The Great Depression and the New Deal 1933-1939

1. The Great Depression and the New Deal 1933-1939 Objective: Students will understand the purposes and effectiveness of the New Deal and the shift of power from state to federal government.

2. FDR: Politician in a wheel Chair • Polio helped build his character • Eleanor his wife, was a champion of the poor • Their relationship was rocky at best, he had several affairs • FDR was a great speaker and he used speeches often to communicate directly to the people over the radio • Nominated in 1932 on a wet platform that also promised to balance the budget • FDR toured the country assailing Hoover while Hoover stayed in the White House trying to consul the people • 22-15 million for FDR and 472 to 59 • 1932 election saw the shift of blacks to the Democratic party • In the lame duck period Hoover and FDR refused to work together and it made the Depression much worse

3. FDR and the 3 R’s: Relief, Reform, and Recovery • Nationwide Banking Holiday March 6-10 • 100 days March 9-June 16 1933 • Passed much of his alphabet legislation • Brain Trust • Congress gave FDR more power than the Constitution allows, Americans were just happy they were moving even if it was in the wrong direction

4. Roosevelt Manages the Money • Banking Holiday was ready in 8 short hours • Gave the president power to regulate bank transactions and reopen solvent banks when they were ready • Glass-Steagall Banking Reform Act 1933 • FDIC—insured individual investments up to $5,000 • Gave Americans their faith back in the banking system • Took the nation off the gold standard • Was hoping inflation would occur to help the debtors

5. Creating Jobs for the Jobless • ¼ of Americans were unemployed • Civilian Conservation Corps (CCC) 1933 • Employed more than 3 million young men: reforestation, firefighting, flood control, etc • Federal Emergency Relief Act (Agency) 1933 (FERA) • Harry Hopkins at the head • Gave $3 billion to states to distribute to the poor • Agricultural Adjustment Act (AAA) 1933 • Helped farmers pay their mortgages • Homeowners Loan Corporation (HOLC) 1933 • Refinanced mortgages on non farm houses • Helped 1 million families • Helped banks from closing and made many homeowners democrats • Civil Works Administration (CWA) 1933 • Temporary jobs during the 1933-34 winter

6. Helping Industry and Labor • National Recovery Administration (NRA) 1933 • Designed to help industry, labor, and unemployed • Long term and short term goals • Industry were to work out codes of fair competition, reduce hours of labor thus spreading out employment, set minimum wages • Labor was guaranteed the right to organize and bargain collectively • Philadelphia Eagles were created and named after the NRA—eagle was the NRA’s mascot • Schechter decision • Supreme Court declared NRA unconstitutional • Public Works Administration (PWA) • Intended for industrial recovery and unemployment relief • Headed by Secretary of Interior Harold L. Ickes • $4 billion spend on 34,000 projects, buildings, highways, etc • Grand Coulee Dam on the Columbia River • Liquor Industry was one of the few that recovered • Repeal of Prohibition

7. Paying Farmers not to Farm • Agricultural Adjustment Act (AAA) 1933 • Establish parity prices through artificial scarcity • Paid farmers to reduce acreage • Declared unconstitutional in 1936 • Actually did bring prices up • Soil Conservation and Domestic Allotment Act of 1936 • Paid farmers to plant crops that conserved soil like soybeans or let it lie fallow, unplanted • Second AAA • Still focused on conservation but had parity price bonuses on specific crops—wheat and cotton

8. Dust Bowls and Black Blizzards • Drought in great plains from Colorado to Missouri • Dust Bowl • Made worse by overproduction, dry farming • Hundreds of thousands fled the dust bowl to California • Frazier-Lemke Farm Bankruptcy Act 1934 • Allowed a suspension of mortgage payment for 5 years, declared unconstitutional by courts until it was changed to 3 years • Resettlement Administration 1935 • Moved farmers onto better land and planted 200 million trees by CCC to act as wind breaks • Indian Reorganization Act 1934 • Tribes could establish local gov’t and preserve native cultures • Helped stop loss of Indian lands due to the Dawes Act

9. Battling Bankers and Big Business • Federal Securities Act • Had to prove the soundness of stocks and bonds sold on the market • Securities and Exchange Commission (SEC) • Watchdog for stock market

10. TVA • Tennessee Valley Authority was created in 1933 • Most revolutionary of all New Deal programs—“planned economy” • Government owned utilities, cheap, no taxes • Couldn’t be done privately—too expensive • Full employment to the area along with cheap electricity, low cost housing, cheap fertilizer, stopped erosion, reforestation, etc

11. Housing and Social Security • Federal Housing Administration (FHA) 1934 • Loans to homeowners for improvements or new houses • Very popular and outlasted FDR’s administration • United States Housing Authority (USHA) 1937 • Money to states or communities for low cost construction—low income housing • 1st time in America slum areas shrank • Social Security Act 1935 • Federal state unemployment insurance • Pensions for retired workers and disabled

12. A New Deal for Labor • 1934 saw a lot of strikes as the New Deal legislation helped unemployment • 1935 Wagner or National Labor Relations Act • Created the National Labor Relations Board (NLRB) • Rights to labor to organize and bargain collectively • Milestone in the labor movement • John L. Lewis—boss of United Mine Workers • 1935 he formed the Committee for Industrial Organization (CIO) inside the AF of L • AF of L pushed out the CIO and the CIO headed to the auto industry • CIO used sit in strikes in Michigan • CIO was recognized by GM as the sole bargaining agent for its employees • This was followed by several others granting CIO right to bargain collectively for it employees • Fair Labor and Standards Act 1938 • Minimum wage and maximum hours • Ended child labor in dangerous occupations • Left agriculture out

13. Landon Challenges the Champ • Landon vs. FDR in 1936 • Republican platform against the debt of the New Deal • Republican carried only 2 states—Maine and Vermont • 27-16 million 523-8 for FDR • Rich vs. Poor • FDR formed a coalition with blacks, South, urbanites, and poor that lasts today

14. 9 Old Men on the Bench • Supreme Court stood in FDR’s way • Turned down 7 of 9 New Deal legislation • Ultraconservative, none appointed by FDR • Court packing • FDR asked congress to allow him to appoint a new judge for everyone over 70—6 raising the court to 15 • FDR’s most costly political mistake • Seen as a dictator, tried to end separation of powers • Some of the judges started voting more liberal • “A Switch in Time Saves Nine” • Upheld minimum wage, Wagner Act, and Social Security • One judge also resigned and was replaced by Hugo Black

15. Twilight of the New Deal • Unemployment dropped from 25-15% • 1937 economy took another downturn, depression in a depression dubbed the Roosevelt recession • Gov’t cut back on spending to balance the budget • Keynesianism—deficit spending • Became the policy of the gov’t • Hatch Act 1939 • Barred federal administrators from campaigning actively • Couldn’t use gov’t money for campaigning • Limited campaign contributions • By 1938 the New Deal lost steam and was all but over

16. New Deal or Raw Deal? • Many criticized FDR for not doing enough while others said he did too much • Debt rose from 20 billion in 1932 to 40 billion in 1939 • Business was frustrated at FDR for his planned economy programs • Failed to cure the depression only acted as a band aid to it • WWII ended it not the New Deal

17. FDR’s Balance Sheet • Waste and graft was fairly common • Most $ spent under the New Deal was on relief • Helped relieve the worst crises in US, saved economy, led to fairer distribution of wealth, gave people self respect, etc • FDR carried out a bold reform without revolution