unit 9 the 1930s u.s. history ii his-112. bread lines during the great depression

UNIT 9THE 1930S

U.S. History IIHIS-112

Bread lines during the Great Depression

Worsening Economic Situation

Overall, the Crash of ‘29 represented loss of over $26 billion on paper This is equivalent of $332 billion in 2008 currency

The Crash was made even worse because of economic policies put in place by the government

Many members of Congress wanted Hoover to veto the Smoot-Hawley Tariff They believed it would hurt foreign trade and the

economy in the long run However, with the Crash, many wanted to protect

Americans interests and Hoover approved it


The Federal Reserve made matters worse In 1931, it raised interest rates which led to a

tightening of creditAs consumer spending went down and loans

were more difficult to get, businesses began cutting production and jobs

The U.S. was also hit negatively by the collapse of the European credit system Many countries tried to get off the gold standard This led many investors to trade in equity in U.S.

companies for gold In turn, this hurt our financial system


In 1930, the market collapsed further Over 1,300 banks failed Many factories cut back on production and others closed U.S .Steel announced a 10% wage cut in 1931 The auto industry laid off workers leading to over 40%

unemployment in Detroit

Hoover worked hard to keep the U.S. from falling into a worsening depression He promoted keeping the U.S. on the gold standard He also worked with Congress to balance the budget He even sponsored a tax cut hoping to stimulate the

economy


Hoover also called for conferences with businessmen and labor leaders In 1931, he tried to organize a pool of private money

to rescue banks and businesses He also met with mayors and governors and

encouraged them to speed up public works projectsIn Europe, the situation grew worse

By June 1931 the German financial system was in chaos

In September, Britain abandoned the gold standard, which led to a decline in lending and trade

Soon most of the industrialized world was caught in the Depression

Desperate times call for desperate measures

The Great Depression

By 1932, the economic recession became known as the Great Depression Investments had dropped by 32% Exports dropped by 1/3 Farm incomes dropped by 60% Gross national product dropped by almost 50% Average wages dropped by more than 40% Some cities had unemployment rates as high as 80% 12 million Americans were unemployed 1/3 of America fell below the poverty level Over 1 million Americans were homeless

Political cartoon about Hoover’s response to the Depression

Government Response

The election of 1930 brought Democrats into the majority in both Houses Hoover was willing to work with them to find new ways

to end the DepressionMore public works projects were built during

his administration than in the past 30 years Congress had approved a $2.25 billion for public works This included a dam on the Colorado River that later

gets named after himThe Federal Home Loan Bank Act of 1932

It was designed to help mortgage lenders who were struggling and to make mortgages more affordable

Government Response

The Reconstruction Finance Corporation was set up in 1932 It was given $500 million to make loans to banks,

insurance companies, farm mortgage companies, and railroads

The Norris-La Guardia Act of 1932 outlawed court injunctions against strikes, boycotts, and picketing This was done to please the Democrats, industrial

workers, and unionsGlass-Steagall Banking Act of 1932 –

It expanded credit to make more loans available to businesses and individuals

Government Response

However, Hoover was not willing to go along with all of the Democrats’ plans He vetoed a bill to build government power facilities

along the Tennessee River He also rejected a proposal by GE President Gerard

Swope (the Swope Plan) that called for industrial cooperation and regulation of businesses by the federal government

Hoover’s biggest failure was that he did not truly understand how bad the Depression was He was willing to use the federal government to

support business, but he would not accept a plan to use federal aid to help the unemployed

Seattle “Hooverville”

Economic Hardship

Many Americans were affected by the Depression Unemployment in 1932 reached 23.6% For those who lost their jobs and homes, many moved

into “Hoovervilles” These were shantytowns on the outskirts of the cities

sardonically named after President Hoover Bread and soup kitchen lines became commonplace in

the cities

Those groups already struggling before the Depression was hit the hardest This included immigrants, Native Americans, and blacks

Economic Hardship

One of the hardest hit groups was the Mexican American population Most Americans assumed that many Mexican-Americans

were here illegally Many left the U.S. voluntarily as the job opportunities

dwindled

Starting in 1929, the Department of Labor began deporting Mexican-Americans out of the U.S. Between 1929 and 1940, approximately 500,000 were

deported as “illegals” Half of them where American citizens

Economic Hardship

Native Americans were already suffering from poverty, high illiteracy rates, and high infant mortality rates prior to the Great Depression In 1928, 84% of Native Americans earned less than $200

a year This conditions were only exacerbated by the Depression

During the Depression, the Bureau of Indian Affairs and other federal agencies continued to exploit the tribes In 1930, the Federal Power Commission allowed the

building of the Flathead Irrigation Project on tribal lands without giving any compensation to the tribes involved

Economic Hardship

African-Americans were also hit hardThe unemployment rates for African-Americans

were double, and even sometimes triple, to those of whites In 1933, unemployment ran approximately 25% for

whites while it was as high as 50% for blacks In areas where they did work, they received 30% less

income than whites

Many lived in the south where conditions were worse Many tenant and sharecroppers lived “below any level of

decency”

“Scottsboro Boys” (1937)

Scottsboro Boys

Socially, conditions were still deplorable in the south for African Americans

In March 1931, nine black youths were accused of gang-raping two white girls in Scottsboro, Alabama When brought in front of an all-white jury in April, they

were all found guilty and eight of them sentenced to death The ninth boy was 12 years old and given life imprisonment

