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Long-Term Causes of the Great Depression
Speculation in the stock market (betting or assuming the market would continue to climb, enabling a shareholder to sell their stock and make money quickly)
Bull Market (a long period of rising stock prices) - prolonged on in the late 1920’s (boom and bust)
10% of American households owned stocks by 1929.
Easy Credit(“installment ) or risky lending practices.
Buying on margin(making a small cash down payment like 10% of the price)
overproduction
uneven income distribution(wages too low for workers - undercut consumer demand; wages were too small for workers for an adequate market for the goods produced.)
too much reliance on a few industries for prosperity (ie. construction + automobiles) - lacked diversity
Interest rates kept to low by the federal reserve
Growing debt - because of buying on margin.
farmers deep debts and inability to repay loans within unstable banking economy.
Brokers issued margin calls (demands that investors repay loans at once - they needed more money as people were withdrawing rapidly)
Spark of Great Depression
Stock market crash- due to long term causes that weakened the ‘20’s economy.
“The stock market crash of 1929 did not so much cause the Depression, the, as help trigger a chain of events that exposed long-standing weaknesses in the American economy… the crisis steadily worsened over the next three years.
Effect of Great Depression on American society - After stock Market Crashed.
Crash lead to bank failures:
A crisis of confidence in the banking emerges as peoples savings were lost; plus banks lost money on their investments in the Stock Market and as speculators defaulted on loans.
by 1932, more than 10% on the nations banks had closed.a misguided monetary policy of the Federal Reserve was a contributing factor.It is responsible for regulating the amount of money in circulation and cutting the interest rate to stimulate economic growth.
Business close:
Business leaders believed their companies’ survival depended upon production cutbacks to maintain prices (supply and demand) and layoffs to reduce payroll.
Business closures lead to increase of unemployment rates:
companies began closing plants and firing workers to save money, while consumers spent less money and businesses then cut production further.
in 1922, around 25% of all American workers had lot their jobs.
Minorities will be prejudiced against more because the jobs are going to go to white men first. !! good for child labor- less workers needed!!
Feelings of personal failure:
Americans felt lost, ashamed and responsible for their financial situation; they blamed themselves for not being more responsibleUS citizens blamed themselves for the crash, not the government at the beginning of the crisis. Lost and ashamed and responsible, should have done more to safe guard against this
Lead to increase in charities and relief programs:
Soup kitchens, Red Cross, Salvation Army, and other charitable groups did what they could to provide for the growing number of desperate people.
Effect of Great Depression on the world - After stock Market Crashed.
International trade and credit was threatened.
Dawes Plan: the us is making money because we are charging interest as we continue to loan money so Britain and the French already owe interest and now so does Germany. a way to bring more profit to the US.
when depression hit the US, it triggered a world wide depression because Germany economy is dependent on US and France and Britain is dependent on germany so when the US money stops flowing, economies crashes and rise of hitler
the Great Depression in the U.S. ultimately helped to trigger a worldwide depression because of the failure of the Dawes Plan.
rise of totalitarianism in Germany and other European nations.
American Suffering during GB
Bonus Army Protests - WWI Vets demand government give them the money they were promised for fighting in the war because they needed it then more than ever.
shantytowns = homeless neighborhoods = hoovilles(Nickname when they started blaming president hoover.
Hooverblankets(newspapers) and hooverflags (empty pockets turned out)- nicknamed to blame hoover for the depression.
The Dust Bowl = ecological disaster which makes it harder for farmers to pay off debts and produce goods.
soaring unemployment
soup kitchens and bread lines = hoover tries to help(too late).
failing crop prices
Migrant laborers/”Okies” - nickname for a migrant, probably a migrant to try to find work from farming, usually from oklahoma.
The Dust Bowl
In addition to the economic hardships they faced, American farmers grappled with a severe drought on the Great Plains in the 1930s.
Though water shortage was a constant problem for the region, “[p]opulation growth & shifts in population distribution, along with new methods of farming, tipped the ecological balance of the region.”
Furthermore, there was less grass on the plains to prevent topsoil from blowing away.
