Depression and a New Deal

1. Depression and a New Deal

2. 1929 to 1932 • Stock market crash fall 1929 • Local private relief agencies overwhelmed, many disappeared • Became clear public agencies had to respond • Clear poverty was result of social and economic (not psychological) factors

3. Hoover’s Response • Hoover against “dole” and federal aid • Thought public assistance would demoralize and enslave recipients • Approved bill for starving cattle but opposed one to help starving farmers • Saw public works employment programs as dangerous ideas

4. Roosevelt as N.Y. Governor • Wicks Act – first state unemployment relief act • Created Temporary Emergency Relief Admin under direction of social worker, Harry Hopkins • Roosevelt also passed an Old Age Pension in NY • “Government is not the master but the creature of the people.”

6. Roosevelt Elected President 1932 • Initiated many programs to deal with immediate crisis -- alphabet soup • Civilian Conservation Corps (reforestation, flood and fire) • Public Works Administration (building projects) • National Youth Admin (part time jobs for high school & college students)

7. U.S. Housing Authority (loans to build public housing) • Basic idea – get people working, restore confidence • Use the principle of work relief – earning not charity • People could retain their dignity

8. Federal Emergency Relief Act • FERA -- similar to NY measure established by Wicks Act • Headed by Harry Hopkins • Federal money to states to be administered by states and localities • Each local office had to have at least one social worker on staff

9. Roosevelt Didn’t Like Relief • Saw relief as temporary • Saw need for more permanent measure to deal with dependency on long range basis • Saw current crisis as result of social and economic forces of industrialization • Summer 1934 appointed Committee for Economic Security

10. Committee on Economic Security • Chaired by Frances Perkins and Harry Hopkins • Edwin Witte (economist) and Wilbur Cohen major influences • Committee report submitted in January 1935 and Social Security Act passed in August 1935

11. Frances Perkins • Secretary of Labor under FDR • First woman to hold a cabinet post (1933-1945) • Appointed by Truman to head Civil Service Commission in 1945 • Commitment to improving the lives of workers; Deeply influenced by labor movement & Triangle fire • Educated in economics and sociology; worked in settlement houses, among other things • Active for women’s suffrage

12. Contributory Old Age Insurance • Workers and employers taxed to finance retirement benefits (Old Age Insurance) • Benefits based on how much they had earned and how long they had worked • Encourage older workers out of jobs to make way for young

13. Unemployment Insurance • Employers taxed for this purpose by federal government • Federal government returned funds to states if they set up unemployment insurance programs

14. Public Assistance • Old Age Assistance: federal government would help states provide aid to old who could not participate in Social Security • Feds gave money to states for help for single parent families with dependent children (expansion of mother’s aid) • Beginnings of AFDC – not controversial

15. Social Security Act • Built on previous precedents • Welfare only to aged and young “deserving poor” • Tied benefits to stable long term labor force participation • Left out a lot of people from social insurance initially • No health insurance

16. New Ideas • Helped prevent destitution and dependency • Not a matter of individual weakness • Federal aid to states for social welfare • Federal government assumed responsibility for welfare of citizens

17. Effects on Social Work Profession • Created many new jobs for social workers • Created demand for new schools of social work • Social workers learned about rural poverty • Return of interest in social reform • Social workers gained prestige • Social work became accepted part of government in a modern state

18. What Ended the Depression? • Deficit spending • Mobilization for World War II