USA 1918-41 Flashcards

Question

# Causes of Prohibition Progressivism - background cause

Answer 1

Prohibition main policy of progressive movement that developed before 1914 Middle class supporters in small towns and rural America worried about crime and immorality in new cities and blamed on alcohol Disliked recent immigration. Claimed immigrants prone to drink Prob not main clause. Was an old movement and hadn't come close to banning alcohol before WW1

Answer 2

- Prominent groups: Anti-Saloon League of 1893 and Women's Christian Temperance Union - 27 states had passed such laws by 1917. - The temperance movement believed that alcohol was responsible for ruining family life, promoting corruption and immorality, causing sexual immorality, and perpetuating poverty.

Answer 3

Big business saw drunkenness as leading to inefficiency and industrial accidents Important and influential people who supported temperance movement However far more business people were against the idea because of loss of trade

Answer 4

War led to national prohibition campaigns. Alcohol seen as unpatriotic. German brewers made big profits. Beer called Kaiser's brew, easy to ban in 1918. Drink portrayed as cause of German aggression. Alcohol led soldiers astray. Lever Act banned grain use in alcohol in 1917. 18th Amendment banned sale, transport, manufacture of alcohol in US in 1919. National prohibition started Jan 1920.

Answer 5

Soft drinks industry developed in 19th century 1905 Coca Cola marked as Grand National Temperance Drink Output increased 17.4 m cases in 1880s to 113m by 1920

Answer 6

Speakeasy - illegal bars run by gangsters. Drinks sold were dangerous, made from industrial alcohol, led to blindness and sometimes death Rum runner - someone who illegally transports alcohol over a border Moonshine - home-made whisky Bootlegging - someone who made illegal alcohol.

Answer 7

Deaths from alcoholism fell by 80% in 1921 Poisoning from wood alcohol occurred Overall 50,000 people died from alcohol poisioning by 1926 No quality control.

Answer 8

Brewing industry affected. Some diversified into soft drinks Farmers lost out - grain or hops not being used Bars and hotels had to cut staff as people going out less Grape growing industry forced closure of most of the wineries Hit gov taxation. Losses were $11billion by 1931 Discriminated against poor. Saloons shut but speakeasies serving wealth stayed open

Answer 9

Gangsters controlled alcohol, speakeasies, and expanded into illegal activities. Immigrants dominated the criminal gangs, with Italian, Irish, and Jewish involvement. Increased profits led to violence. Chicago, with its proximity to Canada and good transportation networks, became a major smuggling center. Torrio and later Capone ran the business in Chicago, with Capone earning a staggering $105 million annually. Gangsters gained popularity as American heroes, with Capone symbolizing enterprise and even running charities during the Great Depression.

Answer 10

**Lack of funding **- John Kramer first Prohibition Commissioner Appointed 1,500 federal agents to destroy liquor supplies and arrest anyone breaking the law Some agents were effective but most didn't have enough staff or money . By 1926 Kramer spending $10million and still wasn't enough **Bribery & corruption** - enforcement agents poorly paid and so bribes often worked. 1 in 12 officers sacked for taking bribes. One gang has 400 police on payroll

Answer 11

Bootleggers organised into gangs to transport and distribute goods. George Remus - King of Bootleggers made $5million Easy to find alcohols Chemists could sell on prescription Thousands of illegal stills Speakeasies grew

Answer 12

Never popular measure Grand juries never send to trial because they too were breaking the law Prisons couldn't cope Never supported in all States, esp urban ones. Maryland never introduced it President Harding had alcohol delivered to White House

Answer 13

Bootleggers organised into gangs to transport and distribute goods. George Remus - King of Bootleggers made $5million Easy to find alcohols Chemists could sell on prescription Thousands of illegal stills Speakeasies grew

Answer 14

**Gangsters** moved in to control smuggling alcohol and speakeasies Criminal gangs deveoped to run illegal smuggling Almost exclusively immigrant origin.Chicago - Italian & Irish. NY - half were Jewish **Increased profits** - branched out into illegal gambling, brothels and drugs Chicago centre of smuggling trade as close to Canadian border and had good road & rail networks John Torrio ran most of the business in Chicago. Retired in 1925 with savings of $30million. Capone took over from him. Became more famous. Earned $105 million per year **Violence** - as gangs began to compete murders and violence erupted Valentine's Day Massacre - 1929 Capone's gang v Bugsy Malon **Popularity of criminals** - Americans took gangsters to their hearts and made heroes of them. Capone became celebrity and symbol of free competition and enterprise. Ran charities and soup kitchens in the depression.

Answer 15

**Lack of funding **- John Kramer first Prohibition Commissioner Appointed 1,500 federal agents to destroy liquor supplies and arrest anyone breaking the law Some agents were effective but most didn't have enough staff or money . By 1926 Kramer spending $10million and still wasn't enough **Bribery & corruption** - enforcement agents poorly paid and so bribes often worked. 1 in 12 officers sacked for taking bribes. One gang has 400 police on payroll

Answer 16

1000s miles of border made smuggling easy 1925 officers guessed they only intercepted 5% of alcohol coming in illegally Waters outside national limit known as Rum Row Almost impossible to enforce because so many people willing to break the law to drink alcohol

Answer 17

Law breaking - social effects of prohibition worse than social ill-effects of drinking Lawlessness had increased, respect for law lessened Capone made into heroes. Gangland murders out of control. Between 1927 & 1931 227 gangland murders for which no one was convicted Never full compliance and took 13 years to repeal the law

Answer 18

Some died or poisoned by illegal moonshine. Health dangers of legal alcohol were less serious as could regulate manufacture

Answer 19

Americans turned against idea. Parades and demonstrations Powerful voices and arguments to repeal law American Federation of Labour organised 'no beer no work' - working man entitled to beer after work Reform had 1m members by 1932. Used same methods prohibition movement had used - leaflets, backing wet candidates, books etc and blamed society ills on being dry

