The Great Depression and New Deal 1929 1939

The Great Depression and New Deal 1929 -1939

7. 1 NATIONAL, STATE, AND LOCAL REFORMERS RESPONDED TO ECONOMIC UPHEAVALS, LAISSEZ-FAIRE CAPITALISM, AND THE GREAT DEPRESSION BY TRANSFORMING THE UNITED STATES INTO A LIMITED WELFARE STATE.

Financial Panic or Great Depression? �What makes the 1930 s different from the Panics of 1819, 1837, 1873, 1893?

Causes and Effects Causes • • uneven distribution of income stock market speculation/buying on margin excessive use of credit overproduction weak farm economy government policies global economic problems

Causes and Effects � 20% of all banks closed GNP drops Unemployment reaching 25%, not including farmers Republican domination will end “Hoovervilles” Mortgage foreclosures

Hoover’s Policies � Rugged Individualism Urges voluntary action and restraint Believed direct relief should come from state and local governments � Later response � Hawley-Smoot Tariff Federal Farm Board Reconstruction Finance Corporation Despair and Protest � Farm holiday association � Bonus Army March disaster

The Election of 1932 �Republicans nominate Hoover �Democrats nominate Franklin Delano Roosevelt who promises a “new deal” for the American people �Landslide victory for Democrats � 20 th Amend. reduces lame duck session (Jan. 20) � 21 st Amend. repeals prohibition “Hoovervilles” represent President Hoover’s failure to act in the crisis

Franklin Delano Roosevelt � The liberalism of FDR’s New Deal drew on earlier progressive ideas and represented a multifaceted approach to both the causes and effects of the Great Depression. � His plan used government power to provide relief for the poor, stimulate recovery, and reform the American economy.

Franklin D. Roosevelt’s Advisors � Eleanor Roosevelt Most active first lady in history Voice of the “forgotten man” � Brain trust & black “Cabinet” Most diverse administration in history Frances Perkins (Sec. of Labor)

Marian Anderson and Eleanor Roosevelt

Franklin Roosevelt’s First New Deal Financial Recovery & Reform Programs Industrial & Agricultural Recovery Programs • Emergency Banking Relief Act • Federal Deposit Insurance Corporation • Home Owners Loan Corporation • Securities & Exchange Commission • National Recovery Administration • Agricultural Adjustment Act • Both declared unconstitutional Relief for Unemployed • Federal Emergency Relief Administration • Civilian Conservation Corps • Tennessee Valley Authority

National Recovery Administration �Businesses worked together to set codes for fair practice and reasonable prices �Ruled unconstitutional by the conservative Supreme Court in 1935 �However, many of the provisions were seen again in later acts (i. e. the Wagner Act) Businesses that were members of the NRA displayed this seal

Tennessee Valley Authority In the 1930 s the Tennessee Valley was one of the poorest regions in the U. S. facing many problems including � Soil erosion � Deforestation � Lack of electricity The TVA put men to work: � Building dams to control flooding and erosion � Building electric power plants to bring electricity to homes, farms, and businesses TVA hired experts to teach farmers about fertilizers and improved farming methods

The Second New Deal 1935 -1936 Relief Programs Permanent Reforms • Works Progress Administration(WPA) • National Labor Relations (Wagner Act) • Fair Labor Standards Act • Social Security Fireside Chats • Weekly radio addresses to reassure the public

Permanent Workers’ Rights National Labor Relations Act (Wagner Act) �Replaces the NRA �Guarantees collective bargaining �NLRB deals with laborlaw violations Fair Labor Standards Act �Federal minimum wage, maximum hours, & no child labor

Social Security �Retiree benefits �Disability insurance �Unemployment compensation

Federal Writers’ Project �Part of the Works’ Progress Administration, 1935 -1939 �Employed writers, teachers, historians, librarians and other white-collar workers �Originally focused on the creation of an American Guide Book �Project expanded to employ people to chronicle personal narratives, folklore, studies of social and ethnic groups, former slave testimonies, etc

Liberal Critics of the New Deal Huey Long Dr. Francis Townsend � Senator and populist � Believed the New Deal did not go far � Doctor and activist for the elderly � Developed the “Townsend Plan” � � enough and was too friendly to banking “share our wealth” campaign – promoted redistribution of wealth Proposed a minimum annual income of $5, 000 This would be raised by taxing the wealthy Partnered with controversial Father Charles Coughlin (best known for his anti-Semitic attacks on Jewish bankers) for an old-age pension program � His ideas were adopted in the Social Security Act

Conservative Critics of the New Deal Conservative Critics FDR’s Response � American Liberty � 1937 Court packing League (businessmen) � The Supreme Court scheme � Defeated by Congress � Aftermath - Justices begin backing off and retiring

Progression of the New Deal � 1936: FDR easily wins reelection and began to appoint new, liberal justices � 1937 -1939: FDR scales back deficit spending, resulting in the Roosevelt recession � 1940: FDR wins reelection in a campaign that focused almost entirely on the war in Europe (WWII began in 1939) � 1941: the U. S. enters WWII, resulting in full employment and higher wages

Political Impact of the New Deal �Although the New Deal did not completely overcome the Depression it left a legacy of government reforms and agencies that endeavored to make society and individuals more secure--creation of the “welfare state” �Helped foster a long-term political realignment in which many ethnic groups, African-Americans and working-class communities identified with the Democratic Party

Impact of the New Deal on Labor � Rise of Unions Congress of Industrial Organizations (C. I. O) breaks away from American Federation of Labor (AFL) � Federal minimum wage, maximum hours, no child labor � Precedent of government mediation of major labor disputes

Impact of the New Deal on Minorities � African-Americans Racial discrimination continues Were able to take jobs with WPA and CCC Appointed to federal department and leaders were invited to Washington Fair Employment Practices Committee � Assists minorities in gaining jobs in the defense industry � A. Philip Randolph � Native Americans John Collier appointed Commissioner of the Bureau of Indian Affairs Native Americans involved in the CCC and WPA Indian Reorganization (Wheeler-Howard Act) 1934 � Mexican Americans As white migrant workers push West, Mexican agricultural workers tend to return to Mexico