Deanna Klima-Rajchel APUSH Notecards April 21, 2013 #100

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Deanna Klima-Rajchel

April 21, 2013

APUSH Notecards

#100-138

WWI

100. League of Nations

The LN is an international governmental organization. It was founded by the

Paris Peace Conference, which ended World War I.

The main objective of the League was to maintain international peace. It was the first organization of its kind. They heavily relied on negotiation and arbitration to settle international quarrels.

Some issues they discussed included labor conditions, treatment of native inhabitants, human/drug trafficking, arms trade, global health, prisoners of war, and protection of minorities in Europe.

At its peak, (September 28 th , 1934 to February 23 rd , 1935) it had 58 members.

An interesting aspect of the LN was that it had no armed force. The Great

Powers were to enforce all policies for them. Many nations in the Great

Powers were reluctant to follow through, because the possibility of countersanctions was a credible threat.

Lasting 27 years, it ultimately broke up during World War II. Proving it had failed, the League of Nations was replaced by the United Nations after WWII.

Cross-References: Senate Ratification, Senator Lodge, Senator Borah, and Rejection of the Treaty of Versailles.

101. Senate Ratification

The definition of Ratification is “ making something valid by formally confirming it.

” When a group wishes to make a bill into a law, the senate must ratify it in order to retain a system of checks and balances.

The President can form and negotiate a bill, but it will only pass if it goes through the senate with a 2/3rds majority

.

If the senate approves the proposal, the president may ratify it. Ratification mostly is in reference to treaties, other than the ratification of our

Constitution.

In instances with a treaty, members of the House of Representatives do not vote on its ratification.

Cross-References: League of Nations, Senator Lodge, Senator Borah, and Rejection of the Treaty of Versailles.

102. Senator Henry Cabot Lodge

Nicknamed “Slim,” Henry Cabot Lodge was born on May 12 th , 1850 and died on November 9 th , 1924. He was a Republican from Massachusetts, acting as a representative in both the state and national House before being a senator.

He was known as the Senate Majority leader, though he did not formally have that title. He was the first senator to hold this position. He was also chairman of the Senate Committee on Foreign Relations (SCFR). This committee leads foreign policy legislation.

He was also well known for his positions on foreign policy. He got into an extreme debate with President Wilson on the Treaty of Versailles in 1919.

He fought for congress to have control of the declaration of war. This was something that Wilson would never give up. As a result, the senate refused to ratify the treaty and did not join the League of Nations.

He was a good friend of President Teddy Roosevelt and a supporter of the gold standard. He was fiercely opposed to the Populists.

In 1890, HCL co-wrote the Federal Elections Bill, which would require the federal government to protect African Americans’ rights to vote.

Unfortunately, the bill was blocked by democrats and never passed.

Cross-References: Senate Ratification, League of Nations, Senator Borah, and

Rejection of the Treaty of Versailles.

103. Senator Frank Borah

William Edgar “Frank” Borah was born on June 29 th , 1865 and died on

January 19 th , 1940. He was a senator from Idaho. He was very well known as being a Progressive. Very outspoken, he became known as the Lion of Idaho.

Not only was he a senator, he was also the successor to Henry Cabot Lodge as chairman of the Senate Committee on Foreign Relations and Dean of the

Senate. He is the longest-serving member of congress in Idaho history.

He became known as the “Great Opposer” for sticking with his principles rather than remaining tied to party agenda. He was an anti-imperialist and believed in America remaining separate from European Great Power politics.

He was also with Henry Cabot Lodge on the Treaty of Versailles debate. He became a leader of the Irreconcilables, which was a group of senators that were extremely opposed to the treaty. In 1919, he toured the country with

Hiram Johnson on a speaking tour, to gain support against the treaty.

Cross-References: Senate Ratification, League of Nations, Senator Lodge, and

Rejection of the Treaty of Versailles.