Answer 20

Du Ponts argued prohibition lead to tax rises. Claimed alcohol tax could pay off National Debt in 15 years. 1920s period of reduced intervention by Republicans. After Wall Street Crash and depression, argued money could be spent on job creation and poor

Answer 21

Some states had already repealed laws on prohibition By 1932 Roosevelt found repeal was popular campaign issue. Managed to unite Democrat party on this issue

Answer 22

Dry lobby divided. Some wanted stricter enforcement whereas others wanted education programme to deter drinking This division made it easier to repeal

Answer 23

Separate facilities for blacks and whites After 1865 Southern states introduced laws against black people Jim Crow laws -named after comedian who made racist jokes in 19th century Plessy V Ferguson court decision said laws were constitutional as long as black and white facilities were equal After WW! laws extended to include taxis, race tracks, boxing matches etc as fears of running into black soldiers increased. Even separate blood banks

Answer 24

33% of black people on relief in South and 52% in North by 1932 Rural nature meant poorly paid Majority of black farmers were sharecroppers. Lived in perpetual debt and lived in dire poverty

Answer 25

Mob takes law into own hands to injure and kill a person accused of wrongdoing Black people could be lynched for minor crimes or just for ignoring customs of south. By 1920s mobs used sadistic tactics - burning, torture, dismemberment, created festival atmosphere, sold tickets 1882-1968 3,446 lynchings of black people. Many not reported

Answer 26

Post-WWI concerns over armed black veterans. KKK flourished in cities like Memphis and Atlanta. "Birth of a Nation" fueled white supremacy and fear. Labor tensions banned Jews, blacks, and immigrants. KKK reached 5 million members by 1923, using violence, intimidation, and political protest. Southern states opposed federal intervention. Immigration restrictions weakened KKK. Infamous kidnapping and rape case involved prominent KKK figures.

Answer 27

One way to get out was migration to the North - 824,000 in the 1920s This is because blacks could earn a better wage and segregation didn't take place In 1910 only 10% of blacks lived in the North and in 1940 that was 22% With no Jim Crow in the North Blacks could assert their rights more.

Answer 28

Just as there was no Jim Crow in the North didn't mean there wasn't any racism - migration led to the creation of ghettos these were black neighbourhoods where housing and other facilities were poor and overcrowding was rife. July 1919 Race Riots in 20 cities and 1000s turned out of their homes

Answer 29

A revival of interest in black culture and black pride Black theatre The rise of books, poems and magazines that put forward a black viewpoint

Answer 30

Led by Marcus Garvey Wanted to encourage black pride and unity of blacks (black nationalism) Had a back-to-Africa repatriation campaign. Asked the League of Nations to give over former colonies to make a new African Republic. Garvey used rallies and sound bites to publicise his cause. He elected himself President-General of the UNIA.

Answer 31

By the mid-1920s, there were UNIA grocery stores, restaurants etc. Black Star Line was a ship that would take black people back to Africa but it went broke and Garvey was deported for fraud.

Answer 32

Led by WE Du Bois Make Blacks aware of their civil rights and also an Anti-Lynching campaign It focussed on legal strategies designed to confront civil rights issues. Managed to limit the number of lynching In 1935 tried to get Roosevelt's help in getting an anti-lynching law

Answer 33

Successfully fought the grandfather clause (said that you could only vote if your grandfather had. Due to literacy tests etc blacks could never vote) They won in the supreme court and it said that the grandfather clauses were null and void due to the 15th amendment Membership rose to 1m by 1921

Answer 34

In Chicago and New York, there was an emerging black middle class and a black capitalist movement to encourage them to set up businesses. There was still poverty and low wages but life expectancy for blacks did rise from 45-48 from 1900-1930 (it rose for whites more)

Answer 35

WASPs feared non-white immigrants and those coming from Eastern Europe. Disliked Catholics and Jews. They felt they were being swamped and this caused some states to sterilise people from certain ethnic groups Nativism valued those born only in the USA | WASP - White Anglo-Saxon Protestant

Answer 36

New immigrants would accept lower wages and this caused more established immigrants to be worried. After the war, munitions factories closed - led to unemployment and soldiers returning from the war wanted jobs They believed that they were either being deprived of work or forced to accept low wages because of cheap immigrant and black labour

Answer 37

A fear that the new immigrants may bring anarchism or communism into the USA. New immigrants were blamed for problems such as trade unions and bombings. The Republicans did very well out of immigration policies

Answer 38

* **1921 Emergany Immigration Act** - immigration limited to 357,000 per year and quotas were set based on the 1910 census so that 3% of the number from that country could enter each year * **1924 National Origins Act** - Now only 150,000 pa and quotas changed to 2% from the 1890 census * **1929** - Max of 150,000 pa and none from Japan or China

Answer 39

Increased hatred of Eastern European, Asian immigrants and blacks. This led to violent racial incidents. Laws passed to force the sterilisation of certain ethnic groups in some states

Answer 40

Espionage (1917) & Sedition Acts (1918) silenced open criticism or opposition to government Strong opposition to WW1 from some immigrant groups, esp Italian-Americans. Arouses suspicion as already involved in organising strikes and demands for higher wagers Published own newspapers highly critical of government Unrest labelled anarchist or communist and seen as subversive

Answer 41

After WW1 saw birth of international communism after Bolshevik Revolution in 1917 Many western democractic states worried by the spread of communism, strongest in US USSR set up Comintern to promote world revolution Early 1920s American Communist Movement established, many members were foreign born

Answer 42

Some anarchists resorted to terrorism 1919 40 nail bombs sent to policitians and industrialists. 8 cities faced bomb attacks. Home of Attorney General (Alexander Mitchell-Palmer) destroyed and he narrowly escaped death 1920 bomb on Wall Street killed 38 Felt anarchists threatened nation's security

