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Dust Bowl and the Great DepressionThe Dust Bowl | Discussion Questions | Activities | Resources Background: Causes of the Depressionwritten by Lynette Boone, University of Oregon References In the decade prior to the crash of 1929, the nation became polarized between rich and poor. The boom period of the 1920's was a time of great prosperity for Americans in the top income brackets. However, lower and middle class working Americans did not share the rewards of the "Coolidge Prosperity." A study by the Brookings Institute indicates that in 1929 the top 0.1% of Americans had a combined income equal to the bottom 42 % of Americans [1]. The Coolidge administration, the republican controlled government and a conservative Supreme Court contributed to the gap between the rich and poor by passing legislation that favored the wealthy such as the Revenue Act of 1926 which reduced federal income taxes and inheritance taxes significantly [2]. In 1923 the Supreme Court ruled minimum-wage legislation unconstitutional [3]. Productivity had increased due to modernization of factories and methods of production. However, wages increased only one fourth as fast as productivity [4]. Poor and middle class Americans could not afford to purchase many of the goods that they were producing. Many people began to buy products such as cars and radios on credit. Between 1925 and 1929 the total amount of outstanding debt from credit more than doubled [5]. The nation's economy was dependent upon the middle class purchasing products on credit and luxury spending by the wealthy. At the same time that there was an imbalance in distribution of wealth among people, there was also a great disparity in the industrial realm. Wealth became concentrated among relatively few companies. In 1929, 200 corporations controlled about half of all corporate wealth [6]. Some industries, such as the automotive and radio companies were thriving, while the agricultural sector declined. During WW1 the federal government had subsidized farms and encouraged modernization to increase production. When the war was over, the government abruptly cut aid to farmers. Prices paid for crops dropped sharply and farmers fell into debt. In 1929 the average annual income for an American family was $750, but for farm families if was only $273. The problems in the agricultural sector had a large impact since 30% of Americans still lived on farms [7]. The growing gap between wages and productivity can also be linked to the decline of labor unions in the 1920's. The post WWl rise of industrial Republicanism gave rise to much anti-union sentiment in the business world and in popular culture itself. The propaganda of the time painted unions as violent, radical organizations of Bolsheviks and other dangerous foreigners. Business organizations like the National Association of Manufacturers waged anti-union campaigns like the so-called "American Plan" which aimed to keep unions from forming in the manufacturing sector. Business had the support of government and the judicial system discouraging unionism through injunctions. Local police in cooperation with industry security forces were willing to use violence or the threat of it to stop organizing, picketing, boycotts and strikes. Without the ability to organize unions, workers were unable to pressure their employers to pay wages commensurate with the increased profits that came with higher productivity [8]. Another major cause of economic problems was the balance of wealth between Europe and the United States. During the 1920's Europe was recovering from the effects of WWI. The United States loaned increasingly higher sums to European countries, and by the late 1920's these countries were struggling to pay back the loans. The United States instituted high tariffs on foreign goods to discourage imports. Europeans, unable to sell their goods in the U.S. at competitive prices saw their economies suffer still further. In a cycle of decline, the Europeans could not afford to buy American made goods [9]. The banking system began to show signs of instability throughout the 1920's. Poor management in the form of risky, unethical lending practices, and the promotion of speculative enterprises led to a large increase in the number of bank failures [10]. In the later 1920's the stock market rose to very high levels. Investors were willing to take large risks, especially with respect to trying to predict the future; gambling in the hopes of making quick, large gains in the stock market. During the boom years, a given company's stock might rise dramatically, bringing huge profits to investors, even though in actuality, it had yet to pay a single dividend [11]. Mass speculation caused a record volume of 1,124,800,410 shares to be traded on the New York stock exchange in 1929 [12]. On Monday, October 21 stock market prices began to fall sharply. Despite some partial recovery during the week and an attempt by a group of bankers to stop the crash, on Monday October 28 the market fell 13%. The next day, which came to be known as Black Tuesday, a record number of 16.4 million shares changed hands and stocks fell so precipitously that no buyers were available at any price [13]. By the time of the stock market crash, the stage was set for economic disaster. The economy of the 1920's had been built, to a large degree on confidence. The stock market rocked the confidence of the rich who stopped spending money on luxury items and investing in the stock market. The poor and middle class stopped buying things on credit for fear of losing their jobs and not being able to pay the bills. With the goods that no one could afford to purchase piling up in stock rooms, production declined 9% between October and December of 1929 [14]. People began to lose their jobs and consequently defaulted on their loans. Banks began failing on a massive scale and since deposits were uninsured, many people lost all of their life's savings. In 1931 a total of 28,285 business failed at a rate of 133 per 10,000 businesses. By 1932, US industrial output fell 54% and there was 25-30% unemployment [15]. Herbert Hoover who had become president only eight months before the stock market crash, believed in the power of free market forces; if left to its own devices, the economy would fix itself. In speeches he reminded the country of his view that caring for the cold and hungry must be primarily a local and voluntary responsibility of private charity, not of the federal government. By the middle of Hoover's term, however, discontent was rising in the country. Hoover, fearing for his political life, called for some limited reforms to relieve farmers facing mortgage foreclosures. He also presented to congress a program asking for creation of the Reconstruction Finance Corporation to aid business, banking reform, and a loan to states for feeding the unemployed [16]. The economy, however, continued to decline and the sentiment among most Americans was that Hoover had done to little, too late. In the election year of 1932, the economy was still on a downward slide. Franklin D. Roosevelt (F.D.R.), the popular democratic Governor of New York had instituted government programs to help alleviate some of the hardships faced by the people of his state. F.D.R. ran on a platform which promised to bring bold new programs to the Federal government which would regulate the large holding companies that had managed to concentrate capital in the hands of a few by manipulating the stock market to suit their interests. He also pledged to put in place a social safety net, offering a New Deal to the American people. In 1932 Roosevelt won the presidential election by a landslide. References
