Transcript TEST 6 lecture notesx

TEST #6 Lecture Notes
The United States from 1890-1941
VUS.9-10
Imperialism
• 1800s: Americans justified their taking over North America
by the idea of “Manifest Destiny”
• The idea of “Manifest Destiny” will lead many in the U. S. to
believe that they are culturally and morally superior to other
people in the world
• Many Americans believed it was their duty to instill the
American way of life on other people in the world
• After 1850, the U. S. will develop an imperialist foreign
policy
▫ The US believed it had the right to expand outside the
continental borders of the U. S.
▫ The US was searching for overseas markets for its products
• By 1900, the US had become an imperialistic nation with
many colonies over the world
• Americans looked to Latin American and Asia as markets
and raw materials for the increased industrialization
Land gained after Spanish American
War
• Began with Cuban war for independence from Spain
• Sinking of the battleship Maine in Havana harbor,
February 15, 1898 united American opinion for war
• Congress declared war April, 1898
• Battle of Manila Bay, May 1, ’98, entire Spanish fleet
sunk
• US Army troops attacked Cuba in June
▫ United States received Puerto Rico and Guam and
the Philippines in the Pacific
• Cuba was granted independence from Spain
• The US had the right to intervene in Cuban affairs
Hawaii
• The U. S. wanted to expand into the Pacific
region
• 1820s and 1830s: U. S. missionaries had gone to
Hawaii
• Over time, the U. S. began to dominate the
economy of Hawaii
• The U. S. also wanted to depose the monarchy in
Hawaii
• 1887: the U. S. gained the right to build and
fortify a naval base on Hawaii at Pearl Harbor
• 1898: The U. S. annexed Hawaii
The Panama Canal
• Many people in the world wanted a canal that
crossed Central America—linking the Atlantic
with the Pacific
• 1903: Plans were made to construct a canal in
the Colombian-owned region of Panama
• Pres. T. Roosevelt saw many benefits to the
creation of a Central American canal
• 1903: the U. S. and Colombia began working on
a treaty to negotiate a price for the narrow strip
of land where the canal was to be built
• Colombia held out for more money
• The U. S. supported a revolution in Panama that
would make Panama independent from
Colombia
• Once independent, the U. S. and Panama
negotiated a treaty that gave the U. S. the land
where the Canal would be built
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1904: Construction began on the Canal
The Canal took 10 years to complete
1914: the Panama Canal was opened
Pres. T. Roosevelt felt proud of his
accomplishment
“Big Stick” Diplomacy
• Created by Pres. Theodore Roosevelt
• He believed that one should not brag about
America’s power
• The U. S. should just be very strong so other
nations would bow down to the U. S.
▫ “Speak softly and carry a big stick; you’ll go far.”
• Pres. Roosevelt used the “Big Stick” diplomacy
in the Caribbean and South America
• Part of his “Big Stick” diplomacy was his support
for the Panamanian Revolution
• 1904 and 1905: problems were occurring the in
the Dominican Republic
• Pres. Roosevelt issued a corollary to the Monroe
Doctrine—the Roosevelt Corollary
▫ Said that any “chronic wrongdoing” by a Latin
American nation entitled the U. S. to intervene in
the nation’s affairs
• The Roosevelt Corollary caused the U. S. to
commit itself to maintaining stability in the
Western Hemisphere—like a police force
Open Door Policy
• Create by Secretary of State John Hay in 1899 and
1900
• Created to strengthen the U. S. position in gaining
control over specific regions of China
• Hay sent out a note to Japan and key European
powers asking them not to control a specific area of
China
• He wanted to leave the door open for ALL nations in
ALL parts of China
▫ All nations would have equal trading rights in China
• Most other nations agreed to the Open Door Policy
• The goal of the policy—the U. S. would get a share in
the trade with China
John Hay
Dollar Diplomacy
• 1909: William Howard Taft became President of the
U. S.
• Taft wanted to influence foreign governments by
using American investment ($)
• Taft encouraged American banks to lend money to
Central American nations
▫ To help the nations pay off their debts to Great Britain
• Taft hoped the loans would gain the U. S. more
influence in the Western Hemisphere
• He also encouraged many businesses to invest in
Latin America
• He promised the Latin American nations that the U.
