World War One and the 1920’sChapters 30-32

1917- 1929

Chapter 30

I. War by Act of Germany• Wilson won re-election in 1916 by keeping

America out of the war• Three groups • Isolationists- Not intervene in European

affairs• Internationalists- Work for peace, not enter

war• Interventionists- Enter war on side of Allies,

protect interests • Wilson supported internationalists• 1917 three events led U.S. to war1.Unrestricted submarine warfare by

Germans2.Zimmerman note intercepted- German

proposal to Mexico to be allies and after German victory territory lost in Mexican-American War (1848) would be returned

3.Russian Revolution toppled tsar, America could now focus on war for democracy not despotism

• April 2, 1917 U.S. declares war on Germany

II. Wilsonian Idealism Enthroned• War shattered American tradition of isolationism• Wilson had to frame war as “making world safe

for democracy’, more glorified aim• War not for territorial conquest or riches, but to

shape international order• Modern world could not afford destructive wars• Presidents appeal fired up Americans to support

war• Wilson recognized as moral leader of war• Jan. 1918 Fourteen Points Address

A.Abolish secret treatiesB.Freedom of the seasC.Removal of economic barriersD.Reduction of ArmamentsE.Get rid of colonialismF.Organize a system of collective security

• Idea was to delegitimize colonial powers, open world to political and economic freedom, not popular with many European powers

III. Gaining American Support and Enforcing Loyalty

• During war government assumed new powers• Changed relationship with federal government• War relied on voluntary compliance more than

formal laws• Build military Congress passes Selective

Service Act (1917) drafts men for war• 4.8 million serve in WWI• 1917- Committee for Public Information

(CPI)- educate public on causes and nature of war

• Advertising to “sell America” on war• Not all Americans supported war• Government took away individual liberties to

quiet dissent• Resistance to the draft• Seen as illegal intrusion into private lives, did

not cooperate with draft boards• Conscientious objectors- moral or religious

reasons forbid fighting in wars

III. Gaining American Support and Enforcing Loyalty

• CPI stifled free expression• 1917- Espionage Act- penalties for

obstructing war effort (print, mail, resisting draft)

• 1918- Sedition Act- unlawful to speak out about government. Used against socialists, political radicals and pacifists

• Supreme Court ruled acts constitutional (Schenck v. U.S. 1919) During wartime freedom of speech does not apply (if it presents a clear and present danger)

• Germany seen as primary foe against U.S.

• Harassment, violence against German Americans

• Stopped teaching German in schools, playing German composers music

IV. The Nations Factories go to War• Wilson organized an effort to supply American in the war

effort• Many Americans had fear of government control and

balked at the government effort• Overall cooperation, not competition marked industrial

effort• To combat this Wilson formed the War Industries Board

(1918) to oversee industrial production• American workers threatened by “work or fight” to combat

unemployment• Labor was given a boost by war, wages rose and work days

standardized to eight hours, still no government guarantee to organize into unions

• War effort supported by AF of L but not by more radical groups (IWW) who committed acts of sabotage

• Wartime prices rose and this negated most wage gains• 1919 steel strike was met with resistance by factory

owners who brought in scabs and setback the union movement

V. Changes for Women and African AmericansWomenMen left workforce , labor

shortage filled by womenTook jobs previously open to menWomen served Red Cross, Army

Corps of Nurses in Europe during war

Many progressive era feminists were pacifists

Efforts and sacrifices during war led Wilson to support passage of 19th Amendment

Economic gains proved fleeting, many women gave up wartime jobs

V. Changes for Women and African Americans

African AmericansMany served in military, in

segregated units and mostly behind the lines

Many went north during the war for employment

Caused racial strife in some cities (Chicago riots 1917)

Movement from rural South to Chicago, Detroit, industrial Northeast

Escape racism, poverty of life in south, promise economic advancement

Called “Great Migration” (1.2 million moved 1910-1920)

VI. Forging a War Economy• America had to feed themselves and

allies, went into it haphazardly• Herbert Hoover was put n charge of food

production effort, effort relied on voluntary cooperation rather than legal means

• Used propaganda campaign to save food for export, promoted “victory gardens”

• Spirit of self denial led to decline in consumption of alcohol and eventually the passage of the 19th Amendment

