Instructions
• Pick up a Google Chromebook
• Log in: use your full login
– lastname.firstname@ltisdschools.net
• Go to my website (Great Depression)
http://goo.gl/TACS9J
• Wait for instructions.
End of the 1920s
• Election of 1928
– Coolidge not running for a
second term.
• Hoover vs Smith
– Herbert Hoover
• Sec. of Commerce under
Harding
• “Prosperity for everyone”
• “we are nearer to the final
triumph over poverty…”
Triple
Whammy
– Alfred Smith
• Irish-Catholic-Democrat
End of the 1920s
• Election of 1928
• Biggest Issue of the 28
Election?
21st Amendments repeals the 18th, ending Prohibition 1933
Triple
Whammy
Hoover Disconnected?
• Oct 25, 1929- Hoover claims
the foundation of nations
industry is strong.
• Oct 29, 1929- Stock Market
Crashed
• March 30, 1930- Hoover, “the
worst effects of the Crash will
pass in 60 days.”
Hoover’s Philosophy
• Believed:
– in “rugged individualism”
• the idea that people succeed
through their own efforts
– in confidence economics
“Prosperity is right around the corner.”
– money given to business leaders
would trickle down…
The “Hoover” Depression
• Believed help should
come from local
governments
–
–
–
–
–
–
State
City
Red Cross
Salvation Army
Churches
Charity
Debt vs. Deficit
Government Spending
• Military
• Social Programs
– Health care
– Welfare
– Unemployment
• Education
Red = Govt spends more money
than they make (deficit)
Blue = Govt makes more money
than they spend. (surplus)
•
•
•
•
•
2008 -4,000,000
2009 -10,000,000
2010 -5,000,000
2011 +6,000,000 (surplus)
2012 -3,000,000
Debt from 2008
to 2012
-16,000,000
The “Hoover” Depression
• Did little to
– spur job growth
– stimulate the economy
– grant government relief.
• Because he believed GOVT
relief would contribute to
DEFICIT SPENDING
• * Relief = Aid in any form
given by govt to people.
Too little too late
Voluntary efforts
1930
Encouraged business
leaders to PLEDGE to
stop slashing wages.
Only lasted a year
Public Works
Govt. financed building
projects
Could not compete with
the amount of jobs lost
in public sector.
National Credit Corp
Govt money given to
banks to keep lending.
Did not meet nations
needs.
Reconstruction
Finance Corp
Make loans to railroad,
banks & farms
Did not meet nations
needs.
Emergency Relief &
Construction act
Money given to states
for relief & jobs
Not enough to fight
effects of depression
Hoover looks bad
Hunger Marches Homeless & jobless petitioned
Washington to “tax the rich”. Faced
violence from police.
Farmer’s Revolts Foreclosed farmers destroyed their
crops hoping to drive up prices or
prevent banks from profiting on
their hard work
Bonus Marches WWI veterans asked for bonuses
early. “Patman Bill” assembled in
Washington. Hoover ordered army
to break up the crowd.
Hoover’s Legacy
• Failed President
• Lost to Roosevelt in ‘32
biggest landslide in US
history.
• Did more in govt relief than
any president before him.
• Depression & Bonus
Marches looked bad in the
eyes of Americans.
Roosevelt’s Philosophy
• Expand the role of the Executive
Office.
• Create federal aide for
unemployed
• Promote work relief and create
jobs that do not compete with
private industry.
• Abandoned the gold standard
• Allow Fed reserve to manipulate
value of the dollar
Franklin D. Roosevelt’s Appeal
• In 1932 presidential
election, FDR was
perceived as a man of
action.
• Hoover was viewed as a
“do-nothing president.”
• Results: a landslide for
Democrats and a mandate
to use government as an
agency for human
welfare.
Situation When FDR Entered Office
• In March 1933, the
country was virtually
leaderless and the
banking system had
collapsed.
FDR Restored Confidence
• In his inaugural address,
he said “The only thing
we have to fear is fear
itself….”
• He promised vigorous
leadership and bold
action, called for
discipline and
cooperation, expressed
his faith in democracy,
and asked for divine
protection and
guidance.
Presidency
• March 4 1933-Inauguration Day
– US unemployment @ 25%
– Most banks were closed
• Gold Standard = Bank Standards
– Economy in shambles
• First Hundred Days
– Sent dozens of BILLS to Congress
– Congress passed 15 BILLS into ACTS
of legislation (New Deal)
– Set Precedent for future presidents.
Purposes of the New Deal
• Relief: to provide jobs for the
unemployed and to protect
farmers from foreclosure
• Recovery: to get the economy
back into high gear, “priming
the pump”
• Reform: To regulate banks, to
abolish child labor, and to
conserve farm lands
• Overall objective: to save
capitalism
Sources of New Deal Ideas
• Brains Trust: specialists and
experts, mostly college
professors, idea men
• New Economists: government
spending, deficit spending and
public works, government
should prime economic pump
• Roosevelt Cabinet: included
conservatives, liberals,
Democrats, Republicans,
inflationist, anti-inflationists -often conflicting, compromising,
blending ideas
First New Deal (1933-1934)
•
•
•
•
Emphasis: reform
Political Position: conservative
Primary aim: economic recovery
Philosophy: economic
nationalism and economic
scarcity (i.e., raise prices by
creating the illusion of scarcity)
• Objectives: higher prices for
agriculture and business
• Beneficiaries: big business and
agricultural business
Second New Deal (1934-1941)
•
•
•
•
Emphasis: reform
Political Position: liberal
Primary aim: permanent reform
Philosophy: international
economic cooperation and
economic abundance
• Objectives: increased purchasing
power and social security for
public
• Beneficiaries: small farmers and
labor
Legacy
•
•
•
•
•
New Deal did not end the Depression!
Balanced economic interests
New ROLE for Federal government
Safety net- safeguards for average Americans
Made govt too powerful