FDR & The New Deal

FDR--Background

Came from a wealthy family in Hyde Park

Fifth cousin of TR

Graduated from Harvard in 1904

Undersecretary of the Navy during WWI

Franklin D.

Roosevelt

• Ran for VP in 1920 (Lost)

• 1921-Contracted polio on vacation in Campobello, Maine

• Elected governor of NY in 1928 Won the election in a

landslide (472-59)

• In 1932, promised America a “New Deal”

• “The only thing we have to fear is fear itself.”

Franklin D. Roosevelt

Defeated Herbert Hoover in Election of 1932

Inauguration on March 4, 1933

• 5,000 banks failed between 1929 and 1933

• On March 5th, FDR declared a “Bank Holiday”

Implementing the New Deal

FDR called Congress into special session

March 9--Emergency Banking Act

• Funds to help threatened banks

Hundred Days

Relief, Recovery, Reform

Unprecedented legislation to address crisis of Great Depression

• Expansion of federal government and of government in people’s lives

“Alphabet Soup”

Bank Holiday

Reconstruction Finance Corporation (RFC)

Civilian Conservation Corps (CCC)

Agricultural Adjustment Act (AAA)

Tennessee Valley Authority (TVA)

Nat’l Industrial Recovery Act (NIRA)

Federal Housing Administration (FHA)

Public Works Administration (PWA)

Banking Act of 1935

Social Security Act (SSA)

National Labor Relations Act (Wagner Act) (NLRA)

Glass-Steagall Act/ Federal Deposit Insurance Corporation (FDIC)

Federal Emergency Relief Administration (FERA)

Securities & Exchange Commission (SEC)

Works Progress Administration (WPA)

….

Role of Government The New Deal-- an attempt to save democracy?

Classic Liberalism vs. “New Deal” liberalism

Keynesian Economics vs. Laissez Faire

← New

Deal Liberalism

“It has been well said that ‘the freest government, if it could exist, would not be long acceptable, if the tendency of the laws were to create a rapid accumulation of property in few hands, and to render the great mass of the population dependent and penniless….’

↑ Classic Liberalism

“No people, least of all a people with our traditions of personal liberty, will endure the slow erosion of opportunity for the common man, the oppressive sense of helplessness under the domination of a few, which are overshadowing our whole economic life.”

--FDR, 4/29/38, Message to Congress on Curbing Monopolies

Second New Deal

By 1934, 10 million people remained unemployed-20% of population

“Second New Deal” launched in 1935

The Supreme Court “Court Packing”

1937

FDR wanted to add up to 6 judges, one for every current justice over 70 years old

To combat Supreme Court that ruled against some New Deal legislation

“Roosevelt Recession” of 1937-1938

Unemployment rate was 14.3%

FDR wanted to balance the federal budget, so he cut federal spending for New Deal programs

Unemployment rate jumped to 19.0%

1938-Return to deficit spending