The Second New Deal Objective 9.05

Objective 9.05 Assess the impact of the New Deal reforms in enlarging the role of the federal government in American life.

New Deal by the Numbers – What did it really do? “FDR threw a bunch of policies against a wall, and the ones that stuck became the New Deal.” New York Times

Unemployment 25 percent in 1933 17 percent for most of the 30s Never below 14 percent until World War II

Deficits Biggest New Deal deficit - $4.2 billion in 1936 – largely due to Veteran’s “Bonus Bill” (passed over FDR veto)

Taxes? “wealth tax” or “soak the rich” tax – 1935 – 79% marginal tax on incomes over $5 million (JDR) Basic rate 4% - minority of Americans Fewer than 1 in 20 households paid any tax at all

Taxes continued Depression-era couple w/ income of $4,000 would be in top 10% of incomes – federal income tax of $16 in 1936 $12,000 would be in top 1% - would pay $600

Bank Failures 100s per year before Depression <10/year in decades after 1933

Accounting Gained new status as a result of New Deal Stock Market regulations

Home Ownership Before New Deal – 4 Americans in 10 1920s typically paid cash or large down payments – not less than 30% By turn of 21st century - ~70% of Americans were homeowners

Democratic success continues Democrats increase their majority in both houses of Congress in the 1934 Congressional elections.

FDR launches the Second New Deal 2nd Hundred Days FDR called on Congress for more relief for farmers and workers.

Eleanor Roosevelt Very socially conscious First Lady

Indian Reorganization Act “Indian New Deal” 1934 Commissioner of Indian Affairs – John Collier

Indian New Deal (continued) Also known as “Wheeler-Howard Act” Departure from 1887 Dawes Act Encouraged Native American Seperatism Paternalistic?

1936 Election Republicans nominate Alfred Landon (Gov. of Kansas) Criticized FDR (not whole New Deal) Didn’t like Social Security Supported by Hoover

New Deal Coalition New political coalition of Democratic support Solid South White ethnic groups in cities Midwestern farmers Labor unions Liberals African-Americans Lincoln was finally dead

“Nobody shoots Santa Claus” Al Smith

Farm Recovery Congress replaced AAA (declared unconstitutional by Supreme Court). Replaced w/ Soil Conservation and Domestic Allotment Act. Paid farmers for practicing good soil conservation.

2nd AAA Many of the features of the same (except for unconstitutional parts) Resettlement Administration – created in 1935 to loan small farmers money for land. Replaced in 1937 by the Farm Security Administration FSA loaned over $1 billion to help tenant farmers.

Everybody else Works Progress Administration (WPA) – provided jobs in construction, textiles, teaching, the arts, and other fields. $5 million budget Most WPA workers – unskilled laborers

Everybody else (continued) National Youth Administration (NYA) – created to proved employment for young people.

Mary McLeod Bethune Head of Office of Minority Affairs in NYA Organized “black cabinet” Est. Federal Council on Negro Affairs

Labor Reforms NIRA declared unconstitutional. Wagner Act (National Labor Relations Act) – said that gov’t supported the right of workers to unionize and engage in collective bargaining

Labor Reforms (continued) National Labor Relations Board – heard worker testimony about unfair labor practices. Fair Labor Standards Act – 1938 – est. max. working hours and set a national minimum wage for the first time.

C.I.O. (Committee) Congress of Industrial Organizations Originally allied with AFL – later broke CIO organized unskilled workers in auto, steel, southern textiles

Strikes Sit-down strike at GM in 1937 Ford later recognized UAW Republic Steel – Chicago – 1937 - police fired into crowd

Help for the elderly Social Security Act – passed in 1935, provided old-age insurance for retirees 65 and older and their spouses. Provided unemployment compensation, and aid to families w/ dependent children and the disabled

Frances Perkins First Female Cabinet Member – Secretary of Labor

Recession of 1937 New Social Security tax reduced spending as FDR reduced relief funding (balance the budget attempt) J.M. Keynes – “prime the pump”

Improvements for Minorities Marian Anderson Refused Constitution Hall by DAR Lincoln Memorial thanks to H. Ickes and E. Roosevelt

Let there be light Rural Electrification Administration (REA) – created, financed, and worked w/ co-ops to bring electricity to previously isolated areas.