unit 5: causes of great depression/new deal

Causes of the Great Depression

Overproduction, stock market speculation, buying on margin, agricultural collapse, bank failures, and unequal wealth distribution. The 1929 stock market crash was a major trigger, but systemic issues had been building.

Business Cycle

Natural rise and fall of economic growth over time. Includes expansion, peak, contraction (recession/depression), and recovery.

Dow Jones Industrial Average

Key stock market index used to measure the performance of 30 major industrial companies.

Gross National Product (GNP)

Total value of goods and services produced by a country. During the Great Depression, the GNP fell by nearly 50%.

Effects of the Great Depression

Massive unemployment (25%), homelessness, poverty, decline in industrial output, bank closures, and social upheaval.

Hoovervilles

Shantytowns built by homeless people, named after President Hoover to criticize his inaction.

Dust Bowl

Severe drought and poor farming practices led to massive dust storms across the Great Plains, displacing thousands of farmers.

Herbert Hoover

President at the start of the Depression; believed in "rugged individualism" and was criticized for not providing direct relief.

Rugged Individualism

Hoover's belief that individuals should succeed through their own efforts without government aid.

Reconstruction Finance Corporation (RFC)

Hoover's program to lend money to banks and large businesses; aimed to stabilize the economy indirectly.

Direct Relief vs. Indirect Relief

Direct relief provides immediate assistance to individuals (cash, food); indirect relief targets businesses and banks to stimulate the economy.

Bonus Army

WWI veterans who marched on Washington in 1932 demanding early payment of bonuses. Hoover ordered their removal, hurting his public image.

Election of 1932

Franklin D. Roosevelt (Democrat) defeated Hoover in a landslide by promising a "New Deal" for Americans.

Franklin D. Roosevelt (FDR)

President from 1933-1945; implemented the New Deal to combat the Great Depression.

20th Amendment

Changed the inauguration date to January 20th.

21st Amendment

Repealed Prohibition.

New Deal

Series of programs and reforms designed to provide relief, recovery, and reform during the Great Depression.

Fireside Chats

Radio broadcasts by FDR to reassure and inform the public.

Hundred Days

First 100 days of FDR's presidency; saw a flurry of legislation aimed at economic recovery.

Bank Holiday

Temporarily closed banks to prevent further runs and restore confidence.

CCC (Civilian Conservation Corps)

Provided jobs for young men in conservation projects.

FDIC (Federal Deposit Insurance Corporation)

Insured bank deposits to prevent losses in case of bank failures.

FERA (Federal Emergency Relief Administration)

Provided direct relief to the unemployed.

TVA (Tennessee Valley Authority)

Built dams and power plants in the Tennessee Valley to generate electricity and improve the economy.

AAA (Agricultural Adjustment Act)

Paid farmers to reduce production to raise crop prices.

Wagner Act

Protected workers' rights to unionize and collectively bargain.

Social Security

Provided pensions for the elderly, unemployment insurance, and aid to the disabled.

Huey Long

Critic of FDR; promoted "Share Our Wealth" program.

Francis Townsend

Proposed a pension plan for the elderly; influenced Social Security.

Father Coughlin

Radio priest who criticized FDR's New Deal for not going far enough.

Court-Packing Plan

FDR's failed attempt to add more justices to the Supreme Court to secure favorable rulings for New Deal programs.

John Maynard Keynes

Economist who advocated for deficit spending to stimulate demand during economic downturns.