5.2: USA 1930s: Depression and New Deal Flashcards

(43 cards)

1
Q

-Causes of the crash in 1929

A

speculation, overproduction, Hoover

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2
Q

causes of the crash: speculation

A

Only interested in short-term profit, not long-term investment

1929: US bank lent $9 billion to speculators

System relied on confidence, but investors believed they could see weaknesses

Some started selling shares, causing panic & people sold shares for any price possible

In four trading days, market lost nearly half its value: Wall Street Crash

Black Tuesday: 29th October 1929

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3
Q

causes of the crash: overproduction

A

Lack of demand for long term products like cars, tvs, radios… people only needed one

May rural areas couldn’t afford these good anyways

Protective Tariffs made it impossible to sell goods overseas

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4
Q

causes of the crash: Hoover

A

Believed in Laissez Faire but cut taxed to encourage people to buy more goods

Mid 1931, production was rising again but the crash had destroyed confidence

1929-1931: approx. 4300 banks failed, causing mistrust and withdrawals of savings

Hoover refused to even accept there was a problem

Prosperity ‘just around the corner’, ‘in hoover we trusted and now we are busted’

Tried to persuade business leaders not to cut wages- leads to lower spending and demand

Set up Reconstruction Finance Company which propped up banks

Put money into public work programmes like Hoover Dam on Colorado River-these failed

1932: Revenue Act- largest peacetime tax rise in US ever, doubled rate of tax for richest 1%

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5
Q

-effects of the crash

A

countryside, towns, attitudes to poverty

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6
Q

effects of the crash: countryside

A

People were hit hard despite not experiencing benefits of the boom

Farm income fell and thousands couldn’t pay mortgages and went bankrupt

Total farm income slipped to just $5 billion

Some farmers resisted and scared off any Sheriffs with pitchforks

Many were forced to leave homes and become migrants, AAs often were worse off

Over farming and drought (southern &Midwest 1930s), turned topsoil to dust

Winds created dust storms and large areas turned into ‘dustbowls’

Many faced hunger and malnutrition

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7
Q

effects of the crash: towns

A

Unemployment rose rapidly: Toledo, 80% were unemployed

Forced to sell homes and thousands were taken in by family but rest were on streets

1932: approx. 2 million men travelled by railway/wagons seeking jobs7

Thousands of children were found living in these wagons or tents next to tracks

Every town had a ‘Hooverville’

Rubbish tips were crowded, parks were full at night

1931: 238 were admitted into NY hospital due to malnutrition, 45 died

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8
Q

effects of the crash: attitudes to poverty

A

10 years ago, articles about poverty would have been ‘sob stories’ but this changed

Dorothea Lange (photographer), Wood Guthrie (musician) showed poverty in a new light

More sympathy and anger towards the system that threated the poor unfairly

Many started to question Laissez Faire and rugged individualism

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9
Q

-the 1932 presidential election

A

why Hoover lost, why FDR won

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10
Q

1932 election: Hoover

A

Refused to accept there was a major economic crisis

Blamed for the Wall Street Crash as he didn’t do enough to elevate the impact

Bonus Marchers June 1932 with thousands of servicemen who fought in WW1

Peacefully marched to Washington & sang patriotic songs but Hoover refused to meet them

28th July, police and troops killed two with guns and tear gas

Did some things to help Wall Street but blocked $2 million relief bill!

Republicans had been in power since 1920: time for a change

Did little to help farmer who made up much of the electorate

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11
Q

1932 election: FDR

A

Embarked on countrywide tour with idea of the ‘New Deal’

Made 16 major speeches and another 60 from back of his train for 20,800km

Warm and confident person, not afraid to ask for advice, believed in ‘active’ government

Democratic party had Charles Michaelson to produce campaign mocking Hoover

‘Smile your way to prosperity’

Believed in using public money to create jobs and restart economy

Won by 7 million votes-worst defeat Republicans had suffered

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12
Q

-the New Deal 1933

A

intro, emergency banking act and securities exchange commission, FERA, CCC, AAA, PWA, NRA, TVA, impact

