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Chapter 22: The Great Depression Begins

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Eileen Brown

on 16 April 2018

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Transcript of Chapter 22: The Great Depression Begins

Bank and Business Failures
Money was quickly withdrawn from banks
No gov't insurance on bank accounts
Run on a bank
Chapter 22: The Great Depression Begins
Hoover Takes the Nation
1928 election: Herbert Hoover (R) against
Alfred E. Smith
(D)
Hoover cited the prosperous times of Republican administration
"final triumph over poverty"
Consumer Culture
Living on credit / installment plans
Uneven distribution of income
Rising prices but wages freeze
Installment plans feed off of the income gap
The Nation's Economy is Sick
Industries in Trouble
Railroads and coal mining
Alternatives
Housing market dropped
Dreams of Riches in the Stock Market
Dow Jones Industrial Average
Gauges how well the stock market is doing
30 large companies serve as an indicator
Stocks rose and many bought shares
Bull Market
Farmers Need a Lift
Crops were high demand during WWI
Loans = new equipment & land
= increased production
Speculation
- buying stock, expecting a quick profit, and not considering risks
Stock prices did not reflect a company's worth
Buying on the margin
- putting a down payment on stock and borrowing the rest
If the stock declines no way to pay off loans
The Stock Market Crashes
Value of stocks were declining
Why?
Fall 1929 investors panicked and started to sell
October 29 - Black Tuesday
Prices plummeted
Beginning of the Great Depression
Financial Collapse
The Great Depression
- 1929 - 1940
Bad economy and high unemployment
The Crash NOT the only reason for the G.D.

World Wide Shock Waves
1930 -
Hawley-Smoot Tariff Act
Protect American farmers and manufactures
Opposite effect
Unemployment in export industries
Other countries levy tariffs
Europe still has war debts
Causes of the Great Depression
Tariffs and war debt
= loss of foreign market
Collapse of farming industry
Overproduction followed by drought
Availability of easy credit
Unequal distribution of wealth

The Depression in Rural Areas
Many farmers lost their land
Foreclosures
Tenant farming
The Dust Bowl
1930s Drought in the Great Plains
Farmers and sharecroppers moved west to CA for jobs
Dorothea Lange - photographer
"Okies" negative term for the migrant workers
About 300,000 men became transient
Hobos
Traveled looking for jobs
Railroad box cars
Under bridges
Homeless shelters
Helped each other out
Chalked symbols
Effects of the American Family
Importance of family unity
Family entertainment
Many women canned food or sewed clothes
Women received a lower salary
Some thought married women should not take jobs
Some companies refused to hire
Jobs were temporary or seasonal
Begging seen as shameful

Children Suffer Hardships
Poor diet and money for healthcare
Budgets cut for schools and welfare programs
Many went to work or left home
Freight trains
"Wild boys" or "Hoover tourists"
Social and Psychological Effects
Loss of will to survive
Sacrifices to achieve financial security
Doctors, marriage, education
Habits of saving developed
Hoover Struggles with the Depression
Herbert Hoover
- economy will fix itself
Opposed federal welfare or direct relief
Weakens people's respect
Called together leaders in business and labor
Ease the economic issues
Work together
Boulder Dam
Proposed by Hoover years earlier
Generate electricity and flood control
$700 million public works program
1930 Congressional Elections
Democratic majority
Hoover Takes Action
Federal Home Loan Bank Act
1932, lowered mortgage rates and farmers could refinance to avoid foreclosure
Reconstruction Finance Corporation (RFC)
1932, up to $2 billion emergency financing for banks, insurance companies, rail roads, and other large businesses

Mockery:
Hoovervilles
Hoover blankets
Hoover flags
Money from the RFC would "trickle down" to the average citizen
How?
Many argued that direct relief was still needed
Gassing the Bonus Army
WWI vets traveled to Washington DC
The Bonus Army
Came to support the Patman Bill
A bonus to WWI vets - not adequately compensated
Congressman Patman - paid out immediately
Hoover opposed the legislature
Respected the right for peaceful protest
The bill was not passed
Hoover asked the men to leave
Many stayed
1,000 troops were sent in to disband the camp
MacArthur and Eisenhower
Violence ensued
Tear bombs
Three pictures by Lange
After the War prices dropped by almost half
McNary-Haugen Bill -
Price Supports
Government would buy surplus and sell on the world market
President Coolidge vetoed the bill (twice)
(Do not forget the Fordney-McCumber Tariff - 1922.)
Daily struggle put a strain on families
Men and unemployment
Discouraged
Abandonment
Hardship and Suffering During the Depression

Depression in the Cities
Evictions meant people were forced to sleep in parks or sewers
Shantytowns
were built
Hoovervilles
Waited on
bread lines
Charitable organizations or public agencies
No federal
direct relief
Cash payments or food
Racial tensions increased
Higher unemployment rates for African Americans and Hispanics
People of Mexican descent were moved to Mexico
Competition for jobs
Frustration:
Farmers destroyed crops rather than sell it at a loss
Farm holidays - refusal to work
Road blockages
Food shortages would raise crop prices
Full transcript