Transcript The Depression and the New Deal

The Depression and the
New Deal
1920’s Politics

Warren G. Harding 1921-1923 (Died in Office)

Calvin Coolidge 1925-1929

Herbert Hoover 1929-1933

Three Republican presidents led the nation after the
turbulence of WWI on the roller coaster of the 1920’s
Sought less direct government to support the public
good and relied heavily on cooperation between D.C.
and Corporations.
Also, United States returned to its tradition of
isolationism and reduced military


“I sympathize deeply with you,
Madam, but I cannot associate
with you,” 1923

President Harding’s
secretary of state, Charles
Evans Hughes, broke the
news to a desperate, wartattered Europe that America
was going, and staying,
home.
The Granger Collection
Warren G. Harding
 A well-liked
man who was known as for his
easy going personality and love of people
 However, he was overwhelmed with the
job and had a difficult time detecting
morally corrupt friends and confidants.
(Like Grant)
 “He was not a bad man, he was just a
slob.”
 Influenced by the “Ohio Gang.”
Warren G. Harding
 His
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cabinet
Charles Evans Hughes- Secretary of State
Andrew Mellon- Secretary of the Treasury
Herbert Hoover- Secretary of Commerce
Albert Fall- Secretary of the Interior
Harry Daugherty- Attorney General
 Albert
Fall considered a wolf in sheep
clothing.
 Daugherty was essentially a big time crook
1920’s Politics
 As
Harding assembled his team, it was
apparent the old guard Republicans,
lovers of laissez-faire and big business
returned to Washington. Idea that
Washington was there to help business
make hefty profits
 This essentially ended the reforms of the
Progressive era with Harding’s election
Supreme Court

Harding lived less than 3 years as President but
appointed 4 justices
 Chief justice was ex-president Taft.
 Harding’s Supreme Court
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Killed federal child labor laws
Stripped away gains by labor
Restricted government intervention in the economy
Adkins v Children’s Hospital-revered Muller v. Oregon
• Leads to debate about legal equality of women
Big Business
 Flourished
under Harding as Anti-trust
laws were ignored
 For example, ICC led by men sympathetic
to railroad industrialists
 Idea that businesses should regulate
themselves and not the government
regulate business dominated under
Harding and his cabinet.
Aftermath of War

Wartime government controls were stopped
once the war ended


War Industries Board- Dismantled almost immediately
Railroads returned to private management after the
war
• Esch-Cummings Transportation Act- not save the country
from railroads, but save the railroads for the country

Labor Unions also were harmed by the Republican
policies
• Union membership declined by 30 percent and federal
government used injunctions to break strikes
Veteran’s Bureau
 Established
in 1921 to operate hospitals
provide vocational rehabilitation for
disabled veterans
 American Legion formed.
 Many soldiers demanded compensation
for the war in lost wages
 Adjusted Compensation Act- passed in
1924.
Peace with Germany and Foreign
Policy

July 1921, Congress passed a joint resolution
that the war had ended. (Had to do this because
US did not sign the Treaty of Versailles)
 Middle East gained importance geopolitically as
oil was deemed vital to defense and also
domestic consumption
 Hughes secured vital concessions for Americans
to share in the oil of the Middle east
Washington Conference
 Intended
to reduce the size of Navies and
also situation in Far East
 Hughes Plan


10 year suspension of the building of
battleships and even scraping some already
built
Wanted a ratio of 5:5:3 for size of British,
American, and Japanese navies
Five Power Naval Treaty

