1929-1943 Great Depression

1933-1939 New Deal

Working Definition

A series of measures including programs, work projects, financial reforms and regulations brokered by President Franklin Roosevelt in 1939 to combat the deep problems caused by and America to recover from the 1929-1943 Great Depression.

Aims of the New Deal

Importan

When questioning the effectiveness of the New Deal, we must weigh it against its aims.

• Relief
• Recovery
• Reform
• Re-election for Roosevelt 💀

Agencies created by the New Deal

Summar

Marked an increase in power and regulation from the American government, as compared to before when corporations were allowed to run free under laissez-faire policy.

• significant because – Americans have a fear of totalitarianism and authoritarianism, of the government becoming too powerful and overstepping its bounds

• Agricultural
  • AAA: Agricultural Adjustment Act ^AAA
    • aimed to help farmers raise their income back to sustainable levels
    • part of the 'second' New Deal offering relief to farmers
    • disbanded after World War II
    • problem:
      1. excess of crops produced – many farmers ramped up production during the war
      2. low & depressed farm prices
      3. farmers’ cost of living + debt repayment issues
    • solution: price control via buying off excess crops
    • outcome:
      • raised prices by controlling the production of staple crops through cash purchases of excess
      • 📈 cotton prices rose from 6.5c to 10c per pound
        • 10.5 million acres of cotton were taken out of production
      • 📈 total farm income rose from $4.5 billion in 1932 to $6.9 billion in 1934
      • ❓ 6 million piglets were slaughtered to enable the price of pork to rise → very contentious & controversial
  • FSA: Farmers’ Security Act
    • aimed to provide critical assistance to farmers
    • included the ^AAA and ^RA
    • implemented soil conservation practices to combat soil erosion
  • FCA: Farm Credit Act
    • provided short- and medium-term loans to enable farmers with low incomes to keep their home and land by refinancing their mortgages
    • removed the fear of losing both home and employment
    • provided a sense of security enabling farmers to take advantage of other government agricultural programmes → raised production
• Industry
  • WPA: Works Progress Administration
    • employed millions of jobseekers (mostly uneducated men) to carry out public infrastructure projects
      • e.g. constructions of roads, hospitals, schools
  • CCC: Civilian Conservation Corps
    • problem: high unemployment rates
    • solution: job creation
      • e.g. planting trees, building flood barriers & other infrastructure, etc.
    • outcome:
      • created work for unemployed Americans
      • offered immediate financial relief for families in poverty
      • helped cushion the economy
  • TVA: Tennessee Valley Authority
    • provided power to rural areas in the South
  • FCC: Federal Communications Commissions
    • regulates interstate and international communications by radio, television, wire, satellite and cable
• Banks/Finance
  • FDIC (1933 June): Federal Deposit Insurance Corporation
    • insures customers' deposits in banks up to $250k – returns them money in the event of a bank run, e.g. Credit Suisse or Silicon Valley Bank in 2023
    • importance: restored Americans’ confidence & hope in the American banking system & President Roosevelt + hope that such a banking crisis will never happen again
  • SEC (1934 June): Securities Exchange Commission
    • oversaw the exchange of stocks & shares
    • importance: before the SEC, there was no regulation at all → government oversight gave hope & confidence in the American stock system
  • EBRA (1933 March): Emergency Banking Relief Act
    • 📈 from 6 March 1933 to 1 April 1933 (1 month), savers returned $1 billion to banks → proof of restored confidence in the American banking system
• Social
  • SSA: Social Security Act
    • provided financial relief to the elderly
    • faced backlash from conservatives, who thought that it eroded traditional American values of self-reliance and individualism + work ethic
      • the idea that you can get money without working was incredulous → threatened America’s work ethic, could make people reliant on government handouts for money
  • RA: Resettlement Association ^RA
    • helped struggling farmers relocate to more productive land via loans and technical support
  • FERA (1933 May): Federal Emergency Relief Administration
    • $500 million was divided equally among states to provide relief for the unemployed
    • half was given directly to states, and half was kept back to give them back $1 for every $3 they spent on relief
  • FHA: Federal Housing Administration

Two New Deals

• 1933-1934: Reformed the financial system, offering immediate reliefs to banks amidst a pressing banking crisis

Sample Essay Question

Question

‘The New Deal helped the nation.’ Discuss.

