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Great Depression

Great Depression. The Cruelest Year-1932. Underconsumption & Overproduction. Mass production had increased efficiency per man hour by over 40% In 1929, a family needed $2000/year for the bare necessities (60% of families not earning that much) People could not afford to buy new products

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Great Depression

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  1. Great Depression The Cruelest Year-1932

  2. Underconsumption& Overproduction • Mass production had increased efficiency per man hour by over 40% • In 1929, a family needed $2000/year for the bare necessities (60% of families not earning that much) • People could not afford to buy new products • Overproduction led to layoffs, led to more underconsumption • Could have raised wages so more people could afford to buy goods

  3. Other Causes • Unequal distribution of wealth • 1% of the population owned 59% of the wealth • Middle class not large enough • Deflation- prices of goods were falling (partly due to overproduction & underconsumption) • Stock Market Crash (more of a symptom of the underlying causes)

  4. Effects on Businesses • Stock market- investors lost $74 billion, • 86,000 businesses closed • US Steel producing at 19.1% of capacity • Industries doing well: phonograph recording, movies, cigarettes, contraception, miniature golf

  5. Immigration • Emigration exceeded immigration (more people left America than came into America), 350 applications per day to Russian trading agency for Americans who wanted to move to Russia.

  6. Farmers • Destroying crops because cheaper to burn crops for heat rather than buying coal • Montana rancher who shot his livestock because he did not have $ to feed them. • Taking revolutionary actions: blocking highways, kidnapping judges, calling for a “Revolution like they had in Russia.”

  7. "Farmer and sons walking in the face of a dust storm. Cimarron County, Oklahoma" (Also known as "Fleeing a Dust Storm," Arthur Rothstein, 1936) Image Source: http://www.edb.utexas.edu/resources/team/lesson_1.html

  8. Welfare- social stigma • Lewiston, ME. barred recipients from voting • Kids not allowed in schools • Not allowed in hospital in WV unless guaranteed payment

  9. Effect on Schools • Chicago Teachers worked without pay (owed teachers $20 million) • Schools closed for 10 or more months in Arkansas, or only open 3 days/week • Teachers boarding with their students

  10. Effect on Children • Children called drowsy, lethargic, …. Possible mental retardation because of hunger” • Teacher told student to go home for lunch, student replied: “It’s my sister’s turn to eat.” • Boy brought his pet rabbit for show & tell; Sister: “He doesn’t know we are going to eat it.”

  11. Children in a “Hooverville” Image Source: http://www.picturehistory.com/product/id/879

  12. "Children who live in a migrant camp on U.S. Highway No. 31, near Birmingham, Alabama" (Arthur Rothstein, 1937) Image Source: http://www.edb.utexas.edu/resources/team/lesson_1.html

  13. Responses of the wealthy • President Hoover: “no one is actually starving” • It was considered benevolent to give your garbage (food scraps) to fellow countrymen who were hungry • Played polo, Republican governor candidate “too much prosperity ruins the moral fiber of the people”

  14. Corruption of the Wealthy • 1% of the population owned 59% of the nation’s wealth • Samuel Insull’s utility companies were a “pyramid of holding companies” and his stock dropped to 4% of its 1931 value • Insull fled to Europe, held a Paris press conference, snuck out back door to Greece (no treaty but then US signed extradition treaty), fled to Turkey

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