Chp 24 Identifications

The Great Depression begins (Oct 1929~)

● Background Info: Stock prices had risen steadily in the 1920s, but a frenzied
upsurge in 1928-29 meant a big bubble was waiting to burst.
● In 1918 and again in Sept 1919, the Federal Reserve Board tried to dampen
speculation by raising interest rates, but with speculators willing to pay up to 20%,
banks continued to loan freely.
● The collapse finally came on Oct 24, a day that became called “Black Thursday”.
As prices fell, some stocks became literally worthless.
● A weak upswing in 1930 suggested the beginning of recovery. But instead of
recovering, as many predicted, the economy fell into full-scale depression.
● Economists point to agricultural depression, wage increases less in proportion to to
price increases, and assembly-line methods that encouraged overproduction as
causes, believe the lagging of railroads, steel, textiles, and mining made recovery
difficult. Economists also criticize the Reserve Board’s tight-money policies.

Response to the Depression

● Hoover went against historical belief that depressions were natural and urged
business leaders to maintain wages and employment.
● In Oct 1930, he set up the Emergency Committee for Employment.
● In 1931, he persuaded the nation’s largest banks to form the National Credit
Corporation, which would help hard-pressed smaller banks.
● These measures did little good. Hoover, dreading a budget deficit, also increased
taxes. As the depression worsened, public opinion turned against Hoover. A section
of Central Park where jobless men lived was dubbed Hoover Valley.
● Midwestern farmers organized a boycott movement called Farmers’ Holiday
Association. The most alarming protest came from WW1 veteran bonus marchers
who demanded immediate payment of bonuses intended over 20 years. When
Congress refused and some stirkers stayed put, Hoover called in the army.
● American fiction also exuded despair, as shown in John Dos Passos’ The 42nd
Parallel (1930).
● In 1932, Hoover put aside his principles and set up the Reconstruction Finance
Corporation (RFC) to make loans to major economic institutions. However, Hoover
gained little political benefit.
● As Hoover endlessly claimed that prosperity was “just around the corner,” his media
relations soured. An administration launched with hope in 1929 was falling apart.

Election of 1932
● The Republicans renominated Hoover as the democrats scented victory.
● The Democrats rejected 1928 candidate Al Smith and nominated Franklin D.
Roosevelt. Roosevelt’s campaign offered no clear program, but instead promised “a
new deal for the American people.”
● Roosevelt exuded confidence, and above all, was not Hoover. Both houses went
heavily democratic, and FDR won in a landslide.

President XXXII: Franklin D. Roosevelt

● FDR seemed an unlikely popular hero, coming from wealthy origins (like distant
cousin TR). He allied with the Democrats' urban-immigrant wing and had introduced
innovative measures in NY. FDR dedicated his administration to helping people in
crisis and had no definite agenda.
● FDR brought in a circle of advisers nicknamed the brain trust. With FDR listening
from all sides, no one person dominated the administration's New Deal.
 ● FDR's cabinet was diverse, including Postmaster Gen. James Farley (top political
adviser), Secretary of Labor Frances Perkins (first woman cabinet member), and
Interior Secretary Harold Ickes. Eleanor Roosevelt, FDR's wife, played a key
role, always supporting her wheelchair-ridden husband.

The Hundred Days and the First New Deal

● Between Mar 9 and its adjournment on June 16, 1933, Congress enacted over a
dozen new measures. (see below sections)

Emergency Banking Act (1933) and Federal Deposit Insurance Corporation (FDIC)
● FDR addressed the banking crisis by ordering all banks to close on Mar 5, and
reopening healthy banks on Mar 9 under the Emergency Banking Act.
● The act also set up procedures for dealing with failed banks and increased govt.
oversight of banks. Congress also created the FDIC to insure all banks $5k.