104. Whistle Stop Tour

Also known as a Whistle Stop Train Tour, the Whistle Stop Tour was a style of political campaigning. It entails a politician making short speeches at small towns, for a short period of time. In the early days of the tour style, speeches were made from an observation car, or a private railroad car.

The political origins of the term came from Robert Taft, who accused

President Truman of “blackguarding Congress at whistle stops across the country.”

In many cases, candidates rarely even stepped on the ground of the towns where they gave speeches. The trains, chartered for the candidate’s tour,

would briefly stop, display the candidate on the rear platform of the train, and move on.

Cross-References: None

105. Rejection of the Treaty of Versailles

President Wilson left Paris on February 15 th , 1919 to return to America to promote the treaty. He felt that the center of the treaty was the League of

Nations. He considered the League to be a way to make the world safe for democracy, and end wars.

Upon his return, he discovered a considerably skeptical congress. Senator

Henry Cabot Lodge largely headed the anti-treaty sentiment, with help from

Senator Frank Borah and Senator Hiram Johnson. While many did not directly call out the League of Nations, many congressmen cited President

Wilson’s unwillingness to compromise as a reason to reject the treaty. On

November 19 th , 1919, the senate overwhelmingly denied the bill.

Cross-References: Senate Ratification, League of Nations, Senator Borah, and

Senator Lodge.

The Intolerant 20’s

106. Red Scare

The Red Scare refers to two periods in American history in which there is an overwhelming amount of Anti-Communism sentiment.

The first period, 1919 to 1921, was mainly came from the workers’ revolution and political radicalism. The second period, 1947 to 1957, was a much more paranoid time. Many Americans lived in fear of communist influence on United States society, especially in the federal government.

The first scare was initiated by the Bolshevik Russian Revolution of 1917, coupled with the patriot spirit during and after WWI. Newspapers, thanks to

Yellow Journalism, stirred up the anti-communist sentiment by posing anarchism as an answer to poverty. It became commonplace for the papers to misrepresent strikes as crimes and conspiracies, all secretly backed by

Communism.

In April of 1919, the scare became worse. It was discovered that bombs were being primed to send to 36 important American figures including JP Morgan,

John D. Rockefeller, Supreme Court Justice Oliver Wendell Holmes, Attorney

General Alexander Mitchell Palmer, and several immigration officials.

Just 2 months after the mail bombs were averted; chaos ensued in eight cities across America. Washington DC, more specifically the home of Attorney

General Alexander Mitchell Palmer, was a site of the bombs. It was that explosion that led to the demise of the bomber, who was found to be an

Italian-American.

In reaction, Attorney General Palmer directed the US Justice Department to begin a time known as the Palmer Raids (1919 to 1921). These raids were criticized as being unconstitutional.

Ironically, in 1918, President Harding pushed the Sedition Act of 1918 through congress. This bill was meant to uphold morale during the war by deporting persons of suspicion. It was an extremely anti-immigration, antianarchist piece of legislature. It allowed for the immediate deportation of anyone considered to be an alien radical.

Cross-References: Soviet Ark, “Normalcy,” Emergency Immigration Act of 1921, and National Origins Act of 1924.

107. Soviet Ark

Also known as the Red Ark, the Soviet Ark was a nickname given to an old military ship that was used to deport 249 non-citizens from the US on grounds of suspicion of communist activity.

Originally named the USAT Buford, the Soviet Ark was used for the agenda of the Department of Justice and the Department of Labor. The deportation took place on December 21 st , 1919, and included well-known anarchists Emma

Goldman and Alexander Berkman. The ship dropped the deportees off in

Russia, and returned to New York City.

Cross-References: Red Scare, Emergency Immigration Act of 1921, and National

Origins Act of 1924.

108. “Normalcy”

Normalcy, in this case, is in reference for a national plea for a return to life as it was before WWI.