S. would step in if unrest threatened their
investments
William Howard Taft
World War I
• World War I will dramatically change the world
• There were 4 underlying causes that helped lead to
WWI in Europe
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Nationalism
Imperialism
Militarism
Alliances
• June 28, 1914: The war will start in the Balkans
when Archduke Franz Ferdinand was assassinated
in Bosnia
• Austria-Hungary blamed Serbia for the attack
• Russia comes to help Serbia
• The alliances will be brought in bringing Europe
into a major conflict
Assassination of Archduke
Franz Ferdinand
• Allied Powers in WWI at beginning of war
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Great Britain
Russia
France
Serbia
Belgium
Japan
• Central Powers in WWI at beginning of war
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Germany
Austria-Hungry
Bulgaria
Ottoman Empire
• At the outbreak, President Woodrow Wilson
immediately declared the United States neutral
• The U. S. will stay out of WWI for the first 3
years
• Many in the U. S. did not want the U. S. to get
involved at all
• During these 3 years, the war had turned into a
stalemate, with neither side having a decisive
advantage
• Several factors contributed to the U. S. finally
entering WWI in 1917
• 1.) Germany’s use of unrestricted submarine
warfare—violating the freedom of the seas
▫ Germany continued using U-boats (submarines)
to attack ships
▫ In 1915, a U-boat sank the Lusitania, killing 1,200
civilian passengers.
▫ The press publicized the event, greatly influencing
public opinion against Germany
▫ Germany’s sinking of ships also disrupted
American trade
Sinking of the Lusitania
• 2.) Zimmerman Telegram
▫ In early 1917 the British intercepted the
Zimmerman telegram from the German
government to their Mexican ambassador.
▫ A German plan to keep the US out of the war by
urging Mexico to declare war against America.
▫ The press printed the telegram and public opinion
changed to war
Original coded
telegram
Decoded telegram
• 3.) Americans wanted to “make the world safe
for democracy” (Woodrow Wilson)
• 4.) It was difficult because of the close relations
with Britain, the leader of the Allied powers
▫ As Great Britain reached stalemate, it became
difficult for the U. S. to stay out of the conflict
• America’s involvement in the war helped turn
the tide in favor of the Allies
• The U. S. sent much needed resources and fresh
soldiers to help aid the Allies
• Because of America’s involvement, the Allies
were able to defeat Germany and the Central
Powers
• After the war, peace treaties were laid out with
the defeated Central Powers
• The Most important treaty was the Treaty of
Versailles which dealt with Germany
Wilson’s 14 Points
• Even before the war was over, Pres. Woodrow
Wilson had created a peace plan
• His plan to eliminate the causes of war
• Key parts to Wilson’s 14 Points
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Self-determination
Freedom of the seas
Freedom of trade
League of Nations (Wilson’s 14th Point)
Mandate System
• Wilson believed the most important part of his plan
was the creation of the League of Nations
▫ This was to be an international mediating body to
discuss problems in Europe and the world with the
hope of deterring future wars
President Woodrow Wilson
Treaty of Versailles
• Treaty dealing with Germany at the end of
World War I
• The French and English insisted on harsh
punishment of Germany
▫ Taking of German territory
▫ Germany had to pay huge war reparations
• Created the League of Nations—one of Wilson’s
14 Points
• National boundaries were redrawn, creating
many new nations
Meeting over the Treaty of Versailles
• The Treaty of Versailles created new nations in
Europe
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Finland
Estonia
Latvia
Lithuania
Poland
Czechoslovakia
Yugoslavia
• The Treaty of Versailles also divided the old
Ottoman Empire (an ally of Germany) into
mandates
• The victorious Allied nations began dividing up the
old Ottoman Empire (Mandates)
▫ Great Britain gained control of Jordan, Iraq, and
Palestine
▫ France gained control of Syria and Lebanon
• In the Middle East, conflicts between Jews and
Muslims began to arise
• Great Britain had promised the Arab nations
independence after the war
• Great Britain broke that promise once GB and
France took over the Arab areas and turned them
into Mandates
▫ Helps explain why many Arab nations do not like
western European nations today
League of Nations Debate in the U. S.
• The US Senate refused to approve the Treaty of
Versailles
▫ Pres. Wilson (Democrat) had upset many Republicans
by urging the American people to vote Democratic in
the upcoming mid-term elections
▫ Republicans won the elections, and voted against
Treaty of Versailles—backed by a lot of public support
to stay out of European affairs
• Therefore, did not join the League of Nations
▫ The U. S. was NOT a member of the League of Nations
• Many did not like the idea of US foreign policy
decisions being made by an international
organization—not the U. S.
