Ch. 34: The Great Depression &the New Deal

Election 1932

The New Deal (3R’s)

1. Policies developed by FDR that would give:

a. relief to the needy,

b. economic recovery,

c. financial reform

2. First 100 Days: Passed 15 bills!

3. Power of the federal gov’t?

Early On…

1. Bank Holidaya. Closed banks before

bank runs bankrupt them

b. Emergency Banking Relief Act = Inspected by gov’t to ensure they were secured

c. Restores confidence to the people

Fireside Chats

a. Talking directly to Americans

b. Informing them of plans/policies

c. Build confidence in banks

Glass-Steagall Banking Act

Est. Federal Deposit Insurance Corporation (FDIC)$5,000 $100,000 $250,000

Getting off the Gold Standard

All private holdings of gold exchanged for paper currency

Relief Programs

Civilian Conservation Corp a. Roads, planting trees, flood control, soil

erosion

b. $5/$25

c. Free food & uniforms

Federal Emergency Relief Administration

Aid to states for direct aid for food & clothes and public works projects.

Home Owners’ Loan CorporationHOLC

Creating Jobs1. Public Works Admin

(PWA)a. construction jobs

b. High schoolers, college student, and artists

2. Civil Works Admin (CWA)

3. Both criticized for menial job opportunities

            

Father Coughlin

Critics on both sides

1. Gov’t too big and socialistic

2. Not doing enough

3. Huey Long:

“Every man a king” Annual min. income Assassinated Sept.

1935

Share the wealth!

Dr. Francis Townsend

$200 a month

Helping Industry:

1. National Recovery Administration

a. Self-regulating: established “codes of fair competition” and regulations; price fixing and limited work hrs.

b. Allowed for unions = increase in membership

c. NRA Considered unconstitutional - Why?

1933: 21st Amendment1. Taxes applied to raise revenue for federal government

2. Repeals the 18th amendment

Helping America’s Farmers 1. Agricultural

Adjustment Acta. Price setting and gov’t

subsidiesb. Crops and livestock

destroyed by farmersc. Sharecroppers and

tenant farmers lost jobs and homes

2. Later ruled unconstitutional -taxing buyers to pay farmers

Background

1. The AAA paid farmers not to grow crops and not to produce dairy produce such as milk and butter. It also paid them not to raise pigs and lambs. The money to pay the farmers for cutting back production of about 30% was raised by a tax on companies that bought the farm products and processed them into food and clothing. The AAA also became involved in trying to help farmers destroyed by the creation of the dust-bowl in 1934.

2. In 1936 the Supreme Court declared the AAA unconstitutional. The majority of judges (6-3) ruled that it was illegal to levy a tax on one group (the processors) in order to pay it to another (the farmers). In 1938, another AAA was passed without the processing tax. It was financed out of general taxation and was therefore acceptable to the Supreme Court.

Dust Bowl:1933-1936

Dust Bowl(1933-1936)

1. drought, overproduction, windy conditions added to hardships of depression

2. Resulted in a westward migration = “Okies”

3. John Steinbeck’s Grapes of Wrath

“Okies”

New Deal and the Dust Bowla. Resettlement

Administration

b. Crop and seed loans

c. Gave direct aid to sharecroppers and tenant farmers

d. Conservation techniques: water, soil

e. Crop rotation

Reforming Banking and Finance

Finance/Stockmarket–Truth in Securities Act (1932)

–Securities and Exchange commission (SEC): regulate stock market, “insider trading”

Rural Electrification & Public Works

1. Modernizing the regions

a. Tennessee Valley Authority; dams

b. Rural Electrification Administration

Federal Housing Administration & United States Housing Authority

FHA (1934)Loans to householders

Improving dwellings

Stimulates building industry

USHA (1937)Low-income housing

Lathrop Homes

Cabrini Green

Social Security Act (1935)

1. Pension/spouse

2.Unemployment benefits

3. Disability insurance

4.Farmers/domestic workers not covered

National Labor Relations Act (1935)

1. aka Wagner Act

2. legalized unions

3. CIO: Committee for Industrial Organization (later Congress)

Skilled-craft union

used sit-down strikes

John L. Lewis

Election 1936

20th Amendment

No more!

“Court-Packing Bill”

1. Wanted more judges and place age criteria on Supreme Court Justices

2. Didn’t pass – considered a political mistake

3. Both parties stopped supporting New Deal proposals

Limits certain political activities of Federal employees both on and off duty; later to include limiting campaign contributions and expenditures

Anna Eleanor Roosevelt

1. Social Reformera. Anti-lynching

b. Health ins

c. Child labor

d. Discrimination

2. Advantage/influence?

Roosevelt Recession 1937

1. New Deal initially worked

2. Tried reducing deficit by cutting programs and constricting credit = recession

a. Stock collapse again

b. Decreased industrial output

c. Farm prices decrease

d. Unemployment up 20%

3. Ultimately, what ends the depression?