Answer 43

Large strikes in 1920s Convinced government adn employers that new trade unions were dangerous. Strike leaders seen as socialists. William Foster, leader of Boston steel workers, thought to be a communist. Unions seen as foreign and socialist, blamed by influx of European immigrants 1919 4 million workers went on; strike 20% of workforce; overall 3,600 strikes Feb 1919 5 day general strike in Seattle - railways, coal, textile and steel workers involving 400,000 workers 1919&1920 coal miner's strike in W Virginia only ended when Governor used state troops to smash it Worst disputes in textile industry. In 1927 girls working 56 hour week were paid 18c an hour

Answer 44

In Aug 1919, Mitchell-Palmer formed Intelligence Division to probe revolutionary actions led by Hoover. Spied on Reds, raided locations, amassed 200k cards on radicals, resulting in many arrests, deportations. Unlawful arrests, poor conditions, syndicalism made illegal in 32 states.

Answer 45

New Year's Day 1920 men & women rounded up for allegedly subversive activities in raids on 33 cities Many recent immigrants and innocent. Had to be released due to lack of evidence Newspapers and Supreme Court Justice criticized anti-sedition bills Industry leaders realised that deporting immigrants was a drain on labour source, resulting in higher wages and decreased profits

Answer 46

Many fearful of changes taking place - cars, flappers, immigrants, black political movement Felt urban changes were harmful to their way of life Scopes Trial must be seen in context issues like red scare, banning alcohol, banning immigration

Answer 47

High church attendance. Evangelicals like Billy Sunday used meetings, radio, rallies. McPherson built mega-church in LA. Scopes Trial against modern values. Fundamentalists supported prohibition, opposed Smith for being Catholic, from NY.

Answer 48

Freedom of religion is guaranteed by First Amendment of 1791 but forbids any official or established religion Many urban people believed in Darwins theory of evolution and retained their belief in God. Reinterpreting Bible stories in light of modern discoveries Many rural Americans disagreed and believed in Fundamentalist theories - everything in Bible is literally true Fundamentalists set up Anti-Evolution League - 6 states made illegal to be taught in schools. Tennesse passed Butler Act 1925 banning teaching of Darwin in state schools. Joined by 5 other states.

Answer 49

Biology teacher John Scopes deliberately broke law in Dayton, Tennessee so he could be arrested and put the case in the courts He was supported by American Civil Liberties Union who put an ad in newspaper looking for someone to test the law.

Answer 50

Scopes convicted and fined $100 but Fundamentalism was on trial Defence attourney Clarence **Darrow** Prosecutors led by William Jennings **Bryan** who had run for President 3 times. Supported by World Christian Fundamentalist Association who promoted traditional values Trial first to be heard on radio. Newspaper reported throughout trial Dramatic legal battle. Darrow asked for Bryan to go on stand so could question his beliefs. Made to admit that he didn't believe every word of Bible as literal truth Anti-evolution lobby never recovered after the trial Bryan died suddenly after trials Darrow cleverly focused the trial on ideas rather than action of Scopes. However Judge rejected this and Scopes found guilty and fined Tennesse Supreme Court overturned verdict a year later. Law never used again

Answer 51

US rich country with many resources, large population 1920 census 106.4 million people, compared with 42 million in Britain US population rose by 16% in 1920s. Large market for cheap goods Large immigration - cheap and plentiful workforce Natural resources like coal, cotton, wood, metals New railways, roads and good communications Agriculture more efficent in world, even overproduction Largely self-sufficient and huge internal market that could fuel its own industrial expansion. Highly entrepreneurial

Answer 52

US philosophy geared towards doing well economically as people keen to make money and become entrepreneurs Inventions like light bulb, sewing machine, telephone, Bakelite Work ethic of rugged individualism. Gov not intervene and allow people to make their own wealth Encouragement of thrift and savings fuelled investment. Self made millionaires - Rockefeller and Carnegie

Answer 53

War a great stimulus to growth. Helped train workforce and high unemployment gave them high purchasing power with high wages. During War US provided goods to Britain and France. Factory production increased by 35% Largest growth was steel industry. 1910 26.1 million tons. 1922 42 million tons New industries - air travel, radios, electricity, chemicals, vehicles, fertilisers, plastic. Overtook Germany Exported new products - cigarette brands v popular in Europe Produced 70% of world's petrol Gave out large loans to help countries fight war effort. Received interest on loans Unskilled workers' wages rose by 20% Employment of women made more cash to spend

Answer 54

Laissez faire policies let businesses get on. Gov took active role in economics during war but backed off in peacetime 1920s governments were Republican. Believed in laissez faire economics Andrew Mellon, Treasure Security, second richest man in US, supported big business with low taxes, high tarrifs Nov 1921 Revenue Act - changed taxes, charged businesses more but cut wartime tax on high levels of profit Revenue Act 1925 changed taxes, cut individual tax and wartime tax but increased business tax from 1922 Businesses benefitted from state and congressional support against formation of trade unions Yellow dog contracts enforced no strike agreements. Meant wages couldn't rise too high. Trade union membership fell 1.5m 1920-1929

Answer 55

Encouraged further consumer spending & conditions for business growth Isolationism meant a high tariff policy that encouraged people to buy US goods Fordney-McCumber 1922 raised tariffs and extended them to industrial goods. Gave President the power to raise them annually in line with selling price of these goods in the US

Answer 56

New management & production techniques led to cheap goods. Affected other industries **Mass production** Took off in 1920s. Assembly lines. Model T was produced every 10 seconds by 1926. River Rouge Plant, Detroit employed 75,000 people & produced 1 million cars per year **New management techniques** Production costs kept down. Management focussed on productivity of workers. Management was crucial. Harvard Business School created. Time and motion studies to more production even more competitive

Answer 57

New industries Electricity v important. Enabled new cheap goods 1920s second industrial revolution. Most of it was electricity generated 1914 30% of factories powered by electricity. 1929 this was 70% Construction industry took off Consumer durables created . 5,000 fridges in 1921, 1 million in 1930

Answer 58

Selling techniques helped create huge demand for new goods. 1929 $2billion spent on advertising. 600,000 employed in advertising Companies tried to sell new products and change habits.

