The New Deal By 1932 Herbert Hoover was

The New Deal By 1932, Herbert Hoover was practically unelectable Unemployment = 25% Massive Bank Failures National Income 50% of 1929 levels Hoover offered little relief for the many Americans in need Voters Elect a New President � *FDR = Franklin Delano Roosevelt � � Promised the American people a “New Deal” He believed the Federal Government needed to play a more active role in promoting recovery and providing relief Opposed Hoover’s approach that local & state governments should provide relief “It is common sense to take a method & to try it. If it fails, admit it frankly, & try another. But above all, try something. ” FDR won 1932 election; received 7 million more votes than Hoover

The New Deal “Brain Trust” � FDR surrounded himself with the best & brightest; professionals & academics � He nicknamed them the “Brain Trust” � Goal = formulate a plan to fix the economy NEW DEAL � FDR’s plan to fix the economy � 3 GOALS 1) Provide RELIEF for the needy 2) Promote long-term economic RECOVERY 3) REFORM banking & finance to prevent future depressions

The New Deal The 1 st New Deal The first phase of the New Deal dealt exclusively w/ economic reform � Unlike Hoover, FDR believed government legislation and involvement was crucial to stimulate the economy

The New Deal � 1 st HUNDRED DAYS as President � Step #1 Restoring Confidence in Banks � � � This became his means of communicating his New Deal initiatives to the American People FDR’s 1 st 100 days in office = he and Congress passed 15 pieces of legislation He made a bold attempt to swiftly restore the nations’ confidence � 1932 – banking panic in the months leading up to FDR’s inauguration 1 st Day in office – EMERGENCY BANKING BILL FDR declares a national “bank holiday” - Banks close for 4 days to get accounts in order, & then reopen to public FIRESIDE CHAT = FDR talked to the American people in a radio address, in order to restore confidence in the banking system. When the banks reopened, people did not run to withdraw all of their deposits.

The New Deal FDIC In order to restore & maintain America’s confidence in banks, the FEDERAL DEPOSIT INSURANCE CORPORATION insured accounts up to $5, 000 (now = $250, 000) This is to encourage Americans to do business with banks & deposit money, rather than keeping the money under the mattress

The New Deal Step #2 *These practices and laws were designed to prevent another long term depression stock market reform�Securities and Exchange Commission established to police the NYSE Ensured more honesty and less fraud in the sale of stocks, bonds, treasuries, and securities first chairman was Joseph P. Kennedy - practice of buying on margin was regulated

The New Deal Step #3 To put more $ in circulation, FDR went off the GOLD STANDARD (gov't could print more $ than Fort Knox gold reserves would allow) With more $ in circulation, wages and prices increased(= inflation), causing dollar value to lower This gave the gov't spending power (Keynesian economics)

The New Deal The FIRST New Deal First wave of New Deal programs (1 st Hundred Days) Dealt with Recovery & Reform (some direct Relief) FDIC SEC AAA CCC TVA NIRA (NRA) PWA

The New Deal The 2 nd New Deal 1935 (& after) Second major wave of New Deal legislation Aimed at helping the poor, elderly, and unemployed; created public works projects; helped farmers; and protected workers’ rights WPA * SSA REA NLRB NYA Fair Labor Standards Act

FDIC FEDERAL DEPOSIT INSURANCE CORPORATION Ensured bank deposits up to $5, 000 ($250, 000 today)

CCC CIVILIAN CONSERVATION CORPS Provided jobs for single males, 18 -25, building roads, parks, and national forests

CCC

PWA PUBLIC WORKS ADMINISTRATION

WPA WORKS PROGRESS ADMINISTRATION Quickly created jobs for unskilled workers for public works projects *2 nd New Deal

WPA

NYA NATIONAL YOUTH ADMINISTRATION Provide work and education for americans between 16 and 24

NYA

NRA NATIONAL RECOVERY ADMINISTRATION Created by the NIRA; worked with businesses to establish fair codes of competition

SEC SECURTIES AND EXCHANGE COMMISSION Supervised the stock market and eliminated dishonest practices

AAA AGRICULTURAL ADJUSTMENT ACT Aided farmers and regulated crop production

TVA TENNESSEE VALLEY AUTHORITY Developed the resources of the Tennessee Valley (built dams, provided electricity, created jobs, etc…)

TVA

HOLC HOME OWNERS LOAN CORPORATION Loaned money at low interest rates to homeowners who could not meet mortgage payments

NLRB NATIONAL LABOR RELATIONS BOARD Defined unfair labor practices and settled disputes between employees and employers

New Deal Critics The “Left” – many leading socialists believed the New Deal didn’t do enough to end the depression � Claims against FDR that he only cared about saving the banks for big businesses to profit Populists – critics who saw themselves as spokesmen for the poor � Francis Townsend � Father Charles Coughlin � Huey Long – “Share our wealth” program Taxes on the wealthy & big businesses = redistribute their money to the poor Huey Long was assassinated before he could run for President against FDR The “Right” – Conservatives complained that the New Deal made the U. S. government TOO powerful � Former President Hoover claimed it as “the most stupendous invasion of the whole spirit of liberty” in the nation’s history. � Many believed that the New Deal were a threat to the individualism that made the nation great; threatened too much government control � Some Democrats joined the Republican party because they believed the New Deal abandoned Democrat’s principles of limited federal government

SSA SOCIAL SECURITY ADMINISTRATION Provided a pension for retired workers and their spouses and aided people with disabilities

Social Security Respond to the prompt in your notes… If people are out of work (either retired, disabled, or otherwise unable to find work), should they receive money from the government (which comes from tax money)?

Social Security Video Answer while watchin g 1) What is social security? 2) Where does money for social security come from? 3) Where did Huey Long think money should come from? 4) Where did Francis Townshend think money should come from?

The nd 2 How did FDR plan to pay for these programs? -John Maynard Keynes -FDR New Deal “Pump Priming” & Deficit Spending Pump Priming – � In order to get the economy going, it was believed that public spending was needed to generate private spending, which would spur economic growth Deficit Spending – � Government spending, in excess of revenue (of funds raised by borrowing rather than taxation) *Economic Bill of Rights Speech (1944) We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. "Necessitous men are not free men. " People who are hungry and out of a job are the stuff of which dictatorships are made

Opposition to the New Deal = unconstitutiona l? ***Judicial Review**** During FDR’s 2 nd term, The Supreme Court ruled several New Deal programs unconstitutional NIRA � Fed. Gov’t could not regulate INSTRASTATE trade � Congress could regulate; NOT the President (what court case established this principle? ) AAA � Regulation of agriculture was deemed a STATE power

Opposition to the New Deal Court Packing In order to “dilute” the power of the Supreme Court, FDR proposed to ask Congress to increase the number of justices (from 9 to 15) � “Judicial Procedures Reform Bill” Power to President to appoint Add 1 new Judge for every one over 70 yrs of age Would add 6 new judges (maximum) Defeated in the Senate – Did not pass *In the end, FDR was able to appoint new Justices; court dominated by his appointees

Court Packing Analyze: 1) What is the title of the cartoon? 2) What people & symbols are present in the cartoon? What is the significance of each? 3) What message is the artist trying to convey?

Court Packing 1) What is the title of the cartoon? What is the significance of the title? 2) Who is FDR being compared to? Why?