Solutions to the Depression: President Hoover

1. Solutions to the Depression: President Hoover “It is not the function of the Government to relieve individuals of their responsibilities to their neighbors, or to relieve private institutions of their responsibilities to the public, or the local government to the States, or the responsibilities of State governments to the Federal Government. In giving that protection and that aid the Federal Government must insist that all of them exert their responsibilities in full. It is vital that the programs of the Government shall not compete with or replace any of them but shall add to their initiative and to their strength.” “It does not follow, because our difficulties are stupendous, because there are some souls timorous [nervous] enough to doubt the validity and effectiveness of our ideals and our system, that we must turn to a State-controlled or State-directed social or economic system in order to cure our troubles. That is not liberalism; that is tyranny.” • INDIVIDUALISM • VOLUNTEERISM

2. Solutions to the Depression: President Roosevelt “ There are two ways of viewing the Government's duty in matters affecting economic and social life. The first sees to it that a favored few are helped and hopes that some of their prosperity will leak through, sift through, to labor, to the farmer, to the small business man…This is no time for fear, for reaction or for timidity. Ours must be a party of liberal thought, of planned action, of enlightened international outlook, and of the greatest good to the greatest number of our citizens. And now one word about unemployment, and incidentally about agriculture. I have favored the use of certain types of public works as a further emergency means of stimulating employment…” “My program, of which I can only touch on these points, is based upon this simple moral principle: the welfare and the soundness of a Nation depend first upon what the great mass of the people wish and need; and second, whether or not they are getting it .What do the people of America want more than anything else? To my mind, they want two things: work, with all the moral and spiritual values that go with it; and with work, a reasonable measure of security--security for themselves and for their wives and children.”

3. The Election of 1932 Who would you vote for? Why?

4. FDR and the New Deal

5. Review: Problems of the Depression • Unemployment • Falling prices for farm products • Businesses failed • Banks failed – Americans lost their savings • Drought (destruction of the land and dust storms) • Home and farm foreclosures – homelessness • Poverty – poor living conditions

6. Your Task • Each group will be given a problem that your government has to solve • Come up with one or two possible solutions • Explain your best solution to the rest of the class

7. What was “The New Deal?” The New Deal was a complex package of economic programs initiated by President Franklin Roosevelt beginning in 1933. The goal of the New Deal was to provide relief to the unemployed, reform of business and financial practices, and promote recovery of the economy during The Great Depression.

8. Who was responsible for the New Deal? • President Franklin D. Roosevelt • A strong cabinet – members of both political parties • A “brain trust” – a number of brilliant unofficial advisors to the President, including faculty from Columbia University. The New Deal is based on the economic ideas of John Maynard Keynes, called Keynesian (Kains-see-un) economics. In very basic terms, it states that the government should intervene when the market and/or economy is bad – for example, through spending on social programs.

9. New Deal Programs Emergency Banking Act/Federal Deposit Insurance Corporation (FDIC) Right after taking office as President, FDR shut down all of the banks in the nation and Congress passed the Emergency Banking Act which gave the government the opportunity to inspect the health of all banks. The Federal Deposit Insurance Corporation (FDIC) was formed by Congress to insure deposits up to $5000. How did it help? These measures reestablished American faith in banks. Americans were no longer scared that they would lose all of their savings in a bank failure. Government inspectors found that most banks were healthy, and two-thirds were allowed to open soon after.

10. New Deal Programs Home Owner’s Loan Corporation (HOLC) The Home Owner's Loan Corporation was created in 1933 to assist in the refinancing of homes. The housing crisis created a great many foreclosures, and Franklin Roosevelt hoped this new agency would stem the tide. In fact, between 1933 and 1935 one million people received long term loans through the agency that saved their homes from foreclosure.

11. New Deal Programs Civilian Conservation Corps (CCC) This environmental program put 2.5 million unmarried men to work maintaining and restoring forests, beaches, and parks. Workers earned only $1 a day but received free board and job training. From 1934 to 1937, this program funded similar programs for 8,500 women. How did it help? The CCC provided jobs for the unemployed and helped the environment at the same time, for example by planting trees to prevent erosion across the great plains states.

12. New Deal Programs Tennessee Valley Authority (TVA) The TVA helped farmers and created jobs in one of America’s poorest and least modernized areas. The project involved a series of dams and and a hydroelectric power plant, which provided provided cheap electric power, flood control, and recreational opportunities to the entire Tennessee River valley.

13. New Deal Programs Works Progress Administration (WPA) As the largest New Deal Agency, the WPA impacted millions of Americans. It provided jobs across the nation. Because of it, numerous roads, buildings, and other projects were completed. The WPA also provided work for artists, photographers and writers. It was renamed the Works Projects Administration in 1939. It officially ended in 1943. Farm Security Administration (FSA) The FSA loaned more than $1 billion to farmers and set up camps for migrant workers.

14. The WPA at work A WPA rock quarry that supplies large rock to be used in road construction. A travel poster produced by the WPA arts program

15. New Deal Programs Social Security Act This act established a system that provided old-age pensions for workers, survivors benefits for victims of industrial accidents, unemployment insurance, and aid for dependent mothers and children, the blind and physically disabled. The SSA was designed to combat poverty among the elderly. Although the original SSA did not cover farm and domestic workers, it did help millions of Americans feel more secure.

16. Your Task: Using the handout provided, apply what we have learned about the New Deal programs to problems in today’s economy In a short paragraph, identify what problem you want to solve, choose the New Deal program that you think would be the best solution and explain how it would help today.