Answer 59

1919 Alfred Sloan set up credit agency for ordinary consumers. Pay for products by installments Hire purchase. 75% of cars and 50% household goods bought this way 1920-29 consumer credit grew from $32billon to £60 billion Being in debt no longer shameful

Answer 60

Consumerist attitude - people felt they had to have new goods, an essential not luxury Spending money became leisure activity Women a big target - cosmetics, perfumes etc

Answer 61

Sport - baseball, American football Air travel - 500,000 people travelled by air per year Cinema - Hollywood. 1920 talkies began. 1922 cinemas taking $14million a week, by 1930 $80million Department stores - customers helped themselves to goods and pay at checkout.

Answer 62

1.5m ordinary Americans bought shares People found it easy to borrow 'on the margin' - borrow from bank or broker and pay it back when share price rose Bank rates low so little encouragement to save In bull market prices always seem to rise and plenty of confidence that it would always do so.

Answer 63

**Assembly line** Speeded up mass production so car prices fell Ford pioneered hire purchase for car buying **By 1915 over 28 million cars in US** **Knock-on effect on other industries** New jobs for factory workers and mechanics to service cars **1929 over 4 million workers depended on car industry**

Answer 64

$2billion in mortgages taken out post-war Ford made Fordson tractor in 1917. Sold 750,000 in 10 yrs Led to demand for combine harvester. Farmers built up debts to buy machinery 1923 Agricultural Credits Act gave farmers cheap loans and built up debts at a time of falling demand and overproduction

Answer 65

Farmers producing 9% more by 1929 even though demand had falled Farms were too efficient and too many of them Overproduction was main problem, especially when European market dried up after WW1 Fall in demand and high tariffs meant farmers could not sell abroad. Price of wheat fell $1.83 bushell in 1920 to $0.38 in 1929

Answer 66

New products like rayon hurt cotton farmers Wool & cotton hit by changes in fashion. Shorter dresses and skirts needed less fabric Prohibition hit wheat & hops farmers European recovery meant didn't need US exports which were expensive

Answer 67

High tariffs hit exports. Overproduction couldn't be sold abroad Emergency Wheat Tariff 1921 on wool, sugar and wheat to give home producers an advantage 1922 Fordney McCumber tariff went further and put tariffs on 28 products but led to European retaliation that meant farmers found it harder to sell abroad

Answer 68

All led to fall in prices that led to fall in income Farm incomes fell $10billion in 1919 to $4billion in 1921 66% of farms in South Carolina were operating at loss. Had to cut wages or not raise them to keep up with factory worker wages More than 3 million farmers earned less than $1000 per yr which was the minimum requirement of a family Farm labourer income half that of coal miner and quarter of clerical worker

Answer 69

600,000 farmers suffered bankruptcy in 1924 Foreclosures grew (farms were repossessed) 13m acres of land abandoned & not cultivate

Answer 70

Many farmers found it unprofitable to harvest crops Smaller farms lay off workers - 1million laid off. 6 million left for cities Sharecroppers had worst time as so dependent on crop selling at a good price Rural work force fell from 27% in 1920s to 21.2% of total labour force

Answer 71

Post-war drop in demand. Rayon cheaper to produce than wool or cotton Tariffs hid industry hard. Dresses and skirts shorter so needed less fabric. 19m cloth for dress in 1913, 7m in 1928 Factory production needed fewer workers. More women employed as lower wages Supreme Court said that banning child labour was unconstitutional Textile factories moved south where labour was cheaper Supreme Court banned laws on minimum wages for women Most textile workers were not unionised so jobs not protected and wages were lower

Answer 72

Coal overtaken by oil & gas which could produce electricity much cheaper Coal worker's weekly wage was $30 below what was considered minimum wage

Answer 73

Faced competition from cars & lorries Far slower growth than in past. 10% freight growth in 1920s

Answer 74

**Wealth Gap** 16 million families received less than $2000 per year 70million people (42% Americans) living below poverty line

Answer 75

**Unemployment** Between 1923 & 1929 over 200,000 miners lost jobs In Muncie, Indiana 72% of working population were jobless at some stage in 1920s

Answer 76

**Strikes** As result of new technology was discontent and strikes Strikes in 1929 led to police chief being killed after trying to break up mill strike

Answer 77

Rising share prices inflated demand and prices. US stock exchange experienced a long bull market. Value of stocks increased significantly from 1925 to 1929. 1925 value stocks $27 billion. 1929 $87 billion

Answer 78

1920 4 million share owners. In 1929 20 million. Popularity of buying shares encouraged more companies to issue them to develop their businesses Initially this pumped money into companies and the rising prices made large profits Everyone wanted in to make a quick profit - FOMA

Answer 79

Many shares bought **on the margin** - 10% deposit, rest on loan or HP from banks People thought they were buying shares for a quick profit instead of keeping their money invested in the same business for some time. **Speculation rather than investment** Federal Reserve Bank lowered interest rates in 1927 in time for a massive boom on the stock market fuelled by easy credit

Answer 80

People were encouraged by books and media to invest. Part of American Dream Some brokers operated illegal bull ring where they bought and sold to each other to talk the prices up and sold high to investors. Prices then fall and investors lose money