National Industrial Recovery Act (NIRA) (1933)

● In order to provide jobs and stimulate the economy, the National Industrial Recovery
Act appropriated 3.3b for heavy-duty public-works programs.
● Section 7a, thanks to Robert Wagner, guaranteed workers’ right to unionize and
bargain collectively.
● The Public Works Administration (PWA) was headed by Harold Ickes.
● However, as unemployment continued, Harry Hopkins suggested direct federal
relief programs rather than going through state and local agencies.
● FDR named Hopkins to a temporary Civil Works Administration (CWA) in 1933.
● FDR feared creating a permanent underclass living on welfare, and abolished the
CWA when warm weather returned in 1934.
● Sidenote: The PWA did pick up steam in 1935-36, a period known as the Second
New Deal. Over 30k bridges, damns, and buildings were built under the PWA.
● The National Recovery Administration (NRA) - which brought business leaders
together and drafted codes of "fair competition" - was headed by former War
Industries Board member Hugh Johnson.
● They rallied behind a blue eagle logo with the slogan "We Do Our Part".
● As the unity spirit faded, violations increased. Small businesses argued it hurt them,
while the administration itself became bogged down with trivial codes.
● In 1935, the Supreme Court ruled the NRA unconstitutional for it gave president
Congress' regulatory powers and as it regulated intrastate commerce reserved for
individual states.

Federal Securities Act (1933)

● The Reconstruction Finance Corporation remained active and proved a powerful
financial resource for corporate America. It also reinforced the incorporation of
businesses in FDR's "all American team."
● On the other hand, the Federal Securities Act took a more regulatory approach to
businesses and required corporations to inform the Federal Trade Commission
fully on all stocks and made executives liable for any mistakes.
● In 1934, Congress created the Securities and Exchange Commission to enforce
the new regulations.

Federal Emergency Relief Act (1933)

● The Home Owners Loan Corporation and Farm Credit Administration assisted
urban and rural Americans struggling to survive.
 ● The Civilian Conservation Corps (CCC) employed jobless youths in govt. projects,
combining work relief with environ. programs. By 1935, 0.5m were earning a crucial
$35 a month to families with little or no income.
● The principal relief measure, the Federal Emergency Relief Act, appropriated $500m
for state and local relief agencies. Harry Hopkins was chosen as the administrator,
and soon became a powerful New Deal figure.

Tennessee Valley Authority (TVA) (1933)

● Background Info: A hydroelectric station was built during WW1, and was continued
in the 1920s as a facility that would power a plant nearby.
● The TVA advanced the economic and social development of the entire Tennessee R.
and provided electricity, water recreation, and erosion prevention to poor regions.
● The TVA remained as one of the popular and enduring achievements.

Agricultural Adjustment Acts (1933, 1938)

● In 1933, Congress set up the Agriculture Adjustment Administration (AAA).
● Under this law, producers of major agriculture commodities received subsidies for
cutting production, which were funded by a tax on food processors.
● In 1938, Congress set up new procedures for limiting production of farm goods and a
system to provide farmers with warehouses to supply surplus crops.
● Farm income rose 50% during FDR's first term. However, by reducing production,
the individual southern sharecropper was actually hurt.
● Some victims resisted through the Southern Tenant Farmers' Union.
● Advocates of a more class based farm policy soon gained support as the Great Plains
were turned into a Dust Bowl by drought.
● Battered by debt and drought, many “Okies” gave up and abandoned houses and
farms. Survivors never forgot the experience.

Charles E. Coughlin, Francis E. Townsend, and Huey Long

● Rising frustration found expression in 1934 through over 2000 strikes.
● Coughlin and his followers attacked FDR as a great "betrayer and liar".
● Townsend proposed the govt. pay $200/month to all retired citizens, and require
them to spend the money within 30 days. The scheme would have bankrupted the
govt., but many rallied behind his call.
● Long preached his "Share Our Wealth" program. This program suggested a 100%
tax on all incomes over $1m and distribution of all fortunes in excess of $5m. He
proclaimed, "Every man a king!" and had 7.5m supporters by 1935. Long was
assassinated that Sept., but his organization survived.
● But other than from reactionaries and radicals, the New Deal remained popular.
● FDR also maintained good relations with the media and set a precedent by appearing
favorably on radio (later presidents would do so on TV).
● FDR also responded vigorously to challenges with a series of bold legislative
initiatives in 1935 and 1936, called the Second New Deal. (see below sections)
This was because FDR’s political advisers feared that supporters of Coughlin,
Townsend, and Long could cost FDR enough votes in 1936.

