APUSH - Great Depression Study Guide

Overproduction

• Producing more goods (crops, manufactured items) than consumers can buy

  • This can lead to a surplus which can lead to an economic crisis

• This was a major cause of the Great Depression

Speculation

• Example of risky financial behavior

• Includes buying stocks or property hoping for quick profits from price increases

  • People are making a gamble in hopes that they can gain money

• Happened with the stocks during the 1920s

Margin Buying

• This is purchasing stocks by paying only a small percentage upfront and paying the rest using borrowed money

• Fueled the speculation of the 20s

• Contributed to inflated stock prices

Hawley Smoot Tariff

• This was a high U.S. protective tariff raising import taxes

• It was intended to help American farmers and industries during the Great Depression and protect from foreign industries

  • This tariff backfired and led to retaliatory tariffs from other nations

• It worsened the economic crisis

Black Thursday

• This was the first major stock market crash

• So many people were selling their stocks and prices plunged

• Marked the beginning of the Great Depression

Bank Runs

• This was a panic where many people withdrew their money from the banks

  • They were afraid it would fail and wanted their money

• This was a major crisis because banks weren’t holding all of the money

  • People lost all of their money and people lost confidence in their banks

Dust Bowl

• This was an ecological disaster during the Great Depression

• This was caused by intense drought and unsustainable farming such as overproduction

  • Created destructive dust storms that ravaged through Middle America

• Caused many people to lose their homes

Herbert Hoover

• He was the 31st President

• His Republican administration faced the Great Depression

• He had ineffective beliefs during the GD and made poor decisions

• Believed everyone was for themselves

  • No government intervention

• Not well received by the public

Rugged Individualism

• This is the belief that individuals should succeed through their own hard work, self-reliance, and determination

  • There is minimal government intervention

• Herbert Hoover promoted this idea

Shantytowns

• Makeshift settlements made out of scrap metal materials

• They sprang up all over the US because many were homeless and unemployed

• Symbolized the economic despair

  • Many blamed it on the president and called them “Hoovervilles”

Hoovervilles

• These were makeshift shantytowns of cardboard, scrap metal, and wood that homeless and unemployed people built in cities during the Great Depression

Bonus Army

• This was when WWI veterans marched to Washington D.C. demanding early payment of a promised bonus that they were supposed to receive in 1945

• They were violently removed from protesting

  • Encouraged by Hoover which damaged his reputation

Mexican Repatriation Act

• This was a mass deportation of Mexican immigrants and Mexican-Americans from the U.S. during the Great Depression

• This was driven by the economic hardship and anti-Mexican sentiment

  • Wanted to open up more jobs for white Americans

  • Lowered unemployment rates

Franklin D. Roosevelt

• He was the 32nd President who led Americans through the Great Depression

• He created the New Deal

• He believed in more government intervention

• He was better received by the public

Three R’s

• Relief, Recovery, and Reform

• These were core principles of the New Deal

• Relief

  • Offer immediate aid

• Recovery

  • Rebuilding the economy

• Reform

  • Prevent future crises and make government policies

    • CCC, TVA, Social Security Act

Radio

• New form of media and entertainment from the 20s

• People were able to get national news and be more connected

Fire Side Chats

• These were a series of informal radio addresses by President Franklin D. Roosevelt

• He spoke directly to the American people and reassured them about the New Deal

• He used a conversational tone and was very personable

Bank Holiday

• This is when FDR temporarily closed the banks to halt massive withdrawals

• This allowed for the government to regulate banks

Alphabet Agencies

• These were the numerous federal programs created by President Franklin D. Roosevelt's New Deal to combat the Great Depression

• These agencies addressed unemployment, poverty, banking crises, and agricultural hardship

• The government had a major role in society

New Deal

• This was FDR’s series of programs and reforms to combat the Great Depression

• It was characterized by the 3 R’s

FDIC

• Federal Deposit Insurance Corporation

• This was made to insure bank deposits up to $250,000 and restore public confidence in the banking system after massive failures

FSA

• Farm Security Administration

• Their goal was to combat rural poverty and help farmers who were impacted from the Dust Bowl and Great Depression

AAA

• Agricultural Adjustment Act

• This is when they were paying farmers subsidies to reduce crop production and kill excess livestock

