A) Farm Crisis – farmers were plagued with overproduction, falling farm prices, and declining income throughout the 1920s.
2) Non-Partisan League – called for government intervention (the government ownership of the grain elevators and slaughterhouses, easier credit, and tax exemptions for farm improvements). This group was strongest in the upper Midwest (the Dakotas and Minnesota); it remained a force into the 1940s, particularly in Minnesota where it was transformed into the Farm-Labor Party.
4) Rationalization of the family farm – more and more families were in fat being pushed off the family farm by the worsening economic conditions; this farmland was then bought up by corporations, who in turn then hired labor (often, the family who had been forced to sell their farm) to work on these farms.
B) Decline of Organized Labor – the reaction against radical politics in general had a definite negative effect on organized labor; with the decline of organized labor also came a decline in the share of profits that workers got from the workplace.
1) “American Plan” (its evil opposite would, of course, be the “un-American Plan) – the description of the corporate drive for the open (anti-union) shop; the closed (or union) shop imposed upon the “individual liberties” of the American worker.
(a) Employer Welfare Plans – insurance, company athletic teams, and other company sponsored cultural and social events were all intended to fight the impression that workers labored for a coldly impersonal corporation that would throw them out into the streets as soon as an economic downturn occurred (which, of course, was the reality of the situation).
(b) Company unions – gave the appearance of employee representation; in reality, company unions were a way of sidetracking employee complaints about working conditions and wages. Corporations were able to push out or eliminate unions that were affiliated with the AFL, and replace them with unions that the companies could control.
2) Decline of mature industries – with the decline of mature industries, in particular the coal industry, labor lost many members in these industries which it had already organized, while more workers were finding employment in newer manufacturing industries (like automobiles), that the AFL had never been able to successfully organize in the first place
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3) Death of Samuel Gompers – Gompers died in 1924, while in office. William Green, who had formerly been an official with the United Mine Workers, replaced him. Green was not a dynamic leader, which the labor movement probably needed at this point desperately to battle against the tide of events.
(a) Brotherhood of Sleeping Car Porters – led by A. Philip Randolph, by 1926 this union had several thousand members; the AFL, however, refused to charter the union, mainly because it had a largely black membership, and was led by an African American.
C) The Business Cycle – the so-called “boom and bust” cycle was an ongoing phenomenon for which we really have no good explanation. However, depression had happened in the past (1837-38, 1857-1861, 1873-1877, 1885-86, 1893-1897, 1907, 1920-1921), but had largely been self-adjusting (that is, they were waited out without government intervention).
1) “New prosperity” – according to economist Thorstein Veblen in 1921, this so-called new prosperity was based upon an “inordinately productive form of mechanical activity.” Machinery was able to produce more goods faster with fewer workers; but ultimately this also provided fewer customers to buy these goods.
2) Wall Street speculation – buying stocks “on margin” (that is, with money that was borrowed, in the expectation that the market would continue its upward trend. When the market crashed, these investors had to pay back these loans, which often wiped out most of the gains (and then some) that they had made previously.
4) Federal Reserve Board – had fueled Wall Street speculation by keeping interest rates low through most of the 1920s; after the crash, the Fed reacted by raising interest rates at exactly the wrong time.
E) Hard Times – bread lines and soup kitchens became common sites in major US cities, and are our most common images of the Great Depression.
1) Joblessness – in many of the manufacturing cities in the Midwest and East, unemployment levels ranged between 25% to 50% of the workforce (Toledo was at the high end of those figures). Women, particularly married women, were forced out of the workforce, since they were there to earn “pin” money anyway, and were taking money out of the pocket of a male breadwinner.
2) “Sharing the misery” – even those workers still employed were working greatly reduced hours; sometimes only 1-3 days a week, and often for six hours or less a day. This allowed many more workers to remain on the job than would otherwise be the case; however, this method could only be used in larger manufacturing concerns, smaller ones could not afford to do this.
3) Return migration – many southern whites returned to the South during this time, since it would be easier to eke out an existence back on the family farm among relatives and friends. Not all internal migrants, however, chose to return to their former homes, or returned voluntarily.
(a) Mexican nationals – many Mexican nationals had moved north to manufacturing jobs; with the onset of hard times local government officials and other workers often used intimidation to force these people to vacate their northern homes.
(b) African Americans – remained in the North, preferring life there, as hard as it was, to returning to the South. In part, this was probably caused by the increase in physical violence against blacks in the South; lynchings increased in the 1930s for the first time in a decade.
F) Government response
1) Crisis in confidence – consumer and business confidence in the expansion of the economy had created the extended economic boom; as the depression worsened and lengthened, this confidence evaporated.
2) Hoover’s response – Hoover was in many ways the personification of progressive politics; a technocrat, an able administrator, who believed that politics could be made apolitical, and that rational decisions could be made after one was able to gather sufficient information.
(a) Reconstruction Finance Corporation – a plan which loaned $700 million to failing banks and businesses; but the government also raised taxes to pay for this, which largely undercut its economic effectiveness.
(c) “Hoovervilles” – shantytowns that were thrown up using discarded scrap were referred to as a “Hooverville,” in a black humor poke at the man most people blamed for their abject condition.
G) Poor People’s Campaigns
1) Communist Party and Unemployed Councils – local agitation for rent relief and other kinds of assistance were often led by members of the Communist Party, or by those sympathetic to the immediate aims of the party in the affiliated Unemployed Councils.
(a) Sharecroppers’ Union – active among black sharecroppers in Alabama
II) 1932 Presidential Election
A) Hoover’s popularity – Hoover, of course, was hugely unpopular; most of the blame and frustration with the economic woes most people were facing were placed upon him.
B) Franklin Delano Roosevelt – promised to balance the federal budget (Hoover was running the largest peace-time budget deficit in the country’s history at this time) and trim the federal payroll; his stand on religion and drink were completely unexamined during the campaign (much to his benefit). Roosevelt campaigned on the slogan “A New Deal for the American People.”
1) Background – patrician (meaning he came from old money, as did his cousin TR). In many ways, he tried to model his political career with that of his cousin’s—he served as New York assemblyman, secretary of the Navy, and he was the Democratic Party’s choice to run as Vice-President in 1920. In 1921 he was stricken with polio, and was never able to walk without some kind of assistance after that. That he was able to make a political comeback from this disease was due in large part to the assistance of his wife, his second cousin Eleanor.
2) The New Deal--for Roosevelt, the "new deal" was simply a campaign slogan, rather than a well-thought out plan to implement socialism, or to provide a social "safety net" for some Americans. Roosevelt was willing to try just about any program, as long as he was convinced that it might work. As we will see, Roosevelt was very unwilling to overthrow the capitalist system; rather, he was convinced that the system had to be saved (although he did prove more willing to campaign against some groups of people). In 1932, the only thing Roosevelt really promised to do was to balance the federal budget.
3) FDR won 57% of the popular vote (against an immensely unpopular Republican candidate); the only state that he lost outside of New England was Pennsylvania.
a) The interim period--the interim months between Roosevelt's election in November 1932 and his inauguration in March 1933 saw conditions in the country worsen, as the country entered the depths of the Great Depression. Despite an offer from Hoover to collaborate on policies to stem the suffering, Roosevelt chose to remain at his home in New York, and let Hoover and the lame duck Congress deal with the consequences (and take the blame for what was happening)
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