Causes, Consequences, and US Government Response to the Great Depression and New Deal, Slides of United States History

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The Great Depression

and the New Deal

The Causes and Consequences of America’s

most significant economic downturn

Mr. Sean McAtee Iroquois High School Elma, New York

The 1920s had been a period of

prosperity - good economic times

Black Tuesday - Oct. 29, 1929 - Crash of the NY Stock Exchange Caused panic - and an economic depression that would last until World War II

GNP Drops, Unemployment Soars

Between 1928-1932, the U.S. Gross National Product (GNP)

• the total output of the nation’s goods and services - fell nearly 50% 90,000 businesses went bankrupt Unemployment increased 3% in 1929 to 25% in 1932

Causes of the Great Depression Weakness in the Overall Economy overproduction, underconsumption Excessive Buying on Credit Efforts to pay-off loans leads to underconsumption Weak Corporate Structure Lack of competition in many businesses Weak Banking System Banks were not required to hold adequate reserves ($) Unequal Distribution of wealth Big gap between “the rich” and common people; Farmers continue to struggle

The Dust Bowl Kansas Farmer, 1933 A severe drought began in the Great Plains in the early 1930s Wind scattered topsoil, exposing sand and grit. The dust often traveled hundreds of miles One storm in 1934 picked up millions of tons of dust, and carried it to the East Coast. These hard times began in 1931 and lasted until 1939

Smoot - Hawley Tariff (1930) Representative Willis C. Hawley (left) and Senator Reed Smoot Put in place the highest tariff rate in American history. GOAL - Protect American businesses from foreign competition U.S. exports to Europe fell from $2.3 billion in 1929 to $784 million in 1932. U.S. imports from Europe declined from $1.3 billion in 1929 to $390 million in 1932 European nations respond by enacting high tariffs as well - reduced trade for all nations.

Hoover’s Response to the Depression

Believed the economy would “Fix Itself” Economic policy = laissez faire Organized private relief agencies Hoover did not believe that the government should provide direct relief to people in need Encouraged Americans to buy American-made products Goal - stimulate the economy Reconstruction Finance Corporation (1932) Loans to businesses

Americans React to Hoover Hooverville - Seattle, WA. Hoover was very unpopular with the American people Hoover did not support giving direct aid to individuals — Rugged Individualism Slums were the homeless lived — “Hoovervilles” Many felt that Hoover cared more about the wealthy / business owners than the “common” people

FDR Elected President 1932 Roosevelt defeated Herbert Hoover FDR promised government action to help end the Depression.... A ‘new deal” between the American people and the federal government Goals of the New Deal Relief (help those with needs) Recovery (fix the economy) Reform (to prevent another crash)

Franklin D. Roosevelt at Harvard, 1903

- Senior Year Franklin D. Roosevelt, 1889 Age 7

Served as Assistant Secretary of the Navy during World War I Candidate for vice president (Democratic Party) - 1920 James Blaine was the Democratic candidate for president

The Warm Springs Institute for Rehabilitation

Warm Springs, Georgia

How else may polio have impacted FDR?