Chapter 23: Roosevelt and the New Deal American History

Roosevelt takes office In 1932, Franklin Delano Roosevelt won the presidential election, and took on the burdens of the depression as his first duty in office Described his policies for ending the depression as the “New Deal” Meanwhile, before his inauguration, people were afraid that he would abandon the gold standard, or equaling the value of the dollar to an ounce of gold, in order to fight off the Depression Many withdrew from their bank accounts, forcing banks to take “bank holidays” in order to prevent further withdrawals

The First New Deal During the 100 days Roosevelt was president, he sent out 15 acts to help meet the economic crisis, and setting in motion programs to come The first act Roosevelt passed was the Emergency Banking Relief Act Required federal examiners to survey banks and issue Treasury licenses to those that were financially sounds During his first of many “fireside chats”, Roosevelt assured the people to invest in the banks again They did, and deposits soared, ending the banking crisis

Regulating bank activity Persuaded to go further by advisors, Roosevelt passed the Securities Act of 1933 and the Glass-Steagall Act Securities Act of 1933: Required companies who bought and sold stock to provide information to investors Created the Securities and Exchange Commission, regulating activities in the stock market Glass-Steagall Act: Separated commercial banks from investment banks, which took away commercial banks’ rights to use investors money to take risks on the stock market Created the Federal Deposit Insurance Corporation, providing insurance for bank deposits to a certain amount

Helping Farms and Industries Roosevelt passed the Agricultural Adjustment Act, which paid farmers not to raise certain livestock or grow certain crops, in order to combat with the food surplus and low food prices Was administered by the Agricultural Adjustment Administration Roosevelt also passed the National Industry Recovery Act, which suspended anti-trust laws and allowed business, labor, and government to cooperate and set up voluntary laws for each industry Was administered by the National Recovery Administration Act was short-lived, and caused production to go down instead of up

Providing Debt Relief To help those who were struggling to pay their mortgages, Roosevelt asked Congress to establish the Home Owners’ Loan Corporation Company bought the mortgages of those struggling, and established a longer pay period with lower interest rates Only helped those who were still employed Roosevelt also authorized the creation of the Farm Credit Administration Helped farmers refinance their mortgages in order to keep their land and grow crops

Relief Programs Roosevelt organized work programs for those who were unemployed in order to give money to those who were most in need, while also boasting their self-worth Civilian Conservation Corps: Offered unemployed men ages 18-25 work planting trees, fighting forest fires, and building reservoirs Federal Emergency Relief Administrations: Channeled money to state and local agencies to fun their own relief projects Public Works Administration: Used construction workers to build and improve highways, dams, sewer systems, water works, schools, and other government facilities Civil Works Administration: Employed 4 million workers to built or improve airports, roads, schools, playgrounds, parks, and playing fields Spent money too quickly, so it was shut down after the winter of 1934

Criticisms from the New Deal The New Deal had improved the economy only slightly, so many started becoming opposed to it the right wing believed the New Deal had imposed too many regulations on businesses and state rights and opposed deficit spending, or borrowing money to pay for programs The left wing believed that Roosevelt had not done enough and needed to intervene more on the expense of the peoples’ rights Huey Long, Father Coughlin, & Francis Townsend

The Second New Deal To counteract the failure of the New Deal, and the reassure his re-election in 1936, Roosevelt launched the Second New Deal Organized the Works Progress Administration, which invested money in public works programs, as well as the arts and history Roosevelt’s programs were threatened, however, when the Supreme Court ruled NIRA codes unconstitutional after the Schechter v. United States case Threatened to end the New Deal, so Roosevelt and Congress quickly acted

Rise in Industrial Unions Thinking union dues would cause workers to spend more, thus boosting the economy, Congress passed the National Labor Relations Act, guaranteeing workers to organize Set up the National Labor Relations Board Also set up the process of binding arbitration, where a third party could come and listen to the complaints of the workers In an attempt to organize unions in one field of work, industrial unions organized the Committee for Industrial Organization Workers began gaining more attention with their unions, participating in sit-down strikes and other protests

The Social Security Act Congress passed the Social Security Act in 1935 Workers earned the right to receive benefits by paying premiums, and the government provided modest welfare payments to other needy people, those with disabilities, and poor families with young dependent children Workers received a monthly retirement benefit, which they received when they were 65, and unemployment insurance for those looking for new jobs

Election of 1936 Supports of Long, Coughlin, and Townsend gathered to form the Union Party in opposition of Roosevelt The Republicans nominated Kansas governor Alfred Landon Despite having opposition from the Republicans and the Union Party, Roosevelt won re-election

Blows towards reputation Roosevelt had several occurrences happen that thwarted his reputation Court-packing plan: desired to nominate new justices if old justices were over 70 and did not retire in 6 months Recession of 1937: Roosevelt cut spending of WPA and PWA to fund into social security Despite what happened during the court-packing plan, it allowed the Supreme Court to back off from Roosevelt and his efforts to create more programs

Last of the New Deal Acts The National Housing Act Established the United States Housing Authority Gave the authority $500 million to subsidize loans for builders will to buy blocks of slums and create low-cost housing Farm Security Administration Gave loans to tenant farmers who were expelled from farmer’s lands so they could purchase lands of their own Fair Labor Standards Act Provided more protection for workers, abolished child labor, and established a 40-hour work week From growing interest on the threats of Germany and Japan, combined with Republicans blocking more New Deal programs, the New Deal era ended in 1939

Legacy of the New Deal The New Deal did not end the depression, and economic stability didn’t come until after World War II However, because of the New Deal: Federal government has more power over the economy Established a broker state in order to work out conflicts among different interests in politics and the economy Gave the public the view that the government had to be a safety net for the American people and establish relief programs if necessary Created the debate on how much the government should intervene in the economy and support the disadvantaged