FDR’s New Deal Begins

D. Challenges at Home and Abroad

(ca. 1914-1945)

f. Explain the economic,

environmental, and social impact of

the Great Depression on American

society

g. Evaluate the impact of the New

Deal on various elements of American

society (e.g., social, political,

environmental, economic)

Herbert Hoover

was a Republican

elected President

in 1928. The Great

Depression

began during his

administration.

Many were discontent with Hoover’s “hands off” approach. He did

not want to raise taxes to give direct relief and aid to struggling

Americans. He was afraid this would make people dependent on

the government. He felt the government should get out of the way

and let the free market work out the Great Depression on its own.

Villages of homeless people in shacks were nicknamed

“Hoovervilles” and Hoover’s tension with WW I veterans, called

the Bonus Army, tarnished his political popularity.

Franklin Delano

Roosevelt, a

Democrat, defeated

Herbert Hoover for the

Presidency in the

Election of 1932.

While Hoover wanted

the government to

“get out of the way” in

the Great Depression,

FDR felt the

government had to be

involved and

intentional to fix the

bad economy.

The New Deal

-In 1932, Franklin Delano Roosevelt, a Democrat and governor of New York, was elected President of the USA.

-FDR offered a New Deal (like in cards). He felt the hands off approach of the Republicans had failed and wanted to try another approach.

-FDR wanted direct relief for the needy to be paid for with taxes. He also wanted to make rules to enforce financial reform. In other words, he wanted the government to act like a strict referee for the stock market.

Like the Progressives, FDR

wanted the government to act

like a strict referee in the

economy.

Yet, to pay for the New Deal, FDR was going to have

to spend tax payer money.

The First 100 Days

-FDR claimed immediate action was needed during his first one hundred days, from March 9th to June 16th of 1933.

-FDR got Democrats in Congress to pass the New Deal legislation and drifted away from the hands off approach of past Republican leaders.

-Then, FDR signed the New Deal legislation into law. This was the first time in history that the government tried so aggressively to fix an economic down turn.

The Government Creates Jobs

-Like with the Hoover Dam, FDR wanted to pursue

government projects that would create jobs for the

unemployed and improve the economy.

-The Tennessee Valley Authority hired workers to

build dams and bring electricity to areas that did not

have the power source in Tennessee.

-The Civilian Conservation Corps (CCC) built

roads, planted trees to stop soil erosion, and did other

jobs. Millions of trees were planted to help prevent a

future dustbowl.

In the midst of the Great Depression, a massive weather catastrophe,

the Dust Bowl, damaged the output of agricultural goods. This

phenomenon was partially man made due to excessive farming.

By planting trees, the CCC helped to prevent a

future Dustbowl. It also gave men jobs

who were out of work.

Men who were out of work could come to places like

Tennessee to work for the government in various

New Deal projects.

Banks and the New Deal

-The Emergency Banking Relief Act reopened good banks and delayed the opening of struggling banks.

-FDR began radio addresses to personally address the nation and reassure many who had lost faith in banks.

-In 1933, the Federal Deposit Insurance Corporation was created and guaranteed a customer $5,000.00 in the bank, even if banks closed. Today, this amount is $250,000.00.

FDR used the technology of radio to gain support for

the New Deal and encourage people to start using

banks again.

People were afraid to put their money back in banks

because, when the banks crashed, many lost

everything. The New Deal created FDIC to

guarantee people would get their money back, to a

certain amount, if their bank failed.

The Stock Market and the New Deal

-The Federal Securities Act created rules for the stock market. The Securities and Exchange Commission (SEC) enforced rules as a referee for the stock market.

-Entities like these prevented people with “inside” information from manipulating the market, known as “insider trading.”

-The 21st Amendment ended Prohibition and allowed the taxing of alcohol.

The Government and Agriculture

-The Agricultural Adjustment Act (AAA)

planned to lower production and pay farmers to

not plant crops.

-FDR ordered the slaughter of pigs to prevent

their consumption. He wanted to destroy food

surpluses. Many protested; this was destroying

food.

-Yet, FDR asserted that, as long as supply was

too great, farmers could not reap profits. A low

supply would make farming profitable again.

More New Deal Policies

-The National Industrial Recovery Act (NIRA) established “rules” for industry and officially made unions legal.

-Due to the Red Scare, unions had decreased in power because business interests asserted union activities were Communist in nature.

-The Civil Works Administration (CWA) gave money to build schools and community buildings.

During the era of the New Deal, unions

became stronger and more prevalent.

THE

END

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