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Great Depression Facts

Herbert Hoover

Great Depression Facts: Herbert Hoover was the 31st US President who served in office from March 4, 1929 to March 4, 1933. One of the most important events during his presidency was the beginning of the period in US history known as the Great Depression.

Definition and Summary of the Great Depression Facts
Summary and definition:
The Great Depression started in 1929 sparked by the Wall Street Crash. The economic crisis led to bank closures, mass unemployment, homelessness, hunger and the despair and dejection of American people.

The terrible drought in 1932 led to dust storms that ravaged the land in the prairies states of America brought unbelievable hardship to even more people. Bread Lines and Soup Kitchens were the only form of sustenance for the hungry.

People joined Hunger Marches and the Bonus Army March by WW1 veterans resulted in debacle  in Washington. Shantytowns, called 'Hoovervilles' sprang up across the country, the only refuge for the homeless. Unemployed men, hobos, traveled the railways to different locations desperately searching for work.

The worst years of the Great Depression were 1932-1933, during the presidency of Herbert Hoover who was blamed for the crisis. Things slowly improved under the presidency of Franklin D. Roosevelt.  The economic output in America surged and unemployment fell as the United States entered WW2. The devastation of the Great Depression was replaced by the destruction of World War Two.

When did the Great Depression start? The Great Depression started with the Wall Street Crash which occurred on October 29, 1929 (Black Tuesday)

When did the Great Depression end? The Great Depression lasted for ten years and ended in 1939 as WW2 broke out. The worst year of the Great Depression was 1933.

What was the Unemployment Rate during the Great Depression: The Unemployment Rate during the Great Depression in 1933 was 25%. Over 12 million people were unemployed with over 12,000 people being made unemployed every single day at the height of the Great Depression.

Facts about Great Depression Facts
The following fact sheet contains interesting facts and information on Great Depression Facts.

The Roaring Twenties had been an exciting period in America with new inventions, technical innovations and changing lifestyles. The feeling of exuberance and invincibility disappeared almost overnight triggered by the 1929 Wall Street Crash and economic collapse in the United States.

The Great Depression was aptly named reflecting both the long and severe recession in the American economy and the feelings of dejection and despair experienced by the American people. 

The Great Depression began with the Wall Street Crash in October 1929. Just six months before, on March 4, 1929, Republican President Herbert Hoover, riding on a wave of optimism, had been inaugurated as President of the United States.

During the euphoria of the Roaring Twenties many of the once "thrifty and prudent" American public adopted the modern philosophy of "Live now, pay later" and bought expensive products, like automobiles, on easy credit terms.

Ordinary, Middle Class Americans had invested in the Stock Market. By 1929 nearly 4 million Americans (about 10% of US households) had invested in the stock market " Buying on Margin" meaning that they were buying shares with loans.

The levels of debt effected the ability of many Americans to survive the effects of the Great Depression. The number of suicides jumped to an alarming 18.9 per 100,000 in 1929, the year of the Wall Street crash.

There was an uneven distribution of income in America. Lower class, poor Americans were in the majority (60%) - these people were suffering even before the Great Depression and had limited spendable income.

Those Americans who had money and remained "thrifty and prudent" also suffered. They had placed their money in banks for safe keeping. Many were small banks who had also recklessly invested in the stock market and lent money to stock market investors.

The federal government did not insure bank deposits. If a bank collapsed its customers lost all their savings. During 1929-1931 over 3000 banks went bankrupt - over 10% of the nation's total and more followed as the Great Depression deepened.

People were desperate to get their money out of ailing banks which led to a series of banking panics called Bank Runs. There were numerous Bank Runs at the same period of time which led to financial crisis and a chain of bankruptcies.

Rumors would circulate that a bank was about to collapse. People scrambled to withdraw their money. As a bank run progressed, it generated its own momentum in a kind of self-fulfilling prophecy. As people withdrew their money, even more people made withdrawals. The bank would run out of cash and become bankrupt.

Four days later, the stock market crashed and the Great Depression followed. The credibility of the president was lost. At the time when strong leadership was essential to Americans, confidence in the president was at an all time low and Herbert Hoover bore much of the blame for the Great Depression in the minds of the American people. His reputation was tarnished even further as he failed to recognize the severity of the situation, was perceived as insensitive, and failed to take effective measures to address the problems.

What did the Hoover Administration and the Federal Government do? The measures taken by President Hoover and the federal government included the following:

  • 1930 Hawley-Smoot Tariff created protective tariffs (taxes) and increased rates on imported goods

  • 1931 Federal Home Loan Act was passed creating the Home Loan Board and the creation of banks to handle home mortgages. The Federal Home Loan Banks received $125 million in capital

  • In October 1931 the National Credit Corporation was created to encourage the largest banks in the country to establish lending agencies to lend money to small banks on the brink of foreclosure, that could be used for loans

  • 1931 Wagner-Graham Stabilization Act was passed to set up the Federal Stabilization Board to initiate public works such as dams and highways

  • The 1931 Keyes-Elliott Acts appropriated an additional $330 million for Federal buildings and construction projects in order to aid employment

  • Congress passed the Emergency Relief and Construction Act of 1932 to create the Reconstruction Finance Corp. (RFC). The RFC was designed to give out loans to banks, railroads, and companies in order to pump money back into the economy

  • The Emergency Committee for Employment was set up August 19, 1931 in an attempt to mobilize private charity and encouraged states and cities to increase public works spending. It ended on June 30, 1932 because the government was not willing to help the agencies with the aid of money

  • Public Works Programs were initiated, such as the construction of the Hoover Dam

The Great Depression sparked civil unrest and a series of Hunger Marches by WW1 veterans. On December 5, 1932 nearly 2000 people marched to Capitol Hill in Washington chanting "Feed the hungry, Tax the rich". They were soon dispersed but there action inspired other veterans to march to Washington later in the year.