He later had his conviction overturned as he should have been tried as a juvenile

The case got the attention of the NAACP and the Communist Party’s International Labor Defense (ILD)

Scottsboro Boys

In November 1932, the boys’ convictions were overturned by the Supreme Court on the basis the boys had not received adequate council

Starting in 1933, the Scottsboro Boys were retried The ILD hired Samuel Leibowitz, a New York defense

attorney, to defend the boys At the retrial of one of the boys, one of the women admitted

that one of them lied for fear of being charged with a Mann Act violation of crossing state lines for immoral purposes

The boys were once again convicted of rape and charged with the death penalty

Scottsboro Boys

The Supreme Court overturned the convictions in Norris v. Alabama (1935) It stated that the boys had not received due process and

equal protection because blacks were excluded from the jury rolls

Four of the boys were found guilty in their third trials Each of them received jail sentences from 75-109 years

The others had the charges dropped Two because they were young and the judges found time

served was enough of a punishment Two were disabled at the time of the crime, one blind and

the other suffering from debilitating syphilis, and were considered not guilty

World War I veteran Frank Tracy and his children in front of their tent shelter outside

Washington D.C. (June 19, 1932)

Bonus Expeditionary Force

In 1930, World War I veterans began demanding immediate payment of their Adjusted Service Certificate This was a bonus guaranteed by the Adjusted Service

Certificate Act of 1924 which gave them a bonus of $1 for each day served in the U.S. (max $500) and $1.25 served abroad (max $625)

It was not scheduled to be paid until 1945Hoover and the Republicans did not support

an immediate payout They were fearful that such a large payout would hurt

the federal government and relief programs


In 1932, Representative Wright Patman introduced a bill to the House to give the veterans their bonuses

In support of the bill, former Army Sergeant Walter W. Waters and a number of veterans marched to Washington

The marchers grew in number and were known as the Bonus Expeditionary Force (BEF) It contained around 43,000 protesters including the

veterans, their families, and affiliated groups Many of them created a “Hooverville” just outside of

D.C. in Anacostia Flats


The bill failed to pass the Senate in June Most veterans accepted free railroad tickets and left However, several thousand remained behind in

protestWhen the protesters clashed with police

forces on July 28, 1932, Hoover called this a "Communist conspiracy“ He sent in the U.S. Army under General Douglas

MacArthur to clear the area MacArthur used tear gas, tanks, and machine guns to

clear the protesters and their camps With him were Major Dwight D. Eisenhower and

Major George Patton

Election of 1932

Election of 1932

In the Democratic National Convention, Franklin D. Roosevelt was nominated as the party’s candidate His running mate was Speaker of the House John Nance

Garner of TexasThe Democrats ran on a platform of:

Federal relief for the unemployed Repeal of prohibition, with the liquor income paying for

a reduction in federal spending by 25% Lower tariffs

FDR gave his promise of a New Deal “I pledge you, I pledge myself, to a new deal for the

American people”

Election of 1932

FDR traveled throughout the country promoting his idea of change His campaign song was “Happy Days are Here Again”

Hoover was the Republican candidate He portrayed FDR as a radical who would make

conditions only worse However, with the Great Depression to his name, he

had no chance of winningFDR won the election with 57.4% of the votes

and 472 electoral votes Hoover only received 39.7% of the votes and 59

electoral

Election of 1932

Franklin D. Roosevelt (1933-1945)

Franklin D. Roosevelt

Franklin D. Roosevelt was born on January 30, 1882 in Hyde Park, NY As a young child, he was taught by private tutors and then

attended Groton School, a private academy, when he turned 14

He went on to attend Harvard where he was editor of the Harvard Crimson

He then went to Columbia Law School but never graduated because he dropped out after passing the New York Bar Exam

In 1905, he married Eleanor Roosevelt She was Theodore Roosevelt’s niece She was also his fifth cousin once removed


In 1910, FDR started his political career as a New York State Senator He was a progressive who was best known for fighting

the Tammany machine in New York

Because he supported Wilson in the 1912 election, FDR was appointed Assistant Secretary of the Navy in 1913 While there, he created the Navy Reserve and

expanded the navy After the war, he was responsible for demobilizing the

navy


In 1920, James Cox was nominated by the Democratic Party for president with FDR as his running mate After losing the election, FDR returned to private life

and became vice president of Fidelity and Deposit Company of Maryland

In August 1921, FDR was afflicted with an illness believed to be polio He was paralyzed from the waist down Some researchers believe that he had Guillain-Barré

which is an autoimmune disease


For the next few years, FDR worked to improve his health He did not believe his paralysis was permanent and

spent his time seeking treatments and therapies The most successful was the hydrotherapy treatments

he received in Warm Springs, Georgia He set up the Warm Springs Foundation to help other polio

victims, especially those who could not afford treatment

He returned to public life when he was elected as governor of New York in 1928 There he worked against a Republican state legislature

to push through progressive reform including unemployment insurance, conservation and child labor laws

One of the few photos of FDR in a wheelchair (1941)

FDR’s Inaugural Speech 1933

“This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. In every dark hour of our national life a leadership of frankness and vigor has met with that understanding and support of the people themselves which is essential to victory. I am convinced that you will again give that support to leadership in these critical days.”