• Food production and export rose during war

• Other wartime administrations copied Hoover’s lead

• Treasury Department held “liberty bond” drives to raise money for the war effort

• Involuntary increase in taxes raised the rest of the money to fund the war

• Government exercised power of railroads and nationalized them during the war

VII. American Entry into the War• At the beginning of the war, most

Americans thought America would contribute naval power and supplies to Allies

• 1917- Central powers gained an edge on Western Front

• March 1917 Czar of Russia overthrown in revolution

• November 1917 Vladimir Lenin and socialists take over Russian government, sign treaty with Germany and leave war

• Spring 1918 Germans begin new offensive on Western Front

• Early 1917 Allies ask for manpower and draft was instituted, believed the US could not raise enough men to fight in time

• Draft was more effective with fewer loopholes than during Civil War draft

• By early 1918 the first poorly trained American soldiers began to arrive in Europe

Technology, Trench Warfare and a StalemateWar unlike others • Trench warfare- built trenches, attacked,

counter- attacked each other across “no-mans land”

• High death toll- machine guns, artillery, tanks, poison gas produced massive causalities

• Effective defensive weapons led to stalemate- no side could gain advantage

VII. American Entry into the War

•Early 1918 American troops arrive in large numbers

•Commanded by John J. Pershing

•German offensives became less effective, troops became exhausted

•American troops gave Allies military advantage

•Fall 1918 German troops were running out of food, many mutinied, deserted, refused to fight

•Germans surrendered Nov. 11, 1918

VIII. End of the War• The main US contribution to the war was

food, munitions, credit, oil and manpower• Prospect of endless US troops and material

contributed to the end of the war• Wilson wanted the peace based on the

Fourteen Points, he was seen at the end of the war as the moral leader of the world

• By the time Wilson went to the peace conference he was a diminished leader in the US due to Republican victories in the Congressional elections of 1918

• Going to Paris personally seemed to many like grandstanding and Wilson made a political mistake by not including a single Republican in the peace delegation

VIII. End of the War• European leaders kept the new hero Wilson at

arms length, they felt that he would disrupt the status quo

• Big Four of Paris Peace Conference Wilson, David Lloyd George (Great Britain), Georges Clemenceau (France), Vittorio Orlando (Italy)

• Russia stayed out, Lenin thought the war was an imperialist land grab

• Wilson’s main goal was to establish the League of Nations controlled by the great powers

• Wilson did not want the victors to be vengeful to their former enemies, he wanted “peace without victory”

a)Promoted openness, independenceb)Move to end colonialismc) National self- determination (right of people

to choose their own form of government)d)Disarmamente)Asked for League of Nations to promote

peaceful cooperation among nations, collective security

• The European countries had different ideas

VIII. End of the War• European allies blamed Germany for starting war,

wanted them punished• Suffered more than Americans• Germany had to pay reparations (payment for

war damages)• Rejected ideas to end colonialism, disarm Europe,

free trade• Allied powers were torn by conflicting aims and

the peace was a fractured one• French claims in the Ruhr region caused tension

with Germany• France signed a pact with Great Britain and US to

provide for aid in case of another German invasion• New nations emerged in Europe, liberated millions• Austrian, German people found themselves as part

of new countries• Breakup of Ottoman Empire clustered different

ethnic groups together• Middle East broken up by European powers, not

allowed to practice self- determination• Wilson did get League of Nations in a compromise

with the European leaders

IX. Selling the Treaty to the US• Many Americans thought US was entering into “tangling

alliances” of European affairs, the League of Nations was also seen as a “super state” and was opposed by the isolationists

• Some thought treaty was not harsh enough• German and Italian Americans thought treaty was too

harsh• Some thought treaty gave British too much influence• Republicans and isolationists in Senate (led by Henry

Cabot Lodge) used delay tactics to keep treaty from being passed

• Eventually apathy and confusion crept in to the treaty debate

• Wilson tried the direct appeal method to get support for the treaty, during his tour he had a stroke and could not actively campaign for the Treaty of Versailles

• Lodge took control of the proceedings and would not pass the treaty if it included the League of Nations

• Wilson urged Democrats to reject the treaty Lodge proposed, it was defeated

• The Treaty of Versailles was also defeated by traditions of isolationism, disillusionment with the war and partisanship

