The Great Depression and the New Deal

The Great Depression and Franklin Roosevelt's New Deal

Background: The Great Depression

• The Great Depression started in 1929 and extended into 1930.
• Hundreds of thousands of businesses failed in America within a short time.
• Millions of Americans lost their jobs.
• The rest of the world was already struggling economically, exacerbating the global impact.
• The entire world suffered, though some countries recovered faster.

Appearance vs. Reality

• There is a common perception of complete devastation, but most people adjusted to having less rather than losing everything.
• Some people in small, rural towns experienced little to no change.
• Many Americans felt ashamed and hid their financial problems.
• Men, traditionally breadwinners, blamed themselves for job loss and family struggles.
• Women increasingly entered the workforce, jumping by nearly 50%, further impacting men's self-esteem.
• Suicide rates jumped almost thirty percent between 1929 and 1932.

Impact on Children

• Children were significantly impacted; some were abandoned and placed in orphanages.
• Some children were sold to be farm laborers, which was legal then.
• There were flour companies that started putting colorful prints on flour sacks so the sacks could be used to make inexpensive dresses.
• Public schools began feeding children, as many were going hungry.
• Children's health declined, death rates increased, and there were immeasurable long-term psychological effects.
• African American children were hit harder, with unemployment in some communities reaching 80%.

The Dust Bowl

• During the 1930s, the Great Plains suffered a drought, with eight out of ten years experiencing drought conditions.
• The removal of deep-rooted grasses for farming and cattle grazing led to the loss of topsoil.
• Bison that used to help condition the soil were gone.
• Poor farming methods, like deep plowing without irrigation, contributed to the crisis.
• Loss of topsoil combined with drought turned the ground to dust, leading to agricultural collapse.
• Dust storms, known as black blizzards, stretched hundreds of miles, covering everything in dust.
• These storms caused death and destruction for people and livestock.
• Dust storms reached as far as Boston, New York, and Washington D.C.
• Nearly 100,000,000 acres across Texas, Oklahoma, and Kansas were affected.
• Thousands lost their homes due to inability to pay mortgages or rent.
• Between 1935 and 1940, about three and a half million people fled the Great Plains, primarily to California.
• Migrants from Oklahoma, Kansas, and Texas were known as Okies.

Herbert Hoover's Response

• People looked to the federal government and President Herbert Hoover for assistance.
• Hoover believed the depression was due to reckless stock market investors and thought it would resolve itself.
• He did not believe it was the federal government's job to fix the economy.
• The Smoot-Hawley Tariff Act made the depression worse.
• Hoover relied on the business community for voluntary assistance, asking them not to lay off workers or reduce salaries.
• The National Credit Corporation was established to provide federal loans to banks.
• The Reconstruction Finance Corporation (RFC) provided loans to railroads and other companies.
• Hoover's plan was based on the trickle-down theory, which helped the wealthy and corporations, in order to have it trickle down to help the poor.
• Only 20% of the allocated $500,000,000 was loaned out, as companies needed customers more than loans.
• Homeless camps, called Hoovervilles, popped up around the country.
• Americans held Hoover accountable for not taking appropriate action.

Protests and Pushback

• In 1932, farmers in the Midwest formed the Farm Holiday Association to protest low crop prices.
• They withheld crops and farm products from the market, destroying some crops to create a shortage and raise prices.
• Violence and threats against banks, judges, and sheriffs undermined the organization, leading to its decline.
• The Bonus Army, comprised of unemployed World War I veterans, marched to Washington D.C. to demand early payment of their promised bonuses.
• About 17,000 veterans, along with their families and friends, totaling over 42,000 people, set up a campsite near the capital.
• Congress did not pass the bill to pay the bonuses early.
• Hoover labeled the veterans communists and criminals and ordered the Washington D.C. police to break up the camps, leading to a riot and the death of two veterans.
• General Douglas MacArthur, with infantry, cavalry, and tanks led by General Patton, forcibly removed the veterans with tear gas and bayonets, burning down the campsite.
• MacArthur ignored Hoover's orders and pursued the veterans across the river, claiming they were trying to overthrow the U.S. government.
• This event was a public disaster for Hoover, portraying him as overaggressive and heavy-handed.

1932 Presidential Election

• Republicans nominated Herbert Hoover, and Democrats nominated Franklin Roosevelt.
• The election was centered on the depression.
• Democrats criticized Hoover's lack of action.
• The media coined terms like Hoover blankets, Hoover flags, and Hoover wagons to mock Hoover's policies.
• Roosevelt used mass media such as the radio to get his message out.
• Roosevelt won the election in a landslide, carrying most states in the North and West.
• The election marked the end of Republican dominance among African American voters, who began voting for the Democratic party.

Franklin Delano Roosevelt (FDR)

• Born in 1882 in New York to a very wealthy family.
• He met President Grover Cleveland as a child.
• Cousin of Teddy Roosevelt, from an old political family.
• Attended Harvard, studied history, and was the editor of the school newspaper.
• Earned a law degree from Columbia University.
• Married his cousin, Eleanor Roosevelt, in 1905. Teddy Roosevelt walked Eleanor down the aisle.
• They had six children, but their marriage was more of a partnership; Franklin had multiple mistresses.
• Was a state senator and Assistant Secretary of the Navy during World War I.
• Was a vice presidential candidate in 1920.
• In 1921, he was paralyzed from the waist down and diagnosed with polio.
• He learned to walk short distances with leg braces and kept his disability from the public.
• Elected governor of New York in 1928.