Emergency Relief Appropriation Act (1935)

● Congress passed the $5b Emergency Relief Appropriation Act and set up the Works
Progress Administration (WPA). Hopkins was placed in charge of the WPA, an
administration that - like the CWA - directly assisted individuals.
● The Federal Writers' Project, Federal Music Project, Federal Theater Project,
and Federal Arts Project made drastic impacts on people.
Resettlement Administration and Rural Electrification Administration
● The Resettlement Administration made loans to help out tenant farmers from their
plight, a plight that was partially caused by the AAA.
● The Rural Electrification Administration made low-interest loans to utility companies
and farmers' cooperatives.
● When the Supreme Court declared the AAA unconstitutional in Jan 1936, Congress
responded with a soil conservation act that paid farmers to plant grasses instead of
soil-depleting wheat and cotton.

National Labor Relations (Wagner) Act (1935)

● Thanks to the persistence of Wagner, when the NIRA was deemed unconstitutional,
FDR called for a labor law that would survive constitutional scrutiny.
● The National Labor Relations Act - also called the Wagner Act - guaranteed
collective-bargaining rights, outlawed blacklisting, and created the National Labor
Relations Board (NLRB) to deal with violations.
● The Public Utilities Holding Company Act restricted gas and electric companies to
one region.

The Banking Act of 1935 and the Revenue Act of 1935 ("Soak the Rich" law)
● The Federal Reserve Board also tightened control over finances, reinforcing the
class-conscious program.
● Congress also enforced the Wealth Tax Act (Revenue Act) that raised taxes on
corporations and the wealthy. Although there were many loopholes, it did express
the Second New Deal's more radical spirit.

Social Security Act (1935)

● The Social Security Act stands out for its long-range significance. Chaired by
Frances Perkins and born from complex sources (Progressive, England, Germany),
it established a state-federal system that ensured various social welfare benefits.
● This was funded partly by employers, and partly by withholding wages from
employees. By withholding wages, FDR ensured that Congress could not repeal it
without angering workers and committing political suicide.

Election of 1936, End of Second New Deal, and the New Democratic Coalition
● By Congress' adjournment in Sept 1935, the New Deal had ended.
● FDR insisted that he saved capitalism by addressing social problems it caused. By
giving attention to those who had received little attention before (women, disabled,
migrant workers, etc.), FDR also set himself up nicely for the 1936 Election.
● FDR's New Deal also tipped the Legislative-Executive balance and expanded the
Executive Branch's scope.
● The Republicans nominated an earnest but inept Alfred Landon. They blasted
FDR's dictatorial ambitions, but FDR struck back saying that only the forces of
selfishness and greed opposed him and that he "welcomed their hatred."
● Landon only carried 8 EVs, and the strongest third party, the Union Party supported
by Coughlin, Townsend, and Long supporters, only managed 900k popular votes.
This showed FDR's popularity and a united new Democratic coalition.
● FDR managed this by supporting Democrats (at least on the surface) whether or not
they supported the New Deal.
● FDR was able to gain votes from farmers who traditionally voted Republican but
switched to Democratic after several New Deal programs that helped them.
● FDR was also able to get northern blacks to vote for him despite the lingering image
of hero Lincoln because he made symbolic gestures of racial justice. Mary McLeod
 Methune and other blacks formed the “black cabinet”. However, for the most
part, FDR remained aloof from NAACP and other black organizations.
● Led by Molley Dewson, a friend of the Roosevelt's, FDR was able to gain women's
votes too. Unlike her predecessors, she argued that the New Deal was in the best
interest of both genders, and did not promote a feminist agenda.