• The U. S. became isolationist after World War I
▫ The U. S. began to focus more on itself instead of other
worldly problems
America in the 1920s and 1930s
• When World War I ended, the U. S. developed
an intolerance toward those that spoke against
the government
• This period was also known for new
developments in music and art
• At the end of the 1920s, the US will fall into a
depression that will impact the entire world
• 1.) Red Scare:
• A violent wave of anti-communist panic that swept
through the U. S. between 1919 and 1920
• 1917: the communist Bolsheviks in Russia took over
the Russian government during the Russian
Revolution
• Many in the U. S. were afraid the same thing could
and would happen
• 1919: there were 2 small communist parties in the
U. S.
• People were afraid that these 2 small parties would
lead a communist revolution in the U. S.
• People in the U. S. started seeing any foreign born
people as a threat to democracy
• The Attorney General of the U. S. directed the Red
Scare
▫ Mitchell Palmer
• 2.) Palmer Raids:
• Mitchell Palmer believed that communists were about to
take over the U. S.
• Palmer was a Quaker
• He was against the idea of revolution
• June 2, 1919: Palmer’s fears nearly became reality
• Bombs exploded in 8 cities in the U. S.
▫ One exploded in front of Palmer’s house
• After the bombings, Congress gave Palmer $500,000 to
search out and destroy any radical people in the U. S.
• Palmer created the Central Intelligence division
▫ Palmer appointed J. Edgar Hoover as the head of the new
government division
• Palmer began to raid different organizations suspected
of radical ideas
▫ Over 4,000 people were arrested
▫ Over 550 foreigners were deported
Mitchell Palmer
• 3.) Sacco and Vanzetti:
• 2 men were accused of robbing and killing a
guard at the Massachusetts shoe factory
• Both men were immigrants
• Both men had radical political views
• Many believed the only reason for their
conviction was because of their immigrant status
and radical views
• No real evidence pointed to the 2 men’s
involvement in the crimes
• Even the judge at the trial denounced the 2
defendants for the immigrant background
• Both men will be executed
• Many protests sprang up after their execution
Sacco and Vanzetti
• 4.) Mass Media and Communications:
• Radio: Broadcast jazz and Fireside Chats
▫ Brought immediate information the people—news
▫ A new form of entertainment—music, radio shows, etc.
▫ Jazz—a new form of music developed in the 1920s
 Began in New Orleans and spread
 Started as African American music, but whites soon took
interest
• Movies:
▫ Started as silent films, then talking movies appeared
▫ First talking picture: The Jazz Singer
▫ During the Great Depression, movies offered people a
chance to escape
• Newspapers and magazines:
▫ Shaped cultural norms and sparked fads
• 5.) Agricultural Overproduction:
• During WWI, US farmers began producing lots
of food
• The US government bought most of the farmers’
harvests to send to the troops
• In the 1920s (after WWI was over), the military
needed less food stuffs
• The government stopped buying the harvests
from farmers
• US farmers now had an oversupply of food
• Caused crop prices to plunge, meaning less
money for farmers
• Many farmers lost their land and homes on
defaulted loans
• 6.) Scopes Trial:
• 1920s: science and religion will square off in
this trial
• 1859: Charles Darwin published The Origin of
Species by Natural Selection
▫ Said animals (and humans) had evolved from
more primitive creatures
▫ Many scientists used Darwin’s work to challenge
the religious idea of creation
• 1920s: Fundamentalist Christians began
attacking the idea of evolution
▫ These people believed the Bible was absolute truth
• Many southern states outlawed the teaching of
evolution in schools
• 1925: Butler Act in Tennessee outlawed the
teaching of evolution in schools
• The ACLU (American Civil Liberties Union)
announced it would defend any biology teacher
who challenged the Butler Act
• John T. Scopes accepted the offer and read
about evolution to his students
• Scopes was arrested and placed on trial
• The case started small, but became a national
news story
• Scopes was found guilty and fined $100
• Later, the Supreme Court overturned the
decision
Scopes Monkey Trial
7.) Prohibition:
• Many people saw alcohol as the cause of crime and
violence
• These people wanted to prohibit alcohol in the U.S
• January 1920: The 18th Amendment (Volstead
Act) was passed
▫ National law prohibiting the manufacture, transport,
and sale of liquor (alcohol) in the United States
• At 1st , it looked like Prohibition might work
▫ The consumption of alcohol in the U. S. did drop
• Many people were against Prohibition
• Bootleg liquor became very popular
▫ Homemade alcohol
▫ Alcohol brought in from Canada
• Very difficult for the U. S. to keep illegal alcohol
from crossing into the U. S.
