The Dust Bowl and the New Deal

The Dust Bowl

Dust Bowl (lasted almost 10 years) Causes: Poor agricultural practices, drought and winds 1931-1934 worst drought ever 1935- FDR under the FERA gives $525 million for drought relief WPA-puts 8.5 million to work Okies – migrated to California 1939-RAIN finally arrives

Running from Dust Storm Okies

Franklin D. Roosevelt (FDR) 32nd President Former Gov. of NY Democrat 4 Terms, 1933-1945 Handicapped from Polio President during GD and WWII Gave people hope and confidence during the GD

The Splendid Deception FDR

Roots of the New Deal Programs

The New Deal New Deal Name FDR gave to his new program to fight the Depression It was a revolution in American society - changed completely the way gov't functions the first phase of the New Deal dealt exclusively w/ eco. Reform unlike Hoover, FDR believed gov't legislation/involvement was crucial to stimulate the economy

Roots of New Deal Progressive Reform World War I: New York Gov. FDR: use gov’t to solve problems World War I: War Boards regulate economy New York Gov. FDR: relief for needy pensions unemployment insurance public power projects

Basic Ideas Behind New Deal on how to Solve the Great Depression Pump Priming and Deficit Spending – Pump money into the economy: put cash into people’s hands; Fed. Emergency Relief Administration ($500 mill. to states) Spend money the Federal Government does not have Use “deficit spending” (Keynesian economics) spend more to create jobs for unemployed Create scarcity to increase prices problem of over-production AAA & NIRA Regulate banks & stock market, restore confidence of investors: Emergency Banking Act/FDIC /Security & Exchange Commission SEC

Basic Ideas (cont.) Cheap electricity, control flooding (gov’t controlled) provide jobs Tennessee Valley Authority (TVA) Protect the elderly & disabled Social Security Administration (insurance, not welfare) Increase economic activity

Relief Recovery Reform NEW DEAL IDEALS Of Unemployment Of the American PWA, CCC, WPA, FERA Recovery Of the American Economy NRA, AAA, TVA Reform Programs to Prevent Another Depression FDIC, SEC, Social Security

Supporters of the New Deal New Deal Coalition Voters who supported FDR and his policies Made up of: Laborers Farmers Unemployed Young Old Intellectuals Minorities

New Deal Programs

FDR’S PROGRAM First New Deal (1st One Hundred Days): 1933-35 Immediate relief, regulate business, banks & stock market Second New Deal (2nd One Hundred Days): 1935-1937 More social reform affects ordinary Americans

The First Hundred Days “This nation asks for action, and action now.” March 4-National Bank Holiday March 9-Emergency Banking Act March 20-Government Economy Act March 31-Civilian Conservation Corp (CCC) April 19-Renunciation of the Gold Standard May 12-Federal Emergency Relief Act May 12-Emergency Farm Act May 12-Agricultural Adjustment Act (AAA) May 18-Tennessee Valley Authority (TVA) May 27-Truth-in-Securities Act June 5-Abrogation of the Gold Clause June 13-Home Owner’s Loan Act June 16- National Industry Recovery Act June 16-Glass-Steagall Banking Act June 16-Farm Credit Act June 16-Railroad Coordination Act

Banking Relief Banking Holiday 3/5 – 3/9, 1933 All banks are closed Inspected by treasury If sound reopen on Monday Restores peoples’ confidence in banks Need people to deposit $ so banks can give out loans to people and business Fireside Chats – informs people of actions gov’t is taking and why

Gov’t actions in Economy Security Exchange Commission (SEC) Police NYSE Regulate buying on margin More Money into Circulation Off the gold standard Gov’t buys up more gold More money in circulation = increase in wages, prices and causes inflation Gov’t should spend money to stimulate economy Keynesian Economics

Gov’t Actions in the Economy Glass – Steagall Banking Reform Act (1934) Limits investment practices of banks FDIC Gov’t backs up bank accounts to $2,500

Alphabet Soup Programs

National Recovery Administration (NRA) Part of National Industry Recovery Act Established to encourage fair business practices in order to help business Recover during Great Depression Ruled Unconstitutional Schechter Poultry v. U.S.

Public Works Administration (PWA) 1935

Triborough Bridge PWA Project

Fort Knox PWA Project

Civilian Conservation Corps

CCC Built Pool

Works Progress Administration

Agricultural Adjustment Act (AAA) - 1933 Ruled Unconstitutional in Butler v. U.S. Rewritten and passed again Restore farmers' purchasing power and to restore the family farm Paid farmers SUBSIDIES to not produce certain crops or breed certain animals Criticisms Paying farmers to not farm when millions are starving Plantation owners are paid not to farm so they fire sharecroppers Food Stamp Act of 1939 Excess food used to feed hungry

TENNESSEE VALLEY AUTHORITY

TENNESSEE VALLEY AUTHORITY (TVA) - used to promote hydroelectric power, control flooding - lower rates  private industry, manuf. fertilizer fed. gov't. took ownership (nationalization v. privatization)

TVA Built Dams Which led to…

SOCIAL SECURITY Unemployment Insurance Old Age Pension Payments

Social Security Act (1935)- feared by opponents as "creeping socialism"- this act typifies the WELFARE STATE - unemployment insurance, old age pensions Problem: it took some $ out of circulation (payroll deductions) at a time when purchasing power was already low- also, it only covered the unemployed 1936 - "Soak The Rich" tax

Minimum Wage Maximum # of Hrs. per Workweek