FDR as President

When FDR took office on March 4, 1933, the country was in shambles Over 15 million Americans were unemployed with

unemployment at 25% Over 2 million where homeless Thousands of financials institutions were on the verge

of bankruptcy Bank runs caused banks to collapse to such a point

that 29 states passed legislation placing a moratorium on removal of assets

32 of 48 states had closed their banks Industrial production dropped by 50% since 1929 Price of agricultural products dropped by 60%

FDR as President

Roosevelt surrounded himself with intelligent and innovative advisers Harold Ickes, a progressive Republican and once

supporter of Theodore Roosevelt, was appointed as secretary of the interior

Henry Wallace, another progressive Republican, was appointed as secretary of agriculture

Frances Perkins, secretary of labor, was the first woman ever appointed to a cabinet post

FDR also had an informal “brain trust” of Columbia professors who helped him shape the first New Deal

FDR hoped that his New Deal would bring three things: relief, recovery, and regulation

First Hundred Days

FDR hit his first stumbling block the day after his inauguration The New York Federal Reserve Bank was unable to

open because there had been a bank run on it the previous day

FDR responded by calling a four-day national bank “holiday” to put a stop to the bank runs

During his “First Hundred Days” of office, FDR pushed through legislation to help the failing economy of the country He started with calling a special session to deal with

the financial crisis on March 9, 1933

First Hundred Days

On March 9, 1933, Congress passes the Emergency Banking Act of 1933 This gave the president the ability to regulate currency It gave the Treasury the right to inspect banks and

issue federal loans It also legalized FDR’s national bank “holiday”

On March 12, 1933, FDR gives the first of his many “fireside chats” The purpose was not only to calm the populace about

the bank runs but also to convince them that depositing money in the banks was safe

First Hundred Days

On March 30, Congress passes the Reforestation Relief Act This created the Civilian Conservation Corps (CCC) It created 250,000 jobs for young men between the ages of

17 and 25 in reforestation, road construction and developing national parks

The men lived in work camps and earned $30 a month, $25 of which had to be sent home

On April 19, FDR took the U.S. off the gold standard The was done by executive order prohibiting the export of

gold The purpose was to stabilize the country’s gold supply

First Hundred Days

On May 12, Congress passed the Federal Emergency Relief Act It created the Federal Emergency Relief Administration

(FERA) which was authorized to distribute $500 million to state and local governments

Half of the money was to be granted directly on the basis of need with the other half given on a matching basis of one federal dollar for every three state dollars

This money was a grant, not a loan, that was given to states in need

Harry Hopkins was appointed to head FERA and supposedly gave out $5 million in grants in his first two hours on the job

First Hundred Days

Also on May 12, FDR signs the Agricultural Adjustment Act This called for farmers to reduce crop sizes of major

agricultural staples—wheat, cotton, corn, hogs, rice, tobacco and milk—to stabilize prices

The Agricultural Adjustment Administration (AAA) was charged with giving farmers a subsidy for compliance

In 1933 alone, the AAA ordered thousands of acres of cotton plowed up and 6 million young pigs slaughtered

AAA helped large farmers more than small ones It was often disastrous for tenant farmers and

sharecroppers who were simply kicked off the land

First Hundred Days

On May 18, Congress created the Tennessee Valley Authority (TVA) The Tennessee Valley was one of the more

impoverished regions of the country The TVA was established to construct dams and provide

electricity for the region as well as provide fertilizers and education for farmers to improve crop yields

The TVA built nine major dams and many minor ones between 1933 and 1944

For residents it meant cheaper electricity and an improvement in lifestyle

The TVA was successful as a relief and recovery method since it created jobs for thousands

First Hundred Days

On May 27, the Federal Securities Act was passed It required stock brokers to file information regarding

investments It also made company directors responsible for

improper practices

On June 6, the National Employment System Act was passed It set up the United States Employment Service

(USES), a system of public employment offices

First Hundred Days

On June 13, Congress passed the Home Owners Refinancing Act This created the Home Owners Loan Corporation (HOLC)

which designated to issue government bones to refinance mortgages

This rescued 10% of homes from default or foreclosureOn the last of the “first hundred days,” June 16,

Congress passed three more acts to help with the economic crisis

The Farm Credit Act created the Farm Credit Administration This allowed farmers to refinance their loans and

mortgages

First Hundred Days

The Banking Act of 1933 (aka Glass-Steagall Banking Act of 1933) It separated banks into commercial v. investment banks It also created the Federal Deposit Insurance Company

(FDIC) to insure bank depositsNational Industrial Recovery Act

It also created the Public Works Administration (PWA) to supervise public works projects and create new jobs

It created the National Recovery Administration (NRA) which had the power to set fair competition codes in all industries

The law also gave labor the right to organize and be involved in collective bargaining

National Recovery Administration poster

First Hundred Days

The NIRA was considered very radical for the time but ultimately failed The biggest problem behind the NIRA was the NRA

One major problem with the NRA was that it assumed businesses would police themselves All the codes that were created to protect workers and

consumers were drawn up by the biggest companies Therefore, all the policies were beneficial to large

companies, not small businesses or consumers

First Hundred Days

Another key problem is that corporations rarely respected the rights of labor to organize The federal government did not do its part to enforce

labor's right to collective bargaining as per the NIRAThe NRA actually hurt recovery rather than help

it It had tried to stabilize prices by lowering production The money would have been better off going to consumers

to encourage them to buy goods In 1935 in Schecter Poultry Corp. v. U.S., the

NIRA was declared unconstitutional The Supreme Court stated that the industrial “codes of

fair competition” in the NIRA were unconstitutional

Civil Works Administration workers (c. 1934)

