STA NDARD 6 .0 - DE M ON ST RATE A N UN DE RSTANDI NG OF T H E
C ON F LI CT BE T W E EN T RA DI T I ONALI SM A N D P ROG RE SSI VISM I N
T H E 1 9 2 0 S A N D T H E E C ON OM I C C OLLA P SE A N D T H E P OLI T I CA L
RE SP ON SE TO T HE E C ON OM I C C RI SI S I N T HE 1 9 3 0 S
Opening:
Complete pages 219222 in your Reading
Study Guide. What
you do not finish
should be completed
for homework.
Closing:
Quiz
Work Period:
 Great Depression
Notes
 Activity:
 Great Depression
Notes Continued
 Activity: Political
Cartoon
OBJECTIVE
Explain the causes
and consequences
of the Great
Depression
THE GREAT DEPRESSION BEGINS
Photos by photographer Dorothea Lange
THE NATION’S SICK ECONOMY
As the 1920s advanced, serious problems threatened the
economy while
Important industries struggled, including:









A griculture
Railroads
Textiles
Steel
Mining
Lumber
Automobiles
Housing
Consumer goods
CONSUMER SPENDING DOWN
 By the late 1920s,
American consumers were
buying less (demand
declined)
 Rising prices, stagnant
wages and overbuying on
credit were to blame
 Most people did not have
the money to buy the flood
of goods factories
produced (overproduction)
A SUPERFICIAL PROSPERIT Y
Many during the
1920s believed the
prosperity would go
on forever
Wages for most
workers fell while
productivity
increased
GAP BETWEEN RICH &
POOR WIDENED
Photo by Dorothea Lange
 The gap between rich
and poor widened
 The wealthiest 1% saw
their income rise 75%
 The rest of the
population saw an
increase of only 9%
 More than 70% of
American families
earned less than
$2500 per year
THE UNFORTUNATE CYCLE
Companies did not pass on
their prosperity to their
employees by paying them
more, so workers couldn’t
afford to buy the products
they made.
When consumers reached
their limit of installments,
they had to stop spending.
No spending means lay offs for workers.
FARMERS STRUGGLE
Photo by Dorothea Lange
 During World War I European
demand for American crops
soared
 After the war, they faced
international competition,
depressed prices, debt and
taxes
 Farmers defaulted on bank
loans causing banks to fail
BEFORE the crash in 1929.
 Fewer banks= limited
number of loans for everyone
else.
REPUBLICAN
ADMINISTRATIONS
 Gov’t abandoned policy of
progressivism and limited
regulation of Big Business
(unlike Sherman Anti-Trust
and trust-busing of TR)
 Return to laissez-faire
meant corporations became
increasingly powerful
 The tariff was raised and
the Supreme Court
overturned child labor and
minimum wage laws for
women
 Income taxes for wealthy
slashed, and they invested
in luxury goods and the
stock market instead of
new factories
THE STOCK MARKET
 By 1929, many Americans
were invested in the Stock
Market
 The Stock Market had
become the most visible
symbol of a prosperous
American economy (“get rich
quick”)
SEEDS OF TROUBLE
 By the late 1920s,
problems with the
economy emerged
 Speculation: Too many
Americans were engaged
in speculation – buying
stocks & bonds hoping for
a quick profit
 Margin: Americans were
buying “on margin” –
paying a small percentage
of a stock’s price as a
down payment and
borrowing the rest
The Stock Market’s bubble was about to
break
THE 1929 CRASH
 In September the Stock Market
had some unusual up & down
movements
 On October 24, the market
took a plunge . . .the worst
was yet to come
 On October 29, now known as
Black Tuesday, the bottom fell
out
 16.4 million shares were sold
that day – prices plummeted
 People who had bought on
margin (credit) were stuck
with huge debts
By mid-November, investors had
lost about $30 billion
ACTIVIT Y ONE
 Stock
market
crash video
clip
THE GREAT DEPRESSION
 The Stock Market crash
signaled the beginning of
the Great Depression
 The Great Depression is
generally defined as the
period from 1929 – 1940
in which the economy
plummeted and
unemployment
skyrocketed
 The crash alone did not
cause the Great
Depression, but it
hastened its arrival
FINANCIAL COLLAPSE
 After the crash, many
Americans panicked and
withdrew their money
from banks
 Banks had invested in
the Stock Market and
lost money
 In 1929- 600 banks fail
 By 1933 – 11,000 of the
25,000 banks nationwide
had collapsed
Bank run 1929, Los Angeles
THE FEDERAL RESERVE
 The Federal Reserve (1913),
the nation’s central bank, has
the capacity to regulate the
money supply by making loans
to banks, which then make
loans to businesses, which hire
workers, who buy products.
