Chapter 9 and 10 Study Guide

Describe the presidential candidates in the election of 1928

- Coolidge did not run in the election of 1928. -A successful engineer & former head of the Food Administration during WWI, Hoover also spent over 7 years as Secretary of Commerce in the Harding & Coolidge administration. -Democrats chose Alfred E. Smith, 4 time governor of New York. Smith was an Irish American from New York's lower East side and the first Roman Catholic ever nominated to run.

Describe Roosevelt's Second New Deal

-Although he remained tremendously popular with the American people, Roosevelt realized that his political support could be undermined by the attacks from his opponents on the left & right. He was also disturbed by the failure of the New Deal to generate a rapid economic recovery. -In 1935 he launched what came to be called the Second New Deal—another series of programs & reforms that he hoped would speed up the nation's recovery, provide economic security to every American, & ensure his reelection in 1936.

Describe the Midterm Election of 1930

-As the congressional elections of 1930 approached, most Americans felt that worsening unemployment posed a grave threat to their well-being. Citizens blamed the party in power for the stumbling economy. The Republicans lost 49 seats & their majority in the House of Representatives; they held onto the Senate by a single vote.

Describe the American Liberty League

-In August 1934, business leaders and anti-New Deal politicians from both parties joined together to create the American Liberty League. Its purpose was to organize opposition to the New Deal & "teach the necessity of respect for the rights of person and property."

Describe the public's reaction to the Agricultural Adjustment Act

-In a nation caught in the Depression, however, raising food prices drew harsh criticism. Furthermore, not all farmers benefited. Large commercial farmers, who concentrated on one crop, profited more than smaller farmers who raised several products. Worse, thousands of poor tenant farmers-many of them African Americans-became homeless & jobless when landlords chose their fields to be taken out of production.

Describe the term "broker state"

-In taking on this mediating role, the New Deal established what some have called the broker state, working out conflicts among different interests. This broker role has continued under the administrations of both parties ever since.

Describe the stock market crash

-Monday October 21st, Groucho Marx, comic star of the stage & screen was alerted that the stock market had crashed. -October 24, a day that came to be called Black Thursday, the market plummeted further. The following week, on October 29th, a day later dubbed as Black Tuesday, prices lost $10 to $15 billion in value. -By mid November, stock prices had dropped by over 1/3. Some $30 billion was lost, a sum equal to the total wages earned by Americans in 1929. The stock market crash was not the major cause of the Great Depression, but it undermined the economy's ability to hold out against its other weaknesses.

Describe the impact on farmers from the Dust Bowl

-Only some Midwestern & Great Plains farmers managed to hold onto their land. If their withered fields were mortgaged, they had to turn them over to the bank. Penniless, many farmers packed their belongings & headed West. Since many migrants were from Oklahoma, they became known as "Okies". -Many migrants believed they would find a better life in California, which was thought to have the perfect climate for agriculture, therefore making plenty of work available. However, many were met with hostility from those already living in CA b/c of competition for jobs. Most remained homeless & impoverished.

Describe the right wing's concerns with the New Deal

-People on the right generally believed the New Deal had imposed too many regulations on business. -The right wing also included many Southern Democrats who believed the New Deal had expanded the federal government's power at the expense of states' rights. -The right wing had opposed the New Deal from the beginning, but by late 1934, the opposition began to increase. To pay for his programs, Roosevelt had begun deficit spending. He had abandoned a balanced budget and begun borrowing money to pay for his programs. Many business leaders became greatly alarmed at the government's growing deficit.

Describe Frances Perkins

-Roosevelt appointed the first woman to a cabinet post, Secretary of Labor Frances Perkins, & assigned many women to lower-level jobs in the federal bureaucracy. Even so, the general view was that women did not need federal government action to ensure equal treatment, but rather to provide certain protections for them.

Describe Henry Morgenthau, Harry Hopkins & Harold Ickes

-The recession of 1937 led to a debate inside Roosevelt's administration over what to do. Treasury Secretary Henry Morgenthau favored balancing the budget and cutting spending. This would reassure business leaders & encourage them to invest in the economy. -Harry Hopkins, head of the WPA, & Harold Ickes, head of the PWA, both disagreed with Morgenthau & pushed for more government spending. They pointed to a new theory called "Keynesianism" to support their arguments.

Describe the Townsend Plan

-A third left-wing challenge to Roosevelt came from Dr. Francis Townsend, a former public health official. Townsend proposed that the federal government pay citizens over age 60 a pension of $200 a month. Recipients would have to retire & spend their entire pension check each month. He believed the plan would increase spending and remove people from the labor force, freeing up jobs for the unemployed. -Townsend's proposal attracted millions of supporters, especially among the elderly, who mobilized as a political force for the first time in American history. Townsend's program was particularly popular in the West. When combined with Long's support in the Midwest & South & Coughlin's support among urban Catholics in the Northeast, there was a real possibility of a coalition that would draw enough votes away from Roosevelt to prevent his reelection in 1936.

Describe Eleanor Roosevelt's role as First Lady

-First Lady Eleanor Roosevelt helped bring about the change in the African American and women's vote. She had demonstrated strong sympathies toward these groups, with whom she spoke in her many tours of the country. She recounted her experiences to her husband & persuaded him to address at least some of their problems in his New Deal programs.

Describe the move, "Gone with the Wind"

-Gone with the Wind, an elaborately costumed film nearly 4 hours long, topped the Depression-era epics. Its heroine, Scarlett O'Hara played by British actress Vivien Leigh, struggles to maintain her life on a Georgia plantation during & after the Civil War. Romance enters as Clark Gable, playing the masterful Rhett Butler, woos Scarlett. Audiences found inspiration in Scarlett's unassailable will to survive.

Describe the Hunger Marches

-In January 1931, around 500 men & women in Oklahoma City, shouting angrily about hunger & joblessness, broke into a grocery store & looted it. Crowds began showing up at the rallies & "hunger marches" held by the American Communist Party, which was eager to take advantage of national problems to change the American form of government. -On December 5, 1932, a freezing day in the nation's capital, around 1,200 hunger marchers assembled & chanted, "Feed the hungry, tax the rich." Police herded them into a blocked-off area, where they had to spend the night sleeping on the sidewalk or in trucks. The police denied them food, water, and medical treatment until some members of Congress insisted on the marchers' right to petition their government. They were released & permitted to march Capitol Hill.

Describe the movie, "Mr. Smith Goes to Washington"

-In Mr. Smith Goes to Washington, James Stewart plays a naive youth leader who becomes a senator. He dramatically exposes the corruption of some of his colleagues & calls upon his fellow senators to the American political system as the peak of "what man's carved out for himself after centuries of fighting for something better than just jungle law".

