FDR & The New Deal
During President Hoover’s government the Depression was in full swing. Unemployment was at 13 million, industries were closed, farms repossessed and the Dust Bowl was disastrous, banks shut down and the stock market had major difficulties.
People couldn’t find work anywhere so the government had to act.
The 1932 Election: Hoover vs Roosevelt
• Roosevelt promised relief for the poor and more public works programs to provide jobs.
• He attacked Hoover and the Republicans for their response to the Great Depression.
• Franklin Delano Roosevelt (FDR) won the 1932 Presidential election.
• In his inauguration speech, FDR stated that, “the only thing we have to fear is fear itself.”
He was related to Theodore Roosevelt.
– He survived polio.
– He was governor of New York.
– Married to Eleanor Roosevelt
A Political Partnership
Franklin Roosevelt
• Appealing blend of cheerfulness, optimism, and confidence
• An effective communicator (ex. fireside chats)
• A reform-minded Democrat
• Believed the government could solve economic and social problems
Eleanor Roosevelt
• “Eyes and ears” of her husband
• Directed efforts to solve several major social issues (ex. lynching of African Americans)
• Wrote her own newspaper column
• Had the trust and affection of many Americans
FDR as President
Banking Crisis
• Temporarily closed all the nation’s banks to stop panic and large-scale withdrawals
• Passed the Emergency Banking Act
• Glass-Steagall Act created the FDIC
Hundred Days
• Critical period of government activity
• Roosevelt pushed Congress to put most of his New Deal into practice.
• The New Deal promised relief, recovery and reforms.
Beyond the Hundred Days
• FDR and Congress passed important legislation after the Hundred Days
• Created the Civil Works Administration
• Passed the Indian Reorganization Act
Saving the Banks
• Roosevelt declared a “bank holiday”, closing every bank in the nation for eight days.
• Congress then passed the Emergency Banking Relief Act, which only allowed banks to open if they had enough funds to pay their depositors.
The Banking Acts of 1933 & 1935:
• Investors deposits insured
• No gambling in securities
• Banks had to keep a certain % of their customers’ money in the bank
FDR gave 30 radio speeches to the nation, which became known as fireside chats.
• FDR’s first fireside chat reassured people that banks were safe to use again.
The NEW DEAL
FDR developed many new bills that created programs to help end the Great Depression.
These programs were known as the New Deal.
The New Deal had three major goals:
I. Relief for the unemployed
II. Plans for economic Recovery
III. Reforms to prevent another depression
• To achieve these goals, Roosevelt’s government created a number of different organizations & agencies
• Several are known as “alphabet agencies” because they go by their abbreviations
NEW DEAL PROGRAMS
Civilian Conservation Corps (CCC)
• Helped unemployed young men 18 to 25 years old
Agriculture Adjustment Act (AAA)
• Helped farmers by paying them not to grow crops
National Industrial Recovery Act (NIRA)
• Helped business by requiring that businesses in the same industry cooperate with each other to set prices and output
• Started Public Works Administration (PWA)
• Labor received federal protection for the right to organize.
Federal Securities Act
• Helped investors, restored confidence in the markets
Securities and Exchange Commission (SEC)
Tennessee Valley Authority (TVA)
• Helped build dams and other projects along the Tennessee River and its tributaries
Federal Emergency Relief Act ( F E R A )
$500 million to state governments to provide relief
Given as DOLE payments
Problems w/ FERA
Many states penalised by dollar matching arrangements
People treated abominably by states who believed people should help themselves
Variations in relief provided – Georgia didn’t provide direct relief.
Successes
Helped prevent starvation
Won political support for the Democrats from the poor
Lowered unemployment from 13 million to 6 million by 1941
National Recovery Administration (NRA)
It made..
1. Industry less cut throat in its operation
2. Owners introduce a minimum wage
3. Rules on the maximum working hours
Owners, like Henry Ford, didn’t like the NRA. Workers loved it because it gave them more power & security
Fair Labour Standards Act
Set new standards for working conditions
1. Set a maximum working week of 40 hours
2. Banned child labour
Wagner Act
The Wagner Act stated that workers could join a trade union
Social Securities Acts
The Social Security Acts established a contributory insurance scheme.
$ is taken out every month, & when you retire you get a check from the gov’t every month.
Agricultural Adjustment Act (AAA)
Put up prices by creating artificial scarcity, ie killing livestock, ploughing up crops
This was considered by many to be unconstitutional and an extension of federal powers.
Parity price fixed for main crops
–farmers were paid NOT to grow crops
Civilian Conservation Corps (CCC)
The first New Deal project introduced in March 1933.
1. Created work for 2.5 million unemployed workers
2. Led to tree planting and soil conservation
3. Bridges, dams, nature trails and picnic areas were built
4. Blacks were segregated and women excluded
Tennessee Valley Authority (T.V.A.)
