The Great Depression and the “ New Deal ”

The Great Depression and the “New Deal” How the greatest economic crisis in American history shaped American politics, culture and society

I. The Stock Market Crash • Republican responsibility for the economy • Stock market outraces real economic growth • The problem of buying stock “on margin” • Public concern over the stock market by 1929 • The crash

II. The Great Depression • Initial governmental optimism • Catastrophic unemployment figures • Urban poverty, especially for immigrants, is the worst • State and local governments as well as private charities can do little

II. The Great Depression • Corporate failures • Drop in farm income • Even the wealthy had problems • “Riding the rails” looking for work

III. Contributing Causes to this Economic Catastrophe • American farmer in trouble • Unstable American foreign trade • The Gold standard forsaken in Europe • Weak and vulnerable American banks • Large individual debt • Corporate profits enriched only a few

IV. The Response of the Hoover Administration • Positive statements aggravate the Depression crisis • Hoover’s background • Hoover’s actions to stem the economic crisis • “Trickle Down” Solutions

IV. Hoover’s Response (cont.) • Unemployment continued and farm prices dropped dramatically • Violent farm protests by 1932 • Hoover was limited by his own governmental philosophy • Hoover championed “voluntarism” as a solution

IV. Hoover’s Response (cont.) • Growing inability to compromise with Congress • Hoover’s unpopularity grows • His name becomes synonymous with the Depression • Economic and Political blunders

V. The Election of 1932 • Democrats nominated Franklin Roosevelt • FDR’s background • Republicans nominated Hoover • Roosevelt’s campaign • FDR projects the image that he will take action as President • Results of the Election

VI. “The New Deal”: A “Revolution”? • Major success = restoration of confidence • FDR’s “Brain Trust” • Military analogy • Reliance on Social Workers

VI. The “New Deal”: A “Revolution”? (cont.) • Bi-partisan support for FDR publicly and in Congress • How revolutionary was the “New Deal”?

VII. Changes Made • Federal government directly provided services to the American people -- “welfare state” • Vast centralization of national power • Increase in power of the presidency • Democratic party becomes majority party • Blacks vote for Democrats

VIII. Franklin Delano Roosevelt: The Man • Strong president who enjoyed leading • Great politician • Used the radio effectively -- “fireside chats” • Not a systematic thinker • Great ability to project empathy • Many Americans think of FDR as part of the family • More loved and hated than any other president

IX. First Lady Eleanor Roosevelt • Creates model for the active first lady • Activist, especially for Blacks and women • Real concern for the poor • FDR’s “eyes and legs” • Reputation for being constantly on the go

X. The “New Deal” and American Banking • Emergency Banking Act (March 6, 1933) • SEC: • Initial success • Federal Deposit Insurance Corporation (1933) • US abandoned the gold standard

XI. The “New Deal” and the Problem of Individual Economic Relief • Justification for the “alphabet soup” agencies of the “New Deal” • Federal Emergency Relief Administration (FERA—spring, 1933) • Civil Works Administration (1933-34)

XI. Problem of Individual Economic Relief (cont.) • Civilian Conservation Corps (CCC—spring, 1933) • Public Works Administration (PWA—June, 1933) --Directed by Harold Ickes • Works Progress Administration (WPA—1935)

XI. Problem of Individual Economic Relief (cont.) • WPA directed by Harry Hopkins • Federal Writers and Artists projects • National Youth Administration (NYA) • National Recovery Administration (NRA—1933)

XII. The “New Deal” and the American Farmer • Agricultural Adjustment Act (AAA—spring, 1933) • Commodity Credit Corporation (1933) • “Dust Bowl” migrations -- “Okies” • Tennessee Valley Authority (TVA—spring, 1933) • Farm Security Administration (FSA—1937)

XIII. The “New Deal” and Organized Labor • FDR’s sympathy with union concerns grows • Growth in union membership • Wagner Act (1935) --Creation of NLRB • Congress of Industrial Organizations (CIO) created in 1935

XIII. The “New Deal” and Organized Labor (cont.) • Use of the “sit down strike” • Fair Labor Standards Act (1938) --minimum wage: 40 cents --prohibition of child labor --maximum work week of 40 hours

XIV. The Social Security Act (1935) • Myth of poor being lazy exposed • 13 weeks of unemployment insurance • Pension fund for retired people over 65 • Funds also for disabled and single parent families • Response to more radical schemes

XIV. The Social Security Act (cont.) • Revenue Act of 1935 (“Soak the Rich” Tax) • Health insurance pulled due to congressional resistance • Problems with Social Security initially and long-term • Important “New Deal” legacy

XVI. Roosevelt’s Second Term (1937-1941) • Election of 1936 • FDR vs. Alf Landon (R-Kan) • Biggest landslide since 1820 • The “Roosevelt Recession” of 1937-1938 • Harsh CIO strikes

XVII. The Court Reorganization Act (Spring, 1937) • Supreme Court attack on the “New Deal” (1934-1936) • FDR’s proposals for change • Court fight eroded public confidence in Roosevelt administration • Supreme Court suddenly begins to reverse itself on the “New Deal” • Congressional opposition takes shape

XVIII. Summary of the Results of the “New Deal” • Did not end the Depression • Many agricultural problems unsolved, especially for southern Blacks and tenant farmers • Did restore national hope • Controls were built into the economy to avert future crises --Federal Securities Act of 1933 and SEC (1934) • The Government as “broker state” • Restoration of confidence in U.S. government and economy—but both different than before 1932

The Great Depression and the “ New Deal ”