First New Deal

All of the legislation passed during his First Hundred Days was part of the first New Deal It was focused mainly on recovery from the

Depression and relief for the poor and unemployed No single ideological position united all legislation It rested on the assumption it was possible to create a

just society by superimposing a welfare state on the capitalist system, leaving the profit motive undisturbed

This lasted from 1933 to early 1935FDR believed that economic planning and

government spending could help the Even still, he remained cautious and conservative

First New Deal

On November 8, 1933, FDR created the Civil Works Administration (CWA) through Executive Order Its purpose was to create over four million jobs for

unemployed workers during the winter months It was disbanded on March 31, 1934 after costing over

$200 million a monthOn December 5, the Twenty First Amendment

took effect This officially ended Prohibition The amendment was first proposed on February 20, 1933 North Carolina rejected the amendment while eight

others never ratified it

First New Deal

On January 4, 1934, at the start of the 73rd Congress, FDR asked for an additional $10.5 billion to help with the recovery programs

FDR’s next focus was to restructure American finance Part of this was the shift from relief to recovery by

fixing what was wrong with the private market This meant restoring prices, stimulating production,

and speeding up the economic recovery of the country

Restructuring Finance

On January 30, 1934, Congress passes the Gold Reserve Act It legalized FDR’s executive order from 1933 ending

the circulation of gold Americans were not allowed to trade gold outside the

U.S. nor were they allowed to own gold coinage The purpose of this was to stabilize the value of gold It also gave the president the authority to revalue the

dollar and set the price of goldIn June, the Silver Purchase Act was passed

This authorized FDR to nationalize the nation’s silver to be turned into coinage

Restructuring Finance

Both of those acts were designed to keep Americans from hoarding precious metals and keep them in circulation

On June 6, 1934, Securities Exchange Act was passed This created the Securities and Exchange Commission

(SEC) to oversee and regulate security (stocks, bonds, and notes) transactions

This includes overseeing the actually security exchanges like the NYSE

The purpose of this act was to prevent the conditions leading up to the Crash of ‘29

Father Charles Coughlin

Critics of the New Deal

During FDR’s First Hundred Days, the country’s outlook improved and stocks went up 11%

However, not all were happy with FDR’s plans There were still 12 million unemployed

Many businessmen were worried that FDR was leading the country toward socialism In the summer of 1934, conservatives and other anti-New

Deal supporters formed the Liberty League to battle during the mid-term elections but failed

Ironically, in the 1934 elections, Democrats actually increased their numbers in both houses of Congress


On the other side of the spectrum, some critics believed that FDR was not doing enough The Communist party, whose numbers increased

dramatically during this time period, claimed FDR had done too little to help the poor

Minnesota Govern Floyd Olson, member of the Farmer-Labor Party, blamed capitalism for the Depression and threatened martial law if the farm mortgage relief bill failed to pass

Wisconsin Governor Philip La Follette enacted the country’s first unemployment insurance

Upton Sinclair, running for governor in California as a Socialist, promised to pay everyone over 60 a pension of $50 per month financed by higher income and inheritance taxes


One of the most influential and extreme critics of the New Deal was Father Charles E. Coughlin He was a Roman Catholic priest who had weekly radio

broadcast At first, he was a strong supporter of the New Deal but

that changed late in 1934 He founded the National Union for Social Justice (NUSJ)

and used his radio show to attack capitalism and wall street

He criticized the New Deal as too pro-business and demanded that Congress replace the Federal Reserve with a publicly own national bank

His program reached over 40 million listeners throughout the northeast and midwest


Another influential critic was Senator Huey “The Kingfish” Long from Louisiana He pushed a “Share Our Wealth” idea which stated that

wealth was not properly distributed to all Americans He wanted a $2,000-3,000 income for all American

families, pensions for the elderly, and college educations for the young

This would be paid for by taxing the rich and liquidating all fortunes greater than $5 million

“Share Our Wealth” clubs sprung up all over the country with membership in the millions

Long planned to run for president in 1936 but was assassinated in September 1935 by a family member of a political rival

FDR signing the Social Security Act of 1935

Second New Deal

In 1935, FDR began implementing this second part of the New Deal This is more commonly referred to as the Second New

Deal During this phase, his programs were geared towards

social reform and social justice This was in response to the discontent of the lower

middle class and to the threat of various utopian schemes During this phase, he also departed from attempts to

cooperate with the business community

The Second New Deal is best known for the creation of a “welfare state”

Works Progress Administration (WPA)

On April 8, 1935, Congress passed the Emergency Relief Appropriation Act which authorized over $5 billion for relief and employment programs

The Works Progress Administration (WPA) was created out of this act It was the first massive attempt to deal with

unemployment and its economic impact Annually, the WPA employed about 3 million people for

on variety of socially useful projects Nearly 85% of WPA funds went directly into salaries and

wages


State and local governments were given strict guidelines for hiring workers Only one member of a family could qualify for a WPA job,

and first choice always went to the man A woman could qualify only if she headed the household

Eventually more than 13% of those employed by the WPA were women

One part of the WPA was the Historical Records Survey It employed 3,400 unemployed librarians, archivists,

teachers and others to collect public records of every county and state


A minor but important part of the program supported writers, artists, actors, and musicians Over the course of this program, tens of thousands of

artists were employed performing or creating artThe WPA also created the National Youth

Administration (NYA) This offered training, education, and jobs to

unemployed youth between the ages of 16-25Despite criticism, the WPA was constructive