By 1932, loose topsoil, over-farming and grazing, drought conditions and high winds resulted in giant dust storms.
Huge clouds of dirt and dust rose as high as 8,000 feet and moved as fast as 100 miles per hour while blocking out sunlight.
Geographically speaking, the region of Texas, Oklahoma, Kansas New Mexico and Colorado became known as the “dust bowl” during the 1930s or “dirty thirties.”
People could be temporarily choked and blinded by swirling dirt if caught in a dust storm, while the storms also killed cattle, birds, fish and fell in layers upon rivers.
“Dirt seeped into houses covering everything.”
In the end, the dust storms displaced twice as much dirt as Americans had removed while digging to build the Panama Canal.
Escapism
Form of escaping ones trouble, effect of GD.
Went to the movies (bugs bunny)- only 15 cents for 7 hours(no TV)In fact, the years of the 1930s are considered the golden era of Hollywood cinema. Eighty-five million people a week crowded movie theaters across America to escape their sometimes desperate financial situations. From black-and-white and two-color "B" movies to new three-color Technicolor "A" movies, audiences had huge quantities of movies from which to choose.”
Horror films such as Frankenstein (1931) and Dracula (1931) terrified audiences. Epic dramas like Gone with the Wind (1939) captivated audiences for hours. Western movies captured and enhanced the myth of the American West through sweeping landscape shots and tough cowboys played by the likes of John Wayne (1907–1979). Gangster flicks were especially popular in the 1930s. Actors James Cagney (1899–1986) and Edward G. Robinson (1893–1973) perfected the nasty movie criminals patterned after real-life gangsters like Al Capone (1899–1947).”
Dances problems away with Swing (a type of popular jazz)
transfixed by radio - couldn't live without. (had to turn off because of dust bowls)
Comics“Comic books first achieved cultural prominence and significance at the height of the Great Depression. Though comics initially became popular for their escapist appeal, they soon came to hold great influence over the popular imagination. Like other forms of popular culture, comics aimed not only to boost morale, but to celebrate the "common man," give voice to the voiceless, and confront the contradictions of Depression-era politics.
Often defined as the prototypical Depression-era comic, Dick Tracy appealed to popular consciousness with its clear demarcation of good and evil.”Other popular comic book heroes included Superman (1938), Batman (1939) , Wonder Woman (1941), which gave millions of readers a sense of hope during a time of despair.
American Culture with escapism
mass entertainment was high popular to escape worries.
golden age for movies, music, art, and literature.
2/3 of all americans attended at least 1 movie a week.popular releases = Wizard of OZ, Gone with the Wind, Mr. Smith Goes to Washington, Frankenstein, and Walt Disney’s Snow white and the Seven Dwarfs.
steam boat willy = 1st black and white short by disney nickname
National radio networks broadcasted popular shows plus daily news, sport, political commentary, and FDR’s Fireside Chats.
Federal Arts Project/Federal Theatre Project/Federal Writers Project commissioned artists to paint murals, photograph the plight of Americans, stage musical and theatrical performances, record history and folklore in writings.
Herbert Hoover
During WWI, he served as the Head of the Food Administration.
Both President Harding and President Coolidge appointed him as the Secretary of Commerce during this administrations.
Very popular in 1928, he was a sure win for the 1928 presidency and defeated Al Smith in a landslide.
Herbert Hoovers Response
Hands off !
Franklin D Roosevelt
Born into a wealthy NY family, FDR attended elite schools and developed a sense of confidence and a belief that public service was a “noble cause.”
FDR won the Democratic nomination in 1932 after serving as the Governor of New York, as well as in the NY State Senate and as Wilson’s Ass’t Secretary of the Navy.
During the summer of 1921, FDR fell ill after vacationing in the North Atlantic and was diagnosed with polio--he never recovered the full use of his legs thereafter.
He did not let polio “break his spirit” and with his wife Eleanor’s encouragement, he made a political comeback (after losing on the 1920 ticket as VP) and then went on to serve as the NY Governor, a position in which he won a reputation for a being a reformer.
