AMERICA IN DEPRESSION

I.  PROSPERITY IN THE 1920’S

A.  Real Prosperity- Profits rose 65%

B.  Real wages rose 20%

C.  Production increased dramatically

II.  HOOVER part one.

A.  Iowa born Quaker

B.  Orphaned at nine

C.  Stanford 1891

D.  Geologist / Engineer $5000/yr. British Mining Co.

E.  China 1899 Boxer Rebellion

F.  Mine Doctor

G.  WWI

H.  Great Humanitarian

I.  Non Politician

J.  Sec. of Commerce 1921-29

K.  Pro business- Trade associations-Nat. Bureau of Standards

L.  Philosophy American Individualism 1922

*Four major influences

1.  Self made man

2.  Quaker

3.  Engineer/Technocrat

4.  Small town values

III.  CAUSES OF THE DEPRESSION

A.  Maldistribution of income and purchasing power

1.  Miners

2.  Textile Workers

3.  Farmers

B.  Overexpansion of agricultural production

*Tractors (mechanization)

*prices fell 18 mos. Wheat from $2.50-$1:Cotton from 35cents-13cents

C.  Overproduction of industry

*Especially in heavy consumer goods

*Markets Saturated

D.  Automation- Technological Unemployment

E.  Unregulated banking practices

F.  American tariff policy

*Hawley-Smoot tariff-60%

*Tariff Wall

G.  Impact of European and world economy

H.  Monopolistic pricing

I.  Philosophy and policies of Republican administrations

1.  Mellon’s policies under Harding and Coolidge

2.  Hoover’s reaction

J.  Overexpansion of credit

*Payment plans supersaturate markets

*Consumer debt $2 billion:1920- $8 billion: 1929

K.  Stock market speculation and crash

1.  Buying on margin (doubled from1927-29)

2.  Mellon’s tax reductions

3.  Sept.4, Oct.24 Black Thurday, Oct.29 Black Tuesday (16.4/3mil.)

4.  Oct. 37% loss in value

5.  By March 1933 value 1/5 peak value

6.  Banking Crisis

*9000 banks fail

L. Structuralists v. Monetarists

IV.  HOOVER’S REACTION TO DEPRESSION part two

A.  Private Charity

B.  Cooperation of labor and business-Emergency Committee for Employment

C.  Public announcements

D.  By 1932 election looming unprecedented steps

1.  RFC- Save country by saving business $2 bil.

2.  Glass Steagall Act $750mil. Loans to private business

3.  $2 bil. Public works bill signed reluctantly

4.  called for a tax increase- dreaded deficit

5.  Would not accept help for individual- Vetoed Muscle Shoals Bill

E.  Bonus Army

*MacArthur

F.  Election of 1932-Landslide

V.  EFFECTS OF DEPRESSION

A. GNP 1929-104 bil. 1932-59 bil.

B.  Farm prices fell 60% 1929-1932

C.  1/3 RR milage bankrupt

D.  Banks 1929-1933 9000 failed

E.  Unemployment: 1929-3% 1932-25%

F.  Suicide rate up 30%

G.  Nutritional deficiencies: Pellagra, Rickets, Scurvy

H.  Schools

VI.  FIRST NEW DEAL- Relief and Recovery

A.  100 days congress

1.  Banking crisis: Emergency Banking Relief act; FDIC-5000

2.  Fireside Chats

3.  CCC

4.  Home Owners Loan Corp. 1/5 refinanced

5.  Farm Credit Adm.

6.  Federal Emergency Relief Act- $500million to states and cities- Harry Hopkins

7.  Agricultural Adjustment Act

8.  Tennessee Valley Authority

9.  National Industrial Recovery Act

a.  National Recovery Adm.

b.  Section 7a

10.  Public Works Adm: Harold Ickes 3.3 bil.

B.  Civil Works Adm.

C.  National Housing Act (FHA)

D.  Securities and Exchange Commission

VII.  PROBLEMS WITH NEW DEAL

A.  Dustbowl/ Sharecroppers

B.  Midterm Elections

C.  Challenges from the Right and Left

1.  Charles E. Coughlin 40 mil. Radio- Antisemitic

2.  Francis Townshend $200 to elderly

3.  Huey Long : Share Our Wealth-100% tax on incomes over $1 mil. App. $5mil.

4.  Effects

VIII.  SECOND NEW DEAL- RELIEF, RECOVERY, AND REFORM

A.  Works Progress Adm.-Harry Hopkins $11 bil.

1.  Federal Writers Project

2.  Federal Theatre Project

3.  FAP

B.  Resettlement Adm.

C.  Rural Electrification Adm.

D.  Soil Conservation Act

E.  2nd AAA

F.  Wagner Act (National Labor Relations Board)

G.  Social Security Act

H.  Revenue Act 1935

I.  Fair Labor Standards Act 1938

J.  Election of 1936

K.  Recession of 1937

IX.  Labor and the New Deal

A.  CIO split with AFL

B.  John L. Lewis

C.  Congress of Industrial Organizations

D.  Sit down Strikes: Rubber tire factories-Akron, Ohio; GM auto plants-Flint, Michegan UAW

E.  Memorial Day Tragedy: Republic Steel Plant

X.  END OF NEW DEAL

A.  Court Packing Scheme

B.  Election of 1938

C.  Foreign Policy

XI.  ASSESSMENT OF NEW DEAL