Depression and the New Deal - USA 1929-41

Depression and the New Deal - USA 1929-41

1. How serious was the Depression for the American people?

   • Background
     • Import and export
       • Tariff war
         • Other countries raised tariffs to protect own economies
       • Gold Standard
         • Links exchange rate of a country's currency to the amount of gold in that country.
         • Countries abandoned Gold Standard because exchange rates were ridiculously high
           • Helped foreign economies by making American goods more expensive
             • Damaged USA's economy
           • Pound fell from $4.86 to $3.50
     • Collapse of business and industry
       • US exports fell - $10bn in 1929 to $3bn in 1932
       • Industrial production fell 40%, 1/3 of farmers lost their farms
       • Sales fell 50%, wages 60%
       • Unemployment rose from 1.6m in 1929 to 12.1m in 1932 (2.3% fo the workforce to 23.6%)
     • Timing
       • Key weaknesses in economy
         • Overproduction
         • Unequal distribution of wealth
         • Tariff policy
         • Financial speculation
     • Indebtedness of the economy
       • Shares had been bought 'on the margin'
         • Businesses which had lost money sacked people
           • They defaulted on loan payments
             • Banks went bankrupt
               • Banks called in loans, especially overseas
                 • American depression became global depression
                   • Global imports fell from $125bn in 1929 to $35bn in 1933
                 • Other countries were dependent on American loans
                   • 1924-1928 $6bn lent abroad
   • Human effects of the Depression
     • Unemployment
       • Reached 25% in 1933
       • Black people hit worst
         • In Charleston on 1931, 70% of black people of working age were unemployed. It was 75% in Memphis.
       • Many people became hobos.
     • Homelessness
       • No dole payments
       • In 1932, 1/4m people became homeless
       • Set up shanty towns called 'Hoovervilles'
     • The Bonus Army
       • The army had been promised a 'bonus' in 1945 after WW1.
         • In 1932, 20,000 war veterans set up a Hooverville outside the White House to protest against the governmen's refusal to pay up front.
           • Troops used tanks and tear gas to clear them, and killed 2
             • About 1000 injured
     • Help from charities
       • Al Capone provided food in Chicago
       • Soup kitchens, bread kitchens, or cheap food centres
     • Farmers
       • Because no-one was buying, prices dropped so low it wasn't profitable to harvest
       • 1930 dust bowl due to overfarming
       • Many moved to California
     • Limits to the Depression
       • Empire State Building - 1931
         • Hoover Dam -1936
           • Golden Gate Bridge - 1937
       • 'New Industries' prospered
   • Hoover and the Depression
     • The 1932 presidential election
     • Rugged Individualism
       • Hoover did, however, try to help
         • 1930 - taxes cut
         • 1932 - Emergency Relief Act to help unemployed

2. How did Roosevelt deal with the Great Depression?

   • The New Deal
     • The 'Hundred Days'
     • Ending the banking crisis
     • Agriculture
     • Industry
     • Unemployment
     • The young
     • Other measures of the New Deal
     • The Tennessee Valley Authority

3. How far was the New Deal successful in ending the Depression in the USA?

   • Opposition to the New Deal
     • The Supreme Court
     • More opponents
   • The Second New Deal
   • Was the New Deal a success?
     • The Second World War