It is responsible for building 6,000 schools, 2,500 hospitals, 13,000 playgrounds and restored the morale of millions of people

Social Security Act of 1935

On August 14, 1935, FDR signed the Social Security Act into law This provided a pension for the elderly, death benefits,

and benefits for the blind, disabled, and some aid for dependent children

These benefits were to be paid for by a 1% tax both employers and employees

At the time, this resulted in benefits of from $10 to $85 per month

It also established a cooperative federal-state system of unemployment compensation

The act did not include because of protests from the medical profession

Social Security Act of 1935

Poor women were not included in the Social Security benefits Instead, they were part of the Aid to Dependent

Children (ADC) As part of this, mothers and poor women were treated

as social dependants The ADC would provide matching federal funds to states

who would provide “mother’s pensions” to single women and poor mothers on the conditions they kept “suitable homes”

However, more women qualified for this program than were expected so the ADC put in tough screenings including a moral screening

Tenant farmer in Arkansas (c. 1935)

Helping Farmers

On May 1, 1935, FDR created the Resettlement Administration (RA) Its purpose was to relocate struggling tenant farmers

to federally built communities The RA created over 200 communities including the

Jersey Homesteads in Roosevelt, NJ and Greenbelt, MD

On May 11, the Rural Electrification Administration (REA) set up Its purpose was to lend money to cooperatives to

generate and distribute electricity in isolated rural areas not served by private utilities

Putting Large Corporations in Check

In the summer of 1935, FDR set out to control the large corporations

On August 26, the Public Utility Holding Company Act of 1935 was passed It created the Federal Power Commission which had the

authority to regulate and control the power companies The act included a “death sentence” clause that gave

each company five years to demonstrate that its services were efficient or the government would dissolve the company

FDR put pressure on the wealthy He had Congress increase estate and gift taxes and

raise the top income tax rates

Dust storm near Stratford, TX (c. 1935)

The Dust Bowl

Farmers in the Great Plains suffered through years of drought and dust storms This was due to record heat and below-average

rainfall The area, especially from the Oklahoma panhandle to

western Kansas, turned into a giant dust bowlBetween 1932 and 1939 there was an

average of 50 storms a year Many towns were covered in dust and most cities had

to keep their lights on 24 hours a day Thousands died of “dust pneumonia” Over 10,000 farms were abandoned and nine million

acres of farmland was turned into wasteland

The Dust Bowl

By the end of the 1930s, 3.5 million people migrated out of the Great Plains searching for a better life Some 350,000 left Oklahoma for California However, when they got there, they were not able to find

jobs

The Dust Bowl was created by both nature and human actions One main factor was that the Great Plains west of the 98th

meridian was not suitable for such intensive agriculture This was exacerbated by overgrazing, too much plowing

and indiscriminate planting, all of which exposed the thin soil to the elements

The Dust Bowl

The Roosevelt administration did attempt to help with the problem However, many attempts were too late as the damage

had already been doneThe Taylor Grazing Act of 1934 was designed

to protect federal lands in the west It ended unregulated grazing and required permits

and fees to graze on the land Also, it stated that remaining public lands were to be

held by the federal government and not soldThe Soil Conservation Service promoted

growing of drought-resistant crops use of contour plowing

1936 Landon campaign button

Election of 1936

During the primaries, Roosevelt received 93% of the vote by the Democrats He was easily nominated as the Democratic candidate

Roosevelt’s campaign was based on his New Deal Program This was helped by signs of an improving economy He also had the support of the Democratic South,

organized labor, farmers, and urban votersRepublicans nominated Kansas Governor

Alfred Landon Chicago publisher Frank Knox was chosen as his

running mate

Election of 1936

Landon’s campaign was an attack on the New Deal and FDR’s big government His promises were essentially the same things listed in the

New Deal but were to be done more cheaply and efficientlyLandon also had the backing of 2/3 of the

country’s newspapers The Literary Digest, a conservative magazine, even

predicted a Republican landslide to the electionThe Union Party nominated Senator William

Lemke from North Dakota The party was set up by such left-wing critics as Father

Charles Coughlin and was modeled after “Share Our Wealth” program

Election of 1936

George Gallup, a statistician, put together his first Gallup Poll for this election Using only 5,000 respondents, he predicted a win by FDR

On November 3, 1936 FDR won by a landslide He received 60.8% of the popular vote, the third largest

percentage in U.S. history Monroe had 80.6% in 1820 and LBJ had 61.1% in 1964

He also got 523 electoral votes, the second largest in history Reagan got 525 in 1984

Landon only received 36.5% of the popular vote and 8 electoral votes

Lemke received just under 900,000 votes (2%)

Election of 1936

Completing the New Deal

With the confidence coming out of the 1936 election, FDR focused his attention on an economic plan to help the poor and restore consumer spending

On July 22, 1937, Congress passed the Bankhead-Jones Farm Tenancy Act This created the Farm Security Administration (FSA) to

aid tenant farmers, sharecroppers and farm owners who had lost their farms

It provided $500 million low-interest loans to poor farmers and grain collectives

It also set up camps for migratory workers


In January 1936, the Supreme Court ruled that the Agricultural Adjustment Act was unconstitutional in U.S. v. Butler This act has the federal government invading “the

reserved rights of the states” and violates the 10th Amendment

On February 16, 1938, a new Agricultural Adjustment Act was passed This one focused on solving the problem of farm

surpluses by providing for the marketing of surplus crops Farmers would receive with direct payments from the

federal treasury instead of being taxed It also added a soil conservation program


