Crisis of Identity 1920-45 Flashcards
What was unemployment in the 1920s and what happened to their wages?
Never exceeded 3.7%
inflation never higher than 1%
real wages of industrial workers rose by 14% 1914-1929
Which party was mainly in power in the 1920s and what did they aim to do?
Republicans - wanted to reduce federal activity and spending (laissez faire)
financiers believed if business was allowed to go unregulated it would thrive - gov intervention would stifle innovation and industrial progress
believed wealth could trickle down due to employment
What the successes and failures of Hardings presidency 1921-23
+ appointed many able men to government roles (Andrew Mellon and treasury secretary and Hoover as secretary of commerce)
+ elected to reduce gov spending which had risen 10 times between 1910-20. budget and acounting act 1921 required departments to present budgets for presidential approval - 1922 fell to $3.4 billion and Mellon reduced taxes
+ supported the Sheppard-Towner Maternity Aid Act which gave federal money to support infant and maternal health programmes
- African Americans
- unpopular
Successes and failures of Coolidge’s presidency, 1923-28
laissez faire
+ reduced taxes three times (worth $3.5bn to industrial companies
+1928 98% Americans paid no federal tax (popular)
+ ran at a profit $677mn 1925, $603 mn 1927
- encouraged business without gov interferance
- did very little with the US
- still very much divided
- organisations such as the Federal Trade Commission could not operate effectively
- existing laws over business practices such as price fixing often ignored
What were Hoover’s aims?
To continue prosperity
he claimed poverty had been defeated in the US in his inaugural speech
The Great Depression stats
unemployment 3.1% 1929 to 25% 1933
GDP fell from $108bn to $56.2
When was the Wall Street Crash?
1929
What was Hoover’s main emphasis when responding to the Wall Street Crash?
voluntarism and indirect aid through loans to industry and states
what was Hoover’s policy towards international trade during the depression?
Initially he wanted to protect US industry from competition
1930 Smoot-Hawley tariff - highest in history - 40% on industrial and agricultural imports - caused fall in international trade of $1.2bn by 1931. harmed industrialists and farmers
what did hoover do with war debts during the depression?
June 1931 US would postpone the collection of war debt for 18 months - designed to stimulate trade but tariffs to high and too poor
what did hoover do to help the unemployed
unemployment relief - secured $500,000 from Congress 1932 to help charities and relief agencies
set up the President’s Emergency Relief Committee to help co-ordinate efforts
What was the federal home loan bank act 1932?
intended to save mortgages by making credit easier to avoid evictions
federal loan banks set up to help loan associations provide mortgages
loans no more than 50% of value of property so inadequate to prevent reposession
what was the reconstruction finance corporation 1932?
RFC established to lend $2 bn to banks, railroads etc
critics said most of money went to largest institutions - 50% loans went to 7 largest banks
gov argued it made sense to help largest first as they employed the most but it did nothing for people who were desperate
what was the emergency relief and construction act 1932?
RFC authorised - lending of $1.5bn to states for public works schemes for employment
states had to be bankrupt and projects would have to generate enough to pay off the loans
some conservatives said this was too much others said ‘too little, too late’
evaluation of Hoover’s response?
+ done more than any other president to intervene
not enough
refused direct gov intervention even when a drought saw near starvation across huge areas (Congress only allocated $47mn to help which had to be repaid)
What did Roosevelt aim to do and how did he approach this?
1932
promised a ‘New Deal’ to restore faith in US economy through relief, recovery and reform
fiscal conservative
no specific plans laid out
fireside chats
What were the first 100 days?
more legislation that at any period in history
emergency legislation and alphabet agencies set up
What did roosevelt do with banking and finance?
reformed to make stronger - public confidence
Emergency Banking Relief Act (EBRA) gave Treasury authority to investigate banks threatened with collapse and ordered the RFC to buy up debts
Glass-Steagall Act - insured bank deposits against bank failure
stock exchange regulated by Securities exchange commission which oversaw market activities and prevented fraud
what emergency relief did roosevelt introduce?
Federal emergency relief administration (FERA) set up 1933
given $500mn divided equally among states
half given directly to states and other half kept back so $1 every $3 own funds
wanted to make emergency relief funds self-financing
what were the alphabet agencies?
16 created to deal with specific issues relating to recovery from Depression as well as relief
How did roosevelt help farmers?
problems such as overproduction were dealt with by the AAA (agricultural adjustment agency) which paid farmers to produce less - cause price rise
6 mn piglets slaughtered for price rise
successful as prices rose cotton 6.5 cents 1932 to 10 cents 1933
total farm income rose by 2bn in 2 years
how did roosevelt help industry?
National Industry recovery act (NIRA) set up the National Recovery Administration to facilitate industrial recovery
firms encouraged to agree to codes establishing working conditions and product standards
what did roosevelt do with public works?
NIRA created the Public Works administration funded by $3bn - pump-priming
hoped expenditure on public works would stimulate economy and create permanent jobs
many employees went back on relief when contracts ended - temporary relief
what were the civilian conservation corps?
young people needed to gain experience from work
formed to provide useful jobs in conservation
1935 500,000 recruits 3 bn trees planted
impacts of the first new deal?
huge political impact
+first time gov gave direct relief
+helped to restore confidence in the economy
- insufficient funding for scale of problem, but important ideas about role of federal gov
what was the second new deal and when was it introduced?
1935
more radical
favoured poorer classes
why did the second new deal happen?
needed to respond to demands of radical supporters
- congress demanded radical measures - wanted to introduce new legislation rather than what congress wanted
- more frustrated by wealthy and big business who opposed him despite his saviour of economy
- wanted to appeal to less advantaged ranks who he believed had been forgotten
but - still conservative
what was the emergency relief appropriation act, 1935?
biggest expenditure in history for relief 45.5bn for public works, set up
- works progress administration (WPA) which employed 20% workforce by 1940 on schemes (Fort Knox and Lincoln tunnel)
- national youth administration (NYA) to provide part-time jobs for students
what was the rural electrification act 1935?
provide electricity for rural areas where private companies did not want to
REA offered low interest loans to farmers to form co-operatives and buy electrivity
1941 35% farms had it, 773 systems built in 6 years