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The economic crisis in Texas


Picture of Houston in Texas
Picture of Houston in Texas

At the onset of the Great Depression, the economic downturn of the 1930s, many Texans assumed that the downturn was an eastern financial collapse and would not affect Texas. By the winter of 1930-1931, however, the price of cotton had dropped to less than a nickel a pound. More than 350,000 Texans were out of work by mid-1932, and at least 25 percent of them had no resources to survive unemployment. Dwindling tax revenues and the lack of industries limited public funds, and private charities had no funds.

Consequently Texans, like other Americans, were anxious for federal aid, and they voted overwhelmingly for Democrat Franklin Delano Roosevelt in the 1932 presidential election over the incumbent Republican Herbert Hoover. Roosevelt promised a New Deal for Americans in his inaugural address, and his domestic programs profoundly affected the Texas economy in the 1930s. Under Roosevelt’s New Deal legislation, the federal government provided direct relief payments to states and individuals for the first time in history. Programs such as the Works Progress Administration and others hired the unemployed to work on public projects.

Putting people back to work meant that many minority Texans were included in the public work projects. At first local white leaders wanted blacks and Mexican Americans excluded from government employment. But under pressure from federal administrators and organizations such as the National Association for the Advancement of Colored People, which were located in Eastern cities in which blacks could vote, state administrators relented and included minorities in federal programs.

Black voters, as a result, switched their allegiance in the 1930s from the Republican Party to the Democrats. Federal courts struck down the all-white primary in 1944. The number of black voters in Texas increased during the early 1940s, particularly in urban areas, where blacks had begun to move during the 1920s. By 1950 blacks were nearly 20 percent of the population of most Gulf Coast cities and nearly that high a percentage in Dallas and Fort Worth.

Many Mexicans in Texas were deported to Mexico during the Great Depression. Large-scale roundups of immigrants, particularly in rural areas, included Texan Mexicans. Federal projects were prohibited from aiding immigrants, and since many Mexican Texans could not prove citizenship, they did not benefit from Roosevelt’s New Deal as much as other poor people. Nevertheless a group of bicultural business leaders in San Antonio and in the Río Grande Valley organized the League of United Latin American Citizens (LULAC) to fight segregation and to create a stronger voice for Hispanics in Texas and in national politics. Members of LULAC tended to vote Democratic, and they financed the first court challenge to the segregation of Mexican American children in separate schools.

Offshore oil in Texas
Offshore oil in Texas

In 1948 LULAC and members of the Mexican American Legal Defense Fund won lawsuits ending official segregation of Mexican Americans in public facilities in Texas. The New Deal changed Texas politics in other ways as well. Aided by the National Labor Relations Board (a federal commission that oversaw business-labor relations), higher percentages of Texas workers joined labor unions than ever before. These workers also became ardent Democrats.

Some changes were more subtle. The Agricultural Adjustment Act, for example, began planning deliberate scarcities to raise crop prices. Much of the land taken out of cultivation was marginal land farmed by tenants. Texas farmers began the great migration to the cities and to California. The speed of the migration increased during World War II (1939-1945) when defense-related jobs were created in many cities. Texas, 60 percent rural in 1930, would be 60 percent urban in 1950. After 1950 agriculture remained one of the three legs supporting the Texas economy (farming, oil, and defense-related industries), but it no longer dominated all other economic enterprises. Tenant farming, moreover, had all but disappeared from the state. Although the oil industry was important to the economy of the Gulf Coast, it did not dominate the state’s economy before 1930. In that year, the great East Texas oil field near Kilgore began production, and the Permian Basin field was discovered in the late 1930s. Much of the Permian field was on state land, and as a result much of the royalties from the field financed education in Texas. So, too, did the income from the tidelands oil, and petroleum became the state’s leading export. "Texas" © Emmanuel BUCHOT, Encarta, Wikipedia.

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