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Black Tuesday

October 29, 1929; Autumn of stock market fell out as millions of panicky investors ordered their brokers to sell, but almost no buyers could be found

Dow Jones index

Tells us how the stock market is doing and value of stocks; fell from 381 to 198 by late November 1929

Buying on margin

Allowed people to borrow most of the cost of the stock, making down payment as low as 10%

Uneven distribution of income

Economic success was not shared by all; top 5% of richest Americans received over 33% of all income; once demand for products declined, workers were laid off

Excessive use of credit

Low interest rates and belief of both consumers and businesses that economic boom was permanent lead to increasing borrowing and installment buying. Over indebtedness resulted in defaults on loan and bank failures

Overproduction

Business produced volume of goods that workers with stagnant wages cannot buy anymore

High tariffs

Enacted by Congress to protect US industries but hurt farmers and international trade

Federal reserve

Central banking system; blamed for depression because of tight money policy's as hundreds of banks failed; instead of trying to stabilize banks and prices and money supply, its focus on preserving gold standard

Stock market crash

Steep fall in prices of stocks due to widespread financial panic; caused by stockbrokers calling in loans; caused people to lose life savings because financial Institutions failed

Business failures

Company seizing operations cause of inability to make profit or cover expenses; result of great depression

Unemployment

When people have no jobs; result of great depression

Bank failures

Bank is Unable to meet its obligations to depositors or creditors; happened during great depression because people pulled all money out of banks

Gross national product

Value of all goods and services produced by nation in one year

Poverty and homelessness

Increased as a result of great depression; couldn't find jobs or pay mortgage, so government evicted

Herbert Hoover

One of the presidents of the great depression; thought prosperity would return easily; urged business is not to cut wages, unions not to strike, and a private charities to increase efforts for needy and jobless

Self-reliance

Reliance on ones powers and resources rather than those of others; Hoover afraid government assistance during great depression would ruin this for people

Hawley-Smoot Tariff (1930)

Set tax increases ranging from 31% of 49% on foreign imports; Europe retaliated by raising their tariffs

debt moratorium

Proposed by Hoover in 1931; this was a suspension on international debts. Britain and Germany excepted but France balked. International economy suffered from massive loan defaults and banks on both sides of Atlantic scramble to meet demands of depositors

Farm board

Created in 1925; powers enlarges to me economic crisis. Board authorized to help farmers stabilize prices by temporarily holding surplus grain and cotton in storage

Reconstruction finance corporation (RFC)

Federally funded/government owned; created by Congress in 1932 as a measure for propping up faltering railroads, banks, life insurance companies, and other financial institutions; president reason that emergency loans from this would stabilize these key businesses. Benefits would trickle down to small businesses; Democrats felt it would only hope the rich

Bonus March 1932

1000 unemployed World War I vets went to DC to demand immediate payment of the bonuses they were promised by 1945. Joined by thousands of other vets, congress failed to pass bonus bill; after two vets were killed in clash, general Arthur MacArthur used tanks and tear gas to drive vets out

Franklin D Roosevelt

Democrat nominee for president; Governor of New York; pledged for new deal, repeal of prohibition, aid for unemployed, And cuts in government spending. Won and was the 32nd president (served 12 terms) Had polio and was in a wheelchair for the rest of his life

Eleanor Roosevelt

FDR's wife who emerged as a leader in her own right. Most active First Lady in history, route newspaper column, gave speeches, and travel the country. Was FDR's social conscience and influence him to support minorities and the less fortunate

New deal

FDR's programs to stop the great depression; reduce unemployment, stimulate economy, and regulate financial system

Three R's

Relief for people out of work, recovery for business and economy as a whole, and reform of American economic institution

Brain trust

A group of university professors FDR turn to for advice on economic matters

Frances Perkins

FDR's secretary of labor; first women in president cabinet

Hundred days

FDR called Congress into a session for this time; Congress passed every law FDR requested; most of these were referred to by initials: WPA, AAA, CCC, NRA, etc.

Bank holiday

FDR ordered bank close on March 6, 1933 to restore confidence in banks still open; FDR went on radio and explained banks would reopen after government re-organize them on sound basis. passed emergency banking act on March 9 and banks opened on March 13

Repeal of prohibition

FDR had congress pass beer wine revenue act which legalized sale of beer and wine as means of raising needed tax money. Later 21st amendment was ratified

Fireside chats

FDR went on the radio to talk with American people. First one was on March 12, 1933 where he assured listeners that banks were safe and money deposited exceeded money withdrawn

Public works administration (PWA)

Directed by Harold Ickes ; allotted money to state and local government for building roads, bridges, dams, etc. (source of 1000 of jobs)

Harold Ickes

FDR's secretary of interior; directed PWA

Civilian conservation corpse (CCC)

Employed young men on projects on federal lands and paid their families small monthly sums

Tennessee valley authority (TVA)

Hired 1000s of people in one of the nations poorest regions to build dams, operate electrical power plants, control flooding and erosion, and manufacturer fertilizer; sold electricity to residence at lower rate than previous owners

Emergency banking relief act

Authorized government to examine the finances of banks closed during the bank holiday and reopen those judged to be sound