X. A Return to “Normalcy”• Public desire for change from the

progressive politics and high minded ideals of Wilson

• Elected Republican Warren G. Harding of Ohio as president

• Opposite of Wilson, back slapper and dull minded

• With the election of Harding the idea of the League of Nations was dead

• America emerged from the war a changed country nationally and internationally

• 1920 America world economic giant, largest creditor nation

• Compared to Europe, U.S. came out of war strong and prosperous

Chapter 31

I. Seeing Red• After war Americans turned

inward• Shunning diplomatic

commitments, denounced radical foreign ideas and “un-American” lifestyles

• Shut out immigration (passed literacy requirement for immigrants) and sealed off economy from the outside world

• New technologies, forms of entertainment and leisure first appeared in the US, but there were fears that America was losing their traditional ways

I. Seeing Red• Flu Epidemic (1918-1919) September 1918 virus

first appears, Spring 1919 disappears• Killed millions around the world (22m, 500,000 U.S.)• Men and women in 20’s, 30’s hit hardest• Combined with effects of war, gave people a sense of

doom• Red Scare- fear of communists and radicals, plotting

against the United States• Labor unrest seen as work of communists, radicals• Communist Soviet Union called for international

workers revolution and end of capitalism• April 1919 40 bombs intercepted in mail, one sent to

Attorney General (Mitchell Palmer)• Government response- Palmer Raids• Arrested thousands of Southern, Eastern Europeans (not

all were radicals), many deported, or held in jail without ever being charged with crime

• American Civil Liberties Union formed 1920 to protect rights and liberties

• Conservative business leaders used this as an excuse to break the back of labor unions

I. Seeing Red• Anti- foreignism reflected in Sacco and Vanzetti case

• Italian immigrants and known anarchists

• Accused of killing two men at a shoe factory

• ACLU provided defense counsel

• Found guilty, little hard evidence

• Bias against immigrants, political climate worked against them

• 1927 put to death in electric chair

• Gave the radicals two martyrs for their “class struggle”

II. Hooded Hoodlums of the KKK• Membership in the organization spiked

in the 20’s• Manifestation of intolerance and

prejudice from anxiety of changing times

• Resembled “nativist” movement of 1850’s

• Anti- anything except Anglo, “native” American

• Uprising against forces of modernism and forces of diversity shaping American culture

• Movement concentrated in Midwest and South

• At its peak had about 5 million members• Collapsed in late 20’s after political

corruption was exposed

III. Stemming the Foreign Flood

• Country had little use for immigration in the 20’s,

• Immigration Act of 1924- end of open immigration

• Government created a quota system to restrict immigration

• Geared to keep out southern and eastern Europeans, Japanese immigrants

• Employers used racial/ ethnic differences to undermine class and political solidarity

IV. Prohibition and the Rise of Gangsterisim• Last spasm of the progressive movement was

prohibition of alcohol, legalized with the passage of the 18th Amendment and implemented with the Volstead Act in 1919• Prohibited sale, distribution and manufacture of

alcohol• More popular in South and West• South seen as a way to keep blacks “in their place”• West seen as attack on vice associated with the

saloon• Opposition in the east where there were large

groups of immigrants and Old World styles of sociability

• Conditions that hampered enforcement: ignored tradition of weak control by central government over private lives, disillusionment in aftermath of war and wisdom of further self denial, understaffed federal agents to enforce law

• Corner saloon replaced by “speakeasies”, alcohol still available

• Did have some positive effect- bank savings increased, absenteeism at work decreased

IV. Prohibition and the Rise of Gangsterisim• Prohibition spawned criminal

activity• Profits of selling booze led to

rivalries between gangs in big cities• Arrests were few, convictions fewer

and the bribery of federal agents was rampant

• Organized crime developed around sale of liquor and reached into other areas- prostitution, drugs, gambling

• Organized crime became one of the most lucrative businesses in the country

V. Changes in Society• Split in rural and urban values, Changes in

standard of living, religious values• 1920 Census first time more American lived in

urban areas than rural areas• Urban- enjoyed new consumer products,

• Open to social change, science, secular values important

• Formal education more important• Rural- more traditional view of science, religion,

culture• Most new consumer products unavailable• Many people, especially in rural areas, felt

threatened by the changing values of society--formed ways to react to these changes