Describe sit-down strikes

-In late December 1936, officials at the General Motors auto body plant in Cleveland, Ohio, demoted two union men. In an unplanned protest, a shift of 135 workers sat down & launched an unprecedented kind of strike. They stopped working but refused to leave the factory. This stopped the work flow and also prevented the factories from bringing in replacement workers. -A few days later, the workers at the company's plant in Flint, Michigan, launched their own sit-down strike, as the press quickly dubbed it. Workers at other plants followed suit or carried out traditional strikes.

Describe the Glass-Steagall Act & the eventual Federal Deposit Insurance Corporation (FDIC).

-The Glass-Steagall Act separated commercial banking from investment banking. Commercial banks handle everyday transactions. They take deposits, pay interest, cash checks, & loan money for mortgages & other business activities. Under the Glass-Steagall Act, these banks were no longer permitted to risk depositors' money by using it to speculate on the stock market. -To further protect depositors, the Glass-Steagall Act also created the Federal Deposit Insurance Corporation (FDIC) to provide government insurance for bank deposits up to a certain amount. By protecting depositors in this way, the FDIC greatly increased public confidence in the banking system.

Describe the Federal Emergency Relief Administration (FERA)

-A few weeks after authorizing the CCC, Congress established the Federal Emergency Relief Administration (FERA). FERA did not initially create projects for the unemployed. Instead it channeled money-a half billion dollars in all-to state & local agencies to fund their relief projects. The leader of FERA was Harry Hopkins, whose nervous energy & sarcastic manner put off many people. Despite his personality, Hopkins became one of the most influential people in Roosevelt's administration. -Half an hour after meeting with Roosevelt to discuss his new job, Hopkins set up a desk in the hallway of his new office. In the next two hours, he spent $5 million on relief projects. When critics charged that some of the projects did not make sense in the long run, Hopkins replied, "People don't eat in the long run-they eat every day".

Describe the Black Cabinet

-African Americans and women made some modest gains during the New Deal. For example, the president appointed a number of African Americans to positions in his administration; informally, they became known as the Black Cabinet. Roosevelt also tried to ensure that New Deal relief programs did not exclude African Americans.

Describe the Social Security Act

-After passing the Wagner Act, Congress began work on a bill that ranks as one of the most important pieces of legislation in American history. This was the Social Security Act, which became law in August 1935. Its major goal was to provide some security for the elderly and for unemployed workers. -With the support of Secretary of Labor Frances Perkins, Roosevelt & his team spent months preparing the bill. The framers viewed it primarily as an insurance bill. Workers earned the right to receive benefits because they paid premiums. -The Social Security Act provided two social insurance programs. A federal program provided retirement insurance. The individual states administered a program for unemployment compensation that used federal funds. The legislation also provided modest welfare payments to other needy people, including those with disabilities & poor families with young dependent children.

Describe Roosevelt's inauguration

-Although Roosevelt won the presidency in November 1932, the country's unemployed & homeless had to endure one more winter as they waited for his inauguration on March 4, 1933. All through the winter, unemployment continued to rise. -Meanwhile, bank runs greatly increased, further threatening the nation's banking system. Some of the bank runs occurred because people feared Roosevelt would abandon the gold standard & reduce the value of the dollar in order to fight the Depression. -Many Americans, and foreign investors, decided to take their money out of the banks and convert it to gold before it lost its value. By March 1933, over 4,000 banks had collapsed, wiping out 9 million savings accounts. In 38 states, governors declared bank holidays—closing the remaining banks before bank runs could put them out of business. -By the day of Roosevelt's inauguration, most of the nation's banks were closed. One in four workers was unemployed. The economy seemed paralyzed. Roosevelt knew he had to restore the nation's confidence. "First of all," the president declared in his inaugural Address, "let me assert my firm belief that the only thing we have to fear is fear itself. . . . This nation asks for action, and action now!"

Describe the court-packing plan

-Although popular opinion supported most of the president's programs, the Supreme Court saw things differently. In January 1936, the Court declared the Agricultural Adjustment Act to be unconstitutional. With cases pending on Social Security & the Wagner Act, it seemed likely the Court would strike down nearly all of the major New Deal programs. -Roosevelt was furious that a handful of jurists, "nine old men" as he called them, were blocking the wishes of a majority of the people. After winning reelection, he decided to try to change the political balance on the Supreme Court. -Claiming that the Court was overburdened with work, Roosevelt sent Congress a bill to increase the number of justices: If any justice had served for 10 years and did not retire within six months after reaching the age of 70, the president could appoint an additional justice to the Court. -Since four justices were in their 70s and two more were in their late 60s, the bill, if passed, would allow Roosevelt to quickly appoint as many as six new justices. -The court-packing plan, as the press called it, was Roosevelt's first serious political mistake as president. Although Congress had the power to change the size of the Court, the scheme created the impression that the president was trying to interfere with the Constitution's separation of powers and undermine the Court's independence.

Describe Roosevelt's recession

-Although unemployment remained high, Roosevelt decided it was time to balance the budget. Concerned about the dangers of too much debt, Roosevelt ordered the WPA and the PWA to be cut significantly. Unfortunately, Roosevelt cut spending just as the first Social Security payroll taxes removed $2 billion from the economy. Almost immediately the economy plummeted. By the end of 1937, about two million people had been thrown out of work.

Describe the Hawley-Smoot Tariff

-As the bull market of the 1920s accelerated, US banks made high interest loans to stock speculators instead of lending money to foreign companies. Without these loans from US banks, foreign companies purchased fewer American products. -Matters grew worse after June 1930, when Congress passed the Hawley-Smoot Tariff raising the average tariff rate to the highest level in American history. -Aimed to protect American manufacturers from foreign competition, but damaged American sales abroad. Because imports now cost much more, Americans bought fewer of them. Foreign countries responded by raising their own tariffs against American products. (In 1923, US exports fell to about 1/5 of what they had been in 1929).

Describe the Farm Security Administration

-Before the Supreme Court struck it down, the Agricultural Adjustment Administration had paid many farmers to take land out of production to force food prices to rise. The price support program raised farm income, but it badly hurt tenant farmers. Landowners often expelled tenants from the land in order to take it out of production. About 150,000 white and 195,000 African American tenants left farming during the 1930s for this reason. -To stop this trend, the Farm Security Administration was created in 1937 to give loans to tenants so they could purchase farms. Over the next four years it extended loans of about $1 billion. Members of Congress, many of whom believed the program made agricultural problems worse by increasing farm production and driving down prices, kept its appropriations at a low level.