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13
Q

ND 1933: intro

A

to tackle the urgent needs of the poor

The first 100 days of presidency, FRD worked with ‘brains trust’ to make the new deal

Sent 15 proposals to Congress and all were adopted

Every Sunday, broadcast fireside chats to around 60 million listeners (new idea at the time)

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14
Q

ND 1933: Emergency banking act and securities exchange commission

A

Aimed to tackle bank closure

All banks closed for 4 days then 5000 trustworthy ones reopened with support

Effective

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15
Q

FERA

A

Federal Emergency Relief Administration

Aimed to tackle urgent needs of the poor

$500 million spent on soup kitchens, blankets, and employment schemes & nursery schools

Very effective

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16
Q

CCC

A

Civilian Conservation Corps

Aimed to tackle problem of unemployed young men

Men could sign on for 6 months then renew if they still had not found work

Most worked on environmental projects

Very effective and most men sent back money to families: 2.5 million were helped

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17
Q

AAA

A

Agricultural Adjustment Administration

Aimed to help farmers

Reduced farm production to gradually raise prices and modernised farms

Used methods to conserve & protect soil, extreme cases helped farmers with mortgages

Extremely effective, although modernising put more labourers out of work

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18
Q

PWA

A

Public Works Administration

Aimed to build more infrastructure

Used government money to build schools, roads, dams, bridges, and airports

These would be vital for after USA’s recovery

Very effective and created lots of jobs

19
Q

NRA

A

National Recovery Administration

Aimed to improve conditions in industry and child labour

Outlawed child labour and set out fair wages and sensible levels of production

Stimulated economy by giving workers money to spend without overproducing

Was voluntary and joining firms used the blue eagle as a symbol of presidential approval

Over 2 million employers joined the scheme: very effective

20
Q

TVA

A

Tennessee Valley Authority

Lack of dams on river, flooding, droughts, eroding soil, poverty, dust bowl around river

Cut across the powers of the local state governments and dams transformed the region

Brought water to dried out land and provided electricity for undeveloped areas

In short term, dams created many jobs for an area hit by depression so very effective

21
Q

ND 1933: impacts

A

Measure introduced during the hundred days were very effective

Restored confidence in government and boosted morale

22
Q

-Second New Deal 1935

A

intro, Revenue Act, undistributed profits act, Wagner act, social security act, WPA, resettlement administration, farm security administration

