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Tuesday’s history warm up...
• DeMarco Ex 2, p. 116
• “We, in America are nearer to the financial triumph over poverty than ever before in the history of our land. The poorhouse is vanishing from among us.”
Herbert Hoover, 1928President from 1929-33
• 1. Title notebooks economic cycle – copy curved line from whiteboard.
Print the fo l lowing 4 words in correct locat ion on l ine : recess ion, depress ion, recovery, prosper i ty
o1 sales downo2 excess stock on shelveso3 widespread selling of stockso4 lay-offso5 high unemploymento6 low real-estate valueso7 government lowers interest rateso8 employment rates higho9 value of stocks dropo10 real-estate values risingo11 investment thrivingo12 frequent bankruptcies o 13 value of stocks/shares rise
Now place these “events” in their
correct locations along
the line.
The Great Depression
See chart for themes
Great Depression – A period between 1929 and 1939 characterized by high unemployment (25-30%) and poverty in the most industrialized nations. With no government social programs such as employment insurance, there was widespread suffering amongst the general populations of the USA, England, Canada, France and others.
Read about the stock market crash
• DeMarco p. 113- to bottom of 114
Causes of the Great Depression
Whose fault was the stock market crash of October 1929?
o 1. Greedy bankers and businessmen for their selling shares on margin and luring the victim consumers with advertisements
and low borrowing rates on shares.
2. The Government – for allowing an unregulated market.
3. The consumers – for their reckless, gluttonous, unnecessary consumption & shortsighted borrowing.
So ... who do you blame?o 1. Greedy bankers and businessmen for their selling shares on margin and luring the victim consumers with advertisements and low borrowing rates on shares.
2. The Government – for allowing an unregulated market.
3. The consumers – for their reckless, gluttonous, unnecessary consumption & shortsighted borrowing.
Using DeMarco p. 113-114 or Howarth 92-95/or 87 - 89 Generate a list of causes of the GD (aim for 15).
Add to your list if need be...
• Causes of the G Depression
1. wages did not keep pace with company profits – workers could not afford to buy consumer products
2. weak unions/power lay with employers*
3. overproduction of consumer products4. this led to workers being layed off5. overproduction of grain and food6. farmers could not sell excess grain7. farmers could not pay mortgages8. banks took their homes9. new energy sources (oil, gas) put coal miners out of work
and/or reduce their wages10. reduction of cotton demand (due to women’s fashion
changes)11.European retaliatory tariffs (against US) slow global trade12. Speculation on Wall Street shares – 1 million people
spent life savings purchasing shares on margin13. Massive selling of shares and stocks late in 1929 due to
panic their value would drop14. Which they (therefore) did (eg US Cigar Co $113.50 a
share - $4 overnight)15. War debts
- causes review - spurious history -zeitgueist 6:14
- quote
Consequences of the Great Depression
• Cinderella Man 29:40
How did it affect people in North America, England and France?
Cinderella Man
- Aside from charities and churches, there were no social security programs in the 1930’s
to alleviate people’s suffering.
A person could starve to death in the USA!
President Herbert Hoover declared, "Nobody is actually starving. The hoboes are better fed than they have ever been." But in New York City in 1931, there were 20 known cases of starvation; in 1934, there were 110 deaths
caused by hunger. There were so many accounts of people starving in New York that the West African nation of Cameroon sent a
little relief money.http://www.digitalhistory.uh.edu/
- Read “Hooverville” USA in Howarth p. 99 – 102 or 105 - 108- Create 5 points under the title
“Consequences of the GD”
• 25% unemployment is one consequence, for example.