Ratio of 5:5:3 was kept, but Japan was
compensated for accepting it.
 British and Americans agreed to not fortify Far
East possessions
 Four Power Treaty- France, Britain, Japan and
US agreed to a status quo in Navies in the
Pacific
 But all this was fake, because no limit on small
ships. So cruisers, destroyers and submarines
were built.
Washington Disarmament
Conference
(1921-1922)
5 Long-standing Anglo-Japanese alliance (1902) obligated
Britain to aid Japan in the event of a Japanese war with the
United States.
5 Goals  naval disarmament and the political situation in the
Far East.
Five-Power Treaty (1922)
5 A battleship ratio was achieved through this ratio:
US
5
Britain
5
Japan
3
France
1.67
Italy
1.67
5 Japan got a guarantee that the US and Britain would
stop fortifying their Far East territories [including
the Philippines].
5 Loophole  no restrictions on small warships
Kellogg-Briand Pact
 In
1928, signed by 62 nations, outlawed
war.
 But defensive wars still allowed.
 Lacked muscle and teeth
 But it reflected America’s desire to have
security, even if it was under false
pretenses.
Tariff under Harding
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In 1922, Congress passed the Fordney-McCumber Tariff.
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Tariff Commission
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Set rates at 38.5 percent
Allowed the President to change rates based on need up to 50
percent
Harding and Coolidge increased rates 32 times and only
reduced 5 times
High Tariffs were detrimental to European recoveryWhy?
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1. Europeans needed to sell their goods to pay back U.S. loans
2. U.S needed other nations to gain in wealth by selling their
goods so that they could buy American goods and also repay
loans.
U.S. misunderstood that international trade is a 2-way street
In response, the Europeans raised their tariff rates, which all
together slowed European economic recovery
Harding Scandals

Forbes Scandal

Head of the Veterans Bureau
• Appointed by Harding
• He and his accomplices looted the federal government of nearly 200
million dollars

Teapot Dome Scandal

Albert Fall, secretary of the Interior
• Gave precious oil reserves at Teapot Dome and Elk Hills to two
business associates in exchange for kickback money.
• Harding signed secret order to turn over the reserves to the
Department of Interior
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Teapot Dome made many question the moral fabric of
Washington since precious resources for the Navy were sold for
individual profit. Trust in the government waned
Also, fact that the bribers did not get jail time also ruined
people’s trust in the courts, making many belive that only the rich
got off
Washington Officials Trying to Outpace the Teapot Dome
Scandal, c. 1922
 Corruption ran rampant during the Harding administration, the most famous
example being the Teapot Dome Sandal of 1922. High ranking officials in the
Department of the Interior and the secretary of the navy, transferred priceless
naval oil reserves to the Interior Department and from there illicitly leased those
properties to leading oilmen for bribe "loans." Although none of this directly
involved Harding himself, he blindly signed the paperwork authorizing the deal
and the stigma of the long, difficult trial overhung the rest of his term in office.
The Granger Collection
Harding Scandals
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Daugherty Scandal

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Illegal sales of pardons and liquor permits
Harding was implicated but not deemed fully
responsible in each of these scandals.
 On speechmaking tour to Alaska, he died from
complications from a heart attack and
pneumonia in San Francisco.
 Harding was not strong enough leader and
judge of character. Consequently, government
had worst scandals since Grant’s administration
Silent Cal
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Calvin Coolidge was sworn in as president by his father
at their family farmhouse.
Coolidge embodied New England characteristics of
morality, honesty, industry, and frugality
A mediocre leader, he was prone to bouts of silence and
was not a great public speaker
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“man who builds a factory builds a temple”
“man who works there worships there”
Supporter of Big Business like his predecessor.
But his five years in office were full of economic growth
and gain. He was thoroughly hands off and supported
Mellon's reduced taxes and debt philosophies
Cash Register Chorus
 Business
croons its appreciation of
“Coolidge prosperity.”
Used by permission, State Historical Society of Missouri, Columbia
Farmer’s Plight (again)
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Wartime brought enormous profits as \the government
gave high prices and foreign demands increased as
foreign supply decreased.
But, post war period during 20’s was a tough one for
farmers.
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No more government high prices
Less foreign demand
More foreign competition
Also, the tractor allowed for more cultivation of land and
higher outputs by farmers. Less horses, less hired
hands, but a crap load of surplus as at a time when
world prices were decreasing.
So, farmers are going in debt again as they purchase
more land and more equipment, but food prices do not
support growth.

