Dr. Robbins’ Lecture PowerPoint for Ch 33 (American Pageant, 13th ed)

1. The Great Depression
& the New Deal
1933-1938
Essential Questions
Chapter 33
The American Pageant, 13th edition

2. Election of FDR
 Easily won the election over Hoover who was
unfairly blamed by many for the “Hoover
depression” (Anyone but Hoover!)
 Both parties talked of repealing Prohibition
 FDR promised to end national debt
 Upbeat, cheerful personality vs. grimfaced Hoover
 5th cousin to Teddy Roosevelt
 African-Americans voted heavily Democrats for
first time; they were among those hardest &
earliest hit by Depression

3. Eleanor Roosevelt
 Eleanor was a distant cousin of FDR, & niece
of TR
 Great influence on her husband towards more
liberal views
 Also influenced the population with her
speeches & newspaper column, even long after
FDR’s death
 Later involved in establishing the United Nations

4. FDR Quotes
 “I pledge you, I pledge myself to a new deal
for the American people.”
 “Let me assert my firm belief that the only
thing we have to fear is fear itself.”

5. First “Hundred Days” (March 9-June 16)
 During the first “Hundred Days”,
Democrat-dominated Congress pushed
thru unprecedented number of new laws
to deal with emergency
 Some of the ideas came from earlier
Progressive Movement
 President was given unusual powers to
legislate by Congress

6. 20th Amendment
 Moved start of new president’s term to
January 20, from March
 Also started new Congress on January 3rd
 Clarified presidential and vice-presidential
succession

7. Key principles
 Unemployment insurance
 Old-age insurance (Social Security)
 Minimum-wage regulations
 Conservation & development of natural
resources
 Restrictions on child labor
 RELIEF, RECOVERY, REFORM

8. Banking Reforms
 Emergency Banking Relief Act
 gave president power to regulate banking transactions &
foreign exchange; also to reopen solvent banks
 “fireside chats” reassured Americans that banks were safe
again
 Glass-Steagall Banking Reform Act
 created the Federal Deposit Insurance Corporation to
insure deposits (starting with $5000 and later increased)
 Separated commercial and investment bank functions
 ended widespread bank failures that had occurred ever
since Andrew Jackson’s days

9.  Gold standard
 to stop hoarding of gold, FDR ordered that all
private gold holdings be turned into the govt in
exchange for paper currency
 then took the country off the gold standard

10.  Managed currency
 FDR believed that buying up the gold would increase
inflation which would reduce private debt & stimulate new
production
 Treasury bought up gold at increasing prices (from $21 to
$35 an ounce)—did increase the dollars in circulation
 ended the gold buying scheme in Feb. 1934
 FDR then brought back the gold standard but for intl trade
only
 criticized by “sound money” critics

11. Making Jobs, Providing Relief
 Civilian Conservation Corps (CCC)
 for conservation and development of natural
resources
 put 3 million young men to work (had to send
most of pay home to their parents)
 Federal Emergency Relief Act created the
Federal Emergency Relief Administration
(FERA)
 ultimately gave out $3 billion to states for direct
dole or—even better—wages on work projects

12.  Agricultural Assessment Act (AAA)
 gave millions for farmers’ mortgages
 Home Owners Loan Corporation (HOLC)
 to help refinance nonfarm homes
 helped about a million families & strengthened
middle class loyalty to Democrats

13.  Civil Works Administration (CWA)
 under the FERA, provided temporary,
emergency “make-work” jobs such as leaf-
raking!
 especially helpful to desperate Americans during
the winter of 1933-34

14.  Works Progress Administration (WPA)
 spent $11 billion & employed nearly 9 million
people
 from public buildings, bridges & roads, to monkey
cages & tap dancing; also art murals on post
office walls
 white collar workers and artists like John
Steinbeck were given work to do & money to earn

15. In the State Museum of
Pennsylvania, in Harrisburg

16. The Daily Mail, 1937, by Olive Nuhfer
Post Office in Westerville, Ohio

17. Scenes from History of San Francisco,
mural series by Anton Refregier, 1943,
at the Rincon Annex Post Office

19. Reactions
 Early acts heartened Americans, did not
fundamentally improve economy
 Critics included
 Father Charles Coughlin (“Social Justice”)
 Louisiana Sen. Huey Long (“Share Our Wealth”)
 Dr. Francis E. Townsend (help the aged)

20. National Industrial Recovery Act
(NIRA)
 Established National Recovery Administration (NRA)
 Short-lived, very complicated attempt to help industry,
labor, unemployed thru relief and long term recovery
 200 industries would be held to codes of “fair
competition” to reduce hours & provide employment to
more people; set a maximum number of hours and a
minimum wage
 Labor got right to organize & bargain collectively with
representatives of their own choosing
 Anti-union contracts were forbidden & child labor was
restricted

21. More NIRA
 NIRA ultimately failed
 too much self-sacrifice expected of labor & industry
 dishonest “chiselers” took advantage
 Schechter decision (1935) ended NRA
 Court case of local chicken business in NY
 Supreme Court ended NRA for 2 reasons
 federal govt could not control local businesses thru
interstate commerce controls
 denied Congress’ right to give legislative powers to
president

