Roosevelt and the New Deal America 1932 to 1936

Background 1929 – Wall Street Crash High unemployment, homelessness, businesses going bust, loss of savings President Hoover (Republican) – “rugged individualism” and “prosperity is just round the corner” Tried to solve the depression but only half heartedly – people blamed Hoover and the Republicans for it.

1932 Presidential election

1932 Presidential Election Hoover – a dead man walking – blamed Democrats nominated Franklin D Roosevelt FDR promised a “New Deal” – encouraging banks to lend and public works projects Won 42 out of 48 states – biggest victory ever

The New Deal November 1932 to March 1933 – nothing done due to the political system FDR realised that the government had to take control of the financial system Idea was to stop the cycle of depression and allow the US economy to bounce back

The Hundred Days FDR asked for emergency powers – usually asked for at times of war Set up Alphabet agencies in order help the economy Fireside chats – explained what he was doing to the people and gave people confidence in him “The only thing we have to fear is fear itself”

The Banking Crisis People had no confidence in the banks March 1933 introduced an Emergency Banking Act – all banks closed for 4 days, all banks inspected and only those who were well run were allowed to reopen Reopened banks allowed access to government loans The subject of his first fireside chat

Agriculture – the AAA Agriculture Adjustment Agency (AAA) was set up in May 1933 to help farmers Encouraged farmers to produce less food and make more profits Good – helped existing farmers to stay in business Bad – did not help farm workers who had lost their jobs or farmers who had lost their farms. Price of food went up.

Unemployment FERA – Federal Emergency Relief Administration. $500m given to give instant relief to the unemployed CWA – Civil Works Administration. Provided short term work for people during the winter of 1933 – 34. 4m jobs created but these were lost when the winter ended and the CWA was closed down.

PWA – Public Works Administration. Took over from the CWA in order to create long term jobs. Building schools, hospitals etc. Gave jobs to skilled people and helped to improve the quality of life in the USA WPA – Works Progress Administration. Set up in 1935 to help people missed out by the PWA. Agencies provided millions of jobs – people had wages again and were able to pay off mortgages. Helped the economy

Other Alphabet Agencies CCC – Civilian Conservation Corps. Gave temporary work to 18 to 25 year olds. Cheap labour but created unemployment and helped the environment NRA – National Recovery Administration. Helped businesses and workers as long as they protected their workers. Businesses that joined the scheme could display a “Blue eagle” 1933 – businesses had joined the NRA

Other New Deal projects HOLC – Home Owners Loan Corporation. Helped people who were struggling with their mortgages 1935 Social Security Act – set up state pensions and unemployment benefits 1935 National Labour Relations Act – allowed workers to join Trade Unions and said that they could not be sacked for doing so

Tennessee Valley Authority

The TVA Most famous alphabet agency Tennessee river ran through several states – flooded in winter but dried up in summer States could not agree on action FDR set up TVA to sort out the problem by building dams, planting trees to improve the soil etc – attract tourists