Election of 1932
FDR campaigned on the Democratic party ticket and promised a “new deal” for the American people. using a series of addresses that were prepared by his advisors(brain trust), he promised aid to farmers, public development of electricity, a balanced budget, and government supervision of big business.
FDR came off as warm and confident while Hoover was grim and unhappy.
FDR received nearly 23 million popular votes or 57.3 % while hoover received around 16 million or 39.6%; the electoral vote was 472 to 59.
Marked the first time a Democrat held presidency in 11 years following 3 republicans (Harding, Coolidge, and Hoover)
Elected a large democratic majority in both houses of Congress.
commentary of FDR:
tries to reassure and take control of the situation.
FDR Reaction to GD
New Deal + Government involvement( legacy= more dependence on national government and expansion of presidential powers)
New deal = based on deficit spending or “pump priming”employs Deficit Spending = inspired by John Maynard Keynes who was a British economist and an inspiration for FDR’s administration.
called for borrowing money and abandonment of a balanced budget; it also led to an increased federal debt.
The New Deal was a series of programs and projects initiated during the Great Depression by FDR that aimed to restore prosperity to Americans by having the federal government provide Relief, Reform, and recovery. (opposite of Hoover who focused on individualism)
Acts = 4 day bank holiday(emergency banking act), fireside chats, end prohibition, TVA(build dams in TN RIver), ECT.First time citizens received direct assistance and support from government.
Programs still with us today= Social security, unemployment insurance, and federal agriculture subsidies.
Launched a 2nd New Deal in 1935 ( 2 million new jobs created but 10 million Americans were still out of work).
focused on labor/industrial workers and the elderly.break up utility holding companies; FDR spoke out against monopolies.
WPA(Works Progress Admin)- largest public works projects of the New Deal; $11 million spent between 1935 - 1941 for construction jobs, public building and parks development, bridges, airports, and even work for artists of all forms.
NLRB(national labor relations board)- set up by the Wagner Act, which guaranteed workers the right to organize unions and collectively bargain.
Social Security Act - provided security for the unemployed workers and elderly with monthly retirement benefits at age 65 and unemployment insurance; established the idea that the federal government should be responsible for those unable to work at no fault of their own.
Relief Vs Recovery Vs Reform
“Recovery” referred to restoring the economy back to what it was by creating new jobs and spending federal money to revive the economy.
Example 1:National Industrial Recovery Act - created the National Recovery Administration. legalized industry collaboration for price controls and collective bargaining labor.
Example 2:Civilian Conservation Corp(CCC. 1933)- Created under the Emergency Conservation Act, put unemployed and unskilled young men to work on rural and park improvements.
"Reform" referred to implementing new regulations and permanent programs into the financial system to avoid another economic depression in the future.
Example 1:Social Security Act (1935)- created a national system of pensions, unemployment insurance and aid to mothers with children, and created Social security Administration to administer it.
"Relief" referred to immediate economic help for the people hurt by the Great Depression, namely the poor and unemployed.
Example 1: Federal Emergency Relief Act (1933)- Created by the Federal Emergency Relief Administration(FERA). Gave financial aid to states to support local relief programs for destitute.
FDR Fireside Chats
Fireside chats were a series of 31 evening radio addresses delivered by President Franklin D. Roosevelt between 1933 and 1944. These informal radio talks, as Roosevelt called them, aimed to directly connect with the American people, offering reassurance and information during the Great Depression and World War II. They were a significant use of radio to build public support for his administration's policies.
banking act- close banks for 4 days to inspect that they are steady before he reopens them to the people
US move from Isolationism to full engagement
Despite its isolationist stance, the US continued to play an important role in world business and trade. Meanwhile, US foreign policy was shaped by a reaction to WWI- it should never happen again
1921 = Washington Naval Conference(economically and politically): “Washington Naval Disarmament Conference” held from November 1921 to February 1922 with the purpose of limiting the construction of warships (i.e. battleships, naval cruisers and aircraft carriers).try to encourage other nations to reduce production of arms.