22. Public Works Administration (PWA)
 For industrial recovery and employment
 $4 billion spent on 34,000 projects,
including public buildings, highways,
parkways
 Grand Coulee Dam on Columbia River produced
electrical power and irrigation
 Did not reach full potential of job making
out of fear of waste

23. Grand Coulee Dam, Columbia River, Washington State
(photo from Library of Congress)

24. End of Prohibition
 Begins with early Congressional approval
of FDR’s suggested 3.2% alcohol
allowance (light wine and beer)
 Completely ended with 21st Amendment in
1933

25. Agricultural Adjustment
Administration (AAA)
 First AAA declared unconstitutional
 set “parity prices” (based on 1909-1914 value)
 price-depressing surpluses to be stopped by
reducing crop acreage
 started off badly by destroying crops and
livestock when too many people were hungry
 Supreme Court killed it in 1936: regulatory
taxations were unconstitutional

26.  2nd AAA more successful
 emphasized more conservationist methods of
limiting production, thus gaining Court approval
 if farmers followed restrictions for specific crops
they would be compensated with parity
payments
 insured farmers of fairer prices & share of
national income.

27. Dust Bowl
 Tragically worsened impact of Great Depression
on midwestern farmers
 Dry-farming techniques & drought caused
immense dust storms & destruction of 1000s of
farms
 350,000 from Arkansas and Oklahoma moved to
California (Grapes of Wrath)
 Frazer-Lemke Act (1934) suspended foreclosures
 1935 Resettlement Administration set up to help
 CCC planted windbreaks

28. Indian Reorganization Act (1934)
 Attempt to reverse Dawes Severalty Act
 Helped tribes to establish local self-
government & preserve native culture
 Intended to stop loss of Indian lands
 Not all tribes accepted it (“back to the
blanket”)

29. Federal Securities Act
 Required banks & businesses to provide
accurate info to investors
 Led to creation watchdog committee: SEC
(Securities and Exchange Commission)

30. Tennessee Valley Authority (TVA)
 Series of dams built on Tennessee River
 Provided jobs & electricity to one of poorest
regions of country (Appalachia)
 Used to determine real costs of producing energy
& thus to check fairness of utility rates
 Critics questioned government’s conclusions or
feared socialism
 More results: low-cost housing, restored eroded
lands, nitrates for fertilizers, reforestation, flood
control, irrigation

31. Federal Housing Authority (FHA)
 Established in 1934 to provide small loans for
building & improving housing
 To stimulate building industry
 Very popular (cont. after New Deal)
 Congress expanded FHA with USHA
 U.S. Housing Authority
 To lend money to states for low-cost construction
 Reduced slums
 Resisted by real estate promoters, builders, landlords

32. Social Security Act, 1935
 Created federal-state unemployment
insurance
 Created Social Security payments
 Regular payments to aged, handicapped, etc.
 Started at $10-$85 per month
 Paid for with payroll tax on employers &
employees
 Inspired by similar programs in Europe
 To compensate for social changes from
urbanization (fewer family safety nets)

33. Labor Issues
 Wagner Act aka National Labor Relations Act, 1935
 Created National Labor Relations Board (NLRB)
 Replaced function of NRA
 Affirmed labor’s right to organize & bargain collectively with
own representatives
 Committee for Industrial Organization
 Created for unskilled workers; started w/in AF of L
 Founded by John Lewis & supported by NLRB
 Successfully used sit-down strike at GM
 Later renamed Congress of Industrial Organizations

34. More Labor
 More support from Congress with Fair Labor
Standards Act, 1938
 Minimum wages & maximum hours were to be set by
industries involved in interstate commerce
 Goal was 40 cents/hour & 40 hours/week (!)
 Only applied to industrial workers
 farm & domestic workers excluded, mostly women &
minorities
 Ongoing conflicts with AF of L
 Overall, tremendous expansion of labor
movement, & greater public & govt. support

35. The Supreme Court
 FDR’s frustration with a conservative Supreme
Court’s decisions against his programs led to his
“Court-packing” scheme
 Proposed that for every judge over 70, an additional judge
could be added up to total of 15
 Claimed judges behind on cases—backfired ‘cause not true
 FDR’s proposal soundly rejected
 Results
 Existing Court actually became less conservative
 With judges’ retirements over time FDR appointed 9 judges
 FDR got less support from Congress after furor over scheme

36. Roosevelt Recession, 1937
 Unemployment improved but still at 15% in 1936
 Sharp economic decline in 1937 caused by
 Impact of Social Security taxes
 Reduced govt spending to limit deficit
 FDR’s reaction was to embrace Keynesian
economics of “planned deficit spending” to
stimulate economy
 John Maynard Keynes, British economist
 Up till now deficits had been small

37. Did It Work? Much disagreement…
 Did not end Depression, though economy
did improve despite 1937 dip
 Dramatically increased power & scope of
federal govt, while reducing relative
influence of states
 Conservatives saw New Deal as socialism,
but socialists thought it too conservative!

38. Did it work…
 Perhaps saved American people from
complete destitution & widespread
starvation
 Perhaps kept US democracy & free
enterprise alive while other countries were
falling to fascism & communism
 Economy finally recovered with massive
deficit spending during WW2 (from $40
billion in 1939 to $258 billion in 1945)