The New Deal (1933-1941)

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The New Deal (1933-1941)
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I. Forging a New Deal

• The nation waited eagerly for FDR (Franklin
  Delano Roosevelt) to be inaugurated as President
• The inauguration did not occur until March 4th
  until the 20th amendment was passed the Lame
  Duck Amendment
• Now, the inauguration date is January 20th
• FDR would bring about the biggest change in the
  Federal Government since its inception

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A. Restoring the Nations Hope

• The first goal of FDR and Eleanor Roosevelt was
  to restore Americans sense of hope
• Building public confidence in the future was
  essential to calming panics and gaining support
• 3 great examples of restoring hope
• Eleanor visits the veterans of the 2nd Bonus
  March on Washington in the campsites FDR ordered
  be set up
• FDRs 1st inaugural address The only thing we
  have to fear is fear itself.
• FDR would speak to large audiences over the radio
  in his Fireside chats to answer questions and
  renew hope

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B. The First Hundred Days

• From FDRs inauguration in March through June
  1933, the first hundred days
• FDR pushed program after program through Congress
  to provide relief, create jobs, and stimulate
  economic recovery
• Not taking a Laissez-faire approach

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1. Stabilizing Financial Institutions

• FDRs 1st step- restore public confidence in the
  nations banks
• Ordered all banks to close for 4 days while
  Congress passed the Emergency Banking Act which
  inspected the health of all banks (March 5th)
• 2/3 of banks were reopened by March 15th
• People regained confidence in the banks
• Began depositing more than taking out
• Federal Deposit Insurance Corporation was created
  in 1933 which insures our bank deposits

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More ways to stabilize the economy (fun economics)

• Securities and Exchange Commission (SEC) was
  created to regulate the stock market
• Federal Reserve Board could regulate the purchase
  of stock on margin
• Took the U.S. off the gold standard to devalue
  American currency to make debt easier to pay back

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2. Providing Relief and Creating Jobs

• FDRs next step- help overburdened local relief
  agencies
• Established a Federal Emergency Relief Agency
  (FERA) which sent funds to local agencies as well
  as put federal into public works programs
  (government-funded projects to build public
  facilities)
• CWA- Build roads, parks, airports (4 million)
• CCC- (2.5 million) young, unmarried men to work
  maintaining forests, beaches, and parks Earned
  only 30/mnth but lived free of charge

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3. Regulating the Economy

• The NRA (National Recovery Administration) was
  created to balance the unstable economy
• Controlled working conditions
• Set a minimum wage
• Gave organized labor collective bargaining rights
• Was not a huge success but its Public Works
  Administration (PWA) projects are still very
  visible to this day
• NYCs Triborough Bridge, Key Wests Causeway

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4. Assisting Homeowners and Farmers

• Agricultural Adjustment Administration (AAA)
  tried to raise farm prices through subsidies
  (government financial assistance)
• Paid farmers NOT to raise certain crops and
  livestock
• Home Owners Loan Corporation (HOLC)- provided
  low-interest-rate loans to 1 million families

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5. The TVA

• Tennessee Valley Authority (TVA) helped farmers
  and created jobs in one of the countrys least
  developed regions
• Reactivated a hydroelectric power facility
• Provided cheap electricity, flood control, and
  recreational opportunities to Tennessee River
  Valley and surrounding areas

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C. Key Players in the New Deal

• Appointed the first woman ever to a Cabinet
  position (Frances Perkins- Sec of Labor)
• Hired African Americans in more than 100
  policymaking posts
• Eleanor Roosevelt- FDRs wife and most important
  colleague traveled widely for her disabled
  husband and was an important advisor

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D. The New Deal Falters

• The energy and effort shown by New Dealers
  pleased many, but when the programs failed to
  bring about significant economic improvement,
  criticism began to mount
• Many worried about the increased power of the
  Federal government (fear of tyranny)
• The Supreme Court ruled the NIRA and the tax that
  funded the AAA unconstitutional making 2 of the
  most important programs crumble

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E. A Second New Deal

• In 1935, President Roosevelt launched a new, even
  bolder burst of activity than his first hundred
  days
• the Second New Deal included more social welfare
  benefits, stricter controls over business,
  stronger support for unions, and higher taxes on
  the rich
• Responded to people who were saying he wasnt
  doing enough for ordinary Americans

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1. New and Expanded Agencies

• WPA- Works Progress Administration, set up in
  1935, lasted 8 years and provided work for 8
  million citizens (playgrounds, schools,
  hospitals, supported artists and writers)
• FSA- Farm Security Administration, set up in
  1935, loaned more than 1 billion to farmers to
  set up camps for migrant workers

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2. Rural Electrification

• REA- Rural Electrification Administration, 1935,
  offered loans to electric companies and farm
  cooperatives for building power plants and
  extending power lines as well as to individuals
  to pay for services
• Increased electricity over time from 10 of farms
  with electricity to 98 of farms with it

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3. New Labor Legislation

• The National Labor Relations Act (NLRA) called
  the Wagner Act (named after its leading advocate)
• Legalized union practices such as collective
  bargaining and closed shops (workplaces only open
  to union members)
• Also, outlawed spying on union activities
• Set up the NLRB (board) to enforce provisions
• Challenged as unconstitutional, but the Wagner
  Act was upheld on the provision that the
  government can regulate labor disputes linked to
  interstate commerce

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4. Social Security

• 1935, Congress also passed the Social Security
  Act
• Established a Social Security system to provide
  financial security, in the form of regular
  payments, to people who could not support
  themselves
• Old-age pensions and survivor benefits
• Unemployment insurance
• Aid for dependent children, the blind, and the
  disabled