---------------------p. 134 Howarth reading
-Homework 1. Ask a parent, grandparent, great grandparent or an elderly family friend for a story of how the GD affected them
Family stories
Ghost of Tom Joad
Men walkin' 'long the railroad tracks Goin' someplace there's no goin' back
Highway patrol choppers comin' up over the bridge
Hot soup on a campfire under the bridge Shelter line stretchin' 'round the corner
Welcome to the new world order Families sleepin' in their cars in the
Southwest No home no job no peace no rest
The highway is alive tonight But nobody's kiddin' nobody about where it
goes I'm sittin' down here in the campfire light
Searchin' for the ghost of Tom Joad
He pulls a prayer book out of his sleeping bag
Preacher lights up a butt and takes a drag Waitin' for when the last shall be first and
the first shall be last In a cardboard box 'neath the underpass
Got a one-way ticket to the promised land You got a hole in your belly and gun in your
hand Sleepin' on a pillow of solid rock
Bathin' in the city aqueduct
The highway is alive tonight Where it's headed everybody knows
I'm sittin' down here in the campfire light Waitin' on the ghost of Tom Joad
Now Tom said "Mom, wherever there's a cop beatin' a guy
Wherever a hungry newborn baby cries Where there's a fight against the blood and
hatred in the air Look for me mom I'll be there
Wherever there's somebody fightin' for a place to stand
Or a decent job or a helpin' hand Wherever somebody's strugglin' to be free
Look in their eyes Mom you'll see me."
C. Government Response / Solutions
• “We need ‘rugged individualism” ...
• “We promise you a chicken in every pot and a car in every garage.” Herbert Hoover 1932
• “People who are hungry and out of a job are the stuff of which dictatorships are made.” Franklin Deleno Roosevelt Democratic President 1933
Republican President Herbert Hoover 1930
Deficit Financing• “The best guess I can make is, if you save
5 shillings, you put a man out of work for a day.” John Maynard Keynes - Influential British Economist 1936
• He encouraged what is now called deficit spending - and has become an acceptable response to recession by mainstream economists
Two opposing solutions to economic recession:
1. - Strong gov’t intervention/interference.
... or deficit spending. The gov’t borrows $ + prints more $ to generate funds with which to spend on bail-out packages for struggling companies and create make-work projects for the unemployed – such as building projects. In turn, people will be kept employed meaning they will spend money and thus resuscitate the economy. This is what influential British economist John Maynard Keynes advocated. In other words ...“We spend our way out” of recession / depression.
2. Tax breaks to wealthy individuals and corporations. This is the “Rugged individualism” approach of Herbert Hoover (and many today). According to this theory, the wealthy capitalist leaders are the ones with the energy and smarts to simulate the economy – to create wealth. They employ large numbers of people who therefore earn money and spend money and create more jobs (spin offs). SO – cut their taxes. Give them tax breaks – then they will be in a financial position to invest more and employ more people – and we’ll all benefit with what economists call the trickle down effect.
• Hand out - 2 opinions
Government Solutions Do ex 3, 4, 5b,c,d 6, 7 DeMarco p. 117
• The old president (Hoover) is leaving office while the new pres. (Franklin D. Roosevelt) through out Hoover’s old promises.
• New laws were passed by Roosevelt to get people working. Example the CCC and the WPA (which gave unions more power). He also improved the farmers wage with the AAA.
Howarth - 136 FDR’s Critics
“The only thing to fear, is fear itself.”
FDR, 1933
• EX 5 - The high rate of unemployment was inversely related to the low national income. Roosevelt taxed the wealthy and borrowed $ to create work programs. This intervention appears to have been quite effective.
• EX 7 - Roosevelt created bills which helped the elderly (creating pensions with the Social Security Act), and also which built homes with the National Housing Act. The Wagner Act strengthened unions.
The New Deals of President Roosevelt
• Create a list of :
• 1. Roosevelt’s actions during first 100 days
• 2. 4 of Roosevelt’s alphabet agencies and what they accomplished.
• 3. Roosevelt’s critics
Turn to DeMarco 117-118
Feeling scholarly? Try Howarth p. 128
Hoover Haunting
• During WWI and after - painstakingly distributed food to starving Belgians and others throughout Europe
• raised taxes
• Poured millions into public projects
• donated his presidential pay-checks to charities
History test Tuesday• Homework due - see list on side chart
• Test talk - USA in Boom of the 1920’s and the Depression of the 1930’s
• Topics 7 & 8 in Course Outline
• Chapter 9 DeMarco p. 113-119
• USA in 20‘s Assignment Parts A and B
• Slides on website - Great Depression
• 34 multiple choice / Essay - 2 Choices
What to Review
laissez faire
isolationism
Smoot-Hawley
Okie
Herbert Hoover
Wesley Evans
speakeasies
John Maynard Keynes
Franklin D Roosevelt
Tennessee Valley Auth (TVA)
Fireside chats
Supreme Court
October 1929
1933
The 18th Amendment
Republican
BINGO
U S A