The National Housing Act of 1937 was also passed to help those living in low-income urban areas Federal funds were to be used for slum clearance

projects and for the construction of low-cost housingIn the long run, New Deal had a greater impact

on middle class The Home Owners Loan Corporation (HOLC) had the

biggest impact since it provided low interest loans and helped people save their homes from foreclosure

It also introduced first long term fixed rate mortgages and a uniform system of real estate appraisal that tended to undervalue urban property (beginning of the practice of “redlining”)


Federal Housing Administration (FHA), created in 1934 by the National Housing Act, expanded and extended many of the HOLC policies While FHA loan system allowed millions to buy homes, it

favored the purchase of suburban homes over the repairing of older urban residences

The Fair Labor Standards Act was passed in 1938 The act included the country’s first minimum wage law,

which at the time was $0.40/hour It put in place 40-hour work weeks with time and a half

pay for overtime in certain jobs It prevented children between the ages of 16 and 18 from

working in “hazardous” occupations

Battle With the Supreme Court

As the first act of his second term, FDR announced a plan to reform the judicial system He was especially frustrated with the Supreme Court for

invalidating several New Deal measures, including the NIRA and the AAA

FDR introduced legislation in 1937 that would allow the president to appoint one justice for every justice over the age of 70 who did not retire At the time there were six justices over the age of 70 His plan also called for modernizing the court system

However, there was a lot of public outcry against this Even the Democrats broke with the president on this one

Battle With the Supreme Court

FDR withdrew the proposal after several months and admitted defeat

Ironically, the Court began passing practically every new initiative after this event When Justice Willis Van Devanter retired, FDR was able to

make his first appointment and ensure a shaky liberal majority

After 1937, a series of cases established the principle that the federal government trumped states’ rights and local control

FDR’s efforts to change the court had two negative consequences: It slowed reform initiative It also hurt his popularity and support

Hugo Black Supreme Court

Justice (1937-1971)

Managing the Liberal State

During his second term, FDR was worried that the large amount of spending the government did would lead to inflation

Fearing the toll this would have on the economy, he cut public spending at the beginning of 1937 From then until August 1937, unemployment had jumped

from 7 to 11 million 50% of those between the ages of 16-20 were out of work The stock market also fell, losing 2/3 of the gains it had

made since 1933 The Home Owners Loan Corporation was forced to

foreclose on 10% of its mortgages

Managing the Liberal State

Starting in 1938, FDR changed his economic policy and embraced deficit spending Based on the Keynesian policy, it was believed that

federal spending could help boost the economy during a recession

Once people had jobs, they would spend money leading to economic growth

Then, once the economy recovers, the government can begin recouping its losses through taxation

With this plan, FDR gave more money to the WPA and other works projects

He also reduced corporate taxes and halted anti-trust lawsuits

Senator Robert A. Taft (R - Ohio)

Anti-New Deal Coalition

With the mid-term election in 1938, Democrats lost a number of seats in Congress In the House, they lost 71 seats to Republicans In the Senate, they lost 6 seats to the Republicans While the Democrats still held the majority, it was no

longer so dominantA new anti-New Deal Coalition developed in

Congress It was made up of those who supported less public

spending, small businesses, and states’ rights They also believed that the New Deal policies only

helped the poor and ethnic minorities

Anti-New Deal Coalition

One of the leaders of this coalition was Senator Robert A. Taft from Ohio He openly spoke out against the New Deal as being

too socialist, criticized deficit spending, and opposed farm subsidies

Another concern of the Congressional Republicans was the influence communists and labor unions had on the White House The House Committee for Un-American Activities

began investigations to see if any communists had infiltrated some of the New Deal agencies

Secretary of State Cordell Hull (1933-1944)

“Good Neighbor” Policy

Since the early 1900’s, relations between the U.S. and Latin America had been strenuous This was due to the U.S. manipulating Latin American

governments and economies under the guise of protecting its “sphere of influence”

In his 1933 inaugural address, FDR said: “In the field of world policy I would dedicate this

nation to the policy of the good neighbor--the neighbor who resolutely respects himself and, because he does so, respects the rights of others…”

This meant that the U.S. was shifting its policy from military intervention to economic and political cooperation as the means to promote stability in the region


The term “Good Neighbor” Policy was originally coined by Hoover in 1928 but it was FDR who took it to a whole new level

In December 1933, Secretary of State Cordell Hull met with leaders of Latin American states in Uruguay at the Montevideo Conference The goal of this meeting was to change the perception

of the U.S. as an imperialist power whose only concern was conquering the Americas


On December 26, 1933 a treaty was signed at the Conference which stated that: All states were equal sovereign units able to enter into

agreements with other states The signatories of the treaty would not intervene in

the domestic or foreign affairs of another state, they would not recognize territorial gains made by force, and all disputes should be settled peacefully

It also negative the policy of “dollar diplomacy” that had been used since Taft’s administration


Hull continued on the “Good Neighbor” policies In 1934, U.S. Marines were removed from Haiti Also that year, Congress signed a treaty with Cuba

which rescinded the Platt Amendment From 1933 to 1937, Hull negotiates numerous

reciprocal trade agreements between the U.S. and Latin America that cut tariffs in half

In 1936, at the Inter-American Conference for the Maintenance of Peace in Buenos Aires, the U.S. and other American countries agreed to not intervene in other countries disputes