FDR and the Supreme Court

● In 1937, the Supreme Court was made up of nine elderly justices, four of whom
were strict conservatives who detested the New Deal. FDR feared that the Supreme
Court would find unconstitutional the Social Securities Act and the Wagner Act.
● In Feb 1937, FDR proposed a court-reform that would allow the president to appoint
up to 6 new members to support justices over the age of 70. FDR insisted he was
concerned of the workload, but he obviously wanted younger liberals in the Court.
● Congressional and public reaction was sharply hostile. Despite not specifying the
number of judges in the Constitution, there had been 9 justices since 1869, and it
had become almost a sacred number.
● The Senate voted down the scheme in July, and FDR quietly gave up the fight.
However, by then, one conservative justice had retired, and couple others had
announced plans for retirement. Also, the court upheld several key New Deal
measures including the Wagner Act in April and May.
● This result could have been FDR's objective all along. Over the next 4 years, FDR
appointed 4 new members to the Supreme Court and lay down a liberal majority that
would long outlast his New Deal.

The Roosevelt Recession and Keynesian Economics

● The economy again plunged in Aug 1937, partly due to New Deal policies that
reduced immediate consumer income. This was compounded by the Federal Reserve
Board's effort to forestall inflation by contracting money.
● With heavy relief spending, the federal govt. had accumulated large deficits.
● In England, John Maynard Keynes proposed that govts. should deliberately fall into
deficit during recessions to stimulate the economy.
● Up to 1937, FDR saw deficit as an unwelcome necessity, not a positive good.
● On the other hand, some New Dealers became convinced that deficit was good.
Aware that FDR would have to be persuaded by political reasons, they warned of a
backlash if depression returned.
● Convinced in Apr 1938, FDR authorized new relief spending.
● By late 1938, deficit had increased, but unemployment began to decline.

New Deal’s final measures

● FDR offered few domestic initiatives as he was preoccupied by recession, global
issues, and the Supreme Court. Congress, however, enacted several measures.
● The Farm Tenancy Act (1937) replaced the Resettlement Administration with
the Farm Security Administration (FSA). The FSA offered clean shelter, medical
services, and low-interest loans to tenant farmers so they could buy their own farms.
● The FSA also commissioned photographers that recorded realistic documentary style
evidence. This fed a realistic documentary culture of the 1930s.
● The Housing Act (1937) provided urban slum clearance and public housing, which
became big in the 1950s.
● The Fair Labor Standards Act (1938) banned child labor, limited to 40 hours a
week, and set a national minimum wage. Despite loopholes, it improved conditions
for many exploited workers and voiced the govt.'s intention in regulating abuses.
 ● Republicans, who gained heavily in 1938 midterms, and conservative Democrats
came together to end FDR's radical New Deal. In Jan 1939, FDR proposed no new
measures, but rather the need to "preserve our reforms."

The Environment and the West

● Background Info: FDR had sought to combat environmental issues as early as the
1910s, and during his presidency, soil conservation became a major priority. Some
pointed to erosion and over production as factors to the Dust Bowl.
● The Taylor Grazing Act (1934) restricted grazing on public lands and the TVA
helped control flooding which worsened erosion. New Deal planners also promoted
new national parks.
● Robert Marsall and Aldo Leopold helped found the Wilderness Society in 1935.
● Today's environmental issues received little attention as most New Dealers welcomed
energy consumption. However, in context, the New Deal, while coping with an
economic crisis, also made inroads on environmental issues that had not been seen
since the Progressive Era and would not be seen for another 10 years.
● The New Deal also greatly affected the West as some of the largest PWA and WPA
projects such as highways and hydroelectric dams were held there. The New Deal
also set rules for agriculture. The National Planning Board (1934), later renamed
National Resources Planning Board, helped management of natural resources.

John Collier and the Indian Reorganization Act (1934)

● The 1930s saw revived attention to the 330k remaining Natives, most of whom were
at the bottom of life. Citizenship and voting rights (1924) did little to help them.
● In the 1920s, a reform movement to reverse the Dawes Severalty Act arose. John
Collier founded the American Indian Defense Association to preserve "traditional
Indian life" and was appointed commissioner of Indian affairs in 1933.
● Collier drafted a bill to restore remaining unallocated lands to tribes, create/expand
reservations, and require teaching Native history and handicrafts in Indian schools.
● Despite his efforts, many criticized his efforts, including Natives who thought his plan
would transform reservations into museums and cut off Natives from modern life.
● The Indian Reorganization Act, a compromise measure, halted sale of tribal lands
and enabled tribes to regain title to unallocated lands but cut down on Collier's call
for tribal self-government and traditional tribal culture.
● A majority approved the law, but opinion was strongly divided. Indian policy
remained contentious, but the law acknowledged Natives' interests more than
before.