23
Q

SND 1935: intro

A

aimed to transform American society

24
Q

SND 1935: revenue act

A

Increased taxes on wealthiest Americans- 79% on people over $5 million

Warning to wealthy Americans using legal and illegal methods to avoid paying tax

25
SND 1935: undistributed profits act
Put tax on businesses in 1936
26
SND 1935: Wagner act
Forced employers to allow trade unions, allowing negotiation for pay and conditions Made it illegal to sack workers for being in a union
27
SND 1935: social security act
Provided state pensions for widows and elderly State and federal governments worked together to help sick and disabled Set up scheme for unemployment insurance Employed made small contributions each week and unemployed would receive a little
28
SND 1935: WPA
Work Progress Administration Extended role of the original WPA to help the arts (painters, photographers...)
29
SND 1935: resettlement administration
Helped small hold farmers re-settle to better quality land and farming Moved over 500,000 families to better-quality land and housing
30
SND 1935: farm security administration
Replaced RA in 1937 Gave loans to small holders to help buy their land Built camps to provide decent living conditions and jobs for migrant workers
31
-reactions to the new deal
too much, not enough, supreme court
32
reactions to nd: too much
Too complicated and the government was doing the market’s job TVA created unfair competition for private companies FDR blamed for being like a dictator High taxes discouraged people from working hard and gave money to those who don’t Government was much too complex now as opposed to before The New Deal had cracks: FDR poured money in, but loads was wasted through ‘leaks’
33
reactions to nd: not enough
Despite measure, many remained poor Huey Long: governor of Louisiana (1928) then senator (1932)-came to power questionably Helped poor, built roads, schools, hospitals, through taxing big corporations Clashed with KKK and employed AAs on same terms as whites Supported New Deal at first but after 1934 criticised for being too complicated Set up ‘Share our Wealth’ where personal fortunes were $3 million MAX Government taxes were shared among everyone and pensions for all over 60 Very aggressive: lots of friends and enemies-assassinated 1935 Dr Franci Townsend founded ‘Townsend Clubs’ for pensions of $200 monthly for over 60s Father Coughlin attacked FRD on radio and set up National Union for Social Justice
34
reactions to nd: supreme court
FDR won 1936 election but faced opposition from the SC (republican dominated) Schecter Poultry Corporation went against NRA: sold chicken unfit for consumption Exploited their workers and threatened government inspectors Court ruled that government had no right to prosecute them NRA was ‘unconstitutional’ and undermined too much of the power of the local states FDR was angry at them denying democracy by discarding laws he’d been elected to enforce He asked for power to appoint 6 more SC judges who would be more sympathetic Americans felt he was attacking the system of government and were alarmed by his actions Some compared him to a dictator FDR eventually backed down and plan was rejected SC were still shaken by his actions and were less obstructive going forward They approved of 2nd New Deal measures from 1937 onwards
35
the New Deal 1936 onwards
FDR became more cautious and early 1937 prosperity was returning, he cut ND’s budget Unemployment increased and the cut damaged his reputation 1938, Republicans did well in elections, but FDR still won USA no longer as united behind his New Deal as in 1933 but had other wars on their minds
36
-did the new deal work?
a new society?, industrial workers, AAs, unemployment and the economy, women, native americans
37
did the dn work: a new society?
Restored faith in government Huge social and economic programme: set tone for future policies to help people Handled billions of dollars of public money but no corruption scandals! Secretary of interior, Harold Ickes, tapped phones of employees to ensure no corruption He employed AAs, campaigned against anti-Semitism, supported cause of Native Americans Divided USA: FDR often accused of being communist, undermining American values Undermined local government
38
did the nd work: industrial workers
DRA and 2nd New Deal strengthened the position of labour unions FDR’s government mainly supported unions: made larger corporations negotiate with them Some unions combined as Committee for Industrial Organisation (CIO) 1935 Union of Automobile Workes seen by the 2 anti-union companies: General Motors, Ford Big business remained immensely powerful despite being challenged Many strikes were broken with brutal violence Companies like Ford and Chrysler employed thugs or controlled local police
39
did the nd work: AAs
200,000 gained benefits from CCC and other agencies Some agencies discriminated against them, however Racial segregation in the CCC, mortgages not given to black families in white areas Blacks less likely to be given jobs and when they were they were not very good ones Domestic workers not included in the Social Security Act FDR failed to put through any laws against lunching of AAs: feared opposition from South
40
did the nd work: unemployment and the economy
Created millions of jobs Stabilised banking system Cut number of business failures Improved standard of living in deprived parts Provided USA with schools, roads, and power stations Never solved underlying economic problems Confidence remained low and Americans only invested 75% of what they had before FDR cut New Deal budget and country went back into recession Still 6 million unemployed in 1941 Only USA’s entry in WW2 brought end to unemployment
41
did the nd work: women
Women achieved more prominent positions lie Eleanor Roosevelt Mary Macleod Bethune, AA, headed the National Youth Administration Fraces Perkins was secretary of labour: removed 59 corrupt officials and was key for 2nd ND Most programmes aimed to help male manual workers rather than women Only 8000 women involved in CCC Local governments avoided paying out social security to women by making special terms Frances Perkins was attacked in press as Jew and Soviet spy, ignore by her colleagues
42
did the nd work: native americans
Indian Reorganisation Act 1934 provided money to help them buy and improve land Indian Reservation Act 1934 helped preserve and practise traditions, laws, cultures They remained a poor and excluded section of society
43