Just as the automobile replaced the horse on city streets, so did the gasengine tractor replace horses and mules on the nation’s farms in the
1920s. American farmers owned ten times more tractors in 1930 than
they had in 1920. The smoke-belching tractors bolstered productivity but
also increased the farmers’ debt burden, as the Great Depression made
tragically clear.
Library of Congress
Farmer’s Help
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Capper-Volstead Act
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McNary-Haugen Bill
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Farmers marketing cooperatives were except from
Anti-trust laws
Have government buys surpluses and sell them
aboard (keep prices high then)
Government losses would be recouped by a tax on
farmers (Coolidge vetoed bill twice)
So in 1924, farmers were pretty annoyed and
angry
Presidential Election of 1924 (showing
popular vote by county)

Note the concentration of La Follette’s votes in the old Populist
strongholds of the Midwest and the mountain states. His ticket did
especially well in the grain-growing districts battered by the postwar
slump in agricultural prices.
Copyright (c) Houghton Mifflin Company. All Rights Reserved.
1924 Election
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Republicans choose Coolidge
Democrats are split
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Wet v dry
Urbanites v farmers
Fundamentalists v modernists
Immigrants v nativists
South v North
Deadlocked for 102 ballots
Nominated John Davis
La Follette of Wisconsin lead a revival of Progressive
Party and gained their nomination (mostly supported by
farmers)
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Polled 5 million votes
La Follettr brought a liberal voice to the conversation in the
mostly conservative 20’s
Foreign Policy
 Isolationism
ruled the day, except for in the
Caribbean and Latin America

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Troops withdrawn from Dominican republic in
1924
Troops in Haiti from 1914-1934
Nicaragua, troops removed but returned in
1926
Oil in Mexico almost led to guns being shot,
but caused Mexico to further distrust US.
Debt
 10


Billion owed to US.
They want their money
France and Britain say no
• Paid price in men waiting for Americans
• America got rich and out of recession due to war.
• America had huge tariffs making it impossible to
pays debts
• France and Britain also needed money from
Germany and wanted it
European Debts to the US
Hyper-Inflation in Germany:
1923
Dawes Plan (1924)
Aspects of the Financial Merry-go-round,
1921–1933

Great Britain, with a debt of over $4 billion owed to the U.S. Treasury,
had a huge stake in proposals for inter-Allied debt cancellation, but
France’s stake was even larger. Less prosperous than Britain in the
1920s and more battered by the war, which had been fought on its soil,
France owed nearly $3.5 billion to the United States and additional
billions to Britain.
Copyright (c) Houghton Mifflin Company. All Rights Reserved.
1928 Election

Democrats:

Nominated 4-time governor Alfred Smith
• Very colorful personality (wisecracking, hobnobbing, backslapping,
and a known “wet.”)
• Very urban
• Very Catholic
• So, many Fundamentalist southerners who were very dry and very
rural were against his nomination and aligned him with a very rural
and dry vice-president

Republicans


Herbert Hoover
Radio plays a significant role in the election for the first
time, with Hoover coming across much better than
Smith.
Herbert Hoover

Living example of American
success story

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Poor orphaned boy who
worked hard to go to Stanford
Embodied rugged
individualism, industry, selfreliance, and thrift
Worked extensively abroad
which helped him appreciate
American even more.
Championed individualism,
free enterprise and small
government
However, never elected to
public office, so not prepared
for the campaign trail nor the
life of a politician seeking
votes
Herbert Hoover

The ideal businessman candidate
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Self-made millionaire
Anti-socialism, paternalism, or planned economy
However, some progressive leanings
• Endorsed labor unions as Secretary of Commerce and
allowed regulation of radio (even considered a government
owned radio like the BBC)