In 1938, the U.S. made only mild protests to the Mexican government when it took over oil and farmlands own by American citizens

Rise of Totalitarianism


Totalitarianism This is a system of government in which the ruler(s)

of a state control all activities including social, political, economic, intellectual, cultural, and spiritual for their own purposes

Fascism A political ideology that puts nation and often race

above the individual It stands for a centralized autocratic government

headed by a dictatorial leader, severe economic and social regimentation, and forcible suppression of opposition


During the 1930’s, there was the rise of three strong and very dangerous governments that were potential threats to the U.S.: Japan Germany Italy

It was not until major aggressions from these powers that the U.S. changed its isolationist policies

Japanese Emperor Hirohito (1926-1989)

Imperial Japan

Imperial Japan was founded in 1889 At this time, most of the governmental powers were given

to the emperorDuring the latter half of the 19th century, Japan

went through a period of rapid modernization Because the country is an island, it had limited amounts

of necessary raw materials for manufacturing This forced Japan to import a number of raw materials

(iron, coal, and oil)By the late 1920s, 23% of Japan’s gross domestic

product was in manufacturing and mining

Imperial Japan

By 1930, the Japanese Empire was guided by three principles: expansionism, totalitarianism, and militarism

When the Great Depression hit Japan, the Empire’s main priority was to acquire raw materials Influenced by Western thought, Japan believed that these

materials could be gained by colonization They had already acquired Taiwan (1895) and Korea (1910)

for agricultural resources They looked towards Manchuria (iron and coal), Indonesia

(rubber), and China (agriculture) as future Japanese colonies

Imperial Japan

Since the Constitution of 1889, popularity and support of the Emperor developed into worship Japanese nationalism was a source of intense pride The country turned into a totalitarian regime with its

head being the emperorJapanese history and tradition are saturated

with militarism Prior to industrialization, the samurai were held in

high esteem With modernization, this esteem moved to the

members of the Japanese army and navy

Expansion of the Japanese Empire

The Manchurian Crisis

In 1931, Japan invaded Manchuria Within five months the Empire had set up a puppet

government in the region Many Chinese historians start the Second Sino-

Japanese War with this invasion

Opinions in the U.S. were mixed about what the U.S. should do: do we get involved and possibly get dragged into another war or do we ignore it?

The League of Nations wanted to “investigate” the matter but the U.S. does not participate


Hoover, then president, had refused to take the initiative Many encouraged him to put in an economic embargo

against Japan He was afraid that this would ultimately lead to war Also, the U.S. could not afford to intervene because of

the Great Depression

His Secretary of State, Henry Stimson, was actually angered by Hoover’s lack of action


On January 7, 1932, Stimson wrote letters to the Chinese and Japanese governments He stating that the U.S. would not recognize any

changes made in China that would curtail America’s “open door policy” in China

It became known as the Stimson Doctrine However, this did nothing to really stop Japanese

expansionism into China

The League of Nations ordered the Japanese to withdraw its troops from Manchuria The Japanese refused and withdrew from the League in

1933


Numerous skirmishes occurred between the Japanese and Chinese from 1931 to 1937 The main war did not begin until 1937

On July 7, 1937, Japan invaded northern China, including Shanghai and Nanjing The Chinese were overpowered by the Japanese

military machine At the time, the Chinese government was in the midst

of a civil war with the Communists Many historians regard this as the beginning of the

Pacific War It is also known as the Second Sino-Japanese War

Second Sino-Japanese War (1937–1945)

The Japanese did not want to rule these sections of China directly Instead it set up puppet governments to rule in its place

In the Japanese-controlled areas of China, all oppression was put down by severe means They used chemical and biological weapons against

civilians This turned international opinion against the Japanese

Japan also planed to close off raw materials and trade with Europe This threatened the U.S.’s “open door” policy

Second Sino-Japanese War (1937–1945)

FDR responded to the invasion of northern China with his “Quarantine” speech on October 5, 1937 The speech called for a "quarantine of the aggressor

nations" While public opinion was on the side of China,

FDR was criticized by the isolationists This was out of fear of possible military involvement there Instead, he refused to acknowledge a war there and

extended trade credits to ChinaAlso at this time, FDR began to secretly speed up

a program to build enough long-range submarines to blockade Japan

U.S.S. Panay

The U.S.S. Panay

On December 12, 1937, the U.S. gunboat Panay was sunk on the Yangtze River by Japanese planes The Panay was part of the Yangtze River Patrol

designed to protect American interests in China The Japanese claimed they had not seen the American

flags flying on the ships The Japanese quickly offered a formal apology and

paid reparations in the amount of $2.2 million

The U.S.S. Panay

U.S. Navy cryptographers did discover that the attack was planned It was also discovered that the Japanese government

did know it was a U.S. ship

Even with this clear evidence, it was not enough to bring the U.S. military in The isolationist feelings in the U.S were so strong that

the government was pressured to accept the Japanese explanation that this was an accident

Chinese victims being buried alive by Japanese troops in Nanjing

Nanjing Massacre

Nanjing Massacre – (Winter 1937/38) – After the Japanese army took the city of Nanjing, over a six week period the soldiers committed numerous atrocities It is estimated that between 200,000 to 300,000

people were murdered Some were buried alive Over 20,000 women were raped

While this story made the front page of the New York Times, it still did not lead to U.S. action against Japan