• Many began breaking the law
• Illegal drinking establishments developed
around the nation—Speakeasies
• Many made fortunes in alcohol smuggling
• Prohibition began to have a negative effect on
the people
▫ Everyone took a casual attitude to breaking the
law
▫ Many government officials were bribed to let
illegal drinking continue
• Mob crime became a problem
▫ Mob gangsters were big into bootlegging liquor
▫ Al Capone ran a Chicago bootlegging gang
▫ Video on Prohibition
Al Capone
• 8.) Harlem Renaissance:
• A Black cultural movement in New York City in
the 1920s
• Mostly a literary movement (writing)
• The Harlem area of New York City had attracted
lots of African Americans in the 1920s
• Harlem housed Jazz clubs, night clubs, and cafes
• Jazz rhythms were used in poetry
• Many works spoke out against racism
• The most famous writer from the Harlem
Renaissance was Langston Hughes
• Hughes was a gifted poet
• He used jazz and blues rhythms in his poetry
50-50
I’m all alone in this world, she said,
Ain’t got nobody to share my bed,
Ain’t got nobody to hold my hand—
The truth of the matter’s
I ain’t got no man.
Big Boy opened his mouth and said,
Trouble with you is
You ain’t got no head!
If you had a head and used your mind
You could have me with you
All the time.
She answered, Babe, what must I do?
He said, Share your bed—
And your money, too.
Langston Hughes
• 9.) KKK—the Second Klan:
• In the early 1900s , the KKK saw a revival
• The movie Birth of a Nation helped to revive the
KKK
▫ The film glorified the original KKK
• Starting in 1921, it adopted a modern business
system of recruiting (which paid most of the
initiation fee and costume charges to the
organizers) and grew rapidly nationwide at a
time of prosperity
• Membership grew most rapidly in cities, and
spread to the Midwest and West out of the South
• Claimed to have between 4 and 5 million
members
• The second KKK preached Americanism and
purification of politics
• It believed in:
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Racism
Anti-Catholicism
Anti-Communism
Nativism—dislike for immigrants
Antisemitism—dislike for Jews
• 10.) Women in the 1920s:
• After WWI, women gained lots of independence
• 19th Amendment (1920): Gave women in the
U. S. the right to vote
• Women began asking for more freedoms
• In the U. S. women’s fashion and social trends
changed drastically in the 1920s
▫ Make-up was more liberally applied—especially
rouge and lipstick
▫ Hem lengths on skirts rose above the knee
▫ Women began to “bob” their hair and bind their
chests
▫ What they created was the Flapper
Business Cycle
• Sequence of ups and downs in a nations Gross Domestic
Profit (GDP)
▫ GDP—total value of goods and services a nation creates
within its borders
• The cycle consists of periods of expansion, a period of
contraction, and a trough (bottoming out)
▫ 1.) Expansion (BOOM)
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Production increases
GDP rises
Employment is high
Wages=good
Prices=stable
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Unemployment rises
GDP declines
Production slows
Wages fall
Prices fall
The lowest point in the cycle is a depression
▫ 2.) Contraction (BUST)
BOOM
BUST
depression
• Early 1920s: The American business cycle was
expanding
• By the end of the 1920s into the 1930s, the
business cycle sharply contracted—causing the
Great Depression
• Causes of the business cycle of the 1920s
and 1930s:
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Easy credit
Easy availability of capital for businesses
Installment buying
Unbalanced foreign trade
Mechanization of American Industry
• Effects of the business cycle fo the 1920s
and 1930s:
▫ Overproduction of goods
▫ Over speculation in the Stock Market
 Buy stocks cheap with the hope of prices going up
▫ Increase in personal debt
▫ Lack of foreign markets for U. S. goods
▫ Fluctuation in employment and wages
Causes of the U. S. Stock Market
Crash
• Oct. 29, 1929: The U. S. Stock Market crashed,
resulting in world wide depression
• Several underlying factors and direct factors will
lead to the crash
• Underlying factors—spiraling of events
▫ Crop prices falling due to overproduction of food after
WWI
▫ With no $, farmers could not buy stuff
▫ Manufactures sold less goods—warehouses were full of
unsold merchandise—oversupply of manufactured
goods
