The New Deal “Active” Response to the Depression

FDR as President Background Polio New Attitude Psychological Therapy –“Fireside Chats”

Analysis “Under Consumption” Possible Solutions????

FDR’s 1st actions Bank holiday: March 6, 1933 Emergency Banking Act (only sound and healthy banks would re-open)

FDR: ReliefRelief RecoveryRecovery ReformReform –R elied on the advice of very intelligent group of advisors (“Brain Trust”)

Relief Programs ( designed to relieve suffering of the needy )

Federal Emergency Relief Administration ( FERA)( FERA) Harry HopkinsHarry Hopkins Congress gives $500 million to states, cities, and townsCongress gives $500 million to states, cities, and towns used money to repair roads / improve parks, etc.used money to repair roads / improve parks, etc.

Civil Works Administration (CWA) build roads, parks, airports, and other facilities(CWA) build roads, parks, airports, and other facilities gave jobs to 4 million previously unemployed Americansgave jobs to 4 million previously unemployed Americans tremendous morale boostertremendous morale booster

Civilian Conservation Corps CCC: provided help for males (18-25 yrs.); most worked on projects to conserve the nation’s natural resourcesCCC: provided help for males (18-25 yrs.); most worked on projects to conserve the nation’s natural resources 2.5 million men $1 a day Sent $25 / mo. To Family

Recovery Programs (designed to lay foundation for economic growth)

Public Works Administration Harold IckesHarold Ickes funded large scale engineering projects: bridges, dams, etc.funded large scale engineering projects: bridges, dams, etc. spent $6 billion in 6 yearsspent $6 billion in 6 years Hoover DamHoover Dam

Tennessee Valley Authority created jobs and helped farmers in country’s least modernized regioncreated jobs and helped farmers in country’s least modernized region TVA provided cheap electrial power, flood control, and recreational opportunitiesTVA provided cheap electrial power, flood control, and recreational opportunities criticism: government owned industrycriticism: government owned industry

Agricultural Adjustment Administration Henry Wallace, Secretary of AgricultureHenry Wallace, Secretary of Agriculture Paid farmers NOT to raise certain crops and animalsPaid farmers NOT to raise certain crops and animals Lower production = more $Lower production = more $ CONTROVERSIALCONTROVERSIAL VoluntaryVoluntary

National Industrial Recovery Act NIRA creates NRANIRA creates NRA sought to bolster industrial pricessought to bolster industrial prices trade industry codestrade industry codes management-labor relations (Sect 7A)management-labor relations (Sect 7A)

Reform Programs Designed to help prevent future economic crises

* created the FDIC (Federal Deposit Insurance Company) Glass-Steagall Banking Act (1933)

Securities Act (1933) honest disclosure of stocks, bondshonest disclosure of stocks, bonds eventually led to the SEC (Securities Exchange Commission)eventually led to the SEC (Securities Exchange Commission)

Gold Reserve Act (1933) took America off the Gold Standard ($1 paper = $1 gold)took America off the Gold Standard ($1 paper = $1 gold) created inflation because the U.S. could print more moneycreated inflation because the U.S. could print more money

Evaluation of the first 100 days big change in attitude of the American publicbig change in attitude of the American public If it failed, then you try something elseIf it failed, then you try something else

New Deal (1934- )

Works Progress Administration Harry HopkinsHarry Hopkins put people to work in their communities; all types of projectsput people to work in their communities; all types of projects Fed. gov’t: paid 45%Fed. gov’t: paid 45% most expensive New Deal program: $11 billionmost expensive New Deal program: $11 billion

National Youth Administration NYA - Part of the WPANYA - Part of the WPA found jobs for kids so they could stay at schoolfound jobs for kids so they could stay at school mowing grass, painting schools, etc.mowing grass, painting schools, etc.

Federal Housing Admin. FHAFHA easier to get housing loans; lower down payments, etc.easier to get housing loans; lower down payments, etc. attempt to boost construction of new homes “ripple effect”attempt to boost construction of new homes “ripple effect”

Social Security Act (1935) designed to provide “old-age” retirement pensionsdesigned to provide “old-age” retirement pensions collect share of the “tax” upon retirementcollect share of the “tax” upon retirement Included Unemployment Insurance, Old Age Medical & Health Insurance and Grants in Aid to the DisabledIncluded Unemployment Insurance, Old Age Medical & Health Insurance and Grants in Aid to the Disabled

National Labor Relations Act aka Wagner Act (1935)aka Wagner Act (1935) NIRA had been a failure, but Wagner Act was tougherNIRA had been a failure, but Wagner Act was tougher act stipulated specific activities that management could not get involved in.act stipulated specific activities that management could not get involved in. Huge boost for labor unionsHuge boost for labor unions

Critics of the New Deal

Conservative Critics

Radical critics Father Charles CoughlinFather Charles Coughlin Dr. Francis TownsendDr. Francis Townsend Senator Huey Long (Louisiana) Share the Wealth ProgramSenator Huey Long (Louisiana) Share the Wealth Program National Union PartyNational Union Party

Election of 1936 (D) FDR(D) FDR (R) Alfred Landon (Kansas)(R) Alfred Landon (Kansas) (NUP) “Liberty Bill” Lemke(NUP) “Liberty Bill” Lemke

The Supreme Court Battle BackgroundBackground “Court Packing Scheme”“Court Packing Scheme”

End of the New Deal

Lasting Outcomes