Describe the outcome of the election of 1928

-By 1928 prohibition had become a major issue among voters. Because he favored the ban on liquor sales, Hoover was considered a "dry" in the popular language of the day. Smith, who disliked the ban was a "wet". -The candidates religious differences sparked a smear campaign against Smith. Many Protestants were willing to believe that the Catholic Church financed the Democratic Party and would rule the US if Smith got into The White House. -Smith's biggest problem was the prosperity of the 1920s, for which the Republicans took full credit. Republican candidates promised to continue the trend with such slogans as "two cars in every garage". -Hoover received over 6 million more votes than SMith and won the electoral college in a landslide, 444 to 87. -On March 4, 1929, an audience of 50,000 stood in the rain to hear Hoover's inaugural speech. Sound movie cameras covered the inauguration for the first time and radios broadcasted the address worldwide.

Describe Roosevelt's first year in office

-By the end of his first year in office, President Roosevelt had convinced Congress to pass an astonishing array of programs and policies. The programs passed during the First New Deal did not restore prosperity, but they all reflected Roosevelt's zeal for action, his willingness to experiment, and his openness to new ideas. Perhaps the most important result of the First New Deal was a noticeable change in the spirit of the American people. Roosevelt's actions had inspired hope & optimism when it was needed most, and Americans' faith in their nation had been restored.

Describe the Civil Works Administration (CWA)

-By the fall of 1933, neither FERA nor the PWA had reduced unemployment significantly. Hopkins realized that unless the federal government acted quickly, a huge number of unemployed would be in severe distress once winter began. After Hopkins explained the situation, President Roosevelt authorized him to set up the Civil Works Administration (CWA). -Unlike the PWA, the CWA hired workers directly & put them on the federal government's payroll. That winter the CWA employed 4 million people, 300,000 of them women. Under Hopkin's direction, the agency built or improved 1,000 airports, 500,000 miles of roads, 40,000 school buildings, & 3,500 playground, parks & playing fields. -Although the CWA helped many people get through the winter, the program would not last much longer. President Roosevelt was alarmed at how quickly the agency was spending money. He did not want Americans to get used to the federal government providing them with jobs. -Warning that the CWA would "become a habit with the country," Roosevelt insisted that it be shut down. "We must not take the position," the president explained, "that we are going to have a permanent depression in this country." By early April 1934, just over 5 months after it was created, Hopkins had shut down the CWA & fired the 4 million workers the agency had hired.

Describe the end of the New Deal

-Congress, however, was beginning to turn against the New Deal. The recession of 1937 enabled the Republicans to win many seats in Congress in the midterm elections of 1938. Together with conservative Southern Democrats, they began blocking further New Deal legislation. Roosevelt, meanwhile, became increasingly preoccupied with the growing international threat posed by Germany and Japan. By 1939 the New Deal era had come to an end.

Describe Roosevelt's early political career

-Franklin Roosevelt, born in 1882 to a wealthy New York family, married Eleanor Roosevelt in 1905. They were distantly related through former president Theodore Roosevelt--her uncle & his cousin. Likable, optimistic, & intensely competitive, FDR seemed made for a life of politics. -Shortly after graduating from Columbia Law School, Roosevelt won a seat in the New York State Senate, where he earned a reputation as a progressive reformer willing to stand up to party bosses. Under Woodrow Wilson, he became an assistant secretary of the navy, a position he held through WWI. -In 1920 Roosevelt temporarily withdrew from politics. The next year he caught the paralyzing disease known as polio. Undaunted, Roosevelt began a vigorous exercise program, while Eleanor kept his name prominent in the NY Democratic Party. - In 1928 he was rewarded by being elected governor of NY. His policies as governor made him very popular. He cut taxes for farmers, worked to reduce the rates charged by public utilities, and in 1931 pushed through the NY legislature a new state agency to help unemployed New Yorkers.

Describe the Emergency Relief & Construction Act

-From the start, Hoover strongly opposed the federal government's participation in relief--money that went directly to impoverished families. He believed that only state & city governments should dispense relief. By the Spring of 1932, however, they were running out of money. -In 1932 political support was building for a relief measure, & Congress passed the Emergency Relief & Construction Act. Although reluctant, Hoover signed the bill on July 21. The new act called for $1.5 billion for public works & $300 million in loans to the states for direct relief. By this time, however, the new program could not reverse the accelerating collapse.

Describe Hoover's attempt to try & rescue the banks

-Hoover asked the Federal Reserve Board to put more currency into circulation, but the Board refused. In an attempt to ease the money shortage, Hoover set up the National Credit Corporation (NCC) in October 1931. The NCC created a pool of money to enable troubled banks to continue lending money in their communities. Hoover then persuaded a number of NY bankers to contribute to the NCC. Their contributions, however, did not meet the nations' needs. -By 1932 Hoover concluded that the only way to provide funding for borrowers was for the government to do the lending. He requested that Congress set up the Reconstruction Finance Corporation (RFC) to make loans to banks, railroads & agricultural institutions. By early 1932, the RFC had lent about $238 million to approximately 160 banks, 60 railroads & 18 building-and-loan organizations. The RFC was overly cautious, however. It failed to increase its loans to in sufficient amounts to meet the need & the economy continued to decline.

Describe Hoover's Legacy

-Hoover failed to resolve the crisis of the Depression, but he did more to expand the economic role of the federal government than any previous president. The Reconstruction Finance Corporation marked the 1st time the federal government had established a federal agency to stimulate the economy during peacetime. These successes, however, did not change the public's views. It was the image of the routed Bonus Marchers & the lingering Depression that shaped the public's perception of President Hoover.

Describe Father Coughlin

-Huey Long's challenge to Roosevelt became even more credible when his supporters were combined with those of Father Charles Coughlin, a Catholic priest in Detroit. Coughlin had a popular radio show that attracted a weekly audience of about 30 to 45 million Americans. -Originally a New Deal supporter, Coughlin had become impatient with its moderate reforms. He called instead for heavy taxes on the wealthy & nationalization of the banking system. In the spring of 1935, Coughlin organized the National Union for Social Justice, which some Democrats feared was the first step to creating a new political party. By the late 1930s, Coughlin began to lose influence by praising fascism & making comments many considered anti-Semitic.

Describe William Faulkner & Thomas Wolfe

-In "The Sound and the Fury," author William Faulkner shows what his characters are thinking & feeling before they speak. Using this stream of consciousness technique, he exposes hidden attitudes of Southern whites & African Americans in a fictional Mississippi county. -Another Southern writer, Thomas Wolfe, used the facts of his own life to examine the theme of artistic creation in such powerful novels such as "Look Homeward Angel".