• Religious fundamentalism grew during the 1920s • World changing in ways people don't understand

and can't control • Children reject the values that the parents have

lived with all their life • One way this fundamentalism manifested itself

came in the laws of a few southern states which mandated creationism, not evolution, be taught in classrooms

VI. Monkey Business in Tennessee Scopes “Monkey” Trial • Scopes Trial a battle between two sets of

values--the older, rural values and the modern, urban values

• 1925, at the urging of local community leaders, John T. Scopes, a high-school biology teacher in Dayton, Tenn. challenged his state's antievolution law

• He did so with promise of assistance from the ACLU

• ACLU hired team of lawyers headed by Clarence Darrow to defend Scopes

• Prosecution assisted by William Jennings Bryan--who argued for inerrancy of Bible, but sometimes found himself not knowing what the Bible said

• Scopes convicted by local jury--but received short sentence and small fine

• Fundamentalism (and the South) ridiculed by national press-influence of fundamentalism diminished in mainstream churches after the trial, it still retained a large following

VII. The Mass Consumption Economy• Cultural issues divided Americans but…..

• Decade after war America experienced growth

• Changed the way Americans lived • Created modern consumer economy• Rising wages, shorter work weeks• More free time more disposable income• Technology, leisure activities broke down

barriers and helped form a common American culture

• Consumer Revolution- advertising, buying on credit, electricity made new products available to people• Availability of electric power – washing

machines, vacuum cleaners made housekeeping easier

• Advertisers- used new methods to sell more products (focused on desires and fears of consumers)

• Buying on credit allowed people to buy products they would have needed to save years for

• Economy became increasingly venerable to disruptions of the credit structure

VII. The Mass Consumption Economy

• Radio and Phonograph- result of technological advances, business enterprise

• Americans listened to same music, learned same dances- contributed to mass popular culture

• Radio- 1920 first commercial radio station (KDKA Pittsburg, PA)- within three years over 600 stations

• Brought events into millions of homes- sporting events, news

• Politicians had to learn the “art” of media to reach millions at once that heard promises and pleas

• Advertising and commercials made radio a vehicle for selling American free enterprise

• Phonograph- people could listen to music whenever they wanted

• Regional music styles were made national

VIII. Sports and the Rise of the Airplane• Sports created nationally famous

athletes▫ Increased newspaper readers, radio

audience boosted popularity▫ Sportswriters captured excitement of

events▫ Sports became big business▫ Sports feats showed people capable of

great feats, idealized self• 1903 first successful airplane flight

▫ During WWI used in combat▫ After war first passenger lines

operated, mostly used for mail service, stunt fliers traveled across country

• 1927 Charles Lindberg flies solo across Atlantic Ocean, became American hero▫ Feat popularized flying more than any

other event, increased idea of it being a commercially viable industry

▫ Removed some of the “isolation” of the American psyche

IX. Movies • Movie industry began to grow in

early 1900’s and it blossomed in the 1920’s

• Hollywood was the movie capital of the world

• Used during the war to promote anti-German propaganda

• Local theaters became cultural classroom for Americans

• Americas democratic art, most popular form of entertainment

• First movie stars• 1927 first “talkie” Jazz Singer• Movies represent fantasies,

desires, of Americans• Help create a common American

culture

X. Advent of the Automobile Age

• Caused biggest change to lifestyles during the 1920’s and beyond

• Scientific management techniques- reduce time, effort, cost to produce cars (“Taylorisim” sought to eliminate wasted motion)

• Cars put on assembly line- inspired by meatpacking industry

• Best known carmaker Henry Ford, had a one track devotion to standardization that he used to produce cars

• Idea of mass production used for automobiles

• Model T- only car Ford sold ($ 260 by mid-1920’s)

• Ford also doubled wages of workers, weekends off, 8 hr workday

X. Advent of the Automobile Age

• Steel, glass, rubber, asphalt, gasoline, insurance, road construction industries all benefitted

• Oil discoveries in Southwest US• 1926 national highway system first appeared• Service stations, motels • Created new jobs, helped national prosperity• Made commerce speedier• Gave people more freedom, car became a

necessity• Go where they wanted, not tied to tracks or train

schedule, hurt railroads• Altered residential patterns• Suburbs grew, people could live farther from

jobs• Communities linked by highways to cities • Improved mass transportation, car led to

development of suburbs• Suburbs drain resources from cities

XI. Science, Social Thought and Modernism

• Rational, mechanical ideas of how world worked changed

• Einstein’s Theory of Relativity, Heisenberg's Theory of Uncertainty showed absolute values of how things worked were not true