  • They wanted to end the surplus

CCC

• Civilian Conservation Corps

• This employed millions of young, unemployed men

  • They worked on conservation projects like reforestation, flood control, and park development

TVA

• Tennessee Valley Authority

• The aimed to modernize the Tennessee Valley by creating projects to build dams and power lines in rural areas

  • It provided jobs and improved the standard of living

FERA

• Federal Emergency Relief Administration

• Aimed to provide direct relief (food, cash, jobs) to millions of struggling Americans during the Great Depression

PWA

• Public Works Administration

• They were funding large-scale public works projects (dams, bridges, schools, etc.) to create jobs and stimulate the economy

Court Packing

• This was the plan by FDR to add extra justices to the Supreme Court to get favorable rulings for his New Deal programs

• The plan failed

Social Security

• This was a New Deal program signed by FDR that established the first federal system of old-age benefits, unemployment insurance, and aid for dependent mothers/children

• Marked a major role of the government in the economy

Wagner Act

• This was a law that guaranteed workers the right to organize, join unions, and bargain collectively

• Boosted the power of unions

How did installment plans and other financial habits contribute to the start of the Great Depression?

Installment plans and risky financial habits contributed to the Great Depression by encouraging Americans to buy goods on credit rather than with savings, which left many families deeply in debt. When wages stagnated and the economy slowed, people could not keep up with payments, causing demand for goods to collapse. At the same time, easy credit fueled stock market speculation, and when the market crashed in 1929, consumers, banks, and businesses all suffered, worsening the economic downturn.

How did overproduction, speculation, farm failures, and bank failures negatively impact the US economy?

Overproduction led to more goods being made than people could afford to buy, causing prices to fall and businesses to cut jobs or shut down. Speculation in the stock market created an unstable economy based on borrowed money, which collapsed when stock prices crashed. Farm failures reduced farmers’ incomes and demand for goods, hurting rural banks, while widespread bank failures wiped out people’s savings and cut off credit, deepening the economic crisis across the nation.

What is the process of “buying on the margin” and why was it a risky investment in the 1920s?

Buying on the margin was the process of purchasing stocks by paying only a small portion upfront and borrowing the rest from a broker. This was risky in the 1920s because if stock prices fell, investors still had to repay the loans, often being forced to sell at a loss, which contributed to panic selling and worsened the stock market crash.

How did the Hawley-Smoot Tariff (and other high tariffs) damage the US economy?

The Hawley-Smoot Tariff damaged the U.S. economy by raising taxes on imported goods, which led other countries to retaliate with their own high tariffs. This caused international trade to decline sharply, hurting American farmers and manufacturers who depended on foreign markets. As exports fell and prices dropped, businesses cut production and jobs, worsening the Great Depression.

What was Black Thursday and how did this serve as the primary trigger of the Great Depression?

Black Thursday was October 24, 1929, the day the stock market experienced a massive sell-off as investors panicked and rushed to sell their shares. This crash shattered confidence in the economy, wiped out billions of dollars in wealth, and exposed weaknesses like over-speculation and buying on the margin, making it the primary trigger that pushed the U.S. into the Great Depression.

What were “bank runs” and how did they impact the economy between 1929-1930?

Bank runs occurred when large numbers of people rushed to withdraw their money out of fear that banks would fail. Between 1929 and 1930, these withdrawals caused many banks to collapse, wiping out personal savings and reducing the amount of money available for loans. As credit disappeared, businesses closed, unemployment rose, and the economic downturn grew worse.

What caused the Dust Bowl and how did it impact life for American farmers in the 1930s?

The Dust Bowl was caused by severe drought combined with poor farming practices that stripped the Great Plains soil of protective grass, allowing winds to blow the topsoil away. This environmental disaster ruined crops, destroyed farms, and forced many farmers into poverty or to migrate west in search of work, making life in the 1930s extremely difficult for rural families.

How were “rugged individualism” and Herbert Hoover’s economic response viewed by the public?

Rugged individualism and Herbert Hoover’s economic response were increasingly viewed negatively by the public as the Great Depression worsened. Many Americans felt Hoover relied too heavily on voluntary action and self-reliance, which seemed ineffective in the face of mass unemployment and poverty. As conditions declined, the public blamed his limited government intervention for failing to provide direct relief.