The Depression's Social Impact

● Despite the New Deal, unemployment never fell below 14%. Suicide rates went up,
and "unemployment shock" kept people up overnight. Bank failures wiped out
savings of many older Americans.
● The birthrate fell as birth-control devices became better and families faced economic
problems. The population growth slowed as immigrants were increasingly restricted.
● Families were often stretched to, or over, the limit. Some men who lost their jobs,
faced psychological impact as he lost a sense of leadership in the household.
● The divorce rate also increased to a then all time high.
● Married women who usually worked because of economic necessity, were often
accused of stealing jobs from unemployed men. Women also faced wage
discrimination. Despite such conditions, the overall percent of wage-earning married
women increased from 12% to 16% as women needed to help with family income.
● Families also rediscovered traditional skills such as painting houses and repairing
cars to come together as a single unit.
 ● Young people pursued education further as they found little jobs available to them.
Marriages also began to decline as young people postponed them during the
depression. Eleanor Roosevelt saw this as a worrying sign.
● Children found vacation plans canceled and birthdays with few presents. Many
became ashamed as their family came under the support of welfare programs.
● Depression added plight to Blacks and Hispanics, but their resilience and long-
standing oppressions helped them through the depression.

Workers Unionize
● Background Info: Major industries had resisted attempts to unionize their workers.
● Hard times in the 1930s brought about fresh desire for unions.
● Compounding on the Wagner Act, John L. Lewis and Sidney Hillman started the
Congress of Industrial Organizations (CIO), a sub-branch of the AFL. Unlike the
AFL, the CIO welcomed all classes, races, and gender.
● One by one, companies began to acknowledge unions.
● US Steel recognized a union and granted wage increases in Mar 1937.
● Anti-union stronghold GM fell as a peaceful "sit-down strike" led by Walter Reuther
paralyzed GM's production. Also key was the fact that FDR's govt., unlike its
precedents, refused to lend an automatic hand to big businesses.
● A Jan 1937 showdown saw women form the Women's Emergency Brigade. The
brigade was on a 24-hour alert and played a key role during the rest of the strike.
On Feb 11, GM gave in.
● Even Ford, who used thugs to beat up union leaders, eventually yielded in 1941.
● In response to the CIO, the AFL also began to change its nature, and union
membership almost trippled from 1933 to 1941.
● On the other hand, textile, clerical and sales workers made little progress. Many
were women and/or low-paid workers.
● By the early 1940s, as radical leaders showed more conservative union members
that strikes could succeed, unions became more conservative.

Scottsboro boys
● Background Info: Blacks were far less employed than whites, and faced workplace
racism. Lynching and miscarriage of justice continued.
● In 1931, an all-white jury in Scottsboro sentenced eight black youths to death on
suspect charges of rape. The Supreme Court ordered a new trial in 1935, but 5 were
still convicted and served long prison terms.
● The trial signaled the NAACP's activism in courts and legislatures. The Urban League
promoted boycott against companies that refused to hire blacks.
● In Mar 1935, hostility toward white businesses in Harlem led to over $200m in
damages and 3 blacks' deaths.

Hispanics and Minorities in the 1930s

● Hispanic-Americans, many of whom were migrant workers, faced rising hostility,
especially as the Dust Bowl propelled more people to the West.
● Many gave up migratory work and poured into Hispanic neighborhoods called
barrios.
● Lacking work, many returned to Mexico voluntarily, while others were paid to leave.
Relief centers calculated the trip home cost less than annual relief payments. Those
who remained were often denied relief payments or New Deal jobs.
● A wave of protests and strikes swept CA. Organizations like the California Fruit
Growers Exchange (Sunkist) fought back with violence, but resilient strikers gained
some benefits, awakening some Americans to the exploitation of the Hispanics.
 ● Other minorities also faced discrimination, with Japanese-Americans prevented from
owning land and Filipinos offered a free travel "home".

