APUSH - Unit #7A Topic 27

1. APUSH - Unit #7ATopic 27 Chapter 27— Herbert Hoover & The Great Depression (1928—1932)

2. APUSH PowerPoint #7.5 (Part 1 of 1) Unit #7 Chapter 22 BFW Textbook (eBook) – “Managing the Great Depression & Forging the New Deal” (1929—1938) TOPIC – Herbert Hoover & The Great Depression [1928-1932]

3. SSUSH17— The student will analyze the causes and consequences of the Great Depression. • Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression. • Explain the impact of the drought in the creation of the Dust Bowl. • Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

4. Chapter 27:The Great Depression Overview Newly elected President Franklin D. Roosevelt launches a program aiming to end the Great Depression. The Depression and FDR’s “New Deal” have profound effects on the nation.

5. Section 1 – Causes of the Depression Main Idea: President Herbert Hoover is elected, but a stock market crash will cause the Great Depression in the United States and world. Attempts to provide relief result in little progress and the fuel the election of Franklin D. Roosevelt.

6. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression. Presidential Election of 1928

7. Herbert Hoover 31st President 1929 – 1933 Party:Republican Home State: New York Vice President: Charles Curtis

8. Domestic Conservative Republican. Believed in limited government and low taxes. President when the Stock Market crashed (October, 1929) and when the Great Depression began. Supported the construction of the Boulder Dam. Unpopular during the majority of his presidency following due to Depression. Foreign Herbert Hoover

9. Installment Buying – Buying on credit and paying monthly installments (payments). Used by Americans to buy new products in the 1920s. Buying on Margin– Buying stock on credit (barrowing money to buy unsecured securities). Used by Americans to buy stock in the 1920s. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

10. Business Cycle – In a free-market (capitalist) economy, a cyclical process of events which usually occur in this order: (1) Expansion (growth in the economy), (2) Peak (maximum productivity), (3) Recession (economic slowdown), (4) Recovery (expansion of the economy.) a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

11. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

12. Problems in the Agriculture Sector – Farmers made up 25% of the jobs throughout the 1920s. Following the end of the First World War, the demand for American grain fell sharply. Machinery created higher crop yields causing prices to drop and debts to increase. A rural “depression” began in the mid-1920s that was not felt by other areas of the economy. Debt and increasing cost to run the family farm prevented farmers from sharing in the “boom” of the 1920s. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

13. Uneven Wealth Distribution – Wages for industrial workers did rise resulting in a higher standard of living. Despite wages going up gradually (8%) between 1923 to 1929, the productivity of industrial workers increased dramatically (32%) from 1923 to 1929. The wealthiest families earned nearly 50 times what the average family earned, but did not purchase 50 times the productivity. Under-consumption occurred as Americans bought less than was being consumed. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

14. Easy Credit – During the 1920s, the explosion of new products meant that Americans could improve their lives and standard of living. New products included automobiles, appliances, radios, and other goods on credit. By 1929, 60% of cars and 80% of radios were purchased on credit. Many Americans lived beyond their means. Speculation – The idea that the market will grow automatically and rapidly by investing in stocks or other investments. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

15. Black Thursday (October 24, 1929) – The day the stock market began to see a massive sell-off by wealthy investors. Black Tuesday (October 29, 1929) – The day the stock market crashed and the spark to initiate the “Great Depression” of the 1930s. Great Depression – A period lasting from 1929 to 1941 in which the economy collapsed and unemployment increased dramatically (nearly 25% of the working population was unemployed and millions more underemployed) during the period. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

16. Great Depression a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

17. 1. How did prosperity in the 1920s give way to the Great Depression of the 1930s? Unsustainable practices in finance, agricultural, consumption, and industry, which fueled economic expansion during the 1920s, contributing to the collapse that brought about the Stock Market Crash and the Great Depression. “The Great Depression”(p. 3)

18. Bank Closures – The Federal Reserve cut interest rates, but limited the supply of money to discourage lending. Between 1929 and 1932, nearly 3,000 banks collapsed causing a strain on lending. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

19. Business Closures – Without an infusion of capital, businesses were forced to cut workers and production. Hundreds of plants closed and many layoffs followed. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

20. Hawley-Smoot Tariff of 1930 – To protect United States companies, Congress passed the bill in an effort to protect businesses. The new law raised tax rates on imports spurring retaliation by European nations. European Issues – Without capital to invest, investments overseas fell sharply causing a ripple-effect in Europe. Germany ceased reparations and former Allied Powers (Britain and France) suspended loans. The Depression was now a global economic catastrophe. a. Describe the causes, including overproduction, under-consumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression.

21. Section 2 – Americans Face the Depression Main Idea: The collapse of the economy and the Depression causes hard times for millions of people. Farmers lose their farms while workers lose their jobs.

