Transcript The Great Depression And World War 11

The New Deal
Causes of the Great Depression
Stock
Market
Speculation
During the 1920’s, the United States experienced a strong bull market (a market
where stock prices are rising). When the stock market crashed on October 29,
1929, stock prices fell, and the majority of investors tried to sell all of their
investments. Most of the investors received pennies on the dollar for their stocks.
Others lost all of their money in stocks. People holding savings accounts became
worried that they would not be there when the bank experienced so much loss of
cash. They ran to the bank in huge numbers and withdrew all of their money. As
people pulled their money out, the banks foreclosed. Businesses closed because
they could no longer borrow money to cover their expenses. As a result, workers
lost their jobs, and unemployment skyrocketed. This led to a long period of high
unemployment and increased poverty called the Great Depression (1929-1941).
Collapse of Farm Economy
• The biggest problem for farmers during the 1920’s
and 1930’s was that they produced more food than
consumers needed.
• These surpluses drove down prices to the point
that the harvest could no longer pay for the farm’s
operation.
• Between 1933 and 1936, the land between the
Dakotas and Texas received little rain.
• The huge dust storms blew all of the topsoil away
know as the Dust Bowl.
• They left their homes by the thousands and moved
President Hoover’s
Administration (1929-1932)
• Elected during a time of economic prosperity,
Republican Herbert Hoover (1874-1964) received
all of the blame when the economy was thrown
into depression.
• Between 1929 and 1933, 85,000 businesses shut
down, and 400,00 farmers lost their farms because
no one had money to buy farm products.
• Outside the cities, people built communities of
tents and shack called Hoovervilles.
• Children’s malnutrition rate rose from 18% to
60%.
Roosevelt’s New Deal
• With the help of Congress he instituted a series of
federal polices and programs to boost the
economy and put unemployed people to work,
known as the “New Deal”.(1932)
• The New Deal was based on three R’s: relief,
recovery and reform.
• Under the Agricultural Adjustment Act (1933), the
government gave loans to farmers, and the
government paid farmers not to grow crops
• Congress created the Tennessee Valley
Authority(1933). The TVA built hydroelectric
dams to bring electricity to new parts of the South,
including northern Alabama, and to provide
employment and cheap electricity.
• The Social Security Act, (1935), provided
retirement income for all workers once they reach
age 65.
• The Wagner Act of 1935 created a board to
monitor unfair management practices such as
firing a worker who joined a union.
• The Fair Labor Standards Act,(1938), raised the
minimum wage to 40 cents.
• Congress established the Civilian
Conservation Corps in 1933.
• Congress established the Federal Deposit
Insurance Corporation (FDIC) in 1933.
• Congress established the Works Progress
Administration (WPA) (1935) to provide
jobs for unskilled workers.
Cultural Developments
• Movies- Movie makers tried to revive
people’s faith in the nation. Movies told
positive, uplifting stories about happy
families in affluent households.
• Radio- Households listened with great
enthusiasm for the latest news and
entertainment.
Totalitarianism
• In a totalitarian government one political party or group maintains
complete control under a dictatorship and bans all others.
• The fear of communism caused people in Italy to support Benito
Mussolini and his political ideas, which he called fascism.
• Japan- Japan responded to the growing popularity of democratic ideals
by granting the right to vote to all males.
• Germany- As Germany suffered through the Great Depression, its
people turned to the National Socialists also known as the Nazi Party,
led by Adolf Hitler.
• The Union of Soviet Socialists Republics- Joseph Stalin forced many
peasants from their own land to work on collective farms.
Rejection of Peace
• Sixty-three nations signed the Kellogg-Briand
Peace Pact. The ratifying countries promised to
use negotiations rather than war to resolve
political differences, except for cases of self
defense
• Italy, Germany, and Japan formed the Axis
powers.
• Britain, France, and later The United States would
become the Allied Powers.
World War II Begins
• Hitler invaded Czechoslovakia. In 1939
Hitler signed a non aggression pact with the
USSR. Hitler invaded Poland.
United States Involvement
• In 1935 Congress passed the Neutrality Act.
• The Lend Lease Act gave the president the
power to lend, lease, or sell war supplies to
countries whose survival was vital the
United States defense.