Heads of victim’s of the Nanjing Massacre

Adolph Hitler and the Rise of Germany

Fascism

Fascism is a philosophy of government that believes in: A strong centralized government headed by a dictator Stringent social and economic control Often has a policy of belligerent nationalism Two most powerful fascists of all time were Adolf

Hitler and Benito Mussolini

Germany Prior to World War II

Treaty of Versailles – 1919 – Ended World War I Article 231 – “War Guilt Clause” – This article placed full

blame on Germany for the start of the war and ordered it to pay reparations (totaling to over 132 billion marks) to the Allied countries

Many Germans saw this as an embarrassment since it left the country economically broke and unarmed

In April 1921, the Allies first began demanding payment of war reparations from Germany

This led to rapid devaluation of the German mark In 1921, the exchange rate was 75 marks to $1 U.S. In November 1923, it 4 billion marks to $1 U.S.

Germany in the Great Depression

Many lost their life savings due to the devaluation of the mark

During the 1930s, the Germany was hit harder than the U.S. by the Depression Germany had a 33% unemployment rate while the U.S.

only had a 25% one By 1935, Germany literally ran out of money

Before the Crash of 1929, American businesses had invested in the rebuilding of Europe but afterwards stopped

Because of the shortage of jobs and food, many Germans were willing to turn to radical groups

Hitler and the Rise of the Nazi Party

In September 1919, Hitler was working as a police spy for the German Army One of his duties was to infiltrate the German Worker’s

Party (DAP)He liked the ideas of the party and joined it

It promoted the idea of nationalistic “non-Jewish” socialism This became the foundation of the Nazi party

In October 1920, Hitler creates the Sturm Abteilung (SA), which became his own private army Their job was to protect Hitler and disrupt meetings of

political opponents The SA became known as “storm troopers”

Hitler and the Rise of the Nazi Party

In July 1921, Hitler was elected to be Führer of the party He renamed it to the National Socialist German Workers’

Party (NSDAP), or the Nazi partyBy 1923, Germany’s economy was in rough shape

In September 1923, Germany resumed making reparation payments to France

By November, people would be required to carry billions of marks to buy groceries, of which many could not afford

The Nazi party felt this was the perfect opportunity to seize power By November 1923, the Nazi party had over 55,000

members

Munich Beer Hall Putsch

Their plan called for the kidnapping of Bavarian leaders at a Munich beer hall They would then force them at gunpoint to make Hitler

their leader They had a famous WWI general on their side who

would then help them win over the armyOn November 8, 1923 – Hitler and his SA

troops stormed in to the beer hall He managed to convince the leaders to support him However, they were unable to secure the support of the

army This was known as the Munich Beer Hall Putsch Hitler was arrested for conspiracy to commit treason

Leaders of the Beer Hall Putsch

Hitler at Landsberg

Hitler was put on trial in February 1924 The judges at the time were Nazi sympathizers Hitler used the trial to spread Nazi propaganda During the trial he stated "I alone bear the

responsibility. But I am not a criminal because of that. If today I stand here as a revolutionary, it is as a revolutionary against the revolution. There is no such thing as high treason against the traitors of 1918."

He was still found guilty and sentenced to five years in prison with possibility of parole

Hitler was given a large and comfortable cell at Landsberg prison

Hitler at Landsberg

During his time in prison, he dictated his autobiography Mein Kampf It contained a number of his political ideas

Including his belief in lebensraum, “living room,” for Germans It also included the concept of a “superior” race (the Ayrans)

and “inferior” races (Jews and Slavs)

Hitler was released from prison on December 20, 1924 By this time, he realized his mistake with the Beer Hall

Putsch was that he had not gotten the support of the military

This time, he was going to get support of the people and the army by using the democratic process to his advantage

Rebirth of the Nazi Party

Also while he was in prison, the popularity of the Nazi party had declined It had even been banned in Bavaria after the Putsch

Hitler spent the next few years reorganizing the Nazi party and give it a more legitimate appearance He used his oratory skills to win over politicians and

masses He reworked his image to appeal to the middle and upper

classes Hitler was able to enjoy a comfortable lifestyle in Bavaria

The Nazi party did not have any real power until 1929


The Great Depression hit Germany hard Many of the foreign businesses that had invested in

post-war Germany pulled their funds German industry came to a grinding halt without the

foreign money and that led to job layoffs At its peak, unemployment reached 33% in Germany Once again, inflation skyrocketed and people lost their

life savingsWith the dramatic downturn of the economy,

the Nazi party began to rise in popularity Prior to 1929, the Nazi party had a membership of

100,000 (<0.2% of Germany’s 60 million population)


The government was also very ineffective In 1930, the German chancellor asked President Paul

Von Hindenburg to dissolve the Reichstag and call for new elections

Hitler used these new elections to his party’s advantage He campaigned throughout the country and strongly

appealed to the disgruntled masses He promised jobs, a strong economy, and to bring

back pride to Germany


In the September 1930 elections, the Nazi party won 18.3% of the votes This gave them 107 seats in the Reichstag This moved the Nazi party into the second largest

party in Germany However, they were not given a position in

Hindenburg’s cabinetFrom 1930 to 1932, party members did what

they could to disrupt the government and prevent a successful coalition The longer the government was in turmoil, the

stronger the Nazi party would become

unit 9 the 1930s u.s. history ii his-112. bread lines during the great depression

Documents

economic recession

economic policies

great depressioninvestments

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unemployment rates

gold standardthis

gold standardhe

tax cut