Warren G. Harding used this national sentiment to make a campaign platform in the presidential election of 1920. Some believed it was Harding who actually coined the term “normalcy,” since at that time the popular phrase was normality.

Cross-References: Red Scare, Emergency Immigration Act of 1921, National Origins

Act of 1924, and Conformity.

109. Harding Administration Scandals

After Warren G. Harding won the election, he gave away a bunch of political positions to old friends and campaign contributors. He allowed his allies to have power over a multitude of federal money.

Unsurprisingly, many of these people, later known as the Ohio Gang, took advantage of their new roles. While Harding did appoint these people to their positions, there were no documents that suggest he had any idea that his friends were taking advantage of his generosity. He never profited off of anything his allies did.

None of the scandals were ousted during Harding’s lifetime, with the exception of the corrupt Veteran’s Bureau. He began reform of the bureau during March of 1923.

Cross-References: None

110. The Second KKK

The second coming of the Klan came up in Georgia in 1915. By 1921, it became a group of recruitment, causing a nation-wide growth in the KKK.

The re-popularity of the group, especially in cities, was mainly a side effect of the increasingly industrializing, immigrating world.

The main claim in the second KKK was “100% Americanism,” including nativist and anti-Catholic propaganda. They expected a total overhaul of political morals, especially in the call for Prohibition.

As it was since its inception, the Klan was exclusively open for WASPs. In the south, the violent nature of the group was not lost over the years. During the

‘20s, they claimed to have 4 to 5 million national members.

By 1930s, the Klan drastically plummeted to 300,000. Through a series of criminal activity and opposition, both internal and external, the KKK finally collapsed.

Cross-References: Scopes “Monkey” Trial, Harlem Renaissance, and Conformity.

111. Scopes “Monkey” Trial

Technically called “The State of Tennessee v. John Thomas Scopes.”

In 1925, a science teacher (John Scopes) taught evolution at a high school in

Dayton, Tennessee. This was a direct violation of the Butler Act, which was a

Tennessee law banning evolution in public schools.

Scopes was found guilty. However, he got off on a technicality.

The newspapers heavily covered the trial, because the prosecuting and defending lawyers were very famous in their time.

Prosecutor William Jennings Bryan was a well-known democrat that ran for president three times. The defending attorney, Clarence Darrow, was also a very well known attorney.

The trial unearthed a drastic contrast in popular views. The two opinions branched off into modernists, (who believed evolution worked with religion), and fundamentalists, (who took the bible too literally).

A 1955 screenplay entitled Inherit the Wind, and a 1960 film by the same name, depicted a fictionalized version of the story of the trial.

Cross-References: The Second KKK

112. Schenck v. US

Charles Schenck was the secretary of the Socialist Party of America, which mailed anti-WWI propaganda to over 15,000 draftees during our time in the war.

Schenck and the party believed that the draft was a violation of the 13 th

Amendment because it was a form of involuntary service.

Schenck v. US was a Supreme Court Case that was an enforcement of the

Espionage Act of 1917. The founding claimed that first amendment rights

(freedom of speech) did not give Schenck the right to speak out against the draft of World War I.

Justice Oliver Wendell Holmes Jr. led the court in a unanimous decision that, in wartime, citizens do not have complete freedom of speech.

Cross-References: Sacco & Vanzetti

113. Sacco & Vanzetti

A couple of Italian immigrant anarchists that were convicted of killing two men during an armed robbery in 1920 in South Braintree, Massachusetts.

Their trial was very controversial and ended in the two being executed on

August 23 rd , 1927. Many believed the two were wrongfully accused because the trial was full of contradictory evidence.

The two men that died, Alessandro Berardelli and Frederick Parmenter, were murdered at the Slater-Morrill Shoe Company factory on April 15 th , 1920. A pair of robbers held them up as they were delivering the company payroll.

There was no conclusive evidence that linked Sacco & Vanzetti to the crime, leading much of the public to believe that they were convicted simply because they were immigrants. The case became outrageously politicized.

