Heimler’s History: The Great Depression

Introduction

• Focus on Unit 7 of AP U.S. History curriculum
• Previous video: The 1920s
• Current video: Causes and effects of the Great Depression

Causes of the Great Depression

1. Stock Market Crash (Black Tuesday)

   • Happened on October 29, 1929
   • Weeks-long process leading to the crash

2. Factors Leading to the Crash

   • Overproduction by Farmers:
     • Severe debt due to overproduction
     • High tariffs (e.g., Hawley-Smoot Tariff) restricted global market access
   • Speculation in Stock Market:
     • Risky investments and buying on margin
     • Assumption of ever-increasing stock prices
     • Resulted in crushing debt when market crashed

Effects of the Great Depression

• Widespread poverty and homelessness
• Rise of shantytowns known as Hoovervilles (criticism of President Hoover)
• Hoover’s laissez-faire economic policies criticized

Political Responses

1. Herbert Hoover

   • Minimal government intervention
   • Belief in self-correcting economy

2. Franklin D. Roosevelt

   • Elected in 1932, opposite approach to Hoover
   • Heavy government intervention
   • Expansion of federal government size and scope

The New Deal

• Roosevelt’s program to address economic crisis
• Transformation into a limited welfare state

Three R’s of the New Deal

1. Relief for the Unemployed

   • Public Works Administration (PWA): Infrastructure projects
   • Tennessee Valley Authority (TVA): Electric power and erosion control
   • Civilian Conservation Corps (CCC): Soil conservation and forestry

2. Recovery for Businesses

   • National Industrial Recovery Act (NIRA):
     • Stabilize competition
     • Establish minimum wages and hours

3. Reform of Economic Institutions

   • Glass-Steagall Act:
     • Increased bank regulation
     • Established Federal Deposit Insurance Corporation (FDIC)
   • Securities and Exchange Commission (SEC):
     • Regulate stock market, prevent risky behaviors

Second Phase of the New Deal

• Social Security Act (1935):
  • Income safety net for retirees

Criticism of the New Deal

• Liberals: Not enough for the poor and unemployed
• Conservatives: Too much federal overreach
• Supreme Court challenges
  • Narrowed scope of New Deal programs

The Court Packing Scheme

• Roosevelt’s proposal to appoint additional Supreme Court Justices
• Strong opposition from Congress
• Seen as attack on checks and balances

Legacy of the New Deal

• Reforms and regulatory agencies
• Political realignment towards Democratic Party

Conclusion

• Overview of Unit 7 topics 9 and 10
• Encouragement to subscribe for more content