1928 = Kellogg-Briand Pact(politically): an August 1928 agreement in which 15 nations pledged to not go to war (agreed to outlaw war) and instead, try to settle conflicts diplomatically–including the U.S.somewhat involved and more symbolic
Dawes Plan(economically not isolated): From 1924-1929, the “Dawes Plan” cycle helped ease some of the financial burden and/or problems in Europe, as well as the US.way by which we were funneling money to support the worlds economy until great depression, had to worry about our self.
Bad feelings or ill will was felt on both sides of the Atlantic with some Europeans feeling resentment toward the U.S. and many Americans seeking a return to “isolationism” and a desire to stay out of European affairs because : When the stock market crashed in October 1929, bank loans from the U.S. stopped–the prosperity that was returning (supported by the Dawes Plan) then collapsed.
Meanwhile in the US, isolationist sentiment was increasing as the Nye Committee bolstered:
Had been headed by Sen. Nye of South Dakota in 1934 to investigate a theory held that big business had conspired to get the US to enter WWI in order to make a huge profit by selling weapons.
Little hard evidence was found but the belief stood that American bankers and manufacturers had pulled the US into WWI which reinforced strong feelings of isolationism.
commentary:
FDR’s shift towards involvement in the 1940’s - To help allies(specifically B)
FDR’s “Four Freedoms” Speech:
Apart of his State of the Union address on January 6,1941.
He urged Americans to support those who were “resisting aggression” and were “thereby keeping war away from our Hemisphere”- namely the Allies; he also stressed the danger that aggressive dictatorships posed to the US. The four freedoms that FDR noted were the ideals that be believed Americans should fight for - Freedom of speech, worship, from want and from fear.Propose lending money to Britain for the purchase of the nation's war materials.
August 1941, US and Gb leaders meet secretly - Atlantic Charter:FDR and Churchill met to discuss how to make the world better, including destroying “Nazi Tyranny”
No territorial expansion, self-determination, free trade, international cooperation to keep people from want and fear, disarm aggressors, establish permanent systems of general security(UN)
Began to make more direct attacks at Axis Powers:
In July 1941, FDR ordered the seizure of all Japanese financial assets in the U.S. to protest in retaliation for the Japanese occupation of French IndoChina.
By August 1941, FDR implemented an embargo on oil and gasoline exports to Japan.
Later Pearl Harbor was attacked and US was fully engaged in war.
Previous help for GB:
Cash and Carry (Sept 1939) FDR convinced Congress to pass a “less restrictive” Neutrality Act called “cash and carry,” which favored Britain and provided that a belligerent could buy U.S arms if it paid cash and used its own ships.
Spring 1940, Since Britain was under constant attack by bombing raids carried out by Germany and German U-boat attacks threatened the British ability to control the Atlantic, FDR “cleverly arranged a trade” known as the Destroyers for Bases Deal, which gave Britain 50 older US destroyers that were still serviceable and gave the US the right to build military bases on British Islands in the Caribbean.
Lend-Lease Act: allow Britain to obtain all the necessary US arms on credit. (by proposing to end the cash and carry requirement)(ending a neighbor a garden hose to put out a fire.)
Shoot on Sight: That US Navy would escort any British ship that carried lend-lease materials from US shores as far as Iceland in hopes of protecting British ships from submarine attacks.
Social and economic effects on the home front (a consuming military experience)
Social:
Pearl Harbor lead to American unity.60,000 men enlisted by january 1942 with the surge of patriotism.
5 million volunteered
every american was apart of this effort whether working in the defense industry or rationing scrap metal drives or creating victory gardens. Surge of patriotism that was not evident in WWI.
easier for WWII because we have a clear enemy, easy to get behind americans and pearl harbor leads to surge of patriotism.
cities are gonna grow in sun belt, CA and south west.
People re prepared and ready to get to work after struggling and being unemployed for so long(gave them something to fight for)
incredible amount of man power with our natural resources(nce we were ready to go on to a mission, we are going to see an incredible jump of our industry and economy (end GD))
Economic:
Boom of industries = pulls America out of the Great Depression.
the sleeping giant was awakened, lots of factories not being used, we went on a building spree to help allies, fully getting us out of the great depression.