Cross-Reference: Schneck v. US

114. Emergency Immigration Act of 1921

Anti-immigrant legislation during the first Red Scare. It was originally intended to be a temporary law, but it resulted in a few additions to immigration protocol.

The first new addition was a quota system for immigrants from all European countries. They made a formula based off of the number of immigrants from a specific country that were already in the US. For example: At the 1910

Census, there were 3,000 Italians in America. Every year, only 3% of the already present Italian population was calculated. (3% of 3,000 is 90.)

Therefore, immigration only allowed 90 Italians every year. This was done for each country.

The calculation, known as the National Origins Formula, was commonly used until 1965.

This drastically decreased the number of immigrants coming to America, especially from Southern and Eastern Europe. The Act was all in an attempt to maintain American culture. Anti-immigrant sentiment was largely heightened by post-war unemployment, which bread resentment for the lowcost immigrants.

Interestingly, the Act passed through the House without a recorded vote. In the senate, only 1 congressman rejected the legislation.

Cross-References: Red Scare, Soviet Ark, National Origins Act of 1924, and

“Normalcy.”

115. National Origins Act of 1924

Reformed and replaced the Emergency Immigration Act of 1921. Reduced the percentage of the population in the National Origins Formula from 3% to

2%. Also based the formula off of the 1890 Census, rather than the census from 1910.

While the Act was blatantly targeted at decreasing the number of immigrants from Southern and Eastern Europe, it was also a direct attack on immigrants from the Middle East and Asia.

While it was a very discriminatory Act, it did begin preferential immigration for family members and spouses of established immigrants. It also began fishing for immigrants over the age of 21 who were skilled in some craft or trade, especially farming. The families of this group also received preferential immigrant status.

Much later, some aspects of the legislation toned down the heavy discrimination against women being allowed to immigrate to America. It also divided immigration responsibility, giving half to individual states and retaining half for INS, (Immigration and Naturalization Service.) Parts of the law leaned toward immigration being denied to anyone who had not been given a visa from a consular officer abroad. (This was aimed primarily at

Chinese and Japanese immigrants.)

Cross-References: Emergency Immigration Act of 1921, Red Scare, Soviet Ark, and “Normalcy.”

Prohibition

Reform movement with small beginnings in the 1840s, popularized in the

1920s. While alcohol was never officially illegal, the movement cracked down on manufacture and sale of all alcoholic beverages. Many

Protestant churches were strong supporters of the movement.

Two major prohibition groups: The Women’s Christian Temperance

Movement and Anti-Saloon League. The WCTU was, obviously, a female take on the movement, led by WASP women all over the country. They were interested in prohibition for protecting working-class women and children from the evils of an alcoholic man.

The Anti-Saloon League was the business owner’s prohibitionist group.

The ASL fought for building codes that would ban the building of saloons in close proximity to major factories and other work places.

In January of 1919, congress ratified the 18 th Amendment, which prohibited the sale, manufacture or distribution of alcohol. In October of the same year, the Volstead Act was passed to enforce the new amendment. Many large cities, (with large immigrant populations), did not try very hard to crack down on alcohol.

While the consumption of alcohol considerably decreased, organized crime soared in large cities. (Supply and demand.) Though it was illegal publicly, many wealthy families continued to keep private bars exclusively for guests.

As the Great Depression hit, Prohibition became more and more unpopular. Headed by Pauline Sabin and a group of conservative democrats, the Repeal of Prohibition began. They argued that bringing back taxable alcohol would provide much needed revenue for the federal economy, not to mention a reduction in organized crime.

In December of 1933, the repeal was adopted into the constitution as the

21 st Amendment. It gave states the right to decide for themselves if alcohol should remain illegal. On a national scale, prohibition was dead.

However, it did last a bit longer in many southern and border states.

Cross-References: Speak Easies, Flappers & Flaming Youth, and “Lost

Generation.”