22. Breadlines – Lines created by private charities and public agencies in which small portions of food were distributed. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

23. “Hoovervilles” – Makeshift shantytowns of tents and shacks built on public lands and vacant lots. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

24. Tenant Farmers – Many farmers lost their farms (nearly one million by 1932) and worked their land as renters to larger farms and corporations. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

25. 2. How did the Great Depression affect the lives of urban and rural Americans? The Great Depression caused the following in both areas . . . In urban areas, production cutbacks in factories caused many people to lose their jobs and their homes. Homeless communities called “Hoovervilles” sprang up in cities. In rural areas, many farmers were already experiencing economic troubles. The depression caused crop prices to fall drastically and many farmers to lose their farms and homes. “The Great Depression”(p. 3)

26. Dust Bowl – Began on the Great Plains in 1932 as a combination of drought, loose topsoil, and high winds created a natural disaster for farmers. b. Explain the impact of the drought in the creation of the Dust Bowl.

27. “Okies” – Those who fled the Great Plains, the Dust Bowl, and their foreclosed land for other areas throughout the 1930s. Began in Oklahoma, but the term was used for anyone leaving the Great Plains for jobs. b. Explain the impact of the drought in the creation of the Dust Bowl.

28. Section 3 – Hoover Responds to the Depression Main Idea: President Herbert Hoover initially practices laissez-faire policies with the Depression. Eventually, he takes a more activist role to make the needed changes to the economy.

29. Hoover’s Response – Hoover did not cause the Depression. As president, Americans looked to him to create the solution to end the misery. Initially, Hoover believed the crisis to be a temporary set-back in the economy, so he lowered taxes and called for volunteerism. Volunteerism – Hoover asked wealthy Americans and businesses to voluntarily join forces to end the Depression. Money was given to charities and prices remained stable. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

30. Localism – The use of local and state governments to combat the problems of the Depression. Hoover believed in “rugged individualism” so individuals could better themselves through their own efforts. Failures of Volunteerism & Localism – Despite constitutional issues and the belief that he was doing the right thing, Hoover’s measures failed. The nation slipped deeper into Depression and Hoover was going to have to become the “activist” president he did not want to become. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

31. 5. Why did President Hoover turn his attention away from volunteerism and localism to a more active role in ending the Depression? Volunteerism and localism were not ending the depression, and Americans were becoming angry at his failure to alleviate the crisis. “The Great Depression”(p. 4)

32. Reconstruction Finance Corporation (RFC)– Created in 1932 to give billions of dollars in loans to the railroads and large businesses. Hoover believed that the money would begin with business and provide the needed stimulation to the economy. “Trickle-down” Economics – In theory, the money would “trickle down” from the banks to businesses to the workers and provide the needed money to help stimulate the economy. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

33. Hoover Dam – In 1930, the construction of the Boulder Dam began and was renamed “Hoover Dam.” The dam provided jobs and stimulated the economy of the Southwestern United States. In addition, the dam has provided electricity for the region for several decades. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

34. Radical Change – Many Americans believed the president was trying. However, Hoover came to symbolize the Depression many called for change. Hoover’s response to the crisis became an issue, while many believed the “capitalist” system was to blame. Movements sprang up urging the adoption of socialism and communism as an economic system. Some Americans even pushed for fascist policies. In the end, any change would create problems in the face of the Constitution, individual liberty, and American values. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

35. Bonus Army – In 1924, Congress passed the Adjusted Compensation Act which would provide a veteran’s “bonus” after 1945. However, many veterans began to ask for their bonuses. In the summer of 1932, the “Bonus Army” met in Washington, D.C. to support a Congressional bill of early payments . . . It was vetoed by Hoover. Veterans encamped themselves in empty government buildings and parks. When a riot broke out, Hoover called in the military to remove the protesters. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

36. Bonus Army c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

37. Removing the Bonus Army – Despite Hoover’s empathy toward the Bonus Army, he called for their removal. The leadership used to remove the troops consisted of future World War II generals: Douglas McArthur, George Patton, and Dwight D. Eisenhower. Eventually, bayonets and tear gas were used to remove the troops. This event was the last straw and many Americans were now ready for new leadership. c. Explain the social and political impact of widespread unemployment that resulted in developments of “Hoovervilles.”

38. 3. Why did Herbert Hoover’s policies fail to solve the nation’s economic crisis? Reluctant to impose legislation, Hoover relied first on volunteerism and then on trickle-down policies, both of which were inadequate to meet the crisis. “The Great Depression”(p. 3)

39. 4. Do you think that the Depression of the 1930s changed people’s goals? Why or Why not? Yes. A large percentage of people discovered their lives could suddenly be turned upside-down and they were powerless to do anything about it. “The Great Depression”(p. 3)