The Dust Bowlwritten by Lynette Boone, University of Oregon Exacerbating the economic hardship was the phenomena of the Dust Bowl, the most persistent drought in recorded history. Starting in 1930, the eastern third of the country experienced a long, dry spell. The center of the drought moved west in 1932 and covered a range of the Great Plains from North Dakota to Texas and from the Mississippi River Valley to the Rocky Mountains. The areas most affected were the panhandles of Texas and Oklahoma, northeastern New Mexico, southeastern Colorado, and southwestern Kansas. The Dust Bowl was to last for nearly a decade [1]. After WWl, a recession led to a drop in the price of crops. In order to increase productivity, farmers mechanized production and cultivated more land. The land was planted and harvested in an endless cycle of production without allowing the land to lie fallow and replenish itself [2]. The once fertile grasslands of the Great Plains had been overgrazed by cattle. Some of the grassland was then planted with wheat. The heavy demands placed upon the soil depleted it to the point that by 1934 ,125 million acres of land had lost most of the topsoil to erosion [3]. The drought stricken soil with no vegetation left to hold it in place, simply blew away. The dust was so thick during the storms that it obliterated the sun, seemingly turning day to night. People found it impossible to keep the dust out of their houses. Anyone left outside in a dust storm would be overcome by breathing in dirt. Occasionally, the dust would blow longer distances. In April of 1931 a storm blew dust to the Pacific Coast. In May 1934 an even stronger storm blew dust as far as New York City where the dust darkened the daylight to the point that street lamps had to be lit [4]. Many people decided to leave the dust storms behind and move west to start a new life. It is estimated that 2.5 million people left the region during the Dust Bowl years [5]. Even for those who wanted to stay, economic conditions forced many from their farms. Department of Agriculture records indicate that nearly two hundred out of every thousand farmers in the Midwest, Central South and Plains States lost their land to foreclosure between 1930-1935 [6]. Some people, lured by stories of prosperity in California set out in search of agricultural work in the rich, farmland of the San Joaquin Valley. California agriculture was already dominated by large corporate farms however, so the establishment of small, family farms by the newcomers was not possible [7]. The big farms already had a glut of agricultural workers including Mexican-Americans that were being deported from the country by the truckload. As more dustbowl refugees poured into the state, ditch camps consisting of makeshift shelters constructed of cardboard boxes and crates began to spring up alongside the road. The California government and police were less than welcoming to the migrants or "Okies," installing border guards to keep the new arrivals out. Those that did manage to find jobs picking crops lived in squalor in camps with inadequate housing and sanitation [8]. They were paid a pittance for hard work in the hot sun. If they complained, they were reminded that there were plenty of people in line who would be happy to get the work. Some dust bowl migrants settled in the large cities of Los Angeles, San Diego, and San Francisco where they eventually melded with the urban population [9]. Approximately 460,000 people moved to the Pacific Northwest where many eventually found work constructing the Bonneville and Grand Coulee dams. Some settled in abandoned homesteads in the dry eastern valleys of Washington and Oregon. Others worked as migrant agricultural workers or lumberjacks in the ancient forests [10]. ReferencesT.H. Watkins, The Great Depression: America in the 1930s (New York: Little, Brown and Company, 1993) 190 (2) Fanslow, Robin A., American Folklife Center, Library of Congress, "Voices From the Dust Bowl: The Migrant Experience" (April 6, 1998) Online. (3) Internet: http://lcweb2loc. gov/ammenm/afctshtml/tsme.html (4) Watkins, 191 (5) John R. Wunder and Frances W. Kaye, Americans View Their Dust Bowl Experience (University Press of Colorado, 1999) 6 (6) Watkins, 194 (7) Watkins, 193 (8) Watkins, 195 (9) Fanslow, 2 (10) Watkins, 195 Discussion QuestionsBefore the video:
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RESOURCESWeb sites New Deal Network The New Deal Network is an educational web site sponsored by the Franklin and Eleanor Roosevelt Institute and the Institute for Learning Technologies at Teachers College/Columbia University. From the Library of Congress American Memory Project:
Pete Seeger and the Great Depression Doris Ullman Collection, University of Oregon Library Photographs from Appalachia (1920's - 1934). What caused the Great Depression to be damaging to the agricultural sector?Farmers who had borrowed money to expand during the boom couldn't pay their debts. As farms became less valuable, land prices fell, too, and farms were often worth less than their owners owed to the bank. Farmers across the country lost their farms as banks foreclosed on mortgages.
What happened to agriculture during the Great Depression?In the early 1930s prices dropped so low that many farmers went bankrupt and lost their farms. In some cases, the price of a bushel of corn fell to just eight or ten cents. Some farm families began burning corn rather than coal in their stoves because corn was cheaper.
Why were agricultural areas affected badly by the Depression?Agriculture continued to decline under Hoover and there was great hardship. Prices remained so low farmers could not afford to harvest their crops. They left the crops, like wheat and fruit, to rot in the fields and farm animals were killed instead of being taken to market. 40 per cent of farms were mortgaged to banks.
Why was the Great Depression in Texas especially damaging to the agricultural sector?In the second half of the 1930s, as the Depression wore on, a major drought devastated the southern plains. The Texas Panhandle suffered greatly, as winds eroded the parched land and made life on farms and in towns all but impossible. At times, the dust storms were so severe they blocked the sun for hours.
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