117. Speak Easies

Illegal bars that sold alcohol during Prohibition, from 1920 to 1933.

The speak easies were a den for the organized crime that heightened during that time. Many became homes for the various mobsters.

Throughout Prohibition, police continually raided and broke up these establishments, but they were so profitable, they rarely dissolved for very long.

Cross-References: Prohibition, Flappers & Flaming Youth, Conformity and

“ “Lost Generation.”

118. Flappers & Flaming Youth

Rebellious young women during the roaring 20’s. (Often western.)

Created a new style of dress. Popularized the bob hair-do and jazz music. They openly mocked contemporary behavior and old ways of life.

Many older generations were disgusted by the flappers, especially for their gaudy style, casual demeanor, (especially on the subject of sex), and overall unladylike behavior.

Flappers were largely influenced by post-WWI influx of jazz and liberalism.

Cross-References: Prohibition, “Lost Generation,” and Speak Easies.

119. “Lost Generation”

World War I generation. Originated from Ernest Hemingway’s novel

The Sun Also Rises, though he claimed to have heard the phrase from

Gertrude Stein.

In some cases, it may be in reference to the youth during the end of

WWI to the Beginning of the Great Depression. (Sometimes known as the World War I Generation.)

In Europe, the young people during the Roaring 20’s are known as the

Generation of 1914. The term Flaming Youth came from expatriates

that had settled in France and were known to the French as

“Génération au Feu,” (“Generation in Flames”).

In England, the Lost Generation was meant to describe the insurmountable death toll as a result of the Great War. In all nations,

WWI produced a generation of young people incomparable to any before them. Many had witnessed unspeakable horrors, and had numerous hardships to overcome.

Cross-References: Prohibition, Flappers & Flaming Youth, and Speak Easies.

120. Conformity

Dictionary definition: “Behavior in accordance with socially accepted conventions or standards.”

In the early 20 th century, there was a strong urge to conform to the

American Dream, and to reject all forms of outside culture being immigrated to the country at the time.

Flappers and the Lost Generation became poster children for “what happens when you don’t conform,” often being used as an example of what not to be.

After World War I, many returning GIs had a terrible time trying to conform to their lives before the war. As hard as the country tried, it was nearly impossible to return to pre-WWI lifestyle.

Cross-References: “Normalcy,” Hero Worship, and The Second KKK.

121. Hero Worship

Dictionary definition: “Admiration for great men, or their memory.”

During the years after WWI, servicemen were regarded very highly and respected by society. They became the public’s role models, exemplifying bravery and national pride.

During this time, celebrities began to integrate into American pop culture. Movie stars and singers were idolized, along with athletes and authors.

With the increasing economy of surplus, recreational activities began to soar. More and more people began to have the time to enjoy life, rather than work it away.

Cross-References: Conformity and “Lost Generation.”

122. Consumer Revolution

Took place starting in the late 1500’s and going on to the 1900’s. The general public began purchasing more and more products and goods.

It began to close the gap between the classes. Indulgence was becoming a commodity.

Western Europe and the Mediterranean had a major consumer revolution that spread from them. It was all made possible by the discontinuity of an economy of scarcity.

Cross-References: Conformity

123. Radio

In 1900, a Brazilian priest named Roberto Landell de Moura invented the radio. It was a device that transmitted human voice wirelessly.

He took his invention to America and got a paten. The radio allowed for news and current events to be transmitted with speed like never before.

Radios also became an affordable source of entertainment for a large percentage of the population. Singers, writers, poets and drama shows began appearing on radio stations all across the world.

Until the invention of the television, the radio was a staple in most

American homes.

Cross-References: Conformity, “Talkies” (1927), Advent of “National Pastime”

“ and Consumer Revolution.

124. “Talkies” (1927)

Motion pictures with sound recorded by a vibraphone. Became popular in the late 1920s. Originally started out as shorts. The first talkie was The Jazz Singer, which was released in October of 1927.