• Freud explored subconscious, subconscious regions seen as more potent than reason

• Also demonstrated that repression was responsible for a variety of social ills

• Fundamentalist lost ground to the modernists

XI. New Roles for Women• New Woman” of 1920’s more liberated,

Victorian morality rejected• Dresses shorter, wore makeup, danced,

drank• Flapper symbolized new , modern

woman• Wanted same political, social, economic

rights as men• Alice Paul and the National Women’s

party began a campaign for an Equal Rights Amendment to the Constitution

• Lived longer, had fewer children, freed time to peruse other interests

• Many entered professional workforce, although they went into low paying jobs (“women’s work”)

• Elected as governors (TX, WY)• Differences in material culture made life

for urban and rural women distinct

XIII. The Jazz Age• Emerged in South (New

Orleans) where different traditions and cultures came together

• Based on improvisation, blues and European traditions

• Spread north with Great Migration, became theme music of 1920’s

• Radio, phonograph spread influence

• Bridged races, inspired white songwriters and musicians (who stole style and made a huge profit)

XIV. The Harlem Renaissance• African American migration continued

1920’s• Many found a better life, jobs, political voice• Did not escape oppression, had worst jobs,

housing• Period of cultural expression in music and

literature• Development of “new black consciousness”• Center was Harlem, NY, blend of cultures,

ideas • Spawned charismatic political leader

Marcus Garvey• Jamaican immigrant, promoted idea of black

nationalism, “Back to Africa” Movement• Called for black separatism- businesses,

communities• Founded Universal Negro Improvement

Assn. promoted black pride• Put in prison 1925 for mail fraud, deported• Inspired Nation of Islam, Black Panther

Movement later in century

XIV. The Harlem Renaissance• African American literature

developed from the Harlem Renaissance

• Explored pains and joys of being African American, some called for equality with whites

• Langston Hughes- literary voice of HR, captured diversity of AA life

• Jean Toomer- Cane looked at rural life in the south and sophisticated urban life in Washington, D.C.

• Claude McKay- militant writer, wrote about struggle for dignity

• Zora Neale Hurston- collected folktales of rural Florida, called for women’s independence

XV. Modernism in Art and Literature• Literature, arts were changed by

WWI• War killed millions, left many

homeless• Seen as action of irrational people• Began to question ideas of

progress, left people pessimistic • Writers and artists expressed lack

of faith in a traditional worldview• Painters moved away from

traditional representation• Experimented with abstract

styles, represented inner mood• Saw artistic honesty in abstract

paintings

XV. Modernism in Art and Literature

• Postwar literature represented the exuberance of youth and the resentment of ideals betrayed

• Called “Lost Generation”• Searched for new truths, new

ways to express truths• Most were expatriates living in

Paris and London• Wrestled with meaning of war

and life• F. Scott Fitzgerald, Ernest

Hemmingway, T.S. Elliot, Sinclair Lewis, Gertrude Stein

• Greatest generation for American writers

XV. Modernism in Art and Literature

• Earnest Hemmingway- novels feature search for real life

• Hard living, athletic, masculine lifestyle

• About doomed life after the war• Wrote in a concrete, stripped down

style• F. Scott Fitzgerald- first novel This

Side of Paradise, age 24• Wrote about excess of Jazz Age, bible

for youth of the 20’s• Great Gatsby about American dream

and tragedy William Faulkner- stories set in

Mississippi, reflected southern world Literature- dying way of life vs.

modern way of life Leader of Southern Renaissance

1919-1921

I. Wall Street’s Big Bull Market

• Right after the war scarcity of supplies, increased demand caused inflation▫ Agriculture- prices fell, farmers could not pay debt▫ U.S. had a postwar recession▫ Industrial workers wages could not buy as much

after war (inflation)▫ Many workers went on strike to demand better

conditions (1919- 4m), racial unrest across the country in the summer of 1919

• Decade after war America experienced growth • Changed the way Americans live, created

modern consumer economy• 1920’s period of rising stock prices (bull

market)• Investors take risks, buy on margin (pay small

amount up front, pay rest back over time)• Stock was collateral for loan• Thinking boom and bust economy would end,

there would always be prosperity• Signals in bank failures and real estate

speculation

I. Wall Street’s Big Bull Market

• More conservative policies to promote growth of business

• Presidents wanted to serve the public good through less government

• Sec. of Treasury Andrew Mellon, a multimillionaire, favored low taxes on individuals and corporations

