How do you define the Great Depression?

Answer 1

Causes of the Great Depression in the United States :

The Stock Market crash, structural weakness of the economy, overproduction, maldistribution of wealth, and an international crisis contributed to the Great Depression in the United States.

Hoover's Response to the crisis :

Hoover was interested in world peace and wanted to advocate cooperative individualism. He said "people should depend on charity and take care of each other, we'll all suffer but we'll make it through". He was against federal aid during the Great Depression. He was unprepared to deal with this crisis and tried to tell people that laughter was the best medicine. He lowered taxes and raised tariffs; as a result, international trade died out at this point. He encouraged volunteerism and gave businesses tax cuts to increase investment in the economy. The Reconstruction Finance Corporation gave the government the ability to loan money to failing major banks and big businesses. This was a very limited measure though. It only bailed out certain people for certain reasons, and this angered the people.

Franklin D. Roosevelt's Response to the Crisis :

During FDR's first 100 days he waged war against the economy by attacks on the banking crisis. He ordered a "bank holiday" which would shut down the banks so people wouldn't withdraw all their money. He also created an emergency banking system which would loan money to failing banks from the federal reserve so they wouldn't go totally under. The Glass Steagall Act was another one of his attempts; this was a separation of investment and commercial banking, and established the FDIC. According to FDR aide Raymond Moley, "capitalism was saved in 8 days." He also created the Agricultural Adjustment Act which paid farmers to keep land fallow. The National Industrial Recovery Act was created to cure overproduction, boost prices, protect labor, and end cutthroat competition. He created the National Recovery Administration which meant that big businesses should have set standards, codes and wages to eliminate cutthroat competition. The Federal Emergency Relief Administration was also created, as well as the Civilian Conservation Corps. This put young men to work in national parks for forest preservation. The Public Works Administration was created to build roads, hospitals, and bridges. He also created the Tennessee Valley Authority, which hired the unemployed to build dams, which prevented floods and generated hydroelectric power.

Demands of the Populists and the Second New Deal

Some of the most recognized Populists were Father Coughlin, Upton Sinclair and Charles Townsend. Father Coughlin attacked Wall Street and capitalism. He wanted government ownership of industry and supported fascism. Huey Long was governor of Louisiana, which was the closest thing to fascism that the US has ever seen. He had complete control over the commerce in Louisiana. He increased taxes on Louisiana oil companies and used those $ to build roads, schools, and hospitals, all of which provided more jobs. He also wanted a guaranteed national income and free college education. Sinclair ran for governor of CA and experienced the first negative campaign. He wanted to put the poor people to work on the fallow lands in CA. Townsend was the spokesperson for the elderly in CA. He liked the idea of old-age pensions and social security, which would stimulate the economy, but no one liked it because it was too expensive. The second New Deal came about as a result of the Populists. It created the Works Progress Administration which put the unemployed to work building post offices, county buildings, 500,000+ miles of road, 600 airports, stadiums, community Swimming Pools, and sewage treatment plants. It also included the Wagner Act which established the workers' rights to collective bargaining. It outlawed firings and blacklistings of union members. It also created the Social Security Act which gave unemployment insurance to disabled and elderly. The money would come from taxing the people, and the Revenue Act of 1935 increased corporate taxes.

African-Americans During the Depression

Eleanor Roosevelt worked for civil and equal rights, but FDR never really touched the issue. Social Security was not extended to African Americans. Southern Democrats revolted, saying that if Roosevelt tried to help African Americans, they wouldn't pass his acts and laws. As a result, FDR's effort in helping them was low. The states were in charge of the CCC, WPA, and other programs. They didn't generally give those jobs to African Americans. The Federal Housing Act also discriminated against blacks and further segregated America. Federal Employment Practices were discriminatory and projects in the south refused to hire blacks. They were the last hired and the first fired. However, FDR did appoint Mary McLeod Bethune, an African American, to his cabinet. This and his other attempts did encourage hope for the people.

The Effects of the New Deal on Politics

The New Deal was the great debate between Republicans and Democrats. The debate was to either extend the New Deal or cut back on it. It shifted politics. Before the 1920's, the Republicans were progressive, then they slowly started becoming more conservative. The government expanded as well, and it was the first time the government became involved in the welfare of common people. FDR also increased the power of what was called the "imperial presidency".

Life During the Great Depression

The people that lived through the Great Depression said "We didn't go hungry but we lived lean." During the Great Depression, unemployment reached 25% by 1933. 86,000 businesses failed between 1932 and 1933. The national income in 1929 was 87.8 billion; in 1933 it was 40.2 billion. Wages declined by 60%, 9 million savings accounts were wiped out, and poverty became a way of life for many. People moved to the cities to find jobs, but there were no jobs left. The homeless built shanty-towns around cities and called them Hoovervilles, mocking Hoover's response to the Depression. People began to blame Hoover for starting the Depression. People stood in the bread lines and for charity handouts. People started eating jackrabbits (due to the shortage of other common meats) and called them Hooverhogs, again ridiculing Hoover's unsuccessful efforts at dealing with the economic disaster.