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The Great Depression and the New Deal

The Great Depression and the New Deal. Lead up to a Depression. Many Americans began to invest more money in the stock market. American Presidents Harding and Coolidge gave businesses more freedom to achieve and succeed. Wealth distribution was vastly uneven

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The Great Depression and the New Deal

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  1. The Great Depression and the New Deal

  2. Lead up to a Depression • Many Americans began to invest more money in the stock market. • American Presidents Harding and Coolidge gave businesses more freedom to achieve and succeed. • Wealth distribution was vastly uneven • Americans were purchasing items with credit. • Buying stocks on margin.

  3. The Stock Market Crashes • One factor in the Great Depression was the crashing of the Stock Market on October 29, 1929, a day later named Black Tuesday. • On that one day investors dumped more than 16 million shares of stock • The crash led to panic among people in business and industry and triggered a banking crisis • Many companies began to layoff workers because consumers were spending less in fear of economic troubles

  4. Hard Times for Americans • People throughout the country lost jobs • Farms across the country began to fail due to the drop in prices of food • Many farms and landowners faced foreclosure – when a bank or lender takes property from someone who has not made payments • Thousands were left homeless and flocked to shanty villages called Hoovervilles, a reference to President Herbert Hoover, who many blamed for the depression • Times got even worse when drought and dust storms swept throughout the country

  5. Hoover’s Response • President Hoover believed in the idea of “rugged individualism” – that government should not get involved and that individual people and businesses would be the ones to fix the economic crisis. • In 1930 Hoover signed the Smoot-Hawley Tariff Act that raised the cost of imported goods for American consumers. The tariff was a disaster and nearly led to an end in world trade.

  6. FDR • In 1932 Franklin Roosevelt destroyed President Hoover in the election for President • After his landslide election Roosevelt immediately set to work of repairing the nations economy • Roosevelt delivered fireside chats over the radio to help calm American’s fears and deliver his plans • FDR's Fireside Chat: Unemployment • The beginning of Roosevelt’s presidency was later called “the Hundred Days” referring to FDR’s first 100 days as President • His plan was called the New Deal

  7. The New Deal • The New Deal centered around 3 R’s • 1) Relief – for those suffering • 2) Recovery – of the economy • 3) Reforms – that would prevent another depression in the future • Roosevelt created the Civilian Conservation Corps (CCC) which paid Americans to work in projects like planting trees and improving parks • The Agricultural Adjustment Act (AAA) gave farmers a subsidy to grow fewer crops in order to bring the price back up

  8. The New Deal • The Public Works Administration (PWA) managed all of the New Deal plans dealing with work and projects • In 1934 the Securities and Exchange Commission (SEC) was created to serve as the watchdog over the stock market • These are just some of the various “Alphabet Soup” programs that FDR created

  9. Trouble for the New Deal • Many Republicans were angered at the amount of spending and government power being used to create the New Deal • The Supreme Court also ruled that parts of the New Deal were unconstitutional • In response FDR put forth what was called the “court packing plan (or scheme)” to add justices that would favor the New Deal to the Supreme Court • After that threat the Supreme Court began to support more of FDR’s plans and gave way to the Second New Deal

  10. Second New Deal • The Works Progress Administration (WPA) had workers building roads, subways, airports, and even zoos. • Social Security provided financial assistance to the retired and elderly (65 or older) and provided money for people who had lost their jobs • Another big part of the Second New Deal was the Rural Electrification Act (REA) that tried to bring electricity to rural areas of the nation. • SHEG: Social Security

  11. Impact of the New Deal • While the New Deal did help Americans get back to work the economy still struggled throughout the 1930’s. • The New Deal made FDR incredibly popular among the people, especially poor whites and African-Americans. Because of this many African-Americans began voting for a Democrat for the first time. • Parts of the New Deal including Social Security, minimum wage, and projects that were completed are still part of our country today.

  12. What Finally Ended the Depression

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