FDR and the Great Depression Study Notes

Introduction

  • FDR's Impact on America
    • Franklin D. Roosevelt (FDR) is credited with saving America through his New Deal.
    • The New Deal may not have completely solved unemployment but transformed Americans' understanding of their national government.
    • FDR's New Deal is credited with saving democracy in America despite ongoing issues stemming from the Great Depression.

The Great Depression

Definition and Terminology

  • The Great Depression, referred to casually as "the big sad," had profound effects on the American economy and society during the 1930s.

The Stock Market Crash and Economic Impact

  • Initial Effects of the Stock Market Crash
    • The stock market crash did not directly affect as many people; instead, bank closures and business failures had more significant impacts.
    • The Great Depression is recognized as the worst economic downturn in American history.
  • Economic Data from the Great Depression
    • U.S. national production, particularly industrial output, decreased by approximately 50%.
    • International trade virtually ceased due to various factors, notably high tariffs influencing global commerce.

Unemployment Statistics

  • Unemployment Rates
    • Average unemployment peaked at about 25% during the 1930s, equating to roughly one in four workers being unemployed.
    • In specific regions, particularly in the South and rural areas with a large number of farmers, unemployment rates were even higher.
    • Underemployment
      • A significant portion of American workers was considered underemployed, meaning they were overqualified for their roles and being paid inadequately. About 50% of Americans were reported as underemployed.

Housing Crisis and Houselessness

  • The economic climate led to an increase in homelessness. Many families could no longer maintain their homes and were forced to live in shelters or on the streets.
  • Iconic Images of the Great Depression
    • Migrant Mother Photograph
    • Depicts a mother who relocated from the Midwest, impacted by severe environmental disasters known as the Dust Bowl.

Inequality and Discrimination During the Great Depression

  • The Great Depression disproportionately affected marginalized groups, including Mexican Americans and African Americans.
  • Job losses often led to African Americans facing unemployment rates as high as 50%.
  • An increase in female labor occurred, largely driven out of necessity, as families struggled to survive financially.

Societal Impacts

  • The lack of effective responses to the Great Depression generated widespread fear and mistrust toward American institutions, including capitalism and democracy.
  • The rise of radical political movements, particularly fascism and communism, was noted globally as fear spread throughout Europe, leading to totalitarian regimes taking power.

Herbert Hoover's Response to the Great Depression

Initial Government Response

  • Herbert Hoover was the sitting president when the Great Depression began and attempted some government interventions.
  • Reconstruction Finance Corporation (RFC)
    • Created to stabilize businesses by providing funds; however, it was limited in scope and effectiveness.
  • Hawley-Smoot Tariff
    • Introduced as the second highest tariff in American history, intended to protect U.S. businesses but ultimately further restricted international trade and deepened the Depression.
    • The tariff raised some rates to nearly 50%, which discouraged foreign customers from buying American products.

Hoover's Governance Style

  • Hoover advocated for a hands-off approach, believing in charity and volunteerism over federal responsibility for economic recovery.
  • He explicitly stated, "It is the business of the people to support the government, not the government to support the people."
  • Hoover cited state-level solutions, encouraging public works projects as a means to address unemployment.
    • Example of Public Works
    • The construction of the Hoover Dam in Nevada exemplifies state-sponsored efforts to generate jobs.
  • Hoovervilles emerged, named derogatorily after Hoover, representing shanty towns constructed by the homeless.

Bonus Army Incident

  • The Bonus Army consisted of World War I veterans who protested for immediate payment of bonuses promised to them, leading to a violent confrontation.
  • Hoover deployed military forces, led by Douglas MacArthur, resulting in deaths and injuries among the veterans, severely damaging his reputation.

The Response from Organized Labor and Radical Movements

Shifts in Labor Activity

  • The Great Depression saw a rise in organized labor movements as workers sought to defend their rights amid mass unemployment.
  • Formation of Congress of Industrial Organizations (CIO)
    • An inclusive labor union representing all workers irrespective of skill, race, or gender, founded by John Lewis to advocate for workers' rights.

Emergence of Radical Political Groups

  • A surge in communist and fascist ideologies, mirroring trends in Europe, emerged in the U.S. as individuals sought alternatives to mainstream parties due to dissatisfaction with existing solutions.

Franklin D. Roosevelt's Ascendancy

The 1932 Election

  • The 1932 presidential election was pivotal, fundamentally shifting political dynamics in the U.S.
  • The Democratic Party nominated FDR, who was recognized for his progressive policies as the Governor of New York.
  • The election revolved largely around addressing the Great Depression.
  • The Republican nomination of Hoover, seen as ineffective, further solidified FDR's chances of a landslide victory.

FDR's Campaign Strategy

  • FDR's strategy revolved around presenting a hopeful outlook and promising a "New Deal" focused on government intervention to alleviate Americans' struggles.
    • Campaign slogans included, "Happy Days Are Here Again."
  • Many key advisers helped tailor FDR's image to appear sympathetic and relatable to the common citizen, which was crucial given his affluent background.
  • Eleanor Roosevelt’s Influence
    • Eleanor, FDR's wife, championed issues concerning minorities and disadvantaged communities, encouraging FDR to adopt more inclusive policies.

Formation of the New Deal Coalition

  • The New Deal Coalition formed as a significant consequence of the 1932 election, resulting in a diverse group of voters who would consistently support the Democratic Party for decades.
  • Key components included:
    • White Southerners
      • Interested in agricultural reforms.
    • Labor Unions
      • Expecting advocacy for working rights and organized labor initiatives.
    • Religious Minorities
      • Immigrants, especially Jews and Catholics, anticipated the repeal of prohibition and more inclusive social policies.
    • African Americans
      • Transitioned from Republican alignment to the Democratic Party, influenced by FDR's promises and Eleanor Roosevelt's advocacy.

Conclusion

  • FDR was elected in a blue wave, solidifying his presidency as one of the most influential in American history.
  • His inaugural address emphasized the government's role in restoring hope and stability to the nation: "The only thing we have to fear is fear itself."
  • This shift marked the transition to active governmental involvement in economic and social issues, heralding the New Deal era.