Answer 81

Summer 1929 consumer boom running out. Unemployment rising, demand falling. Warehouses filing up Prices of key things falling - coffee, sugar, copper, cotton. Had too much stock so prices fell rapidly Car market and construction in decline Banks found people not paying back loans Share prices kept rising. Any falls were acted upon by buyers who thought they were temporary bargains that would soon recover

Answer 82

Interest rates raised to 6% to try and cool market More difficult to borrow and big investors saw trouble ahead Smaller investors have to leave the market quickly if share prices fell as they had higher borrowing costs Might choke off speculation because borrowing more expensive

Answer 83

By October rumours of falling production and rising unemployment brought correction to market - make shares equal to business value Big investors like Joe Kennedy were pulling out Brokers who sold shares on the margin had borrowed from banks in first place. Banks now demanding repayment. To repay the brokers had to ask customers to repay their debts. Only way to do this was to sell their shares at any price

Answer 84

People realised shares now worth less than what they paid for or the loans they had 24 Oct share prices started falling - Huge number of shares traded 29 Oct - 16 million shares sold and prices crashed. By Nov 1929 shares had lost $26 billion in value,

Answer 85

Economic prosperity unevenly distributed. 1/3 of wealth to top 5%. Mellon's tax policies favored rich. 80% had no savings. 71% earned less than $2500/year, lacking purchasing power. Failing industries, low-paid immigrants, farmers faced poverty. Unions weakened, Ford shut them down.

Answer 86

Car and construction industries in decline by 1920s due to underconsumption Car sales fell 1/3 in 1929 Over production encouraged because many people bought on HP and could no longer keep up with payments Tariffs meant could not sell abroad Large companies put small companies out of business

Answer 87

The farming industry in crisis - Rural poverty and debt are rife 1/3 of US pop lived in rural areas and 66% of farms were making a loss Intensive farming caused dust storms which made land useable. This didn't cause the depression but it did make things worse once it did start

Answer 88

People started to realise that the market was edging down meaning that their shares were worth less than what they paid for them. By November 192 shares had lost $26 billion in value - now a 1/3 of what they were in September.

Answer 89

1. Brokers demanded payment from investors as both had made losses so brokers wanted payment 1. Investors also had losses so they had to withdraw from banks in large sums. 1. Banks had liquidity problems - they didn't have enough cash on hand. So they turned to people who owed them money such as large companies. Some banks crashed as these measures didn't solve their problems. Also savers lost all their money as they had no deposit insurance

Answer 90

With little spare money banks called in on loans and stopped making new ones. This impacted consumers and businesses. Affected businesses found they had to **cut wages, limit investment** or they began to go out of business because they were relying on loans

Answer 91

Banks lost money in the crash, causing distrust and mass withdrawals. In 1929 650 banks failed, leaving savers with nothing due to no deposit insurance. Surviving banks became cautious, refusing to lend, affecting businesses and individuals in need.

Answer 92

The US gov blamed world events so they didn't need to take responsibility or take action. There were some issues such as countries trying to cut themselves off from the USA. There were also WWI loans and some countries depended on thier US to keep paying these if the US pulled out they were left unable to pay. The US did call in its loans and the world economy contracted and so it rebounded back on the USA

Answer 93

The US had no welfare or unemployment benefits due to the fear of creating a class of dependents. There was an emphasis on rugged individualism and hope that private charity would help the newly created poor and homeless however this was inadequate. To help the poor the government encouraged people to give to charity. Many set up soup kitchens including Al Capone.

Answer 94

Some lost money on the stock market - not many though Others lost due to the value of pensions and other investments fell due to share price falling Some lost all their savings as the banks they saved with crashed Others worked for companies that had financial problems which meant their wages were cut or made redundant

Answer 95

**There were 30,000 independent banks and each state had different rules for banks and there was no national system to help them out. Only 1/3 of banks were a part of the Federal Reserve so it was hard for the government to help them out.** Most banks were vulnerable to sudden and large withdrawals as they didn't keep large reserves of cash. This was worsened by agricultural depression as a crop failure could lead to a run on the banks. **20% of banks already failed before 1929**

Answer 96

Farm Prices had fallen so low that by 1933 the cost of transporting animals to market was higher than the price of the animals themselves Total farm income had slipped from $6bn in 1929 to $2bn in 1932 Farm poverty was rife. It was almost impossible for farmers to pay mortgages and debts which meant 1/3 of them lost their land

Answer 97

Bankruptcy and foreclosure were common (banks repossessing the farm). Farming communities sometimes took action to try and stop farms from being sold at auction at very low prices In 1932 75 people defended a farmer against deputy sheriffs in Wisconsin - they were trying to take his farm. The action failed Buybacks also took place: one farm in Beraksa was worth $4,100 and was bought back for $50

Answer 98

Farmers were hit by black blizzards which were partly their fault and partly the weather's. This made the impact of the crash far worse for farmers. Dust Bowl: 60% lost their farms; 500,000 buildings destroyed; 3,500 killed and **20m hectares couldn't be farmed**

Answer 99

1m fled their farms to move west as a result of the Depression and the Dust Bowl. Okies and Arkies were the people fleeing west to states like California. They could get work as fruit pickers but th e wages were low and they had nowhere to live. They often set up temporary camps

Answer 100

25% of labour force was unemployed; Ford made 1/2 of his workers unemployed in Detroit. In Chicago 40% of the workforce was unemployed. Blacks were 52% unemployed In addition, many people were on part-time contracts. US steel workers had their hours cut as production in steel mills dropped 30& in 1930

Answer 101

Around 15% of all live savings lost By late 1932 an estimated 25% weren't receiving a wage Only 20% of single-parent families were receiving financial support

Answer 102

People couldn't keep up mortgage payments and rent. And often lost their homes. In 1932 in NYC the gov had to find accommodation for 20,000 children whose parents couldn't house them any longer