Describe the Fair Labor Standards Act

-In 1938 New Dealers were still trying to reinstate important prolabor regulations to make up for the Supreme Court's dismantling of the NIRA in 1935. The Fair Labor Standards Act of 1938 provided more protection for workers, abolished child labor, and established a 40-hour workweek for many workers to come into effect within three years.

Describe the Works Progress Administration (WPA) [2nd New Deal Program]

-In January 1935, Roosevelt began by asking Congress for nearly $5 billion "for work relief and to increase employment by providing useful projects." Much of the money would be given to the Works Progress Administration (WPA), a new federal agency headed by Harry Hopkins. "The big boss is ready to go places in a big way," Hopkins told a colleague. -Over the next several years, the WPA spent $11 billion. Its 8.5 million workers constructed about 650,000 miles of highways, roads, and streets, 125,000 public buildings, & more than 8,000 parks. It built or improved more than 124,000 bridges & 853 airports. -When Roosevelt asked Congress to fund the WPA in January 1935, he had expected quick action on the bill. He quickly discovered that opposition to his programs was growing in Congress. The bill creating the WPA did not pass until April 1935.

Describe the National Labor Relations Act & The National Labor Relations Board (NLRB)

-In July 1935, Congress passed the National Labor Relations Act, also called the Wagner Act after its author, Democratic senator Robert Wagner of New York. The act guaranteed workers the right to organize unions without interference from employers & to bargain collectively. -The law set up the National Labor Relations Board (NLRB), which consists of five members appointed by the United States President & approved by the Senate. Members serve five-year terms & receive assistance from 33 regional directors. The NLRB organized factory elections by secret ballot to determine whether workers wanted a union. The NLRB then certified the successful unions. -The new law also set up a process whereby dissatisfied union members could take their complaints to binding arbitration, in which a neutral party would listen to both sides & decide the issues. The NLRB was authorized to investigate the actions of employers & had the power to issue "cease and desist" orders against unfair practices.

Describe the Public Works Administration (PWA)

-In June 1933, Congress authorized the creation of another federal relief agency-the Public Works Administration (PWA). Roosevelt knew that nearly 1/3 of the nation's unemployed were in the construction industry. To put them back to work, the PWA began a series of construction projects. -Unlike other relief efforts, these projects focused on economic investment. Workers built & improved highways, dams, sewer systems, water-works, schools, & other government facilities. Among others, the PWA authorized dams in the West to provide needed water & electricity for economic development. The largest project was the Grand Coulee Dam in Washington, which brought cheap electricity to the Pacific Northwest. Other major dams included the Bonneville & Boulder (now the Hoover Dam). -In most cases, the PWA did not hire workers directly, but instead awarded contracts to construction companies. By insisting that contractors hire African Americans, the agency broke down some of the longstanding racial barriers in the construction trades.

Describe the Bonus Army

-In appreciation of the WWI service of American soldiers & sailors, Congress in 1924 had enacted a $1,000 bonus for each veteran, to be distributed in 1945. The economic crisis, however, made the wait more difficult. In 1931 Texas congressman Wright Patman introduced a bill in the House of Representatives that authorized early payment of the veterans' bonuses. The bill later passed the House & moved to the Senate for debate. -In May 1932 several hundred Portland, Oregon, veterans set off on a month-long march to Washington to lobby Congress to pass the legislation. As they moved East, other veterans joined them until they numbered about 1,000. Wearing ragged military uniforms, they trudged along the highways or rode the rails, singing old war songs & reminiscing about army days. The press termed the marchers the "Bonus Army." -Once in Washington, the marchers camped in Hoovervilles. As weeks went by, additional veterans joined them, until the Bonus Army swelled to 15,000. President Hoover acknowledged the veterans' petition rights but refused to meet w/ them. -When the Senate voted the new bonus bill down, a significant number of the marchers stayed on since they had no job prospects, homes, or families to return to. Some moved from the camps to unoccupied buildings downtown. -In late July, Hoover ordered the buildings cleared. The police made the 1st try, but one of them panicked & fired fired into a crowd, killing 2 veterans. The Washington D.C. government then called the in the army. Army chief of staff Douglas MacArthur ignored Hoover's orders to clear the buildings but to leave the camps alone. He sent cavalry, infantry & tanks to clear the veterans from the city. (The soldiers tear gassed stragglers & burned the shacks. Tear gas killed a baby boy). -The nationwide press coverage & newsreel images of veterans under assault by troops presented an ugly picture to the public. Many did not agree with the action taken against the veterans. The routing of the veterans hounded the president throughout his 1932 reelection campaign.

Describe the Farmers Revolt

-In the summer of 1932, farmers also took matters into their own hands. Beginning in the boom days of WWI, many farmers had heavily mortgaged their land to pay for seed, feed, & equipment. After the war, prices sank so low that farmers could not even earn back their costs, let alone make profit. Between 1930 & 1934 creditors foreclosed on nearly one million farms, taking possession of them & evicting the families. -Some farmers began destroying their crops in a desperate attempt to raise crop prices by reducing the supply. In Nebraska grain growers burned corn to heat their homes in the winter. In Iowa food grocers forcibly prevented the delivery of vegetables to distributors. Georgia dairy farmers blocked highways & stopped milk trucks, emptying the milk cans into ditches.

Describe the Federal Reserve Board's response to The Great Depression

-Just as consumers were able to buy more goods on credit, access to easy money propelled the stock market. Instead of raising interest rates to curb excessive speculation, the Federal Reserve Board kept its rates very low. -The Board's failure to raise interest rates contributed to the Depression in 2 ways. 1st, by keeping rates low, it encouraged member banks to make risky loans. 2nd, low interest rates led to business leaders to think the economy was still expanding. As a result, they borrowed more money to expand production, which led to overproduction when sales were falling. Summary: When the Depression hit , the Federal Reserve raised interest rates, tightening credit, therefore causing the economy to continue spiraling downward.

Describe Keynesianism

-Keynesianism was based on the theories of an influential British economist named John Maynard Keynes. In 1936 Keynes published a book that discussed the causes of recessions. He argued that the government should spend heavily during a recession, even if it had to run a deficit, in order to jumpstart the economy. -According to Keynesian economics, Roosevelt had done exactly the wrong thing when he reduced government spending on programs in 1937. At first Roosevelt was reluctant to begin deficit spending again. Many critics of his policies had argued that the recession proved the American people were becoming too dependent on government spending, & Roosevelt worried they might be right. -Finally, in the spring of 1938, with no recovery in sight, President Roosevelt gave in. He asked Congress to approve $3.75 billion for the PWA, the WPA, & other programs with hope that government spending would stimulate the economy.