What were Shantytowns (Hoovervilles) and what was life like in these communities?

Shantytowns, often called Hoovervilles, were makeshift communities built by homeless Americans during the Great Depression. Made from scrap materials like cardboard, tin, and wood, they lacked sanitation, running water, and stable food supplies. Life in Hoovervilles was marked by poverty, overcrowding, and hardship, reflecting the widespread suffering of the era.

Why did the Bonus Army travel to Washington D.C. in 1932 and what was Herbert Hoover’s response?

The Bonus Army traveled to Washington, D.C. in 1932 to demand early payment of bonuses promised to World War I veterans, which were not due until 1945. As many veterans were unemployed and struggling during the Great Depression, they wanted immediate financial relief. Herbert Hoover refused their request and ordered the army to remove them, leading to a violent eviction that damaged his public image and increased criticism of his leadership.

What was the Mexican Repatriation Act and why was it enacted by Congress during the Depression?

The Mexican Repatriation Act was a government policy during the Great Depression that forced or pressured hundreds of thousands of Mexican immigrants and Mexican Americans to return to Mexico. It was enacted by Congress to reduce competition for scarce jobs and public assistance, as many Americans blamed immigrants for unemployment and economic hardship, even though most of those affected were legal residents or U.S. citizens.

How did Franklin Roosevelt’s philosophy on the ecnomy differ from Herbert Hoover’s?

Franklin Roosevelt’s economic philosophy differed from Herbert Hoover’s in that Roosevelt believed the government should take an active role in providing relief, creating jobs, and regulating the economy, while Hoover emphasized voluntary action and limited government intervention. Roosevelt’s approach focused on direct aid and programs to stabilize the economy, reflecting a more hands-on strategy to combat the Great Depression.

How did Roosevelt utilize radio and his “fireside chats” to speak directly to the American public?

Roosevelt used radio and his “fireside chats” to speak directly to Americans in a calm, personal, and reassuring way. These broadcasts allowed him to explain his policies, build public confidence, and make people feel connected to the government during the uncertainty of the Great Depression. By speaking plainly and warmly, he gained trust and support from millions of listeners.

What was the purpose of Franklin Roosevelt’s “Bank Holiday” and how successful was it?

Franklin Roosevelt’s “Bank Holiday” temporarily closed all banks to prevent further withdrawals and panic during the banking crisis. This pause allowed the government to inspect banks and reopen only those that were financially sound, restoring public confidence. It was highly successful, as depositors returned their money, stabilizing the banking system and helping to revive the economy.

How did Roosevelt’s “alphabet agencies” (FDIC, FSA, AAA, CCC, TVA, FERA, PWA) function?

Roosevelt’s “alphabet agencies” were government programs designed to provide relief, recovery, and reform during the Great Depression. The FDIC protected bank deposits, the FSA helped farmers, the AAA paid farmers to reduce crops, the CCC created jobs planting trees and building parks, the TVA developed the Tennessee Valley with electricity and flood control, the FERA gave direct aid to the unemployed, and the PWA funded public construction projects. Together, they aimed to create jobs, stabilize the economy, and support struggling Americans.

What challenges did Roosevelt’s New Deal face from the Supreme Court and how did he overcome them?

Roosevelt’s New Deal faced challenges from the Supreme Court, which struck down several programs as unconstitutional, arguing they gave the federal government too much power. To overcome this, Roosevelt proposed the “court-packing” plan to add more justices who would support his policies, and although the plan was controversial and largely rejected, the Court began upholding New Deal legislation, allowing his programs to continue.

How did the federal government expand protections for workers through the Wagner Act?

The Wagner Act expanded protections for workers by guaranteeing their right to form unions, engage in collective bargaining, and take part in strikes without fear of retaliation from employers. It also created the National Labor Relations Board to enforce these rights, giving workers a stronger voice in improving wages, working conditions, and job security.

What were the different parts of social security and how were the funds collected/istributed?

Social Security had several parts: retirement benefits for older Americans, unemployment insurance, and aid for disabled people and families with dependent children. Funds were collected through payroll taxes from both workers and employers and then distributed as monthly payments to eligible individuals, providing a safety net for those in need.