Glass Steagall act

Increased regulation of the banks and limited how new banks could invest consumers money

Federal deposit insurance Corporation (FDIC)

Guaranteed individual bank deposits

National recovery Association (NRA)

Directed by Hugh Johnson; an attempt to guarantee reasonable profits for businesses and fair wages and hours for labor; could help industries set codes for wages, hours for work, levels of production, and prices for finished goods; Also gave workers right to organize and bargain collectively

Schechler v US

Supreme Court declared NRA unconstitutional in 1935

Securities and exchange commissions (SEC)

Regulate the stock market and place strict limits on the kind of speculative practices that had led to Wall Street crash in 1929; required full audits of corporations to protect investors from fraud and insider trading

Federal housing administration (FHA)

Gave the building industry and homeowners a boost by ensuring bank loans for building, repairing, and purchasing houses; provided many families there first chance to buy home and build wealth that they could pass on to their children; used red lining to define neighborhoods were African Americans lived and did not make loans to that area

Henry Hopkins

Secretary of commerce under FDR and directed new deal relief programs

Workers Progress administration (WPA)

Sent billions of dollars from 1935 to 1940 to provide people with jobs; Hopkins in charge and after first year employed at 3.4 million men and women; paid them double the relief rate but less than regular wage for workers; the national youth administration provided part time jobs for young people in high school or college

National labor relations (Wagner) act 1935

Replaced the labor provisions of national industrial recovery act; guaranteed a workers right to join a union and the unions right to bargain collectively; outlawed businesses practices unfair to labor; national labor relations board enforced the laws and protected workers rights

Social Security act of 1935

Created federal insurance program based upon the automated collection of payments from employees throughout peoples working careers; this trust fund would then be used to make monthly payments to retired persons over 65

Limited welfare state

Government regulated economic activity and aided the poor and unemployed in order to provide economic security for everyone

Modern American liberalism

Basis of limited welfare state

Election of 1936

Democrats nominated FDR for second term; Republicans nominated Alf Landon. FDR won by a landslide

New deal coalition

Group of conservative Democrats and Republicans blocked further new deal reform legislation

Recession (1937 through 1938)

Winter 1937, economy slid backwards in a period of economic decline; this was because of government policies (partly)

John Maynard Keynes

British economist whose writing's taught FDR that he made a mistake in attempting to balance the budget; theory: deficit spending was helpful in difficult times because government needed to spend well above its tax Revenues for economic growth

Father Charles E Coughlin

Catholic priest in early 1930s who had weekly radio broadcast; founded national union for social justice; attacks on new deal became antisemitic and fascist and superiors ordered him to stop

Dr. Francis E Townsend

From Long Beach California; Became an instant hero to millions of senior citizens by proposing a simple plan for guaranteeing a secure income; 2% of federal sales tax be used to create special funding from which every retired person over 60 would receive $200 a month. By spending money they stimulate the economy

Huey long

Kingfish from Louisiana who is also a senator; proposed a share our wealth program that promised a minimum annual income of $5000 for every family paid for by taxing the wealthy; announced candidacy for president then was assassinated

Supreme court

Killed NRA for a business recovery and AAA for agriculture recovery by deciding they were unconstitutional in 1935

Reorganization plan

Proposed president be authorized to a point to the Supreme Court an additional justice for each current justice who is older than 70 1/2; called court packing bill

John L Lewis

Leader of committee of industrial organizations; president of united mine workers

Congress of industrial organizations

The rename of CIO (now CIO.); Broke away from AFL and became rival. Concentrated on organizing unskilled workers in automobile, steel, and textile industries

Sit down strike

Sitting down at assembly line refusing to work or leave factories; workers at General Motors in Flint in 1937 did this

Fair labor standards act

Established several regulations on business and interstate commerce: minimum wage, Max work week of 40 hours, child labor restrictions (no one under 16)

Minimum wage

Minimum amount workers could be paid per hour; initially it was $.40 per hour

Depression mentality

Attitude of insecurity and economic concerns that would always remain even in prosperity; people in great depression developed this

Drought

Period Without rain; one in 1930s ruined crops in Great Plains

Dust bowl

Region of great plains affected by drought; poor Farming practices combined with High winds blow away millions of tons of dry topsoil

Okies

People from Oklahoma and surrounding states who migrated to California in search of farm or factory work after their farms turn to dust

John Steinbeck

Wrote grapes of wrath

Grapes of wrath 1939

About Okies hardships; study of economic heartbreak

Mariah Anderson

Black singer who had been refused the use of constitution hall in DC by the all white daughters of American revolution; Eleanor and Ikes arranged for her to perform at Lincoln Memorial

Mary McLeod Bethune

Black who was appointed to mid-level position in federal department by FDR; had been leader of efforts for improving education and economic opportunities for women. Invited to DC to direct division of NYA, and established federal Council on Negro affairs

Fair employment practices committee

1941; assisted minorities and gaining jobs in defense industries

A Philip Randolph

Head of railroad porters union who threatened to march on DC to demand equal job opportunities for blacks

Indian reorganization (wheeler Howard) act

1934; repeal the Dawes act of 1887 and returned former reservation lands to the control of tribes and encouraged tribal organization and supported preservation of Native American culture