▫ Gap between the rich and poor was growing in the
1920s
• 1.) Overspeculation:
▫ Many Americans invested in the Stock Market
▫ Some sank their life savings into buying stock with
the hope of making it rich
▫ Speculators would by cheap stocks, hoping the
price would increase
 When the price rose, the speculator would sell the
stock for a profit
▫ Many speculators bought stock on margin—with
borrowed $
▫ As more people invested, stock prices became over
inflated
• 2.) Panic Selling:
▫ 1929: the market was saturated with so many
investors
▫ A few investors began selling theirs stocks
▫ Fall of 1929, stock prices started to slowly fall
▫ Many stock brokers began to call in their
margins—asking for people to pay off their loans
▫ Many of the investors could not pay the loans
▫ Brokers were forced to sell the stocks to get their $
back
▫ This selling drove stock prices even lower
▫ People began to panic and sell their stocks
▫ Stock prices fell even quicker
• By the end of Oct. 1929, the stock market had
crashed
• The crash affected those with money in the bank
▫ This money was not insured
• Many banks had loaned $ to stock brokers who
had loaned the $ to investors
• When the $ was lost, the brokers could not pay
back the banks
• The money was lost for good
Stock Market Crash and
Depression Video
Causes of the Great Depression
• 1.) The U. S. stock market crash of 1929
▫ Many had lost everything in the market
▫ Banks had lost people’s $
• 2.) High Protective tariffs (Hawley-Smoot Tariff)
▫ Place high tariffs on imported goods
▫ Resulting in retaliatory tariffs in other countries,
strangling world trade
 We tax their goods, so they place high taxes on ours
• 3.) FED Policy
▫ The Federal Reserve’s failure to prevent widespread
collapse of the nation’s banking system in the late
1920s and early 1930s
▫ The Federal Reserve got rid of all credit after the crash
▫ The supply of money in circulation dried up—not
enough money in circulation to allow the economy to
recover
Impact of the Crash and Depression
• The Crash and Depression had a very damaging
effect on the American people
• President Herbert Hoover issued upbeat
statements to keep the people encouraged
▫ Hoover, however, and the government failed to act
to help ease or end the Depression
▫ Hoover wanted local governments to stimulate the
local economies
▫ Hoover was seen as a failure for his inability to
help
Herbert Hoover
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Hoovervilles:
Millions of Americans were unemployed
Millions had lost their life savings
Farmers had lost farms
Many Americans had to sell off their homes
▫ They needed the $ to pay off debt
▫ As a result, they became homeless
• These homeless families built Hoovervilles
▫ Makeshift houses of boxes and crates
▫ Many were built in city parks
• People had to wait in line to get bread
• Many children had little food or health care
• Many homeless became “hobos”
▫ Drifters from town to town looking for work
Video on Hoovervilles
• Unemployment and lack of demand:
• Since many people no longer had money or
homes, the demand for manufactured goods
severely decreased
• Businesses lost profits—fired workers
• Unemployment began to soar
• Many businesses shut their doors due to lack of
profit
• Farm Foreclosures:
• Farmers were struck hard with low crop prices
after WWI
• After the stock market crash, crop prices fell
even more
• Very little income for farmers
• Farmers could not pay off mortgages
• Banks began foreclosing on farm loans
▫ Banks took the land and property of the farmers in
place of the $ for the loan
• Once the land was gone, farmers were not given
a chance to try and pay off the rest of the
mortgage
• Dust Bowl:
• 1931: the climate of the Great Plains region of
the U. S. changed
• A severe drought struck the land
• Crops began to die
• No vegetation was able to hold the soil together
• Strong winds began to blow the topsoil up into
big, black clouds of dust
• The soil was being blown to the east
• Many families packed up and moved to the west
looking for jobs
• Oakies—families from Oklahoma moved to
California
Video on the Dust Bowl
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John Steinbeck:
Writer during the Depression
Wrote Grapes of Wrath and Of Mice and Men
His books portray the hardships of the
Depression, and the Dust Bowl, on the people of
the U. S.
