believed it was their right to join a union by participating
in a sit-down strike
○ Finally, the United Auto Workers Union was created
○ 1937, a demonstration union picketers ended with four deaths
○ Smaller steel companies agreed to deal with the C.I.O by 1941
● Fair Labor Standards Act
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Established in 1938
Established minimum wage of 40 cents an hour
Maximum workweek of 40 hours
Child-labor restrictions on people under 16
Supreme Court declared that child labor was unconstitutional
Last Phase of the New Deal
● Recession, 1937-1938
○ Banks were stable, businesses earning were rising, and unemployment decreased by 10%
○ 1937, economy had a “backward slide”
○ New social security act reduced customer spending
○ President hoped that this would balance the budget and reduce national debt
○ John Maynard Keynes: British Economist
○ He believed that the government's spending would initiate economic growth
○ As federal spendings on public works and relief increased, employment and industrial
production increased as well
● Weakened New Deal
○ Election of 1938 reduced Democratic Majority in Congress
○ 1938, increased in action in Nazi Germany diverted attention from domestic concerns to
International and foreign affairs
Life During the Depression
● Women
○ Women sought to work because there was an income struggle since many fathers were
unemployed
○ Women were accused of taking jobs from men
○ Many New Deal programs allowed women to receive lower pay than men
● African Americans
○ Racial discrimination continues into the 1930s
○ Employment rates were higher than national average
○ Jobless A.A were excluded from state and local relief programs
○ Lynching continued in the South
○ Civil rights leaders feared that they would lose votes to democratic white southerners
○ The New Deal did provide relief and gave A.A’s low paying jobs
○ Jobs were still segregated
○ African American singer Marian Anderson had been refused the use of Constitutional
Hall in Washington D.C
○ Eleanor Roosevelt organized Anderson to have a concert at Lincoln Memorial
○ Over 100 African Americans were given middle level positions in federal departments by
Roosevelt
○ 1941, an executive order was released to create a committee to assist minorities in
gaining jobs
● Native Americans
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John Collier: Native American Activist
1933, Collier was appointed commissioner of Bureau of Indian Affairs
Indian Reorganization Act (1934): This act returned land to the control of the tribes and
supported preservation of Native American Culture
○ Dawes Act of 1887: Encouraged Native Americans to be Independent
Mexican Americans
○ M.A were the principal source of agricultural labor in CA and the SW
○ High unemployment and drought in the Midwest caused dramatic growth in white
migrant workers
○ Discrimination in the New Deal forced many thousands of Mexican Americans to return
to Mexico