Keeping His Disability Secret

• The press agreed not to photograph him in his wheelchair in exchange for access.
• Photographs showed him standing while holding someone's arm or a rail for support.

Assassination Attempt

• In February 1933, before his inauguration, Giuseppe Zangara, an anti-capitalist, attempted to assassinate Roosevelt in Miami.
• The shots missed Roosevelt but killed the mayor of Chicago who was riding in the car with Roosevelt.

FDR's Political Approach

• FDR was more of a centrist than a radical leftist.
• He took a pragmatic, middle-ground approach to politics.
• Very personable and influential leader.
• Increased government spending but tried to pull back when he thought it was enough.

Key Issues Upon Taking Office

• Millions were unemployed and homeless.
• Thousands of businesses had closed.
• No banks were open in 32 of the 48 states.
• He focused on building public confidence.
• He hired a press secretary and continued his radio broadcasts, called fireside chats, to reassure Americans.

The New Deal

• FDR's plan to fix the country was called the New Deal.
• He needed Congress, which was controlled by the Democrats.
• The first 100 days of FDR's presidency were the most successful of any president.

Banking

• In March 1933, FDR declared a four-day national banking holiday to stop bank runs.
• Congress passed the Emergency Banking Act.
• Roosevelt reopened banks only if they were deemed safe by the Treasury Department.
• On March 15, the banks reopened, and Americans redeposited over a billion dollars.
• In June 1933, Congress created the Federal Deposit Insurance Corporation (FDIC), which guaranteed money in the bank.

Agriculture

• Agricultural Adjustment Act (AAA): Paid farmers to reduce or stop producing key crops and to slaughter livestock in order to stabilize falling prices.
• Rural Electrification Administration: Brought electricity to rural areas to modernize America and build morale.
• Authorized the planting of over 220,000,000 trees to create a natural wind block and stop erosion.

Business Closings

• Cullen-Harrison Act: In April 1933, authorized the sale of low-alcohol beer, boosting business and spirits.
• National Industrial Recovery Act (NRA): Established codes of competition to keep prices stable, suspending antitrust laws and supporting unionization.
• Minimum wages and maximum hours for workers were set, and child labor was outlawed.
• Securities and Exchange Commission (SEC): Created in June 1934, the SEC regulated the stock market, controlled margin buying, and restricted insider trading.

Unemployment

• Federal Emergency Relief Administration (FERA): Provided money to local and state governments to hire unskilled workers.
• Civilian Conservation Corps (CCC): Hired unmarried men from 17 to 28 to work on rural construction projects for farming, forestry, erosion control, and flood control.
• Tennessee Valley Authority (TVA): Brought electricity and economic development to the impoverished Appalachian area.
• Public Works Administration (PWA): Created large federal government projects, such as dams, roads, schools, libraries, and bridges.

Opposition to the New Deal

Republicans

• Republicans said that Roosevelt was trying to do too much too fast and that he was growing government too fast.

U.S. Supreme Court

• In 1935, the U.S. Supreme Court began striking down programs as unconstitutional, such as the National Industrial Recovery Act and the Agricultural Adjustment Act.

Opposition from the Left

• Francis Townsend: A doctor and political activist who advocated for the elderly through the Townsend Plan, which proposed paying every retired person $200 a month to be spent within that month.
• Father Charles Coughlin: A Catholic priest with a large radio following, Coughlin was a self-avowed socialist who wanted the government to nationalize industries.
• Huey Long: The former governor of Louisiana and a U.S. senator who created the Share the Wealth Society, which proposed a 100% tax on all income over a million dollars.
• Assassination: Huey Long was assassinated in 1935.

Second New Deal

• The Wagner Act: This law created the National Labor Relations Board and upheld the rights of workers to unionize, although it excluded farm workers and domestic help, largely impacting African Americans.
• The Works Progress Administration (WPA): This was the largest and most important organization created during FDR's presidency; it put about eight and a half million Americans to work on a variety of jobs.

1936 Presidential Election

• Democrats nominated Roosevelt again; the opponent was Alf Landon, the governor of Kansas.
• FDR won in another landslide, winning 46 of the 48 states.
• The election showed how the American people rewarded a government trying to make things better.
• By 1937, the economy looked like it was heading in the right direction; Roosevelt began cutting government spending.
• The economy spiraled backwards, though; therefore, many of his programs had their funding increased.
• By 1938, America was still in the depression.

Effects on Society

Women

• Eleanor Roosevelt was the most popular and hands-on first lady in U.S. history.
• She traveled around the country meeting people and hosted radio chats.
• Frances Perkins: First woman to serve in a presidential cabinet; she was his Secretary of Labor.
• Frances Perkins was instrumental in getting women a role in Roosevelt's administration.

Legacy of FDR and the New Deal

• Growth of the Modern State: The federal government is expected to be involved in everyday lives.
• Welfare of the People: The government becomes responsible for the individual and collective welfare of the people.
• Rise of the Communist Party of the United States: Reached its peak during this time period in America.
• New Deal Coalition: This brought African Americans, labor groups, ethnic groups, immigrants, city residents, the middle class, and even Southern whites under the Democratic Party.
• Three questions that remain for the Americans approaching 1940:
  • While the economy has improved, we're still in a depression. When is this going to end, and how?
  • What happens when we have a new president? 1940 is an election year. There will be a new president in the 1940 election.
  • What about the rest of the world? The depression is still going on in the rest of the world for the most part. Some nations in Europe are starting to resort to extreme measures, including support of individuals and political parties who are promising recovery at the expense of freedom.