American workers were 2x as productive as German workers and 5x as productive as Japanese workers.
Stalin later said that Am. war production turned the tide of the war.
Meanwhile, earlier in May 1940, FDR declared a national emergency and announced a plan to build 50,000 warplanes per year.
Also, in October 1940—Congress increased the defense budget to 17 million.
By the summer of 1942, almost all major industries (approx. 200,000 companies) had converted to war production.
While the West was once a lightly industrialized region, by the start of WWII parts of the West were [among] the most important manufacturing areas in the country.
Automobile factories produced trucks, jeeps, tanks, as well as artillery, rifles, mines, helmets, etc.
-Sleep Giant Awakened (US) = huge industrial power, military plants under used, millions of people unemployed.
Arsenal of Democracy = we have the means to use factories to create weaponry to win the war.
Great Boiler was Lit = - once we were ready to go on to a mission, we are going to see an incredible jump of our industry and economy (end GD) because we have man power and natural resources = productive
Women experience
Rosie the Riveter:
2.5 million women worked in shipyards, aircraft factories and other manufacturing plants.
12.9 million rose to 18 million by the end of the war.
After the war, most women voluntarily quit or were laid off but a permanent change occurred with attitudes toward women working.
Although “Rosie the Riveter” pictured as a factory worker, women worked in both blue collar and white collar jobs.
At the war’s end, most factory owners expected women to step aside so returning male veterans could get jobs.
And yet, during the 1940s, the number of women employed in clerical and secretarial work increased dramatically.
While the federal government spent $50 million to build day-care centers and facilities for children of working mothers, only 130,000 kids went to daycare and most centers were not used to their capacity as many mothers preferred to leave their children with relatives or neighbors.
64,000 women died in the first couple months.
Fully coming out of great depression, setting off consumer bomb, and energizes feminist movement. - taste of work = want something more.
Seen as the logistic source for winning the war and converted industries for a large number of things needed in the war
New problems for women with new job opportunities:
Lack of childcare/daycare facilities.
Less time with children
Disruption of traditional home/family life.
Rise of vandalism and juvenile delinquency.
Women in Military:
Non-combatant roles—pilots ( 300 flew aircraft deliveries of 77 different planes), nurses, radio operators, electricians, ambulance drivers, as well as clerical and administrative work.
WAAC (women auxiliary army corp) by July ‘43 w/ full benefits and salary; separated from men until 1978—later, just WAC.
NOTE: USO Shows: (United Service Organization) provided live entertainment and programs to U.S. troops and families since 1941 w/ bands, singers, dancers, actors/actresses, comedians
African American Experience
Early on in the war, African American leaders emphasized a need to fight for the “Double V” campaign--victory against fascism abroad and victory against discrimination at home.
A.Philip Randolph argued for African Americans to take up the fight to no longer accept second-class citizenship.
Randolph’s stance led him to present his list of demands to President Roosevelt calling for an end of discriminatory practices in government-funded training, employment and the armed services or he would organize a massive protest march.
Despite large # of African Americans in non-combatant and combat roles, segregation continued in the military.
Courageous acts carried out by many, including the Tuskegee Airmen ( African American Volunteers)-450 of them fought in North Africa, Sicily, and Italy.
Also 33,000 Nisei Japanese Americans fought and 13,000 Chinese Americans in WWII w/ some working as spies and interpreters.
A Philip Randolph (head of the Brotherhood of the Sleeping Car Porters) threatened a march on Washington w/ 100,000 in July ‘41.
FDR issued Exec. Order 8802 which prohibited discrimination towards employees in government/defense agencies.
FDR set up the Fair Employment Practices Commission.
Mexican American Experience
400,000 of the 500,000 Hispanic Americans who served in the war were Mexican.
Many Mexicans were recruited as farm workers through the Bracero Program
200,000 came to harvest fruits and vegetables, and build/maintain railroads.
