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The New Deal, 1932-1938Chapter 21

Unit 5, 1920-1945

Election of 1932

• Democrat Franklin Delano Roosevelt defeated Republican Hoover

• FDR promised the American people “a new deal” involving relief, recovery and reform

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Hundred Days

• FDR relied on his brain trust, a group of academic advisors, to develop New Deal policies

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

• Congress passed a record number of acts between March and June, 1933 to provide relief from the depression

Banking• The Emergency Banking Act closed all banks

• Federal loans were provided to reopen large banks and consolidate small ones

• Glass-Steagall Act prevented commercial banks from speculating on the stock market

• Repealed in 1999

• Federal Deposit Insurance Company (FDIC) insured accounts up to $2,500

• Currently insured up to $250,000

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Creating Jobs• Civilian Conservation Corps (CCC),

Public Works Administration (PWA), and Civil Works Administration (CWA) provided millions of jobs around the country

• Worked in national parks, built public buildings (schools and hospitals), and repaired infrastructure around the country

• Tennessee Valley Authority built and maintained hydro-electric dams

Farming

• Agricultural Adjustment Act tried to regulate farm production

• Farmers were paid to destroy part of their crops or herds

• Less production would mean higher prices

• Dust Bowl in Oklahoma and Texas Panhandle made farming impossible

• Drought and mechanized damage to topsoil caused dust storms

• Many “Okies” moved to California

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Labor

• National Industrial Recovery Act required each industry to develop regulations and codes

• Supreme Court ruled unconstitutional in A. L. A. Schechter Poultry Corp. v. U.S.

• Congress of Industrial Organizations (CIO) unionized workers based on industry instead of skills

• Sit-down strikes were more effective then earlier walkouts

Second New Deal Programs

• Works Progress Administration provided jobs for unemployed laborers, artists, and authors.

• Many San Antonio sights, including the Riverwalk, were WPA Projects

• Social Security Act of 1935 provided insurance and pensions for the elderly, unemployed, and disabled

• Paid for by taxes on paychecks

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Support for FDR

• Working class voters were the key to FDR’s reelection in 1936

•FDR effectively used radio broadcasts to improve morale

• Fireside chats helped him educate Americans about New Deal programs

• Eleanor Roosevelt changed the role of first lady to be more politically active

Court-packing and the end of the New Deal

• FDR proposed the President be allowed to appoint a new supreme court justice once the sitting justice turned 70

• He was concerned the Supreme court would overturn more new deal programs

• Federal Labor Standards Act of 1938 prohibited child labor, and setrequirements for minimum wage and overtime pay

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Government debt and the Welfare state

• Economist John Maynard Keynes advocating for deficit spending

• Public spending by the federal govt. could stimulate economy

• Southern congressmen placed restrictions on social security that limited benefits for minorities

• Low level of benefits attached a social stigma to welfare

Impact of the New Deal

• Expanded the role of the federal govt. in the American economy

• Redefined American Freedom to include economic security and equality

• Failed to address racial inequalities• May have actually made it worse

• Did not generate prosperity• 15% of workers unemployed in 1940