The New Deal Relief Recovery and Reform Background

The New Deal Relief, Recovery and Reform

Background n n n Hoover wins by a landslide in 1928: Continues the Republican policies of the 1920’s: lower taxes, less regulation of businesses, easy and available credit, high protective tariffs

Crash n n n n 1929: October 29 Black Tuesday Causes: Overproduction both agriculture and industry Speculation, buying stocks on margin Debt, easy credit Lack of regulation: unsafe business practices Worldwide depression (made worse by high tariffs) Uneven distribution of wealth

Stock Values Plummet

Crash Cont’d n n n Results: By end of 1929: loss of over $40 million in stock values 1930: over 4 million unemployed in US 1932: over 12 million unemployed Villages of homeless: Hoovervilles

Desperate Times

Hoover’s Response n n n Rugged individualism, laissez faire 1931 -1932; Began to use more govt. power and money to respond Hoover Dam: Colorado River Reconstruction Finance Corporation: made loans to corporations Bonus Army driven out of Washington: people blamed Hoover

Bonus Army

FDR n n Election of 1932: FDR (democrat) wins landslide Note: African Americans switch from primarily republican voters (Lincoln) to dems ( help for poor) Hope: …Only thing we have to fear is fear itself… Known for ‘fireside chats” friendly…

FDR

New Deal n n n Relief, Recovery, Reform: Democratic Congress passes his new plans “Hundred Days Congress” Many new deal reforms based on European reforms earlier

Money and Banking n n n Nationwide Banking Holiday: close banks to stop paranoid withdrawals Emergency Banking Relief Act Federal Deposit Insurance Corporation: insured deposits Federal Securities Act Security and Exchange Commission (Watchdog for stock market

Seen on bank doors all over US

Jobs for Jobless n n n Civilian Conservation Corps: 3 million young men live in camps: forestry, controlled floods, fire fighters… Federal Emergency Relief Act; short term emergency $$ National Recovery Administration: regulation of industry, wages, hours: later over-ruled by Supreme Court

CCC n Civilian Conservation Corps

Jobless Continued n n n Public Works Administration: spent $4 billion on 34, 000 projects, public buildings, highways, dams… WPA Works Progress Administration gave 9 million people jobs in 8 years Reversed prohibition: 21 st amendment sold alcohol legally with a tax to raise money

Helping Farmers n n n AAA: Agricultural Adjustment Act: millions to help farmers pay mortgages Soil Conservation and Allotment Act: paid farmers to grow soil conserving crops ( soybeans) or to not grow crops at all 1935 Resettlement Administration: moved farmers to better land ( away from Dust Bowl)

Migrant Farmers

Pea Camp

Long Lasting Legacy n n n FHA: Federal Housing Administration: small loans to building industry US Housing Authority: loans to state/local govt. to build low cost housing Social Security Act of 1935: pension and insurance for elderly, blind, physically handicapped… based on taxing employees and employers

Critics of the New Deal n n n American Liberty League: too much government!! Huey Long: (LA) “Share the Wealth” every family to receive $5000 from the rich Father Charles Coughlin: Catholic Priest in Michigan spoke out on radio vs. New Deal Wanted more help for the poor

Huey Long

Results: n n n Crisis passes, people have faith in government restored WW 2 1939 -1945 provides industry boost to end depression Government’s role in US changed forever: Social Security, FDIC, SEC, FHA… all continue to present. Much more support is expected…

Quotes: Economic depression cannot be cured by legislative action or executive pronouncement. Economic wounds must be healed by the action of the cells of the economic body - the producers and consumers themselves. Herbert Hoover

Quotes n But while they prate of economic laws, men and women are starving. We must lay hold of the fact that economic laws are not made by nature. They are made by human beings. Franklin D. Roosevelt

When the poor were “us”… not them

Choices? n n How much help is justified? When? Where? How much is too much? What would have happened if Hoover had been re-elected?