Worked mainly in the sunbelt regions
Racial tensions in CA rose between Mexican Americans and whites, especially when juvenile crime increased which was blamed on Zoot Suits.
In June 1942, 200,000 soldiers and sailors attacked Mexican American neighborhoods while the police did nothing.
commentary:
WWII created a huge labor shortage at home and the government tried to deal with it with the Bracero Program(1942) which allowed American businesses to hire thousands of temporary guest workers from Mexico.
Moment of increased national production in building ships, building airplanes, and creating enough food to get the economy up and running to deal with the war effort.
Crops are not being picked efficiently at the precise right moments that they need to be done in the South West.
The Bracero Program allowed Mexican nationalists to legally enter the US for 6 months sas contract laborers mainly on farms.
Bracero = farm hand in spanish, legalizing the migration that had been going on for some time.
Spent long back breaking days in the fields for a steady paycheck and free housing but had inhumane treatment with abuses of power.
Second largest minority in the nation after the war after African Americans.
Continued for years after WWII because they could not find enough Americans willing to work on their farms. Phased out in 1964 with the rise of mechanized farming(4 million apart of program).
Native American Experience
Navajo “Codetalkers”:
The Marines recruited Native Americans from the Navajo tribe to serve as “code talkers” with 400 serving.
Since the Navajo language did not have a written alphabet and was known only to the Navajo (plus a few missionaries and anthropologists), these Navajo recruits developed code words- using their own language- that stood for military terms.
They could relay a message in minutes- at the Battle of Iwo ima, they transmitted more than 800 messages in 48 hours.
Sworn to secrecy, their mission was not revealed until 1971 to the American Public.
In 2001, Congress awarded surviving code talkers with the Congressional Gold Medal for their unique and invaluable contributions during the war.
Asian American Experience
Any individual of Japanese Descent(even American born citizens) were forced into Japanese internment camps or relocation centers with executive order 9066.
forced to leave their homes with just a suitcase(often losing their property indefinitely and be relocated to an internment camp for the remainder of the war).
some decline of animosity or racism towards Chinese Americans as the US sought to support China as an ally in the war against Japan.
Supreme Court ruled the relocation constitutional as it was based on military urgency not race.
Questions:
Executive Order 8802
Executive Order 8802 was issued by FDR after A. Philip Randolph’s threats to march on washington. This order prohibited discrimination toward employees in government/defense agencies.
After hearing grievances from Black Leader, FSR issued Executive Order 8802 on June 25th, declaring “there shall be no discrimination in the employment of workers in defense industries and in Government, because of race, creed, color, or national origin” which was the first Presidential directive on race since Reconstruction.
The order established the “Committee on Fair Employment Practice” to investigate complaints of discrimination that violated the order but was disregarded by most as inefficient.
Significant (bolded words): First federal action to promote equal oppportunity and prohibit employment discrimination. Though it had limited enforcement power, it represented a key step toward federal accountability in workplace discrimination and discrimination in general. Demonstrates a significant example of civil rights activism shaping federal policy. It set a precedent for future civil rights actions and motivated the continuation of civil rights activism long after the war, leading to the civil rights movement later on in history.
executive order 9906
In 1942: empowers the US army to designate areas which any or all persons may be excluded, later forming the War relocation AUthority which was formed to establish 10 permanent campuses housing nearly 120,000 Japanese Americans.
authorized the forced relocation and internment of over 120,000 Japanese Americans, most of whom were U.S. citizens, from the West Coast to internment camps across the interior of the country.
result = The removal of Japanese Americans from their communities and the subsequent interment of all Americans of Japanese descent who resided on the West Coast.
Why = The executive order was the result of wartime panic and the belief on the part of some that anyone of Japanese descent was capable of disloyalty and treachery.
significance: It is seen as one of the most egregious violations of American civil liberties as people were removed from their lives without due process because of ancestry. Only enabling the spread of wartime racism and xenophobia. A cautionary tale about how fear and prejudice can override constitutional rights and serves as a reminder how we can better uphold the constitution in America in the future.