THE NEW DEAL ITS LEGACY Relief Reform Recovery

THE NEW DEAL & ITS LEGACY Relief, Reform, & Recovery

HOOVER’S RESPONSE Did not believe the government should give aid to the needy § Worried aid would undermine self-reliance and encourage people to become reliant on the government § Believed his job to generate optimism and restore public confidence § Hoovervilles: Homeless Americans built cities out of cardboard boxes Asked healthy banks to loan money to failing ones Reluctantly created the Reconstruction Finance Corporation (RFC)- issued government loans to banks, railroads, and big business § RFC loaned money to states to help with needy- financed public works projects

HOOVER’S RESPONSE

HOOVER’S RESPONSE Trickle-Down Theory: Government gives money to business they hire more employees more people earn money § The problem with the trickle down solution – the poor could not wait for money to trickle down. Hoover battled the Bonus Army § Hoover called in troops to push the Bonus Army out of DC - used tear gas and tanks § Americans mad at the use of tanks to push out disabled veterans

ELECTION OF 1932 Republican – Herbert Hoover Democrat – Franklin Roosevelt § 2 -term governor of New York § Distant cousin of Theodore Roosevelt won an overwhelming victory § Immediately set to work formulating a set of policies for his administration § Came to be known as the New Deal § Focused on 3 general goals: Relief, Recovery, & Reform § Expanded the role of the federal government

THE FIRST ONE HUNDRED DAYS Emergency Banking Act - Reformed banking system giving the federal government more power to supervise banks § March 5 – Bank holiday § Sound banks would reopen § Insolvent banks would remain closed § March 12 – 1 st Fireside Chat

THE FIRST ONE HUNDRED DAYS Banking Act of 1933 § Created the FDIC - ensured every account up to $5, 000 § Limited freedom of banks to invest in stocks and bonds Securities Exchange Commission (SEC) § Required companies to publish important facts about their business

THE FIRST ONE HUNDRED DAYS National Industrial Recovery Act (NIRA) § Established the National Recovery Administration (NRA) – Set minimum wages, maximum working hours, & minimum prices at which goods could be sold § Created the Public Works Administration (PWA) – oversaw large-scale construction projects

THE FIRST ONE HUNDRED DAYS Agricultural Adjustment Administration (AAA) § Helped farmers by reducing crop production & raising prices Tennessee Valley Authority (TVA) § Developed construction jobs in the Tennessee Valley

THE FIRST ONE HUNDRED DAYS Civilian Conservation Corp (CCC) § Gave young men jobs planting trees & working on other conservation projects Federal Emergency Relief Act (FERA) § Sent funds to states to distribute to the needy

FDR VS. THE SUPREME COURT By the end of his first term, FDR faced opposition from the Supreme Court § In 1935, the Court ruled that the National Industrial Recovery Act (NIRA) was unconstitutional § The following year, they struck down the Agriculture Adjustment Act (AAA)

FDR VS. THE SUPREME COURT After winning reelection, FDR was ready to take on the Supreme Court § He proposed a plan to add a new justice for every justice over 70 years old § Labeled by critics as “court-packing”

THE SECOND NEW DEAL Wagner Act § Protected the rights of workers who joined unions & went on strike Fair Labor Standards Act § Regulated conditions in the workplace § Set a minimum wage-. 25 § Set maximum hours- 44 § Ended oppressive child labor Social Security Act § Provided a pension for retired workers & their spouses & helped people with disabilities

THE SECOND NEW DEAL Rural Electrification Administration (REA) § Established hundreds of publicly owned electric cooperatives, built generating plants, & strung power lines Works Progress Administration (WPA) § Set out to create as many jobs as possible as quickly as possible § In its 1 st year, the WPA put 3 million Americans to work

CRITICS OF THE NEW DEAL Conservative Critics § Believed that New Deal had gone too far in expanding the role of government § Compared the New Deal to socialism § Father Charles Coughlin § Al Landon § Robert Taft

CRITICS OF THE NEW DEAL Radical Critics § Believed the New Deal should give greater aid to the needy § Huey Long (LA) § “Every Man a King” § Wanted to take money from rich & give every family a grant of $5, 000, a guaranteed job, & an income of $2, 500 a year § Frank Townshend § Proposed a guaranteed income plan for senior citizens § Led to the creation of the Social Security Act

THE LEGACY OF THE NEW DEAL Established the concept that Americans have the right to economic security, including: § A job § Adequate wages § A decent home § Medical care § Good education Expanded the role of government Increased deficit spending § FDR borrowed money to pay for his New Deal programs