This worked to improve the area around the Tennessee River
1. Overturning years of deforestation and soil erosion by replanting and soil conservation.
2. The building of a series of dams and canals.
3. Flood prevention.
4. Hydro electric power for homes and business.
Public Works Administration (PWA)
1. It was slow to get underway.
2. Capital intensive rather than labour intensive – money to T.V.A. and other organisations.
3. Built hospitals and roads and was involved in slum clearance.
Trouble for the New Deal
Radical Reactions to the New Deal
• Believed the New Deal did not go far enough in reforming the economy
• Wanted a complete overhaul of capitalism
• Huey P. Long, Father Charles Coughlin, Dr. Francis Townsend
Conservative Reactions to the New Deal
• Attacked the New Deal as a radical break with traditional American ideals
• Thought the New Deal would drive the country to destruction.
• American Liberty League
Leading Critics of the New Deal
• Huey P. Long (senator from Louisiana)
– Believed Roosevelt’s policies were too friendly to banks and businessmen (started the Share Our Wealth Society)
• Father Charles Coughlin (the “radio priest”)
– Believed Roosevelt was not doing enough to curb the power of bankers and financial leaders
• Dr. Francis Townsend
– Criticized the New Deal for not doing enough for older Americans (wanted pensions for people over 60)
• The American Liberty League
– Believed that the New Deal went too far and was anti-business
• Opposition from the courts
– Critics of the New Deal feared that it gave the president too much power over other branches of government.
– Schechter Poultry Corporation v. United States
– United States v. Butler
The Second New Deal
A new wave of government initiatives starting in 1935 resulted in some strong successes and stunning defeats for President Roosevelt.
The Second Hundred Days
• Roosevelt launched the Second New Deal in the spring of 1935.
• Congress passed laws extending government oversight of the banking industry and raised taxes on the wealthy.
• Congress funded new relief programs.
Emergency Relief
• Emergency Relief Appropriations Act – stopped direct payments to Americans in need
• Works Progress Administration (WPA) – largest peacetime jobs program in U.S. history
Social Security
• Provided guaranteed, regular payments for many people 65 and older
• Included a system of unemployment insurance
The New Deal Revives Organized Labor
1. National Industrial Recovery Act (NIRA) guaranteed workers the right to form unions and bargain collectively.
– Difficult to enforce, fatally weakened by Supreme Count’s ruling in Schechter Poultry Corporation v. United States
2. Roosevelt backed the Wagner Act, or the National Labor Relations Act (NLRA).
– Outlawed a number of anti-labor practices, established the National Labor Relations Board and gave it authority to conduct voting in workplaces to determine whether employees wanted union representation
3. The Committee for Industrial Organization (CIO) was born in 1935.
– John L. Lewis led this group to break away from the American Federation of Labor (AFL).
– The United Auto Workers (a division of the CIO) launched a successful sit-down strike in 1936.
The Election of 1936
Roosevelt
• Passed the Rural Electrification Act, which provided electricity to millions of farmers
• Showcased his achievements: unemployment cut in half, income and business earnings were up, New Deal programs provided hope and help
• Spoke out against big business
His Critics
• Republicans argued that the New Deal was overly bureaucratic and was creating a planned economy.
• American Liberty League tried to stop Roosevelt’s attack on big business.
• Republican Alf Landon did not pose a serious
The Results
• A tremendous victory for Roosevelt
• Alf Landon carried only two states.
• The Union Party candidate polled less than 2 percent of the popular vote.
• The Democrats again gained seats in both houses.
A Troubled Year (1937)
Roosevelt surprised Congress with a plan to reorganize the nation’s courts. (“court packing”)
In the fall of 1937, the nation’s economy suffered another setback.
Although the Supreme Court began to rule in favor of New Deal legislation and the economy began to rebound in the summer of 1938, the positive feelings about Roosevelt and the New Deal had begun to fade.
Court Packing
Roosevelt’s Plan
• Gave the president power to appoint many new judges and expand the Supreme Court by up to six judges
• Roosevelt argued that changes were needed to make the courts more efficient.
• Most observers saw plan as effort to “pack” the court with friendly justices.
The Result
• Plan did not pass; however, the Supreme Court made some rulings that favored New Deal legislation.
• Supreme Court upheld a minimum wage law in Washington state.
• Court ruled in favor of a key element of the Wagner Act.
• Court declared Social Security plan to be constitutional.
Economic Downturn of 1937
• 1937 witnessed an economic downturn that began with a sharp drop in the stock market. By the end of the year, about 2 million Americans had lost their jobs.
• Roosevelt had hoped to cut back on government spending, for he feared the growing federal budget deficit.
• As unemployment rose during 1937 and 1938, the government spent large sums of money to help the unemployed.
• British economist John Maynard Keynes argued that deficit spending could provide jobs and stimulate the economy.