Escape through Radios and Movies

● Radio humor flourished as mass audiences shared same jokes.
● 15 minute segments called soap operas (sponsored by soap companies) gained
sympathy and popular support.
● Warner Brothers worked closely with the FDR administration and made a series of
movies celebrating the New Deal.
● Gangster movies gained popularity too. When they came under criticism for
glorifying crime, they simply switched it so that police and FBI agents became the
heroes.
● When color movies arrived in the late 1930s, they seemed an omen of better times
ahead. In 1939, 65% of Americans went to the movies at least once a week!
● The Marx Brothers provided the depression's greatest comedies, satirizing
authority, fracturing the English language, and defying logic.
● The 1930s still saw blacks dealt with as stereotypes. Hollywood usually portrayed
women traditionally, but some went beyond and chipped away at the stereotype.

Fascism and the Popular Front

● Background Info: As the 1930s drew to a close, many Americans viewed America
with an appreciative eye for American democracy had endured while other societies
fell into dictatorships.
● Early in the 1930s, the US Communist Party attacked FDR, but by 1935, Joseph
Stalin (USSR), fearing a German Nazi attack, called for a worldwide alliance
against Adolf Hitler, Benito Mussolini, and Fascism.
● This movement, called the Popular Front, saw the Communist Party come under
the anti-fascist cause. Many non-communists also responded to developments in
Europe.
● As Spain fought its Spanish Civil War (1936-39), Popular Front sentiment peaked.
● Fascist general Francisco Franco launched a revolt against the Spanish Republic
with military aid from Hitler and Mussolini. On the other hand, Americans rallied
behind the Spanish Loyalists who opposed Franco and Fascism.
● Ernest Hemingway's For Whom the Bell Tolls (1940) told of a young American
volunteer that dies while fighting with Spanish Loyalists. This starkly contrasted with
Hemingway's disillusioned 1920s novels.
● The Popular Front collapsed in Aug 1939 when Stalin signed a non-aggression pact
with Hitler. Overnight, "anti-fascism" faded. However, the Popular Front did help
alert Americans to threatening developments in Europe.

John Steinbeck's The Grapes of Wrath (1939)

● An uprooted Dust Bowl family make it from OK to CA along Route 66.
● Steinbeck stressed Americans' endurance, social cooperation and mutual support.
● Made into a film by John Ford, The Grapes of Wrath stands as one of the most
memorable cultural depression era products.

James Agee, Walker Evans, and Let Us Now Praise Famous Men (1941)
● In 1936, journalist James Agee and photographer Walker Evans spent several weeks
living with sharecroppers in Alabama. From this experience came Agee's
masterpiece, which was enhanced by Evans' photos.

Benny Goodman, Count Basie, Glenn Miller, and Duke Ellington

● Jazz surged thanks to bands lead by Goodman, Basie, Miller, and Ellington.
 ● Goodman challenged racism by incorporating black musicians. Goodman's band also
performed at Carnegie Hall, a sign that jazz was becoming accepted as a serious
form of music. Basie helped launch the swing era.

Zora Neal Hurston's Their Eyes Were Watching God (1937)

● The late 1930s saw interest in regional literature too. Hurston's novel pertained
specifically to rural FL as a black woman explored searching for fulfillment.
● Other novels, such as William Faulkner's Absalom, Absalom!, portrayed the
same regional idea, but instead in MS.

New York's World Fair (1939)

● The visual culture of America changed with a design style called streamlining.
● Rounded edges and smooth flowing curves attracted customers (a vital consideration
during the depression)
● Under "The World For Tomorrow", the World Fair represented the high point of the
streamlining vogue. The Trylon and Perisphere became the instantly famous logo.
● GM's exhibit, the Futurama, showed a 1960 interstate highway network, fully
complete with cloverleaf exits and interchanges! GM would soon built support and
help make the Futurama a reality!
● The Fair conveyed American's optimism as the 1930s ended.
● However, beneath this lay a dire world fear in Europe.

© 2011 SeungJoon Sung

Disclaimer: I take no responsibility for any wrong information that may be present.