Describe the influence of photography during the Great Depression

-Magazine photographers roamed the nation armed w/ the new 35-millimeter cameras, seeking new subjects. -Photojournalist Margaret Bourke-White's striking pictures, displayed in Fortune magazine, showed the ravages of the drought. -In 1936, Time magazine publisher Henry Luce introduced Life, a weekly photojournalism magazine that enjoyed instant success.

Describe Marlene Dietrich & Greta Garbo

-Many European actors, writers & directors, fleeing economic hardship & the threat of dictatorships went to Hollywood in the 20s & 30s. Two European women emerged as superstars. -Germany's Marlene Dietrich portrayed a range of roles with subtlety in movies such as Morocco & Shanghai Express. -Swedish actress, Greta Garbo, often played a doomed beauty, direct & unhesitating in her speech & actions & was the highest paid female in the US during the mid-1930s.

Describe Mary McLeod Bethune

-Mary McLeod Bethune was born into a poor South Carolina family, the 15th of 17 children. Although she worked from a young age picking cotton & washing clothes, Bethune was determined to get an education. -She won a scholarship to a seminary in North Carolina and later graduated from the Moody Bible Institute in Chicago. Bethune then began teaching at the Haines Institute. -In 1904 she founded a school in Florida for the children of African American railroad workers. "I rang doorbells," she later recalled. "I wrote articles . . . distributed leaflets, [and] invaded churches, clubs, lodges, [and] chambers of commerce." -Gradually she raised enough money to found the Daytona Normal & Industrial School, later known as Bethune College. -Bethune's efforts gained her a national reputation. In the 1920s, she visited the White House to discuss African American affairs. She also became a good friend of Eleanor Roosevelt. In 1936 FDR appointed her director of the Negro Division of the National Youth Administration (NYA), which provided job training for young people. Bethune also founded the National Council of Negro Women to support civil rights. In later years, she advised Presidents Truman and Eisenhower.

Describe John Steinbeck

-Novelists such as John Steinbeck added flesh & blood to journalists' reports of poverty & misfortune. Their writing evoked both sympathy for their characters & indignation at social justice. -In "The Grapes of Wrath," published in 1939, Steinbeck tells the story of an Oklahoma family fleeing the Dust Bowl to find a new life in California. Steinbeck had seen 1st hand the plight of migrant farm families uprooted by the Dust Bowl. After visiting camps of these families he had a better understanding of their fears.

Describe the importance of Schechter v. United States.

-On May 27, 1935, the Supreme Court unanimously struck down the National Industrial Recovery Act in Schechter v. United States. The Schechter brothers, who had a poultry business in Brooklyn, New York, had been convicted in 1933 of violating the NIRA's Live Poultry Code. They had sold diseased chickens & violated the code's wage-and-hour provisions. -In what became known as the "sick chicken case," the Court ruled that employees of a slaughterhouse were only involved in the slaughtering & sale of chickens in a local area. Because employees were not involved in interstate commerce, their wages & hours could not be regulated by the NIRA's code for wage-and-hour provisions. -More importantly, however, the court ruled that the Constitution did not allow Congress to delegate its powers to the executive branch. Thus it considered the NIRA codes unconstitutional. The decision worried Roosevelt. The ruling suggested that the Court could soon strike down the rest of the New Deal as well.

Describe the Emergency Banking Relief Act

-On his 1st night in office, Roosevelt told Secretary of the Treasury William H. Woodin he wanted an emergency banking bill ready for Congress in less than 5 days. The following afternoon, Roosevelt declared a national bank holiday, temporarily closing all banks & called Congress into a special session scheduled to begin on March 9, 1933. -One the day Congress convened, the House of Representatives unanimously passed the Emergency Banking Relief Act after only 38 minutes of debate. The Senate approved the bill that evening & Roosevelt signed it into law shortly afterward. The new law required the federal examiners to survey the nation's banks & issue Treasury Department licenses to those that were financially sound. -On March 12, President Roosevelt addressed the nation by radio. Sixty million people listened to the 1st of his many "fireside chats," direct talks FDR held with the American people to let them know what he was trying to accomplish. He told the people that their money would now be secure if they put it back into banks. "I assure you that it is safer to keep your money in a reopened bank than under the mattress." When banks opened the day after the speech, deposits far outweighed withdrawals. The banking crisis was over.

Describe the National Housing Act

-One of the president's goals for his second term was to provide better housing for the nation's poor. The Home Owners Loan Corporation had helped many middle-class citizens, but it had not provided housing for those who could not afford a mortgage. -Eleanor Roosevelt, who had toured poverty-stricken regions of Appalachia & the Deep South, was among those urging the president to do something. Senator Wagner, who shared the First Lady's concerns, prepared a new housing bill with Roosevelt's full support. -The 1937 National Housing Act established the United States Housing Authority, which received $500 million to subsidize loans for builders willing to buy blocks of slums and build low cost housing.

Describe Huey Long

-Perhaps the most serious threat from the left came from Democratic senator Huey Long of Louisiana. Long captivated audiences with folksy humor and fiery oratory. As governor of Louisiana, Long had championed the downtrodden. He had improved schools, colleges, and hospitals, & had built roads & bridges. These benefits made Long very popular & enabled him to build a powerful & corrupt political machine. -Long's attacks on the rich gave him a national following, too. His supporters organized some 27,000 "Share Our Wealth" clubs across the country. Pollsters estimated that if he ran against Roosevelt as a third-party candidate in 1936, Long would win several million votes—enough, they believed, to ensure a Republican victory.

Describe Hoover's response to the Great Depression

-President Hoover hoped to downplay the public's fears over the economy. He wanted to avoid more bank runs & layoffs by urging consumers & business leaders to become more rational in their decision making. Critics of Hoover's approach believed that the government should be more truthful w/ the public. -On Friday, October 25, the day after Black Thursday, President Hoover issued a statement assuring the nation that industry was "on a sound and prosperous basis". In March 1930 he told the public that "the worst effects of the crash...will have passed during the next 60 days". -Despite his soothing words, Hoover was seriously worried about the economy. He organized a series of conferences, bringing together the heads of banks, railroads & other big businesses, as well as labor & government officials. -He won a pledge from industry to keep factories open & stop slashing wages. By 1931, however, business leaders had abandoned those pledges. Hoover's next step was to increase public works--government financed building projects. The resulting construction jobs could replace some of those lost in the private sector. He urged governors & mayors throughout the nation to increase public works spending. -Hoover's actions did spur construction increases, but the effort made up for only a small fraction of the jobs lost in the private sector. The only way the government could create enough new jobs would be to massively increase government spending, which Hoover refused to do.