The Bonus Army March took place in the summer of 1932 as WW1 veterans marched to Washington to lobby Congress to pass legislation authorizing the early payment of $1000 veterans bonuses. The bill was not passed. Some veterans, with no where else to go, stayed in Washington living in unoccupied building and makeshift camps. The government called in the army to remove the veterans. The US Army, under Douglas MacArthur, used extreme and violent tactics to remove the veterans.

Over 20,000 companies and business went bankrupt and closed at the start of the Great Depression. People were laid off work and their were no opportunities for new employment.

Between 1929 and 1932 construction projects fell by 80% contributing to the high levels of unemployment.

By 1933 the number of unemployed reached the staggering figure of 12 million (25% of the population). 70,000 factories were closed by 1933.

People had no jobs and no money and many went hungry. There was no benefits system and people were literally starving. Americans were forced to join 'Bread Lines' for free handouts of food, in particular bread. There were so many impoverished people that the Bread Lines sometimes stretched over several blocks. Others lined up at 'Soup Kitchens', established by charities, where food was served to the hungry.

Shanty towns (Hoovervilles): Due to unemployment Americans were unable to pay their bills. Many unfortunate tenants were evicted by bailiffs. Homeless Americans had no alternative but to set up shacks on unused or public lands. The photograph of the children living in a 1930's shantytown conveys the plight and the living conditions forced on American citizens who had been made homeless, through no fault of their own, during the Great Depression. Nearly 50% of children did not have adequate food, shelter, or medical care. For more facts refer to Shantytowns and Hoovervilles

Hobos: Many men and young boys became hobos during the great Depression. Many absented themselves from their families in search of jobs anywhere in the country. Many unemployed men felt they were a burden consuming scant food rations available to their families. The easiest way to travel around the country was by train and hobos would ride on open boxcars or in freight trains to each new destination. Shantytowns, called 'Hobo Jungles' sprang up by railroad stations.

Dust Bowl: Farmers had experienced a difficult time in the 1920s. It got worse in the 1930s. In 1932 a devastating drought hit the farmers in North and South Dakota, Nebraska, Kansas, Oklahoma, and New Mexico. With no rainfall the soil turned to dust. Violent winds whipped the dry soil creating terrifying dust storms. The dust got everywhere, crops were ruined and livestock were killed. Farmers lost their lands and homes to the foreclosures by the banks. The dust bowl and the dust storms destroyed 100 million acres of land. Over 3 million impoverished people became homeless and many had no alternative but to head west to California away from the devastation of the prairie states.

The Los Angeles Police Department established the "Bum Blockade," in the illegal attempt to block immigrants from the Dust Bowl from crossing the California border

During the Great Depression author John Steinbeck wrote "The Grapes of Wrath" and "Of Mice and Men" about the lives of the people living in the Prairies states and the devastating effects of the Dust Bowl.

Americans sought to escape the horrors of the Great Depression by listening to the radio or spending a dime to go to the movies. 60-80 million Americans went to the movies every week. The biggest hit song of 1932 was "Brother, Can You Spare a Dime?" by Bing Crosby. The most popular films during the era were 'Gone with the Wind', 'Snow White and the Seven Dwarfs', 'King Kong', the 'Wizard of Oz' and 'Mr. Smith goes to Washington'.

Crime increased during the Great Depression. Amongst the Americans, who followed in the path of Al Capone, turned to crime during the period were Bonnie and Clyde, John Dillinger, "Baby Face" Nelson, Machine Gun Kelly, Pretty Boy Floyd and the Ma Barker gang.

The Stock Market: By 1932 industrial stocks lost 80% of their value since 1930.

International Trade: The Wall Street Crash had impacted across the globe sending other countries into recession. This, and the high tariffs on imported goods to America led to a massive fall in International trade. Between 1929-1932 international trade fell by a massive 70%.

Income Tax: The top rate of tax was raised from 25% to 63% but this measure was seen as too little, too late.

The Great Depression peaked between 1932 and 1933 when things slowly started to improve.

The period in American history known as the New Deal was about to begin.

In the 'First 100 Days' the Roosevelt presidency started with intensive legislative activity and Congress passed 15 important acts to combat the economic crisis - these actions were referred to as the 'First New Deal' encompassing his policies of Relief, Recovery and Reform.

President Roosevelt's New Deal Programs would become the biggest, most expensive government initiatives introduced by any American President. His first goal was to stabilize the banking system. The Emergency Banking Relief Bill brought all banks under federal control.

President Roosevelt realized that he had to win back the confidence of the American people. He used the power of communication via the radio and established a weekly broadcast called the "Fireside Chats" to speak directly to Americans.

The Second New Deal emerged in 1935 - 1936 established more radical and reforming policies. These included the Works Progress Administration, the Rural Electrification Administration and the National Labor Relations Act. The federal organizations that were created to provide practical were nicknamed “Alphabet Agencies,” such as the TVA, NRA, CCC, AAA and PWA.

World War 2 broke out in 1939 and the United States entered the conflict on December 7, 1941. At this point the economic output in America surged and unemployment fell - refer to US Mobilization for WW2

And so the Great Depression came to an end, only to be replaced by devastation caused by WW2.

US American History
1929-1945: Depression & WW2

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