Talkies automatically took off and raised Hollywood to the status of household name.

Many professionals in the film industry scathingly criticized the

Talkies and suspected they would defile the artistic value of filmmaking. Many other parts of the world were more hesitant to adopt the films with sound.

Cross-References: Consumer Revolution, Advent of “National Pastime” and

“ Radio.

125. The Automobile

The car as we know it today actually has a history as far back as the

1700s. Scientists developed a primitive form of an automobile with a steam engine that paved the way for the internal combustion engine of the 1800s.

For the past 100 years, electric cars have faded in and out of popularity. In recent years, they have seemed to pick up momentum.

Henry Ford was the first entrepreneur to apply the factory assembly line to manufacturing cars in Detroit, Michigan in 1913. His Model T was an instant success that is direct ancestor to the modern car.

The popularity of traveling by car and interstate highway systems led to a boom in car culture in America. It went on to shape the way we work, travel, and even the way we eat. It is now permanently engrained in our country.

Cross-References: Consumer Revolution, Radio, Advent of “National Pastime,”

“ and “Talkies.”

126. Advent of “National Pastime”

Baseball was first referred to as America’s national sport in 1919, when Morris Raphael Cohen called baseball “America’s national religion.”

In the beginning, baseball was meant for the middle-class. Prices were considered high for the time, and game times were not sympathetic to a blue-collar work schedule.

In time, it grew on the American public and was a very popular sport by the 1900s. It enabled the public to keep up morale during WWI and

WWII.

Now, it has spread all over the world, inspiring many countries to open their own baseball leagues and immigrate to our leagues as well.

Cross-References: Consumer Revolution, Radio, The Automobile, and “””””T

“””” “Talkies.”

127. Harlem Renaissance

Cultural movement during the 20’s and 30’s. Reclaimed African-

American pride. Originally known as the “New Negro Movement.”

Named after the writings of Alain Locke.

The movement started in Harlem, in New York City, and spread to many urban areas of America. It got its roots from the African-

American literary movement after the Civil War.

Many followers were the children and grandchildren of slaves. They wanted to regain their African heritage. They were largely flooding the north at this time during the Great Migration out of the south.

Cross-References: The Second KKK

128. Jazz Age

Musical movement during the Roaring 20’s. Personified by flappers and the Flaming Youth. Jazz is now a popular part of American culture.

Originally, it was seen as “negro music,” and was not accepted by the middle or upper class.

New types of dance, such as the Charleston, began to pop up among listeners. With the invention of the radio developing at the same time, jazz was destined for greatness from the start.

With the blending of European and American cultures during and after WWI, jazz and blues became a major hit for the Lost Generation, and a national anthem for the Great Depression.

It was popularized when the white musicians took hold of the genre.

New York City and Chicago are two of the most popular cities for jazz, and were epicenters for the movement in their time.

Cross-References: Prohibition, Flappers & Flaming Youth, Conformity, Speak

“””” Easies, and “Lost Generation.”

Causes of Great Depression

129. Inequitable Distribution of Income

It is the goal of an entrepreneur to keep costs as low as possible, in order to keep profits as high as possible.

Manual labor is the biggest expense a business owner has. In order to keep costs low, the owner paid the workers barely enough to live.

Hardly living on their wages, workers were forced to buy only necessities. This greatly hurt the economy and strained the profit margins entrepreneurs so desperately protected.

Cross-References: 25% Unemployment

130. Over Production

Products were being overproduced in relation to its demand.

Many businesses thought their economic turmoil could be solved by lay-offs rather than simply cutting down on manufacturing products that weren’t being purchased.

Leaving consumers without jobs, there was no one to buy the products that were already being made in excess.

This was a major problem in the agriculture industry, which led FDR to write the Agricultural Adjustment Act. It created a quota system to cut down on over production of food.