Describe the new attitude towards the government brought about by the New Deal

-Probably the biggest change the New Deal brought was the new public attitude toward government. Roosevelt's programs had succeeded in creating something of a safety net for average Americans-safeguards & relief programs that protected them against economic disaster. -By the time the Roosevelt years were over, the American people felt that the government had a duty to maintain this safety net even though it required a larger, more expensive federal government than at any time in American history. -Critics continued to argue that the New Deal made the government too powerful. Another legacy of the New Deal, therefore, is a debate that has continued to present over how much the government should intervene in the economy or support the disadvantaged.

Describe the importance of radio throughout the Great Depression

-Radio offered entertainment on a more personal level. People listened to the radio everyday, gathering around the big wooden box in the living room. -One of the most popular heroes was the Lone Ranger, who fought injustice in the Old West with the help of his "faithful Indian companion," Tonto. The listener needed only to picture the hero w/ a black mask hiding his identity, as he fired a silver bullet to knock a gun from an outlaw's hand. -Programs such as "The Guiding Light" depicted middle class families confronting illness, conflict & other problems. These short dramas allowed listeners to escape into a world more exciting then their own. The shows sponsors were often makers of laundry soaps, so the shows were nicknamed "soap operas".

Describe Roosevelt's divided administration

-Roosevelt's advisers were divided into 3 main groups. Despite their disagreements, most of the advisers had grown up in the Progressive Era, & their approaches reflected progressive ideals. They generally favored some form of government intervention in the economy--although they disagreed over what the government's role should be. -One group that was very influential during the early years of Roosevelt's administration supported the "New Nationalism" of Theodore Roosevelt. These advisers believed that business & government should work together to manage the economy. They had been very impressed by business-government cooperation on the War Industries Board during WWI. They believed that if government agencies worked with businesses to regulate wages, prices & production, they could lift the economy out of the Depression. -A second group of advisers in the Roosevelt administration went even further. They distrusted big business & blamed business leaders for causing the Depression. These advisers wanted government planners to run key parts of the economy. -A third group in Roosevelt's administration support the "New Freedom" of Woodrow Wilson. They too blamed large trusts for the Depression, but they believed the government had to restore competition to the economy. These advisers wanted Roosevelt to support "trust busting" by breaking up big companies & allowing competition to set wages, prices & production levels. They also thought the government should impose regulations on the economy to keep the competition fair.

Describe the factors that led to Roosevelt's presidential nomination

-Roosevelt's popularity in NY paved the way for his presidential nomination in 1932. Many Americans applauded his use of the government's power to help people in economic distress. Others believed that his struggle against polio had given him a better understanding of their hardships. -Perhaps most important, Americans saw in Roosevelt an energy & optimism that gave them hope despite the tough economic times. After Roosevelt became president, his serenity & confidence amazed many people. When one aide commented on his attitude, Roosevelt replied, "If you had spent two years in bed, trying to wiggle your big toe, after that anything else would seem easy".

Describe Roosevelt's "second hundred days"

-Shortly after the Schechter decision, Roosevelt sprang into action. With the Court threatening to strike down the New Deal & with growing challenges from the left & right, the president knew he needed a new series of programs to keep voters' support. -He called congressional leaders to a White House conference. Pounding his desk, he thundered that Congress could not go home until it passed his new bills. That summer, Congress began what the press nicknamed the "second hundred days" & worked feverishly to pass Roosevelt's programs.

Describe the Dust Bowl

-Since the beginnings of homesteading on the Great Plains, farmers had gambled with nature. Their plows had uprooted the wild grasses that held the soil's moisture. -When crop prices dropped in the 1920s, however, midwestern farmers left many of their fields uncultivated. Then, beginning in 1932, a terrible drought struck the Great Plains. With neither grass or wheat to hold the scant rainfall, the soil dried to dust. -From the Dakotas to Texas, America's pastures & wheat fields became a vast "Dust Bowl". Winds whipped the arid earth, blowing aloft & blackening the sky (Crops & livestock buried, farmhouses covered).

Describe the problems with Social Security

-Social Security helped many people, but initially it left out many of the neediest members of society--farm and domestic workers. Some 65 percent of all African American workers in the 1930s fell into these two categories. -In 1939 the act was expanded to also include dependents and survivors of workers. It was not until 1950 that the coverage was again expanded, this time to include full-time farm and domestic workers. Nevertheless, Social Security established the principle that the federal government should be responsible for those who, through no fault of their own, are unable to work.

Describe the living conditions of the less fortunate during the Great Depression

-Some homeless paralyzed by fear & humiliation would not or could not move. Their landlord would then as the court for an eviction notice. Court officers called bailiffs then ejected the non paying tenants, piling their belongings in the street. -Throughout the country, newly homeless ppl put shacks upon unused or public lands, forming communities called "Shanty Towns" or "Hoovervilles". -In search of work, many homeless & unemployed Americans began to wander around the country, most often referred to as "riding the rails". These wanderers, called hobos, would sneak past railroad police to slip into open boxcars on freight trains. They camped in "hobo jungles", usually situated near rail yards.

Describe the Central Valley Project (CVP)

-The Central Valley Project (CVP), funded in 1935 by the Emergency Relief Construction Act, provided for the construction of the Contra Costa Canal, Shasta Dam, & Folsom Dam. These components of the CVP help prevent water shortages, flooding, and generate electrical power for California's Central Valley & much of the San Francisco Bay area.

Describe the problems with the National Recovery Administration (NRA)

-The NRA did produce a revival of few industries, but the gains proved short-lived. Small companies complained, justifiably, that large corporations wrote the codes to favor themselves. Most efficient companies disliked price fixing, which limited competition & made it hard for them to increase their market share by cutting prices. Employers disliked codes that gave workers the right to form unions & bargain collectively over wages & hours. They also argued that paying high minimum wages forced them to charge higher prices to cover their costs. -The codes were also very difficult to administer & business leaders often ignored them. It became obvious that the NRA was failing when industrial production actually fell after the organization was established. By the time the Supreme Court declared the NRA to be unconstitutional in 1935, it had already lost much of its political support.