• Tax burden shifted to the middle class

• Herbert Hoover- Commerce Sec. wanted to use business and labor leaders to manage industry, not legislation

II. Republicans in Power• Harding used government to guide business

to profits• Used courts to back up policies, appointed 4

justices to Supreme Court (would have an effect for years)

• Stripped away gains for labor, women in the workplace, anti trust laws ignored

• Dismantled progressive and wartime controls over the economy

• Close circle of advisers called ‘Ohio Gang”• Saw government service as a way to get rich

at expense of others• Teapot Dome Scandal- (1921) Sec. of

Interior arranged sale of government oil reserves in Wyo. to private investors for “loans”

• Harding signed deal, senate investigated• 1924- Sec. of Interior sentenced to prison• 1923- Harding died before he could finish his

term or answer for his role in this and other scandals

III. Silent Cal Coolidge•Replaced by VP Calvin Coolidge•“Silent Cal” quiet, honest,

frugal, fumigated some of the stench of Harding

•Pro- business, creation of wealth was good for all America

•Followed same economic policies as Harding

•American economy grew, general prosperity for all Americans over next six years

IV. Hiking the Tariff Higher•True to idea of American isolationism,

business tried to keep out foreign investment in the 1920’s

•Put up high tariff walls to keep out a flood of cheap foreign goods from recovering Europe

•Tariffs were raised throughout the decade, Republican presidents were far more friendly to tariff increases than the progressives of past decades

•Set off chain reaction that kept Europe from being able to pay war debts, spurred Europe to pass tariffs to keep out American goods

V. Frustrated Farmers• Farmers caught in boom-bust

cycle more than industry• Peace brought an end to

guaranteed prices by government and overseas purchases

• Wartime boom encouraged them to cultivate new land

• Farmers produced surpluses that led to price dampening depression

• In 1920’s 25% of all farms were sold to repay debt

• Congress tried to help farmers but conservative financial policies allowed farmers problems to not be heard

VI. American Foreign Policy• Isolationism was the rule in the 20’s, even though

America sent “observers” to the League of Nations meetings in Geneva, Switzerland

• America was active in the Middle East where they secured drilling rights to reap the benefits oil

• 1921-1922- Washington “Disarmament” Conference- limit construction of navies, reduce arms race

• 1928- Kellogg- Briand Pact- treaty to outlaw “war as an instrument of national policy” world leaders knew this was useless

• Defensive wars were still permitted with pact, America had been lulled into a false sense of security

• 1920’s U.S. thought best policy was to keep rest of world at arms length, by outlawing war U.S. hoped to never be involved in another world war

VI. American Foreign Policy• US did still participate in the affairs of Latin

American and Caribbean nations to protect their investments

• Overshadowing all other foreign policy issues was international debt, US after war was the creditor nation of the world

• US wanted to be repaid the $10 billion it loaned Europe during the war

• US wanted Britain, France to pay back money borrowed for war

• They needed Germany to pay reparations• Financial issue threatened world economy• 1924 Dawes Plan arranged US loans to

Germany to pay Britain and France• Damaged US reputation- Europe saw US as

heartless demanding payment after human costs of war

• US never did get money and it led to continued neutrality and isolationism as thing grew worse in Europe in the 1930’s

VII. Presidential Elections 1924, 1928• 1924 Coolidge reelected over a

hopelessly split Democratic party and the reform minded progressives

• Times were too good to change the course

• 1928 Coolidge decides not to run, Herbert Hoover (Sec. of Commerce) was chosen as successor