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F. The 1936 Election

• FDR beat the Republican challenger Alfred M.
  Landon by an electoral college vote of 523-8!
• The only states Landon won were Maine and Vermont
• Most Americans supported the New Deal

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II. The New Deals Critics

• There was plenty of support for Franklin
  Roosevelts New Deal, but it also inspired its
  share of critics

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A. The Limitations of the New Deal

• For all its successes, the New Deal fell short of
  some peoples expectations
• New Deal agencies were generally less helpful to
  women and minority groups when compared to white
  men

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1. Women

• Men and boys received strong preference in relief
  and job programs (ex. CCC)
• No New Deal program protected domestic service,
  the largest female occupation
• Some programs permitted lower standards for women
  (ex. NRA allowed women to be paid under the
  established minimum wage)

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2. African Americans

• Federal relief programs in the South, including
  public works projects, reinforced racial
  segregation
• African Americans were not offered professional
  jobs or skilled labor positions
• The New Deal did nothing to end discrimination in
  the North
• Still, African Americans voted for FDR in the
  1936 election and many were thankful for job
  opportunity

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B. Political Critics

• People ran widely differing political views
• They criticized the New Deal for both what it did
  and what it did not do

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1. New Deal Does Too Much

• Believed the New Deal went too far
• Wealthy people since he raised their taxes
• People against Social Security believed it
  penalized success the more you make, the more
  you have taken away and given to the poor
• The American Liberty League spearheaded much of
  the opposition to the New Deal

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2. New Deal Does Not Do Enough

• Felt the programs did not provide enough help
• Progressives
• Socialists
• Some wanted to completely change the economic
  system to prevent a permanent crisis
• The New Deal had only limited success at ending
  poverty

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C. Other Critics

• Demagogues- leaders who manipulate people with
  half-truths, deceptive promises, and scare
  tactics
• Two specific Demagogues were the leading critics
  of the New Deal

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1. Father Coughlin

• A dynamic speaker who used the radio to broadcast
  his message
• Known as the Radio Priest in Detroit
• At first, he supported the New Deal, but later
  denounced them and called FDR a double-crossing
  liar
• Lost popularity when he issued openly anti-Jewish
  statements and began showering praise on Hitler
  and Mussolini

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2. Huey Long

• Known as the Kingfish- assassinated in 1935
• Powerful Louisiana politician who began to gain
  national support and wanted to run for President
• Was an excellent speaker who worked to help the
  underprivileged by improving education, medical
  care, and public services
• His program was Share the Wealth and wanted to
  limit the amount of people could make and then
  redistribute the rest of the to everyone else.
  
• 1 million max, 5,000 minimum per family
• Not mathematically possible

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D. Modern-Day Critics

• Many Americans place FDR as one of the greatest
  presidents of all time, yet some historians and
  economist believe that the New Deal actually
  hindered economic progress and threatened
  Americas belief in free enterprise
• Upset about the creation of a large bureaucracy
• Didnt allow supply and demand to set the market
• Deficit spending- the government borrowed from
  itself which greatly increased the national
  deficit

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E. The Court-Packing Fiasco

• In order to ensure that his legislation would be
  upheld by the Supreme Court, FDR asked for an
  amendment that would allow him to appoint 6 more
  Justices raising the total to 15
• He would be able to pack the court with
  Justices who support the New Deal
• It didnt get passed and was embarrassing to FDR
• People were outraged (both parties) and this was
  the most negative response FDR ever received
• They thought he was trying to take away the
  balance of powers in the U.S. (more like a
  dictator)

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III. Last Days of the New Deal

• Many of the New Deal programs would last into the
  1940s, some are even still around today

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A. The Recession of 1937

• The New Deal was not a miracle cure for the Great
  Depression
• There was temporary economic improvements
• However, in 1937, there was another economic
  downturn, a recession
• Social Security tax was partly to blame as it
  came out of workers paychecks, through payroll
  deductions leading to fewer purchases
• There was also rising national debt and works
  project programs had to be cut back (like the WPA)

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B. Unions Triumph

• The New Deal changed the way many Americans
  thought about labor unions
• Labor union members increased from 3 million to
  10.5 million by 1941
• 36 of workers were unionized by 1945

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C. The New Deals Effects on Culture

• Artists were aided by federal funds allocated by
  Congress to support the popular and fine arts to
  provide jobs

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1. Literature

• The Grapes of Wrath (1939) by John Steinbeck
• A powerful tale about Dust Bowl victims who
  travel to California in search of a better life

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2. Radio and Movies

• Radio was a popular source of entertainment for
  Americans
• The movies recovered from an initial setback by
  1933
• The Wizard of Oz
• Snow White and the Seven Dwarfs
• Mickey Mouse

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3. The WPA and the Arts

• FDR believed that the arts were not luxuries that
  people should have to give up in hard times
• Gave WPA funds to support unemployed artists,
  musicians, historians, theater people, and
  writers
• Collected 2,000 stories from former slaves
• Built 17,000 sculptures and had over 100,000
  paintings

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D. Lasting New Deal Achievements

• It did not end the nations suffering but it led
  to some profound changes in American life
• Just look at the recent bailouts and the recent
  election debates as proof of lasting change

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1. Public Works and Federal Agencies

• Bridges, dams, tunnels, buildings, hospitals
  still exist to this day
• Some of the Federal agencies created still exist
  today as well (FDIC, SEC, TVA)

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2. Social Security

• Social security has come under harsh criticism by
  many throughout the years, but it has endured and
  many Americans depend on their Social Security
  checks
• There have been amendments to Social Security and
  more amendments may be in the near future

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3. A Legacy of Hope

• Perhaps the greatest achievement of the New Deal
  was to restore hope
• People again knew that someone cared about them
  and that the government would do what it could to
  try and support them in times of need