Answer 103

Hoovervilles were set up on the edge of major cities as people lost their homes They were made of iron, tin, cardboard and anything else people could find. There were no running water or sewage facilities. Bonus Army in Washington erected Bonus City which had 22,000 people

Answer 104

Many people tried to travel around the country for work - hobos who would ride trains to try and find work. There were an estimated 2m in 1932 and 6500 were killed in 1933 by accidents on trains or by guards who made sure only paying passengers were on trains. California had armed guards on trains

Answer 105

Blacks had an unemployment rate of 50% compared to 30% for whites 1/2 of black women in the workforce lost their jobs

Answer 106

Many lost their jobs to white people e.g. Mexican workers in California and the South West. Some were deported - around 500,000 returned to Mexico in the early 1930s

Answer 107

Many lost their jobs as domestic workers - around 25%. Women were accused of taking men's jobs if they worked. However, more women did work during the depression to try and help the family income, through low-paid jobs

Answer 108

Many couldn't afford to retire so had to carry on working. Only 11 states had pension schemes Many had to rely on families to help them through

Answer 109

The gov promised to pay WWI veterans a bonus of $625 for serving in the war, payable in 1945. The veterans felt they couldn't wait that long and in May/June 1932 20,000 veterans joined together and marched on Washington to support a bill which would allow them early payments of their bonuses. Hoover opposes this as paying the bonuses would cost $2.3bn and this was too much for Hoover. It passed the House of reps but it failed in the Senate. Money was provided to help send the marchers home but 5,000 stayed and refused to leave

Answer 110

They built a shanty town called bonus city on Anacostia Flats outside Washington. One War Dept official said they were "tramps and hoodlums" Hoover set a deadline for them to leave when this passed the police was to go in to get them out. When the police when in conflict broke out and 2 died. Hoover sent the army in the end and the marches fled. 100 were injured in the end. It all left a bitter taste in the mouth of many Americans.

Answer 111

It was an important event in Hoover's presidency because people used it to show how he failed to deal effectively with the Depression. Hoover took the blame for what happened even though it was likely that the government didn't have the money to pay the bonus May have affected the 1932 election

Answer 112

Moratorium on world debts from 1931. Would not collect war debts for 18 months. But as they had already called in loans they had already hurt world trade By 1932 Hoover was cutting taxes. Average family man with income $4000 per year had tax cut by 2/3. However, tax cuts upset the poor who thought they favoured the rich

Answer 113

Emergency session of Congress April 1929 to help farmers Agricultural Marketing Act 1929 to bolster price of grain, cotton etc Provided $500 million to the Grain Stabilisation Corporation to buy surplus wheat from coops to stabilise prices and keep them high for farmers to make a profit However this failed to stop prices falling, probably because they didn't spend enough. Also gov built up huge supplies of food that it couldn't release or the prices would drop. Unpopular as it seemed a waste of money. Bought wheat at 85 cents a bushel when market rate was 35 cents. Didn't help all farmers and policy widely resented

Answer 114

Federal Farm Loan Act 1932 provided $125 million for banks to provide mortgages. But lending was tight because farmers had to pass various criteria

Answer 115

Initially tried to make an agreement with employers not to lay people off and to try to maintain wages. 1929 National Business Survey Conference of 400 businessmen who made promises about wages, production & expansion Most promises were broken as depression worsened

Answer 116

Federal Home Loans Act 1932. Federal home loan banks created to provide 50% assistance for people who couldn't pay off their mortgages and to stimulate housing market Had 41,000 applications for help but only 3 were accepted

Answer 117

Initial response we to rely on charity and to persuade businesses not to lay off people. Encouraged people to give to charity and set up soup kitchens Charities were soon out of their depth as problem was so large

Answer 118

Reconstruction Finance Corporation 1932 allowed federal gov to loan $300 million to states for relief But the states had to meet tough requirements. Only $30 million loaned by end of 1932

Answer 119

Moratorium on world debts in 1931. US not collect debts for 18 months to give Europe more time to recover But this didn't do enough to prevent collapse of world trade and probably came too late

Answer 120

**Relief** Helping people now - food, cash, jobs **Recovery** To get better long term. Get economy functioning again - raise incomes for farmers, end to banking crisis, higher rates of industrial production **Reform** Making permanent change to prevent re-occurence and to improve people's lives. Make capitalist system work better for people - social security system, strengthen power of trade unions

Answer 121

**Pump-priming** The New Deal's economic approach proposed government intervention through extensive spending on public works to generate employment and stimulate consumer spending. The New Deal aimed to prime the pump by providing wages and encouraging spending while also granting businesses cheap loans to boost investment and confidence. Although initially costly and reliant on borrowing, the government expected to recover the funds through taxation once the economy regained stability, allowing it to reduce its interventionist role.

Answer 122

Fireside chats Spoke to people directly over radio 30 times. Brilliant propaganda. Three aspects **Homeliness** - chats like a father discussing public affairs with family in living room. People felt closer to the government and president and made them feel included in the plans **Reasonableness** - FDR said not make false promises and would not succeed every time. It prevented panic **Blame** - spoke of the 10% who wanted the Deal to fail. Ordinary people believed he was fighting the rich and selfish on their behalf. Even though gains of the New Deal were not great FDR won 1936 election by another landslide

Answer 123

**100 Days/First New Deal** March - June 1933 Period frantic activity that reformed banks, ended prohibition and reformed financial system New laws passed with emergency legislation Emphasis on relief and recovery Agencies set up to help people - fix prices for farmers, civil works programmes to get people back to work

Answer 124

**Pre-empt opposition** Build up of political opposition - Heuy Long, Coughlin so social security and pensions introduced. Farmer- Labour Party pressing for more agricultural reform Radical congress elected in mid-term 1934 elections. Had plans for labour laws, minimum wages, tax rises etc. FDR needed to do more as were strikes over poor working conditions. Workers were the mainstay of FDR 's support so alienating business was a little more acceptable