Campaign of 1928

Smear campaign by both sides, but not necessarily
Smith and Hoover
• “A vote for Smith is a vote for the Pope.”
• Rum, Romanism, and Ruin”
• Smith doomed by the fact he was a Catholic, a wet, an
urbanite and liberal. Southern democrats voted Hoover and
not Smith
Presidential Election of 1928 (with electoral vote

Smith, despite his defeat, managed to poll almost as many votes as the
victorious Coolidge had in 1924. By attracting to the party an immense
urban or “sidewalk” vote, the breezy New Yorker foreshadowed
Roosevelt’s New Deal victory in 1932, when the Democrats patched
together the solid South and the urban North. A cruel joke had Smith
cabling the Pope a single word after the election: “Unpack.”
Copyright (c) Houghton Mifflin Company. All Rights Reserved.
Hoover’s First Moves
 Aiding

Farmers
Hoover’s administration believed in self-help.
• Agricultural Marketing Act

Help farmers form producers cooperatives
• Federal Farm Board

500 million at their disposal that was lent to farm
organizations to buy, sell, and store surpluses
• Grain Stabilization and Cotton Stabilization
Cooperation

1930- Goal was to buy up surpluses and help with
sagging prices
Smoot-Hawley Tariff of 1930

Started in the House to protect farmers, but by
time got through he Senate, it had over a
thousand amendments (lobbyists)
 Highest protective tariff in peacetime


Raised the Fordney-McCumber from 38.5 to 60
percent
Foreigners saw this as tantamount to economic
warfare

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Plunge nations into deeper recession
Forced US into economic isolation
And strained the international financial chaos of 1930
The Great Crash

Oct. 29, 1929 is known as Black Tuesday

Nation was appeared destined to continued progress, but dark
cloud hung overhead
•
•
•
•
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Stock prices continued to rise unnaturally
America was buying too much on credit
Farm belt in Midwest was drown in debt
Progress was built in many ways on “fool’s paradise of paper
profits.”
On black Tuesday, investors started to dumb their
stocks, and 16,410,030 stocks sold on that day.
2 months after the crash, total losses equaled 40 Billion
dollars. More than the cost of World War I for the United
States
Effects of the Crash

The Crash was the impetus that pushed the
world over the precipice to economic depression
that is the worst in US history

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End of 1930, 4 million unemployed.
By 1932, their were 12 million unemployed
Salaries and wages were slashed
Work nearly impossible to find
5,000 banks closed, along with life savings and
people’s money
Breadlines and soup lines were long and filled with
many previously wealthy and middle class families
The Unemployed, by John Langley
Howard, 1937

In this painting Howard soberly evokes the dispirited state of
millions of unemployed Americans during the depression.
Oakland Museum
Causes of the Great Depression

_a) Unequal distribution of wealth, income and
purchasing power among the classes.
 _b) Overexpansion of agricultural production left over
from WWI.
 _c) Overproduction of industrial output.
 _d) Automation
 _e) Unregulated banking practices
 _f) American tariff policies (Smoot Hawley)
 _g) Impact of European and world economy
 _h) Monopolistic pricing
 _i) Philosophy and policies of the Harding – Hoover
administrations.
 _j) Overexpansion of credit
 _k) Stock market speculation
“Hooverville” in Seattle, 1934

In the early years of the depression, desperate, homeless people
constructed shacks out of scavenged materials. These
shantytowns sprang up in cities across the country.
© Bettmann/ CORBIS
Hoover’s Response


Hoover was not prepared (nor should have been
expected to be) to address the turmoil of the crash and
depression
Hoover struggled with two conflicting ideas
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1. He is a humanitarian and wished to help people
2. he supported limited government and believed in self help, not
governmental help.
Strong believer in the virtues of industry, thrift, and self
reliance, he felt that giving out government dole would
destroy the national ethos.
However, after realizing that people were in dire need of
help, he accepted the idea that the “welfare of the people
in a nationwide catastrophe is a direct concern of the
federal government.”
Hoover’s Response