Describe the origins of the New Deal

-The New Deal was not based on a clear strategy shaped by a single philosophy. Roosevelt was not an intellectual, nor did he have a strong political ideology. He was a practical politician. FDR was willing to try a variety of approaches both to see whether they worked & whether they were helping or hurting him politically. -To generate new ideas & programs, Roosevelt sought advice from a wide range of advisers with experience in academia, business, agriculture, government, law & social work. The president deliberately chose advisers who disagreed with each other. He wanted to hear many different points of view, & by setting his advisers against one another, Roosevelt ensured that he alone made the final decision on what policies to pursue.

Describe the Securities Exchange Commission (SEC)

-The Securities Act required companies that sold stocks & bonds to provide complete & truthful information to investors. The following year (1934), Congress created an independent agency, the Securities Exchange Commission (SEC), to regulate the stock market & prevent fraud.

Describe the Social Security Board (SSB)

-The Social Security Act created a Social Security Board (SSB) to oversee the administration of the new program. In 1939 the SSB became part of the new Federal Security Agency. Six years later, in 1946, the SSB was reorganized and renamed the Social Security Administration, a designation it has kept until today.

Describe "Federal Number One"

-The WPA's most controversial program was "Federal Number One," a section of the Professional Projects Division that offered work to artists, musicians, theater people, and writers. "They've got to eat just like other people," Hopkins commented to critics of the program. The artists created thousands of murals and sculptural works to beautify the walls & halls of public buildings. Musicians established 30 city symphony orchestras, as well as hundreds of smaller musical groups. -The Federal Theater Project financed playwrights, actors, and directors. The program also funded historians who interviewed former slaves to document American history. The program helped record important information about the history of the United States, as well as improve the aesthetic quality of many public buildings.

Describe the Committee for Industrial Organization (CIO)

-The Wagner Act stimulated a burst of labor activity. In the mid-1930s, the United Mine Workers union, led by John L. Lewis, began working with several other unions to organize workers in industries where unions did not yet exist. They formed the Committee for Industrial Organization (CIO) in 1935. -The CIO set out to organize industrial unions, or unions that included all workers in a particular industry, skilled & unskilled. The CIO began by focusing on the automobile & steel industries—two of the largest industries in America where workers were not yet organized into unions. -In 1938 the CIO changed its name to the Congress of Industrial Organizations and became a federation of industrial unions.

Describe the importance of the Social Security Act

-The core of Social Security was the monthly retirement benefit, which people could collect when they stopped working at age 65. Another important benefit--unemployment insurance--supplied a temporary income to unemployed workers looking for new jobs. -Some critics did not like the fact that the money came from payroll taxes imposed on workers & employers, but to Roosevelt these taxes were crucial: "We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and the unemployment benefits." -What Roosevelt did not anticipate was that in the future, Congress would borrow money from the Social Security fund to pay for other programs while failing to raise payroll deductions enough to pay for the benefits.

Describe the following cases: 1. NLRB v Jones & Laughlin Steel 2. Wickard v Filburn

-The federal government's ability to take on this new role was enhanced by two important Supreme Court decisions. In 1937, in NLRB v. Jones and Laughlin Steel, the Court ruled that the federal government had the constitutional authority, under the interstate commerce clause, to regulate production within a state. -In 1942, in Wickard v. Filburn the Court used a similar argument to allow the federal government to regulate consumption in the states. These decisions increased federal power over the economy & allowed it to mediate between competing groups.

Describe the National Industrial Recovery Act (NIRA) & the National Recovery Administration (NRA)

-The government turned its attention from farming to manufacturing in June 1933, when Roosevelt & Congress enacted the National Industrial Recovery Act (NIRA). The NIRA suspended the antitrust laws & allowed business, labor, & government to cooperate in setting up voluntary rules for each industry. -These rules were known as codes of fair competition. Some codes set prices, established minimum wages, & limited factories to two shifts per day so production could be spread to as many firms as possible. Other codes shortened workers' hours with the goal of creating additional jobs. Another provision guaranteed workers the right to form unions.

Describe the result of the court-packing plan

-The issue split the Democratic Party. Many Southern Democrats feared Roosevelt's plan would put justices on the Court who would overturn segregation. At the same time, African American leaders worried that once Roosevelt set the precedent of changing the Court's makeup, a future president might pack the Court with justices opposed to civil rights. Many Americans believed the plan would give the president too much power. -Despite the uproar over the scheme, Roosevelt's actions appeared to force the Supreme Court to back down. In April 1937, the Court upheld the Wagner Act, & in May it declared the Social Security Act to be constitutional. Shortly afterward, one of the more conservative judges resigned, enabling Roosevelt to appoint a supporter of the New Deal to the Court. -In mid-July, the Senate quietly killed the court-packing bill without bringing it to a vote. Although Roosevelt had achieved his goal of changing the Court's view of the New Deal, the fight over the plan had hurt his relationship w/ the American people & encouraged conservative Democrats in Congress to work with Republicans to oppose further New Deal proposals.

Describe the bank's reaction to the stock market crash

-The market crash severely weakened nation's banks in two ways. 1st, many banks had lent money to stock speculators. 2nd, many banks had invested depositors' money in the stock market, hoping for higher returns than they could get by using the money for conventional loans. -When stock values collapsed, the banks lost money on their investments & the speculators defaulted on their loan. Having suffered severe losses, many banks cut back drastically on the loans they made. -For some banks, the losses they suffered in the crash were more than they could absorb & they were forced to close. At the time, the government did not ensure bank deposits, therefore, if a bank collapsed, customers lost their savings. -News of banks failures worried many. They began to make runs on national banks, causing banks to collapse. A bank run takes place when many depositors decide to withdraw their money at one time. During this time, there were no guarantees to protect people's money in case of bank collapse. -During the 1st 2 years of the Depression, more than 3,000 banks, over 10% of the nation's total banks were forced to close.

Describe the Civilian Conservation Corps (CCC)

-The most highly praised New Deal work relief program was the Civilian Conservation Corps (CCC), which combined Roosevelt's love of nature & commitment to conservation w/ the need to help the unemployed. Beginning in March 1933, the CCC offered unemployed young men 18-25 years old the opportunity to work under the direction of the national forestry service planting trees, fighting forest fires & building reservoirs. -The young men lived in camps near their work areas & earned $30 a month. By midsummer the CCC had created some 1,500 camps. The average CCC worked returned home after 6 months to a year of service better nourished than before & with greater self respect. By the time it closed down in 1942, the CCC had put 3 million young men to work outdoors.

