effects of the depression

• the depression was terrible - statistics 1

  ●   In 1931, 238 people were admitted to hospital suffering from starvation.  

  ●   International trade slumped from $10bn in 1929 to only $3 bn in 1932.

  ●   5000 banks went bankrupt 1929-1932, including the Bank of America.

  ●   In 1932 a quarter of a million Americans had their homes repossessed, and a fifth of all farmers lost their farms.

  ●   In 1932, 20,000 companies went out of business
• the depression was terrible - statistics 2

  ●   By 1933:

  Industrial production had fallen by 40%

  Prices had fallen 50%

  Wages had fallen by 60%

  Share prices had fallen by 80%

  5000 more banks went bankrupt

  25% of Americans were unemployed.
• the depression was terrible - farmers

  ●   The depression was particularly fierce in agriculture, and things were made worse by the ‘dust bowl’ caused by over-farming.  

  ●   Many farmers could not afford their mortgage repayments and many ‘Okies’ (from Oklahoma) and ‘Arkies’ (from Arkansas) had to abandon their farms and go fruit-picking in California
• the depression was terrible - welfare and despair

  ●   America and no Welfare State.   Many unemployed Americans were reduced to picking over rubbish dumps or begging (cf the song ‘Buddy, can you spare a dime’).  

  ●   SOME towns set up soup kitchens and groups like the Salvation Army (and even Al Capone) organised charity hand-outs – hence the term ‘on the breadline’.  

  ●   In the land of opportunity this was seen as a terrible failure, and 23,000 people committed suicide in 1932 alone.
• the depression was terrible - hobos and hoovervilles

  ●   Homeless people went to live in shanty towns called ‘Hoovervilles’ (as an insult to President Hoover).   ‘Hobos’ travelled round looking for jobs, usually riding illegally on freight trucks.
• the depression was terrible - hatred of hoover

  • Hoover's belief in 'rugged individualism' led to limited government intervention during the Depression.
  • The 1930 Smoot-Hawley Act, 1931 Fed interest rate increase, and 1932 tax hike worsened economic conditions.
  • Public blamed Hoover, mocking him with terms like 'Hoovervilles' for shanty towns and creating satirical items like 'Hoover leather' and 'Hoover blankets.'
  • Slogan emerged: 'In Hoover we trusted, but now we are busted.'
• the depression was terrible - violence

  ●   There were many protest marches and riots.   When banks tried to re-possess some farms, local farmer banded together and drove them off with pitch-forks.  
• the depression was terrible - bonus army

  ●   In 1932, 20,000 unemployed ex-soldiers set up a Hooverville in Washington to ask for their war pension (‘bonus’) to be paid early; Hoover set the army on them, who drive them away with guns and tear-gas.
• the depression wasnt terrible - hoover did not do nothing 1

  • 1930: Tax cuts and formation of the Committee for Unemployment Relief.
  • 1931: $4000 million provided to states for work schemes, including projects like the Hoover Dam. Davis-Bacon Act encouraged high wages on federal construction contracts.
  • 1932: Emergency Relief Act ($300 million for unemployment pay) and Reconstruction Act (created the Reconstruction Finance Corporation, providing $1500 million in loans to support businesses)
• the depression wasnt terrible - hoover did not do nothing 2

  • Norris-La Guardia Act protected trade unions, and Glass-Steagall Act aided banks by facilitating borrowing from the federal reserve.
  • Despite these measures, often criticized as 'too little, too late'; interestingly, the New Deal later adopted similar strategies.
• the depression wasnt terrible - Not all industries or places suffered:

  ●   The Depression was worst in farming, and in the old industries (80% of steel workers were unemployed in Toledo.   'New' industries (such as films, electronics and airplanes) continued to expand and pay high wages.

  ●   Many people who managed to keep their jobs were BETTER off, because prices were much lower.  

  ●   Certain areas of the economy thrived.   The Empire State Building was finished in 1931, and the San Francisco Golden Gate Bridge was started in 1932