Cross-References: Over Extension of Credit by Banks and 25% Unemployment.

131. Bad Foreign Debt From WWI

During WWI, many countries began to run out of resources necessary to continue the fight. We took up the cost and supported our allies.

After the war, the majority of the debt was still unpaid. Germany was expected to pay $40 billion worth of reparations to England and

France. Meanwhile, both countries owed the US $10 billion.

America loaned money to Germany, so they could pay back England and France. England and France then paid the US money, and the cycle went on and on. Became known as circular debt.

The Dawes Plan was meant to solve this issue, but it failed because the government did not watch the economics carefully enough.

Cross-References: WWI, Circular Debt and Scientific Government.

132. Stock Market Speculation

Predicting stock market trends. If the speculation is good, investors buy. If the speculation is bad, investors sell.

During the 20’s, too many “experts” were speculating trends. This led to many inflated highs and severe crashes throughout the decade, causing an unstable economy.

It was ultimately the main cause of the Great Depression.

Cross-References: Stock Market Crash and Great Depression.

133. Over Extension of Credit by Banks

Banks were giving out loans to people who had no means to pay them back.

Most small banks had this problem with farmers. Large banks did this with foreign countries in an attempt to recoup WWI losses.

When they could no longer lend money, many banks went bankrupt and people lost their loans. Almost shut down the American banking system.

Cross-References: Circular Debt and Great Depression.

134. Lack of Economic Forecasting by Coolidge Administration

Calvin Coolidge essentially undid every regulatory reform the progressive era achieved. President from 1923 to 1928, he believed in limited business practices.

He did not care for economics and made no attempt to keep track of government spending. Absolutely no effort toward scientific government.

He also believed in letting economic problems dealing with themselves, which totally jeopardized the economy.

Cross-References: 25% Unemployment, Scientific Government, Great

“””” Depression, Pres. Coolidge, and Progressive Era.

135. Outcomes of Great Depression

The initial outcome was the stock market crash of 1929. This crash revealed the 25% unemployment rate to the public, and woke people up to the financial horror they were in.

In a panic, citizens began a run on the banks, pulling out all of their money. Farmers were severely hit by the depression, as it was paired with the dust bowl and completely ruined their farms.

FDR came in to save the day with the New Deal. His goal was to restore America to its glory and totally revamp the social institutions as they were.

Cross-References: 25% Unemployment, Great Depression, and FDR.

136. 25% Unemployment

Rate of unemployment in America during the Great Depression.

Extremely high. Overall, the average was 25%. However, the agriculture sector had reached 30% by 1933.

Consumers were being paid too little to purchase anything outside of necessities. This led to lay-offs. Unemployed workers could buy even less than before. Led to an economic stalemate.

The rate took 15 years to revive. Many assume WWII was the saving grace of the economy.

Cross-References: Outcomes of Great Depression, WWII

137. Bank Failures

As the depression went on, banks started over extending themselves with loans. They ultimately bankrupted themselves and went out of business.

The descent began as soon as the crash in 1929. The run on the banks followed right after the crash and completely flushed out the banks’ capital in circulation. More than 5,000 banks busted throughout the depression.

FDR saw that this was a major issue and created the “bank’s holiday.”

This was a 30-day break where all banks were shut down and audited.

Some were considered “dead,” and others were consolidated. People stopped the runs, and the banks were restored.

Cross-References: FDR, Overextension of Credit, and Great Depression.

138. Herbert Hoover’s Call for Volunteerism

Hoover felt it was the responsibility of the wealthy to hold up the poor through the depression.

He thought the problem had less to do with over production, and more to do with a lack of distribution of wealth. His fix was to convince the wealthy to take part in philanthropic acts, to support the less fortunate through the depression.

The private charities ultimately failed because there was no return for the money they were shelling out. After that, he pushed rugged individualism, urging those in poverty to pull themselves out of the hole.

Cross-References: Philanthropy and Great Depression.

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