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Dorothea lange ’ s Migrant mother, 1936. Problems?. Incredibly High Unemployment. Problems continued. Large drop in GDP. Stock Prices decrease dramatically. problems: Us farm prices plummet. Problem: Bank of America fails in Ny. Protests and unrest reigns.
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Problems? Incredibly High Unemployment
Problems continued Large drop in GDP
Problem: Bank of America fails in Ny Protests and unrest reigns
Stage 1: Agenda Setting • The Great Depression started to become a major issue when the stock market crash occurred on October 29, 1929; on "Black Tuesday," stock prices dramatically fell. • Soon as the 30's started, income, tax revenue, profits, and prices all fell. Unemployment soared to around 25% and the rate of suicide jumped as well. • This issue was so great that it became the main issue of the 1930s. Everyone in the government was trying to end the Depression. The media was talking about progress occurring, parties were taking stances on how to solve problems, and interest groups were lobbying the President and the Senate.
Stage 2: Policy formulation: Hoover • In many cases, the Presidents of this period were the major players during this disaster. • President Hoover started to control the economy and help it reboot. However, Congress's "Smooot Hawley Tariff" which raised tariffs immensely actually contributed to the disaster. • Congress passed Federal Home Loan Bank Act to spur new construction of homes. • Hoover and Congress had the Emergency Relief and Construction Act passed as well. • Presidents told Congress what issues to address and then Congress passed laws to address the issues.
Stage 2: Policy formation: Roosevelt • The reform really started when President Roosevelt became president; he implemented the "New Deal" to bring the nation out of the depression. • Alphabet Soup organizations such as FDIC, SEC, TVA, and social security were formed. • He first tried to help the banks and gave people confidence to invest in them through the FDIC (through Glass-Steagall Act). • Then he tried to help corporations and the people; he gave people jobs through organizations like TVA--which tried to improve the area and simultaneously gave people jobs. • The Securities Exchange Act of 1934 created SEC to help stocks recover. Congress passed bills to help these organizations form.
Stage iii: Policy implementation • The President played a large role in implementing the policy. However, he did also tell Congress to address issues in Stage II; a lot of this happened quite rapidly so there are not discrete categories • The president provided many alphabet soup organizations support and monetary support. For example, the president would pay farmers in the south to not plant crops through the AAA--Agricultural Adjustment Act. • Roosevelt wanted people to trust banks again, prevent surplus of crops, increase prices/profits, decrease unemployment, and end the depression. He used a lot of trial and error methods. He was willing to try anything and get any bills passed to end the recession; he suggested new methods to Congress while supporting groups/organizations that already started.
Stage iv: Policy evaluation • There are mixed reviews in the solving of the depression problem. While unemployment decreased, prices increased, and the alphabet soup organizations seemed to be working, America (and the rest of the world) still had massive problems to solve. The problems superficially seemed to end, but there was still a long way to go. • Many economists suggest that the New Deal was largely unsuccessful and the little change that did occur was natural and incremental--that it would have occurred without the President or Congress's support. What really brought America out of the depression was World War II. America went from depression to recession straight to inflation; prices increased, unemployment dropped massively, and the economy was once again booming. • Ultimately, while the work of the Presidents and Congress was not squandered, it did not have as large an effect as expected; The New Deal was a minor failure. The changes occurred mainly through incremental change.
Evaluation: Quotes by Others • “Over the last 10 years a huge amount has been achieved in getting people into work. Measures such as the New Deal, tax credits, the minimum wage and improved childcare have brought about record numbers of people in work, a number that is still rising despite the global economic slowdown.” • ~Lucy Powell • “The New Deal is plainly an attempt to achieve a working socialism and avert a social collapse in America; it is extraordinarily parallel to the successive 'policies' and 'Plans' of the Russian experiment. Americans shirk the word 'socialism', but what else can one call it?” • H.G. Wells • “The New Deal also came to the rescue of mortgaged farmers and city-dwellers by taking steps to prevent foreclosures, then dreadfully common; the federal government, in essence, underwrote both the lenders and the borrowers.” • Hugh Brogan
Evaluation: Quotes by Roosevelt • “[Some People]...will try to give you new and strange names for what we are doing. Sometimes they will call it 'Fascism,' sometimes 'Communism,' sometimes 'Regimentation,' sometimes 'Socialism.' But, in so doing, they are trying to make very complex and theoretical something that is really very simple and very practical.... Plausible self-seekers and theoretical die-hards will tell you of the loss of individual liberty. Answer this question out of the facts of your own life. Have you lost any of your rights or liberty or constitutional freedom of action and choice?” • 1934 • “I pledge you, I pledge myself, to a new deal for the American people.” • 1932
Stage V: policy change: The New deals • It was most definitely necessary to revise some policy; it was not effective and was wasting money/resources that could be spent elsewhere. That is why many of the policies of the FND were changed in SND. Different organizations to create jobs were made because earlier ones were not very successful. • To change the policy, linkage institutions would have to demonstrate to government that the policies are not successful and need change. • There are two New Deals • The first New Deal was the beginning of Roosevelt's reform; the second one was similar and included the formation of similar alphabet soup organizations. • In the first, Roosevelt (and Congress) tried to stop the depression. Relief, Recovery, and Reform was his motto. in the second, he (and Congress) attempted to help regulate labor, housing, and farms. • In the second, some ideas of the first were revised and changed. The second new deal (SND) was more radical, more anti-business, and more pro-labor. Some organizations of the first new deal (FND) were abolished and new ones made.
Stage vi: Policy Termination • Many of the agencies and acts and associations formed during the Great Depression still exist today. For example the FDIC and SEC, and TVA still exist today. However, many acts similar to this were abolished and replaced with new acts/laws. • If there is a lot of public discontent with a law that was passed during the Depression (that is no longer applicable because the Depression was over) it was removed. Or if the government sensed its resources were being wasted on something unnecessary. • A lot of poor or lower class people have a lot to gain from maintaining the policy; if a similar depression were to happen again, America would be ready to protect the poor. The upper class has the most to lose; originally, they were the ones least affected by the depression. They constantly have to pay to support the poor (for example through social security, Medicare, and Medicaid)
![Dorothea Lange [1895 – 1965 ]](https://cdn0.slideserve.com/539541/dorothea-lange-1895-1965-dt.jpg)