Describe the Agricultural Adjustment Act

-The nation's farmers had been hit hard by the Depression. One week after calling Congress into special session, Roosevelt announced plans for a new farm program. Working closely w/ the leaders of the nation's farm organizations, Secretary of Agriculture Henry Wallace raced to complete a new farming bill before planting season began. -The Agricultural Adjustment Act that Roosevelt asked Congress to pass was based on a simple idea--the prices for farm goods were low b/c farmers grew too much food. Under Roosevelt's program, the government would pay farmers not to raise certain livestock & to not grow certain crops. The farm program was administered by the Agricultural Adjustment Administration (AAA). -By the time the AAA was organized, however, farmers had already planted their crops for the year & begun raising the season's livestock. To prevent cotton-which was already at a very low price-from reaching the market, the AAA paid cotton farmers about $100 million to plow under about 25% of their crop. Similarly, hog producers slaughtered 6 million piglets instead of fattening them for market. -Over the new few years, farmers withdrew millions of acres from production & received more than $1 billion in support payments. The program accomplished its goal: The farm surplus fell greatly by 1936. Food prices then rose, as did farm income, which quickly increased by more than 50%.

Describe Thomas Hart Benton & Grant Wood

-Thomas Hart Benton & Grant Wood led the regionalist school, which emphasized traditional American values, especially those of the rural mid West & South. -Wood's most famous painting, "American Gothic," portrays a stern farmer & his daughter in front of their humble farm house. The portrait plays tribute to no-nonsense Midwesterners while at the same time gently making fun of their severity.

Describe the Farm Credit Administration (FCA)

-Three days after Congress authorized the creation of the HOLC, it authorized the Farm Credit Administration (FCA) to begin helping farmers refinance their mortgages. Over the next 7 months, the FCA lent 4 times as much money to farmers as the entire banking system had done the year before. It was also able to push interest rates substantially lower. "I would be without a roof over my head if it hadn't been for the government loan," wrote the millions of farmers who were saved by FCA loans. -Although FCA loans helped many farmers in the short term, their long-term value can be questioned. FCA loans helped less efficient farmers keep their land, but giving loans to poor farmers meant that the money was not available to loan to more efficient businesses in the economy. Although FCA loans may have slowed the overall economic recovery, they did help many desperate & impoverished people hold onto their land.

Describe the Home Owners' Loan Corporation (HOLC)

-To help homeowners pay their mortgages, Roosevelt asked Congress to establish the Home Owners' Loan Corporation (HOLC). The HOLC bought the mortgages of many homeowners who were behind in their payments. It then reconstructed them with longer terms of repayment & lower interest rates. Roughly 10% of the nation's homeowners received an HOLC loan. -The HOLC did not help everyone. It only made loans to homeowners who were still employed. When people lost their jobs & could no longer pay their mortgages, the HOLC foreclosed on their property, just as the bank would have done. By 1938 the HOLC had foreclosed on more than 100,000 mortgages. Despite these failures, the HOLC helped refinance one out of every five mortgages on private homes in the US.

Describe the Election of 1936

-To oppose Roosevelt, the Republicans nominated Kansas Governor Alfred Landon. Although Landon favored some New Deal policies, he declared it was time "to unshackle initiative and free the spirit of American enterprise." As the election neared, Landon became more aggressive. The New Deal "violates the basic ideals of the American system," he declared. "If we are to preserve our American form of government, this administration must be defeated." -Despite Landon's attacks, Roosevelt and the New Deal remained overwhelmingly popular with the American people. The challenge from left-wing radicals also proved much weaker than expected—primarily because Huey Long had been assassinated in Louisiana in September of 1935. a) Long's supporters joined with those of Father Coughlin & Francis Townsend in the summer of 1936 to form a new political movement called the Union Party, but without a strong leader, the party had no chance.

Describe the National Recovery Administration (NRA)

-Under the leadership of Hugh Johnson, the National Recovery Administration (NRA) ran the entire program. Business owners who signed code agreements received signs displaying the NRA's symbol-a blue eagle-& the slogan, "We do our part." Since the NRA had limited power to enforce the codes, it used public opinion to pressure companies into going along. It urged consumers to buy goods only from companies that displayed the blue eagle.

Describe the impact of Walt Disney

-Walt Disney produced the 1st feature-length animated film, Snow White and the Seven Dwarfs in 1937. Its box office appeal may have spurred MGM two years later to produce "The Wizard of Oz," a colorful musical that lifted viewers' spirits.

Describe Roosevelt's election

-When FDR came into office, he was bursting with ideas to help the United States recover from the Depression. The president, however, had no clear agenda. The previous spring, during his campaign for the presidential nomination, Roosevelt revealed the approach he would take as president. "The country needs," Roosevelt explained, "bold, persistent experimentation...Above all, try something". -In mid-June 1932, with the country deep in the Depression, Republicans had nominated Herbert Hoover to run for a second term as president. Later that month, the Democrats, after 4 ballots & a great deal of negotiating, chose Roosevelt, the popular governor of NY. When he won the nomination, Roosevelt broke with tradition by flying to Chicago to deliver the 1st acceptance speech ever made to a nominating convention. -The next day, a cartoonist used the words "New Deal" to stand for Roosevelt's program. From that point forward, Roosevelt's policies for ending the Depression became known as the New Deal. Roosevelt's confidence that he could make things better contrasted sharply with Hoover's apparent failure to do anything effective. On Election Day, Roosevelt won the Electoral College in a landslide, 472 votes to 59 & received nearly 23 million votes to slightly less than 16 million for Hoover in the general election.

Describe the left wing's concerns with the New Deal

-While criticisms from the right threatened to split the Democratic Party and reduce business support for Roosevelt, another serious challenge to the New Deal came from the left. People on the left believed Roosevelt had not gone far enough. They wanted the government to intervene even more dramatically in the economy to shift wealth from the rich to middle-income and poor Americans.

Describe the stock market

The stock market was established as a system for buying and selling shares of companies. Sometimes circumstances in the stock market led to a long period of stock prices, which is known as a bull market. -In the late 1920s a prolonged bull market convinced many Americans to invest heavily in stocks. By 1929 about 3 million Americans or roughly 10% of households owned stocks. -As markets continued to soar, many investors began buying stocks on margin, meaning they made only a small cash down payment as low as 10% of the price (stockbroker earned both a commission on the sale & interest on the loan). -As long as stock prices kept rising, buying on margin was safe. To protect the loan, a broker could issue a margin call, demanding the investor repay the loan at once. As a result, if prices fell, they had to sell quickly, or they might not be able to pay their loans. -Buyers hoping for fortune overnight engaged in speculation. Instead of investing in the future of the companies, speculators took risks, betting that the market would continue to climb, therefore enabling them to make money quickly.