Copy of Boom to Bust Handout AP Version

As you go through the Boom to Bust choice activity, keep track of your choices and what happens to you throughout the 1920s. In addition, note anything that might explain a cause of the Great Depression. When you are done, compare the causes you wrote with those of a classmate. Then, read and compare the excerpts from FDR and Hoover about the Depression. What happens to you (experiences & choices) ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● Im a wheat farmer. Crop prices r high. The gov’t pass Fed Farm Loan Act. 12- fed banks established to provide loans to farmers to expand their farms. Quit fam business and work at a Ford factory Save money instead of buy a Ford Buy ford anyway Buy a “bungalow in a box” and become $7,000 in debt and a $2,100 mortgage Get pay in $1000 bills Invest in homes to sell in Hollywood bc it looks promising and take out a loan No buyer of house, can’t pay back loan so bank foreclosed my property. Head back to NY Invest in RCA, bc the radio is the next big thing My stock inc, i open a savings acc at the bank Too many ppl take money out from the bank, no money left and bank has to close Go back to the farm Wheat bubble burst: Plow up a lot of land and plant a bunch of wheat. Everyone else did that so theres an oversupply and prices plummet more. Drought so soil blows away. Fam moves to CA but little jobs Feels optimistic ab Franklin Roosevelt’s “new deal” Causes of the Great Depression ● ● ● ● ● Land prices inc, machine prices inc, crop prices fall Economy is booming but no raise A few inside traders at RCA buy a bunch of its stock, inflating prices. They sold their stocks so prices plummet Smoot-Hawley Tariff has triggered a trade war, and Europe is buying fewer and fewer US crops Wheat bubble burst: Plow up a lot of land and plant a bunch of wheat. Everyone else did that so theres an oversupply and prices plummet more. Drought so soil blows away. Compare the speeches of Hoover & FDR. What do they each believe should be done? Hoover: Rugged Individualism What should be done? (what do they say in their speeches) ● ● ● Unemployment issues best left to state gov’ts Through rugged individualism, ppl can overcome the challenges Federal aid is not helpful- it weakens character and makes government aid expected FDR: New Deal ● ● ● ● Econ laws r made by ppl, not nature Fed gov’t should give ppl emergency relief and work opps during national emergencies. Fed gov’t responsible for public welfare New deal: everyone working together to bring America back to a prosperous ● ● ● If the state gov’ts can’t stop problems, he will then ask for fed help Big loans to promote agriculture & public devs Americans should b given a chance to help themselves & each other b4 help from gov’t ● ● ● ● state. Have ppl working on public projects & redistribute use of natural resources Redistribute ppl across country to make the best use of land Supervision on investments, credits, banks FDR would expand exec pwr to dig America out of depression if needed Next compare the actions taken by Hoover and FDR. 1. Many criticize Hoover for doing nothing to end the Depression, leading to the use of terms like “Hoovervilles.” Do you think this is a fair assessment? Explain. I think it is a fair assessment. It is not true that Hoover did nothing, but there was a lot that he could have done but neglected to do. He focused too heavily on large government policies in hopes of it indirectly benefiting the people, such as the Hawley-Smoot Tariff, instead of policies that directly helped the people. Much of the time his policies would harm people, like the tax increase that made many become poor. 2. What were the similarities and differences in the actions Hoover and FDR took in addressing the Depression? Similarities Recognized that the gov’t has some role in helping the people ● Make public works programs ● Promoted private business and government cooperation ● Differences ● ● ● ● ● Hoover- gov’t small role, FDR- gov’t large role Hoover encouraged fair business practices, but FDR monitored & ensured fair business practices Hoover- projects indirectly benefiting ppl, FDR- projects directly benefiting ppl FDR more successful FDR “New Deal” covered more issues than Hoover and was more thought through