• “New Deal”: define it
• “helped”: define what this means for the essay
• “nation”: what is this referring to?
• “discuss”: positives/negatives – what did it do?

Approach 1

Cons

Depth would suffer – unable to present more nuance in the ways the New Deal did or did not help

• Paragraph 1: Helped…
• Paragraph 2: Did not help…

Approach 2

Pros and Cons

• More nuanced – shows greater understanding of the issue at hand
• Still not as connected as it could be, but much better than Approach 1

• Paragraph 1
  • Helped…
  • However, it failed to help…
• Paragraph 2
  • Helped…
  • OR Did not help…
  • OR Helped…
  • However, it failed to help…

Approach 3

Pros and Cons

• More nuanced

• Paragraph 1
  • Helped…
  • However, it did not help…
    • downplay the damage – but don’t trivialise it
    • why is it not more significant than the New Deal’s contributions?
  • Yet, it did help…

Unemployment rise during the 1937-1938 “Roosevelt Recession”

• Roosevelt tightened spending and didn’t fully utilise deficit spending → leads to a stall in economic activity under Keynesian theory
• 📈 Unemployment rose from 14.3% in 1937 to 19.0% in 1938

Women Under The New Deal

• found employment in menial labor jobs
  • women were overworked without many rights; some fainted at school
• faced patriarchal values; conditions did not significantly improve
• money was seen as an extra, unnecessary allowance as opposed to men, who were the primary breadwinners
• Roosevelt administration created opportunities for women to advance into senior positions (e.g. ambassador)
  • but ultimately their attempts were insignificant in shifting the societal dialogue and attitude
  • common women weren’t allowed into or educated enough for managerial positions
• women felt disenfranchised by the New Deal; they felt bitter, that the Deal was unjust
• the woman is upset about the safety net provided by the New Deal (aka ==state welfarism==)
  • under the SSA, it provides money for the unemployed → they are undeserving of the money handouts

Government Overreach in the New Deal

• the federal government overreached in the New Deal; it superseded state governments and the judicial circuit too much
  • shows that the government is too powerful → bad for American democracy → could lead into American dictatorship

Huey Long

• left-leaning populist Democrat governor of Louisiana
  • Louisiana was one of the poorest states
• he often enacted populist policy – appealing to the masses
• assassinated in 1935
• felt that Roosevelt wasn’t doing enough to help his state
  • if the electorate isn’t being helped → he’ll be voted out
• the New Deal wasn’t equal – it didn’t cover all groups equally

dump

• first New Deal – reforming the financial system, offering immediate relief to banks
• second New Deal – government work programs, offering relief to farmers
• Democratic Party diversified its popular base to include organised labour, black Americans, unemployed, second-generation immigrants, middle-class property holders
  • reflected a wide range of interests, rather than the white (usually male) majority
• New Deal promoted labor rights and union memberships – organised labor at the same time as supporting big corporations
  • conflict of interest + tension
  • affected small-time business owners
• the New Deal was part of the optics of the first 100 days of President Franklin D. Roosevelt’s inauguration as president

Questions

• why do you think the 1935 Wagner Act (Britannica) is significant and important?
  • established the federal government as the regulator and ultimate arbiter of labour relations
  • set up a permanent three-member (later five-member) National Labor Relations Board (NLRB) with the power to hear and resolve labour disputes through quasi-judicial proceedings
  • prohibited employers from engaging in such unfair labour practices as setting up a company union and firing or otherwise discriminating against workers who organized or joined unions
  • also barred employers from refusing to bargain with any such union that had been certified by the NLRB as being the choice of a majority of employees
  • fiercely opposed by Republicans and big business