Answer 125

Ends prohibition. Only 7 states voted against 21st Amendment. POSITIVE Raises morale, raises taxation, reduced organised crime and need for high police costs

Answer 126

Because agencies were being attacked. **CCC 1933** 18-24 year olds put to work in camps built by army. Military discipline enforced. Conservation work. Earned $30 per month, $25 of which is sent back home to families POSITIVE 2 million helped in 9 years. Developed literacy & conservation skills. Some joined army afterwards. Money helped families NEGATIVE Comparisions to Hitler Youth. Trade Unions not keen. Only helped young people and mainly male. Only for 6 months but people kept coming back as no work elsewhere

Answer 127

Replaced PSA & CWA. 11 public projects and part of NRA Spent $11 billion overall on roads, parks, writers and artistic projects, youth training programmes and programmes for women POSITIVE 11,000 schools, 2,500 hospitals, 350 airports, 8,000 parks, 5,900 schools. Employed 8.5 million people over 5 years. 1/5 of nation's workforce. Helped white collar professionals through community service schemes - musicians, actors NEGATIVE Not so good for city centre slums Some of jobs were silly - Steinbeck told to take a census of dogs

Answer 128

The first joint economic planning between government and business aimed to maintain profits and ensure fair wages by offering a Blue Eagle reward for companies that signed agreements on codes, resulting in fair prices for goods and improved profits. Addressing low wages was a key focus due to its contribution to an uneven economy. **POSITIVE** Blue Eagle seen as a symbol of recovery Showed government were on the case 9m in unions by 1939 Banned child labour **NEGATIVE** Employers hated it. Encouraged strikes, pushed up prices. Min wages too high for smaller firms. Success dependent on businesses sacrificing profits for unions

Answer 129

Shut them for 4 days and inspected accounts. Only opened again when had adequate cash reserves. Fireside chats to reassure public. Gov bought shares in bank to give them stability POSITIVE Stopped panic and $300million in gold returned and $1 million in deposits Confidence returned. Saved banks in 8 days NEGATIVE Were banks dealt with harshly enough? Use of emergency leglislation criticised

Answer 130

Created Federal Reserve Board over 12 regional branches POSITIVE Enhanced authority of Federal Reserve and provided belated central banking system. No more bank collapses after 1936 NEGATIVE Opposition from bankers who didn't wish to lose control

Answer 131

Replaced NIRA, allowed unions, stopped spying/blacklisting. Secret ballot for striking. Positive: increased union membership (3m-9m 1933-39), fair practices. Negative: Ford ignored it, Memorial Day Massacre - 10 dead, 30 injured in clash with police supporting union membership.

Answer 132

To help people with mortgage payments. Given longer to repay POSITIVE Around 1 million people able to keep their homes

Answer 133

- Reduced production to raise prices, receiving $11 per unused acre funded by a food production tax. Some food is given to the unemployed. - **Positive** outcomes included doubled farmers' income, reduced foreclosures, and Farmers v keen - 95% tobacco farmers signed up - **Negative** aspects included destruction seen as wasteful, larger farms benefiting more, Cut in production more to do with dust bowl - 35 million acres destroyed, limited price increase due to existing surplus, and consumers being heavily affected by food processing tax.

Answer 134

41,000 sq miles cultivated and built up where erosion had been Big effort to electrify rural areas. Dams built. Established Electric Home & Farm Authority to help farmers buy electrical appliances POSITIVE Provide jobs. 80% of valley had electricity by 1943 21 dams built, Norris Dam Soil erosion prevented by trees being planted 3 greenbelt in Ohio, Wisconsin & Maryland NEGATIVE Too much intervention, near socialism Power companies complained TVA unfair competition Electricity companies built spite lines to richer areas and prevented poorer areas from getting permission to build lines Underfunded. 4,000 families resettled but reluctant to move

Answer 135

Set up by REA to grant loans to rural coops to provide electricity POSITIVE 1930 only 10% farms had electricity, some areas only 1% Not profitable for large companies to provide electricity to remote areas Huge effect on transforming rural life and farming methods By 1941 35% of farms had electricity

Answer 136

V conservative as few Democrat Presidents from 1861 so fewer chances of having Democrat judges 1935 NRA declared unconstitutional 1936 AAA declared unconstitutional Big blow to New Deal, could collapse 11 agencies hit on Black Monday. Democrats furious

Answer 137

After 1936 election FDR proposes to replace new judges to replace those over 70 so get a pro-New Deal court Criticism that FDR amassing too much power. Split Democrat party. Led to limit on amount of time President can serve

Answer 138

FDR was democrat Made federal gov too powerful. Opposed size and power of Alphabet Agencies Supported anti-New Deal decisions of Supreme Court Thought FDR spent too much money and put gov into debt **Tried to oppose by:** In 1936 election Alfred Landon campaigned for more power to be returned to the states, aid for farmers and end to New Deal Regulations However lost election badly and do little until after 1938 mid terms

Answer 139

Argued that FDR was a near totalitarian and threat to nation's freedom with his interventionalist policy Disliked being told what to do - NRA codes, min wage Thought leading country towards bankruptcy and spending too much money on social security and work programmes Thought low taxation was answer to persuading people to spend Disliked help being given to unions Tried to oppose by: ALL joined with business leaders like Du Ponts to oppose New Deal Spent between $500,000 & $1.5billion in promotional campaigns. Funding came mostly from Du Pont family, aswell as US Steel, Colgate, Heinz Challenged Wagner Act but lost in Supreme Court in 1940 In 1934 allegedly involved in Business Plot to overthrow FDR Republicaton Party asked it to stay out of 1936 election for fear it would lose support. Only had 150,000 members

Answer 140

Disliked farming policies and Wagner Act. Thought FDR was going too far with civil policies Tried to oppose by: Could join with Republicans after 1938 mid-terms Managed to cut spending on relief programmes, investigate alphabet agencies and weaken them Even accused officials of being communist Did block housing plan and a request for more work projects in 1939

Answer 141

Governor of Louisiana. Became Senator. Popular because he taxed rich people and provided social services before New Deal (free school textbooks, adult reading and writing courses) **Opposition to New Deal** NRA controlled by big business AAA left tenant farmers homeless Social Security Act didn't reduce gap between rich and poor Campaign

Answer 142

Share our Wealth: New tax code limits personal fortune to $5 million, annual income to $1.8 million (or 300 times average family income), and inheritances to $5 million. Funds used for basic household grant, minimum annual income, free education, pensions, veteran's benefits, assistance to farmers, works projects, and 30-hour workweek.