 Early in the 1920s, the Fed
pursued easy credit policies.
 Charged low interest rates
which helped fuel stock market
speculation mania.
 In the late 1920s, the Fed tried
to tighten money in order to
curb stock market speculation,
ultimately discouraging lending.
GNP DROPS, UNEMPLOYMENT SOARS
 Between 1928-1932, the
U.S. Gross National
Product (GNP) – the total
output of a nation’s
goods & services – fell
nearly 50% from $104
billion to $59 billion
 90,000 businesses went
bankrupt
 Unemployment leaped
from 3% in 1929 to 25%
in 1933
HAWLEY-SMOOT TARIFF
 To protect American industry from
foreign competition, Congress
passed the toughest tariff in U.S.
history called the Hawley- Smoot
Tariff
 It was meant to protect U.S. industry
yet had the opposite effect-limited
international trade.
 Foreigners were unable to sell their
goods in US markets and did not
have dollars to buy American goods.
 Other countries enacted their own
tariffs and soon world trade fell 40%
PRESIDENT HOOVER
 Went farther than any
other president and urged
companies to voluntarily
maintain wages and
hours.
 Lower consumer demand
made this impossible and
companies laid off
workers and cut hours.
 Advocating “rugged
individualism”, Hoover
urged that prosperity was
“just around the corner”
“Hoovervilles”
“Hooverflags”
“Hooverblankets”
HARDSHIPS DURING DEPRESSION
 The Great Depression
brought hardship,
homelessness, and hunger to
millions
 Across the country, people
lost their jobs, and their
homes (25% unemployed)
Many wandered from town to
town selling apples and
pencils door to door.
 No system of unemployment
insurance
 Wages and hours were cut
and people bought only
essential goods.
 “Runs” on the banks (people
tried to withdraw all of their
money) caused banks to
collapse
SOUP KITCHENS
Unemployed men wait in line for food – this
particular soup kitchen was sponsored by
Al Capone
One of the common
features of urban
areas during the era
were soup kitchens
and bread lines
Soup kitchens and
bread lines offered
free or low-cost food
for people
THE DUST BOWL
 A severe drought gripped
the Great Plains in the
early 1930s
 Wind scattered the
topsoil, exposing sand
and grit
 The resulting dust
traveled hundreds of
miles
 One storm in 1934
picked up millions of
tons of dust from the
Plains an carried it to the
East Coast
Kansas Farmer, 1933
Dust storm approaching Stratford, Texas - 1934
Storm approaching Elkhart, Kansas in
1937
Dust buried cars and wagons in South Dakota in
1936
HARDEST HIT REGIONS
Boy covers his mouth to avoid dust,
1935
 Kansas, Oklahoma,
Texas, New Mexico,
and Colorado were the
hardest hit regions
during the Dust Bowl
 Many farmers (“Okies”)
migrated to California
and other Pacific Coast
states
 The plains had been
damaged by
overgrazing since the
1890s, and the winds
blew the top soil away.
Photographer Dorothea Lange captures a family
headed west to escape the dust storms
EFFECTS OF DEPRESSION
 Families undernourished
 Schools closed (couldn’t pay
teachers)
 Marriages delayed
 Birthrate fell
 Men abandoned families
 Some families worked
together
 Women/children forced to
work
 States and charities couldn’t
fix the problem
 Needed the gov’t to step up.
BONUS ARMY
 A 1932 incident further
damaged Hoover’s image
 That spring about 15,000
World War I vets arrived
in Washington to support
a proposed bill
 The Patman Bill would
have authorized Congress
to pay a bonus to WWI
vets immediately
 The bonus was scheduled
to be paid in 1945 --- The
Army vets wanted it NOW
BONUS ARMY TURNED
DOWN
Thousands of Bonus Army soldiers protest –
Spring 1932
Hoover called
the Bonus
marchers,
“Communists
and criminals”
On June 17,
1932 the
Senate voted
down the
Patman Bill
BONUS MARCHERS CLASH WITH
SOLDIERS
 Hoover told the Bonus
marchers to go home–
most did
 2,000 refused to leave
 Hoover sent a force of
1,000 soldiers under the
command of General
Douglas MacArthur and
his aide Dwight
Eisenhower
AMERICANS SHOCKED AT TREATMENT
OF WWI VETS
 MacArthur’s 12 th infantry gassed more than 1,000
marchers, including an 11-month old baby, who died
 Two vets were shot and scores injured
 Americans were outraged
Hoover had little chance to be re-elected in 1932. Americans
demanded help from their government.
ACTIVIT Y TWO
 Analyze the political
cartoon
CLOSING
 Quiz