• Hoover was a self mad millionaire, the ideal businessperson's candidate

• Democrats nominated Alfred Smith of NY

• Many saw Smith as too Catholic, urban, too much of a drinker

• Dry, fundamentalists help Hoover carry the South

• First time for a Republican to carry former Confederate states

• First election where radio played a role

IX. Hoover’s First Years• Many did well in 1920’s; two groups that did

not farmers and wage earners• Hoovers government philosophy- voluntary

cooperation between labor and management• Economy needed sense of competition, little

government interference• Decentralized government, low taxes• Passed Agricultural Marketing Act and

established the Farm Board, agencies set up to help farmers to help themselves through lending and farmers cooperatives

• 1930 Farm Board agrees to buy surplus production, causes glut of agricultural products and leads to a decline in prices

IX. Hoover’s First Years• 1930 Hawley Smoot Tariff designed to help

farmers• Created the highest tariff in peacetime history

(avg. duty 60%)• Hawley-Smoot Tariff raised prices on foreign

goods• Added to farm, manufacturing problems, could

not sell glut of goods• European countries retaliate and pass protective

tariffs, seen as an act of economic war• Destroyed international trade• Countries could not repay loans to U.S.,

business’ bank collapses in Europe

X. Great Crash End the Twenties• When Hoover took office the

speculative bubble and good times on the stock exchange were coming to an end

• In mid-1929 British raised interest rates to bring investment back to the country, foreign investors dumped money in US market for British market

• Sept- Oct 1929 stock market begins to drop

• October 29- Black Tuesday bottom fell out of stock market, billions of dollars lost

• Investors lost confidence in market, many lost all of their money, jobs, homes

• Hoover tells Americans economy healthy

XI. Causes of the Great Depression

• Industrial production increased and corporate profits rose

•Wealthiest 1% made same amt. as bottom 42%

•Problem- overproduction, under consumption, over expansion of credit

•Problems caused by Hawley-Smoot Tariff caused chain reaction across Europe

•Farms sold at auction and many became tenant farmers across the South and Midwest

XII. Chain Reaction • Stock market crash caused chain

reaction of events• Banks Collapse• Depositors tried to withdraw money

(run on banks), many banks failed (over 2,000 from 29-32)

• Misguided Monetary Policy• Federal Reserve tightened money

supply to discourage lending• Too little money in circulation, not

enough for banks• Business Closes, Unemployment

Rises• Reduced spending, production

cutbacks • Led to job layoffs, by 1933 25% of

Americans out of work

XIII. Rugged Times for Rugged Individualists

• Many Americans did not understand the reasons the Depression happened

• Attacked most American families, many men lost initiative and self respect

• Men felt that they betrayed family, birthrates dropped, families broke up, children dropped out of school

• Unemployment at 25%, those that had jobs had wages, hours cut

• Many went hungry, waited in bread lines for food, many lost their homes

• Grouped together in Hoovervilles, makeshift shacks, tents built on public land

• Feeling of loss of American Dream, zapped American spirit and uniqueness

• Most popular song 1933 “ Brother Can You Spare a Dime?”

XIII. Rugged Times for Rugged Individualists

• Hoover struggled to respond to America’s problems

• Tried hands off policy, downturn part of natural business cycle

• Business should voluntarily combat depression, act in best interest of the community

• Asked business, industry to keep employment, wages, prices at current levels, wanted more money in hands of businesses

• Local relief agencies were overwhelmed, did not have funds to battle economic downturn

• Hoover begins to realize that government needed to help, efforts probably prevented further collapse of the economy

XIV. Hoover Battles the Great Depression

• Hoover finally began to use federal resources to battle economy

• 1932- Reconstruction Finance Corporation (RFC)

• Loaned billions for business, railroads, state and local governments

• Money for banks, to provide loans, stimulate business (trickle down economics), no money to individuals

• Succeeded with construction project on Colorado River (Boulder/Hoover Dam), brought irrigation, employment to Southwest

• Benefits to labor through the Norris-La Guardia Act (1932) outlawed using court injunctions to restrain labor

• Policies by Hoover paved the way for the expansion of the federal government under the New Deal

XV. Routing the Bonus Army in Washington

• 1932- Group of WWI veterans went to D.C. to demand payment for service that was to be paid in 1945

• Called Bonus Army• Government did not have the

money• Set up camps and occupied

government buildings• Hoover used federal troops to

remove them• Army used excessive force, Gen

MacArthur called them revolutionaries

• Photographs of army action shocked Americans

• Election of 1932 was time for change