Chapter 14 and 15 Study Guide
What was the McNary- Haugen Bill?
1924-1928) A farm-relief bill that was championed throughout the 1920s and aimed to keep agricultural prices high by authorizing the government to buy up surpluses and sell them abroad. Congress twice passed the bill, but President Calvin Coolidge vetoed it in 1927 and 1928.
What was Living on Credit?
-With consumer items more affordable and available, there was a huge increase in personal debt.
- people counted on future income to cover debt and talk of unending prosperity eased any of their worries of financial trouble.
- Installment plans (monthly payment with interest) with easy terms made luxury goods more affordable.
What was the uneven income distribution?
The rich were getting richer and the poor were getting poorer. in 1929 the richest American Families made up 1% of the population and earned $100,000. 71% of American families earned less than $2,500 a year. (minimum amount for descent living).
What is the DOW Jones Industrial Average?
The average of stock prices of major industries.
What is Speculation?
The practice of making high risk investments in hopes of getting a huge return on your money.
What is buying on margin?
Allowed investors to purchase a stock for a fraction of its price (10-15%) an borrow the rest.
What was Black Tuesday?
October 29, 1929 16.4 million shares were sold in one day. This collapse of the stock market is known as the Great Crash. Within a short time the effects of the Great Crash began to ripple through our nations economy.
What was the Hooley- Smoot Tariff?
(1930) The highest protective tariff in the peacetime history of the United States. Result was European countries passed their own tariffs. This resulted in a cut of worldwide trade by 40%.
What are Hoovervilles, Hoover blankets, and hoover flags?
Hoovervilles- Shanty towns (towns where people lived in cardboard boxes and rusted out cars).
Hoover Blanket- newspaper used as a blanket.
Hoover Flag- pockets turned inside out.
What was the Dust Bowl?
Created by dust storms caused by a severe drought and in part by dust storms caused by poor farming practices.
What was Direct Relief?
Money or food given directly from the government to the poor.
What were effects of the Great Depression on African Americans, Mexican Americans, Farmers, Children, Businessmen, and women?
African Americans, and Hispanics all suffered as white laborers began to demand the low- paying jobs typically filled by these minorities. Men who lost their jobs felt like failures because they could no longer provide for their families, many were ashamed to ask friends for help and ended up abandoning their families. Working women were accused of taking jobs from men. They also worried about feeding their hungry children. Farmers suffered low crop prices decreasing their income. When they couldn't pay off their mortgages they lost their homes to the banks. In protest, they dumped thousands of gallons of milk an destroyed crops. This shocked a hungry nation. Children suffered most from long term effects of poor nutrition and inadequate medical care.
What were Penny Auctions?
Farmers would bid mere penny's on land and machines and then would return the property to their struggling neighbors, the original owners.
What was riding the rails?
Teenagers would ride the rails to find work and adventure. They were often in danger of train related injuries, the possibility of being arrested or shot at.
What was Hoovers response to the Great Depression?
Hoover refused to involve the federal government in forcing fixed prices, controlling businesses, or manipulating the value of the currency, all of which he felt were steps towards socialism. He was inclined to give indirect aid to banks or local public works projects, but he refused to use federal money for direct aid to citizens, believing the dole would weaken public morale. Instead, he focused on volunteerism to raise money.
What is Volunteerism?
The use or involvement of volunteer labor, especially in community services.
What was the Boulder Dam?
"Hoover Dam" The Great Depression led to massive migration of the unemployed to Las Vegas in hopes of landing jobs building Hoover Dam. Men came from around the country, many bringing families and life’s possessions hoping for employment. Living conditions were difficult and became substantially much worse when construction began, creating the shantytown known as Ragtown. Read more about the Men, Women and Children of Hoover Dam where life became a living hell. Life was particularly difficult for the few blacks that were hired as token to government mandate.
What was the Reconstruction Finance Corporation? (FRC)
A government lending agency established under the Hoover administration in order to assist insurance companies, banks, agricultural organizations, railroads, and local governments. It was a precursor to later agencies that grew out of the New Deal and symbolized a recognition by the Republicans that some federal action was required to address the Great Depression.
What was the Bonus Army?
Officially known as the Bonus Expeditionary Force (BEF), this rag-tag group of 20,000 veterans marched on Washington to demand immediate payment of bonuses earned during World War I. General Douglas MacArthur dispersed them with tear gas and bayonets
What was the 1932 Election?
Hoover and FDR ran the election and FDR won on the campaign promise of a New Deal.
What was FDR's first response to the Great Depression?
He declared a National Bank Holiday.
What were the goals of the New Deal and the first 100 days?
The goal of the first 100 days was to set up a bunch of programs that would create jobs for people.
What were Fireside Chats?
President FDR would use the radio to communicate with the public.
What was the Emergency Banking relief act?
On 9th March, 1933, Congress passed the Emergency Banking Relief Act which provided for the reopening of the banks as soon as examiners had found them to be financially secure. Within three days, 5,000 banks had been given permission to be re-opened. Later that year Congress passed the 1933 Banking Act
What was the Glass- Steagall Act?
