The Great Depression and The New Deal

Causes and Effects of the Depression & How We Got Out

The " Great Depression " was a worldwide economic disintegration symbolized in the United States by the stock market crash on "Black Thursday", October 24, 1929 . The causes of the Great Depression were varied, but the impact was visible across the country. When FDR was inaugurated president on March 4, 1933, the banking system had collapsed, nearly 25% of the labor force was unemployed, and prices and productivity had fallen to 1/3 below their 1929 levels. Reduced prices and reduced output resulted in lower incomes in wages, rents, dividends, and profits throughout the economy. Factories were shut down, farms and homes were lost to foreclosure, mills and mines were abandoned, and people went hungry. The resulting lower incomes meant the further inability of the people to spend or to save their way out of the crisis, thus perpetuating the economic slowdown in a seemingly never-ending cycle.

SSUSH 17The student will analyze the causes and consequences of the Great Depression

A. Describe the causes, including overproduction, underconsumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression

Causes of the Great Depression

Global Economic Downturn (connection to WWI) Unequal distribution of wealth (rich-poor gap) Increased Supply, Decreased Demand (Overproduction & Underconsumption) Bank Failures Easy Credit & Margin Spending (buying stocks on margin: “speculation”) Stock Market Crash 1929

Stock Market Crash 1929

Effects of the Great Depression

Unemployment at 25 % Homelessness Poverty Destruction of Families Farm Losses Business and Bank Failures

Unemployment

Poverty: Soup & Bread Lines

Hoovervilles

Farm Foreclosure

“Migrant Mother”: photograph that Dorothea Lange made of Florence Owens Thompson and her children in 1936 in California. Lange gave this account of the experience: “I saw and approached the hungry and desperate mother, as if drawn by a magnet. She asked me no questions. I did not ask her name or her history. She told me her age, that she was thirty-two. She said that they had been living on frozen vegetables from the surrounding fields, and birds that the children killed. She had just sold the tires from her car to buy food. There she sat in that lean- to tent with her children huddled around her. “

(From: Popular Photography, Feb. 1960).

Migrant Mother Photograph

SSUSH 17The student will analyze the causes and consequences of the Great Depression

Explain the impact of the drought in the creation of the Dust Bowl

Black Blizzards: name given to the one thousand foot high dust storms that overtook the Midwest during the Great Depression. Farmers of the area in and around the panhandle of Texas abused the land with their poor farming techniques. Failure to take proper care of the soil they were using resulted in the land losing moisture which made it vulnerable to wind erosion. Besides land being destroyed by farmers, the rest of the land in the area that was rich in grass was also destroyed by overgrazing of livestock. The combination of this and a major drought in the 1930's led to the tragic events of the Dust Bowl.

SSUSH 17The student will analyze the causes and consequences of the Great Depression

C. Explain the social and political impact of widespread unemployment that resulted in developments such as Hoovervilles.

Hoover’s Policy

“Rugged Individualism”

Smoot-Hawley Tariff

Conferences & Speeches to help stimulate economy

Hoover’s Policy

Public Works projects: 1) big contracts 2) JOBS Over $800 million in public works Hoover Dam Reconstruction Finance Corporation

Bonus Army

Social Unrest

Hoover blamed for everything! Communism and Socialism considered

by many as viable form of government

Marches and Protests Bonus Army