• The economy did begin to rebound in the summer of 1938.
New Roles For Women
• Roosevelt promoted and recognized women.
• Frances Perkins – Secretary of Labor – was the first woman to head an executive office.
• Ruth Bryan Owen served as minister to Denmark.
• Roosevelt appointed women to such posts as director of the U.S. Mint and assistant secretary of the Treasury.
• Women served as leaders in several New Deal agencies.
• Still, women faced challenges and discrimination.
– Lower wages
– Less opportunities
– Hostility in the workplace
New Roles for African Americans
• Roosevelt’s administration also appointed many African Americans.
– William Hastie became the first black federal judge.
– A group of African Americans hired to fill government posts were known as the Black Cabinet, and they served as unofficial advisors to the president.
– The Black Cabinet met under the leadership of Mary McLeod Bethune, director of Negro Affairs in the National Youth Administration.
• Still, African Americans continued to face tremendous hardships during the 1930s.
– Severe discrimination
– Thousands of African American sharecroppers and tenant farmers were not helped by New Deal programs.
– Southern Democrats in Congress opposed efforts to aid African Americans.
• Many African American switch from the Republican Party to the Democratic Party during the 1930s.
Art of the Great Depression
• Painters and sculptors fashioned works depicting the struggles of the working class.
• Authors and playwrights focused on the plight of the rural and urban poor.
– Writer John Steinbeck’s The Grapes of Wrath
– Songwriter Woody Guthrie celebrated the lives of ordinary people.
– Writer James Agee’s Let Us Now Praise Famous Men
• Photographers
– Dorothea Lange recorded images of jobless people and the rural poor.
– Walker Evans depicted the lives of sharecroppers in the Lower South.
Popular Entertainment of the Great Depression
Movies
• Millions of Americans went to the movies each week.
• Most films were upbeat and allowed viewers to “escape” the depression.
• Grand musicals and comedies were popular.
• Animation and color photography delighted audiences.
Radio
• Provided politics, religion, music, sports, and other forms of entertainment
• Introduced new music styles such as jazz and swing
• Action shows such as The Lone Ranger and comedies such as Fibber McGee and Molly were popular.
Sports
• Interest in sports remained strong in the 1930s.
• Baseball was popular.
• Babe Ruth
• Joe DiMaggio
• Boxing was hugely popular.
• Joe Lewis
The Impact of the New Deal
• The New Deal promised relief, recovery, and reform.
– Relief programs put billions of dollars into the pockets of poor Americans.
– The New Deal was less successful in delivering economic recovery.
– New Deal reforms were successful and long-lasting.
• The New Deal changed the link between the American people and their government.
– Roosevelt believed that government could help businesses and individuals achieve a greater level of economic security.
– The New Deal required a much bigger government.
– Americans now began to look regularly to government for help.
Relief
• Millions of Americans enjoyed some form of help.
• Direct relief or jobs that provided a steady paycheck
• Programs such as Social Security and unemployment insurance became a fixture of government.
Recovery
• Not as successful at economic recovery
• Unemployment remained high.
• Some critics argued that Roosevelt needed the support of big business.
• Other critics said that the New Deal didn’t spend enough money.
Reform
• More successful and long-lasting
• FDIC restored public confidence in the nation’s banks.
• SEC restored public confidence in stock markets.
• New Deal left thousands of roadways, bridges, dams, public buildings, and works of art.
Limits of the New Deal
Relief programs gave aid to millions of people, but they were not meant to be a permanent solution to joblessness. Also, they did not provide jobs to everyone who needed one.
The level of government assistance varied by state. For example, a family needing assistance in Massachusetts might receive $60 per month, while a family in Arkansas might get $8.
New Deal programs permitted discrimination against African Americans, Hispanic Americans, women, and others.
End of the New Deal
Weakening Support
• Setbacks such as the court-packing fight and the 1937 economic downturn gave power to anti-New Deal senators.
• Opposition in Congress made passing New Deal legislation more difficult. Only one piece passed in 1938: the Fair Labor Standards Act (which set up a minimum wage).
1938 Elections
• Roosevelt tried to influence voters in the South during the congressional elections of 1938; however his candidates lost.
• The Republicans made gains in the both houses.
• Roosevelt lacked the congressional support he needed to pass New Deal laws.
After the New Deal
• The New Deal ended in 1938.
• Americans turned their attention to the start of WWII.
SUMMARY…SUCCESS OR FAILURE?
Success
1. Reduced unemployment by 7 million
2. Soil conservation schemes.
3. The Stock Market and banks recovered.
4. Transformed the Tennessee valley.
5. Roosevelt was re-elected.
Failure
1. Still 6 million out of work in 1941.
2. The numbers fell due to enlistment and rearmament in WW2.
3. Black people were segregated from white.
4. Women were excluded from the New Deal.
5. Tennessee benefited but many areas were still suffering.