The Glass-Steagall Act, also known as the Banking Act of 1933 (48 Stat. 162), was passed by Congress in 1933 and prohibits commercial banks from engaging in the investment business. It was enacted as an emergency response to the failure of nearly 5,000 banks during the Great Depression
What was the Federal Deposit Insurance Corporation? (FDIC)
The Federal Deposit Insurance Corporation (FDIC) preserves and promotes public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for at least $250,000; by identifying, monitoring and addressing risks to the deposit insurance funds; and by limiting the effect on the economy and the financial system when a bank or thrift institution fails
What is the Federal Securities Act?
The 1933 Act was the first major federal legislation to regulate the offer and sale of securities. Prior to the Act, regulation of securities was chiefly governed by state laws, commonly referred to as blue sky laws.
What was the Securities and Exchange Commission? (SEC)
A government commission created by Congress to regulate the securities markets and protect investors. In addition to regulation and protection, it also monitors the corporate takeovers in the U.S
What is the Agricultural Adjustment Act? (AAA)
was a United States federal law of the New Deal era which reduced agricultural production by paying farmers subsidies not to plant on part of their land and to kill off excess livestock. Its purpose was to reduce crop surplus and therefore effectively raise the value of crops.
What was the Civilian Conservation Corps? (CCC)
was a public work relief program that operated from 1933 to 1942 in the United States for unemployed, unmarried men from relief families as part of the New Deal. Originally for young men ages 18–23, it was eventually expanded to young men ages 17–28.
What was the National Industrial Recovery Act? (NIRA)
was a law passed by the United States Congress in 1933 to authorize the President to regulate industry in an attempt to raise prices after severe deflation and stimulate economic recovery
What was the National Recovery Administration? (NRA)
was a prime New Deal agency established by U.S. president Franklin D. Roosevelt (FDR) in 1933. The goal was to eliminate "cut-throat competition" by bringing industry, labor and government together to create codes of "fair practices" and set prices.
What was the Home Owners Loan Corporation? (HOLC)
was a government-sponsored corporation created as part of the New Deal. The corporation was established in 1933 by the Home Owners' Loan Corporation Act under President Franklin D. Roosevelt.
What was the Federal Emergency Relief Administration? (FERA)
was the new name given by the Roosevelt Administration to the Emergency Relief Administration (ERA) which President Herbert Hoover had created in 1932.
What was the Tennessee Valley Authority (TVA) ?
New deal that created jobs building dams, and provided flood control and hydraulic power.
What is Deficit Spending?
government spending, in excess of revenue, of funds raised by borrowing rather than from taxation
What was FDR's court packing scheme?
The Judicial Procedures Reform Bill of 1937 (frequently called the "court-packing plan") was a legislative initiative proposed by U.S. President Franklin D. Roosevelt to add more justices to the U.S. Supreme Court
Who were the critics of the new deal?
Charles Loughlin, Dr. Francis Townsend, Huey P. Long
What was the American Liberty League?
was an American political organization formed in 1934, primarily by conservative Democrats to oppose the New Deal of Franklin D. Roosevelt. It was highly active for just two years.
Who was Huey P. Long?
Louisiana Governor and critic of New deal.
Who was Eleaonor Roosevelt?
FDR's wife, biggest critic and supporter. She had an active role in many of his programs.
Failures of New Deal:
- There was a new recession - the 'Roosevelt recession' in 1937.
- Unemployment was not conquered by the New Deal.
- Many of the jobs created by the New Deal were only temporary.
- The New Deal was the most costly government programme in American History and some of its projects could be accused of wasting money
what was The Second New Deal
The impact of the early New Deal programs was mixed at best. While the gross national product did inch upward between 1933 and 1935, about ten million Americans remained out of work. Public support for Roosevelt remained strong, however
what was the Works progress administration (WPA)?
was the largest and most ambitious American New Deal agency, employing millions of unemployed people (mostly unskilled men) to carry out public works projects, including the construction of public buildings and roads
What was the Wagner act?
a New Deal reform passed by President Franklin Roosevelt on July 5, 1935. It was instrumental in preventing employers from interfering with workers' unions and protests in the private sector.
What was the impact on Labor unions?
- Increasing demand for labor requires increasing the marginal product of labor or raising the price of the good produced by labor
What was the CIO
The Congress of Industrial Organizations (CIO), proposed by John L. Lewis in 1928, was a federation of unions that organized workers in industrial unions in the United States and Canada from 1935 to 1955
What was the sit down strike?
The United Auto Workers staged successful sit-down strikes in the 1930s, most famously in the Flint Sit-Down Strike of 1936-1937. In Flint, Michigan, strikers occupied several General Motors plants for more than forty days, and repelled the efforts of the police and National Guard to retake them.
What was the Social Security Act?
Provided pensions, help for disabled and retired
What were the limits of the New Deal for African Americans, Mexican Americans and Women?
They all were discriminated against and had a tough time finding jobs. When they did they were given lower wages.