• Bonus Army:
• As soon as the stock market crashed, WWI
veterans began to lobby for aid for themselves
and their families
• The Veterans were promised a bonus for serving
the WWI
▫ The bonus was to be paid out in 1945
• May 1932: A group of WWI vets from Portland,
Oregon marched to Washington DC
▫ They were going to ask that the bonuses be paid
out 13 years earlier than the 1945 promise
• The group started small, but quickly grew to over
17,000 members
• Congress will defeat the Bonus Bill
• 2000 of the bonus army refused to leave
Washington
• Congress will defeat the bill a second time
• The 2000 members of the Bonus Army still had
not left
• The federal government thought the Bonus
Army was not leaving fast enough
• The government sent Dwight Eisenhower and
Douglas MacArthur to clear out the Bonus Army
veterans
• Soldiers, tanks, and machine guns were used
against the defenseless WWI vets
• The veterans fled in horror
Bonus Army Camp in Washington DC
Bonus Army Video
• New Deal:
• 1932: a new President is elected in the U. S.—
Franklin D. Roosevelt (FDR)
▫ He won by a landslide over Herbert Hoover
• He came to office with what he called a “New
Deal”
• FDR used the radio to communicate with the
American people
▫ He was trying to reassure them that the economy
would improve
• He believed the federal government should aid
the economy and provide unemployment relief
• His “New Deal” created a lot of legislation to
counter the effects of the Depression
• New Deal Legislation:
• 1.) Agricultural Adjustment Act (AAA)
• Government could set limits on agricultural
output
• AAA paid farmers a subsidy
▫ Paid farmers to CUT BACK their production
• An attempt to reduce agricultural supply to raise
crop prices
• 2.) Civilian Conservation Corps (CCC)
• Give unemployed men jobs on environmental
projects
• Helped build many state and national parks
• Men received room, board, and $30 a month
• 3.) Public Works Administration (PWA)
• Put people to work to build dams, schools,
government buildings, etc.
• PWA spent massive amounts of $ on supplies to
help stimulate the economy
• Randolph-Henry was a PWA project
• 4.) Tennessee Valley Authority (TVA)
• Built dams on Tennessee River to create
electricity
• Many were given jobs working on the dams
• 5.) Federal Deposit Insurance Corporation
(FDIC)
• Created by the Banking Act of 1933
• Created to insure bank deposits in all member
banks
• Many people began to gain confidence in banks
again
• 6.) Securities and Exchange Commission (SEC)
• Created by the Securities Exchange Act
• Regulated the Stock Market
• 7.) Works Progress Administration (WPA)
• Put unemployed teachers, artists, and actors
back to work
• Artists designed and painted murals for
government and public buildings
• Writers wrote books on American History
• Built hospitals, airports, playgrounds, schools,
etc.
• 8.) National Industrial Recovery Act (NIRA)
• Designed to help struggling businesses
• Tried to break the cycle of wage cuts, falling
prices, and layoffs
• Anti-trust laws were relaxed
• Business leader could limit production, set
wages, and ban unfair competition
• Workers could organize labor unions
• Business hours were shortened
• 9.) Wagner Act and the National Labor Relations
Board (NLRB)
• May 1935: NIRA was said to be unconstitutional by
the Supreme Court
• Workers could no longer join unions and bargain
collectively
• July 1935: The Wagner Act was passed
▫ Restored the rights of the NIRA
▫ Workers could join unions again
• National Labor Relations Board was created by the
Wagner Act
▫ Created to make sure business owners would follow
the Wagner Act
▫ Union membership began to steadily increase
• 10.) Social Security Act
• Created in 1935
• The government accepted direct responsibility
for meeting the basic needs of the citizens
• Gave pensions and survivors’ benefits for the
elderly and orphaned
• Gave aid to people in industrial accidents
Effects of the New Deal
• The New Deal provided the “3 R’s” for the people
▫ Relief
▫ Reform
▫ Recovery
• The New Deal changed the role of the federal
government
▫ President and Congress extended their powers into the
economic and social areas that were at once only part of the
private sector
▫ The number of civil servants working in the government
doubled—increased the size of the bureacracy
• Many federal agencies created in the New Deal era are
still around today
▫ Social Security
▫ FDIC
▫ SEC
Effects of the New Deal
• The nature of the American economy changed
▫ Federal deficit increased
▫ Deficit spending—borrowing $ to spend more than
what was collected in taxes
• A welfare state was created
• People feel that it is the government’s
responsibility to deliver public services,
intervene in the economy, and act in ways that
promote general welfare
Effects of the New Deal
• The New Deal did ease some of the depression,
but it did NOT end it
• High unemployment continued in the US until
the beginnings of WWII
• The depression revealed major problems with
the free enterprise system
• The New Deal showed that the government
could and would intervene in the nation’s
economy