Answer 143

Hugely unrealistic - not enough rich people to fund it He was v popular. 8 million members of his Share our Wealth chapters Pressure from Long and his organisation considered by some as being responsible for FDR's turn to the left in 1935 when he enacted Second New Deal He may have stood for president but assassinated in 1935

Answer 144

Catholic priest from Detroit. Had 30 million listeners to his weekly radio programme At first a supporter but later preached about negative influence of international baners and Wall Street Thought Communists influenced FDR

Answer 145

Campaign recommendations National Union for Social Justice established in 1934. Demanded nationalisation of parts of economy, including public utilities Currency and banking reforms Fairer taxation

Answer 146

Simplicity of ideas attacked supporters. After 1936 Coughlin expressed sympathy for Hitler and Mussolini and his radio broadcasts became overtly anti-Semitic. This turn to the left wrong footed his campaign and struggled to remain popular

Answer 147

Retired public health official who was shocked by elderly women searching through bins for food He thought New Deal not doing enough for elderly people

Answer 148

**Old Age Revolving Pensions** Anyone over 60 receive pension of $200 permonth as long as they spent the money within 30 days of received it To be paid for by national sales tax of 2% on all business transactions (like VAT). Idea to end depression with consumer spending.

Answer 149

The tax would be too small to raise enough money He got a lot of support. Got bill into House of Representatives, 20 million signatures. 500,000 people joined his clubs When FDR passed 1935 Social Security Act Townsend continued to press for high payments for social security and old age assistance

Answer 150

Writer of novels of social protest and politics. Thought New Deal not doing enough for workers

Answer 151

Called for new economic system in which state would take over running of farms and factories as state run co-ops. Workers paid special currency to be spent at other co-ops Empty land and shut down businesses to be opened up for unemployed to use. Could produce what they needed

Answer 152

Clubs were formed 'End poverty in California'. Sinclair won state primary in 1936 Lost election for governor after being unfairly associated with communism

Answer 153

Most businesses that survived were able to make a profit. NRA tries to stimulate recovery NRA Blue Eagle everywhere and seen as a symbol of recovery 1937 depression suggests his spending was making a difference

Answer 154

Many businesses ignored the NRA codes Older industries remained unprofitable and the county faced a deep recession 1937-38 Industrial recovery delayed until the war

Answer 155

No bank failures under FDR and deposits insured Stabilised banking and financial markets Centralised the system Deposit insurance

Answer 156

People put money back into banks, but does not help investment which is still slack and stock prices do not recover until after the war

Answer 157

Agencies provided work for millions and unemployment fell from 12.4m in 1933 to 9.5m in 1937. WPA employed 8m people New roads, parks and schools were built

Answer 158

Unemployment didn't fall enough. The gov didn't spend enough and the quality of the agencies varied The CCC provided 6 months of poorly paid work with no skill training In 1939 17% of the workforce was still unemployed

Answer 159

Unionisation allowed and strengthened Right to collective bargaining Ending Child Labour Min wages and max working hours 7m union members by 1938 in the most powerful industries

Answer 160

Hostility from employers, strikes rose and unions were still treated with suspicion Many strikes broken by employer violence 7 hour battle between National Guard and strikers in Toledo, Ohio in 1934

Answer 161

Social Security Act meant that unemployment benefits were accepted by the US economy. Also gave pensions to those over 65 and maternity and disabled benefits. This showed that the gov was capable of compassion and was responsible 35% of the population received relief from the government

Answer 162

Welfare accused of destroying individualism and putting a huge burden on taxpayers. Social Security was quite limited in who could be paid and most agencies didn't give direct benefits. In 1935 only 4% of the 13 million US workers were eligible for a pension

Answer 163

Farm income rose from $2.5bn a year to $4.6bn TVA - enormous areas helped and a huge scheme of regeneration to change the economy of the whole area.

Answer 164

Big Farmers do better Dust Bowl migrants given little support Farm incomes rarely reached the levels of even 1929

Answer 165

Women - Eleanor Roosevelt and Francis Perkins as role models Numbers rose in work by 22-25% in the 1930s Female Ambassadors and judges appointed Grants provided for women with dependent children in Social Security Act

Answer 166

Some NRA codes required women to be paid less than men - in 1937 they were earning around 1/2 a man's wage Only 1 woman elected to the Senate in the 1930s

Answer 167

30% of black families received relief FDR had an unofficial black cabinet to advise him Around 200,000 black Americans recived benefits from agencies CIO unionised many blacks and also prohibited race discrimination in its organisation

Answer 168

- No guarantee against discrimination in agencies - CCC was segregated - By 1935 30% of blacks couldn't get work - whites still came first

Answer 169

The IRA restored 7.4m acres of land to tribes Native Americans were given a chance to vote and government themselves The new law recognised the right of Native American women to vote

Answer 170

Some New Deal polices such as a plan to hill large numbers of the Navajo's sheep and goats were unpopular Reliance on New Deal like the WPA left them without help when they closed down

USA 1918-41 Flashcards

(194 cards)