In attempt to help, Hoover decided to directly aid
the railroads, banks, and rural credit institutions
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Idea is that if the top of the economic pyramid is
assisted, then unemployment would improve through
a trickle down approach.
Many criticized that the man who fed Belgians on
government money would not feed Americans, but
bailed out large corporations
However, it is likely that Hoover’s policies
prevented the depression from getting worse,
and also laid the groundwork for FDR’s New
Deal
Hoover’s Response

Hoover also got Congress to agree to
appropriate 2.25 billion dollars for public works
projects

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In 1932, the Reconstruction Finance Corporation

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
Hoover Dam
500 million, became a governmental lending bank
meant for railroads, insurance companies, banks,
agriculture and state and local governments
But not for individual citizens
Norris-LaGuardia Anti-Injunction Act

Outlawed yellow dog contracts and forbade the courts
to issue injunctions against strikes, boycotts, or
peaceful picketing
Bonus Army

Bonus Expeditionary Force (BEF) demanded
from Congress an early payment of their bonus
owed to them in 1945
 Congress did not pass the early Bonus bill, and
the army that descended on Washington was
asked to leave.
 MacArthur (of WWII fame) forcibly moved the
Bonus army with bayonets and tear gas
Japanese Aggression in Manchuria

This American cartoon lambastes Japan for disregarding
international treaty agreements when it seized Manchuria in
1931. The next year the Japanese would set up the puppet state
of Manchukuo.
The Granger Collection
Japanese Attack Manchuria
(1931)
5 League of Nations condemned the
action.
5 Japan leaves the League.
5 Hoover wanted no part in an American military action in
the Far East.
Hoover-Stimpson
Doctrine
(1932)
5 US would not recognize any territorial
acquisitions that were achieved by force.
5 Japan was infuriated because the US had
conquered new
territories a few
decades earlier.
5 Japan bombed
Shanghai in
1932  massive
casualties.
Clark Memorandum (1928)
5 Clark pledged that the
US would not intervene in
Latin American affairs in
order to protect US
property rights.
5 This was a complete
rebuke of the Roosevelt
Corollary to the Monroe
Doctrine!
Secretary of State
J. Reuben Clark
5 Precursor to FDR’s Good
Neighbor Policy
FDR’s “Good Neighbor”
Policy
5 Important to have all
nations in the Western
Hemisphere united in
lieu of foreign
aggressions.
5 FDR  The good
neighbor respects
himself and the rights
of others.
5 Policy of non-
intervention and
cooperation.
1932 Election
 Unemployment
levels had reached 11
million people. That accounted for 25% of
the workforce.
 As a result, the election focused on ways
to alleviate the pain from depression:

Republicans: Herbert Hoover nominated with
a platform that highlighted his anti-depression
policies and halfheartedly called for a repeal
of prohibition.
1932 Election
 Democrats
turned to Franklin Delano
Roosevelt, 5th cousin of Teddy.
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

Former legislature in New York, governor of
New York, candidate for vice-presidency, and
also assistant secretary to the navy.
In many ways, Roosevelt's struggle with polio
shaped him as a politician. It schooled him in
patience, tolerance, compassion, and the
strength of will.
Another great asset was his wife Eleanor.
Eleanor Roosevelt
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By far one of the
strongest first ladies.
Known as “Conscience of
the New Deal”
Her husband’s political
career was very much
hers as well.
Battled for the
impoverished and the
oppressed
1932 election

FDR believed that money was expendable, but
not humanity. Consequently, this idea will shape
his policies in trying to curb the Great
Depression.
 He was also a great speaker and his record as
governor of New York made him an attractive
option for president.
 Democratic platform:
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Repeal of prohibition
Attacked Hoover’s depression policies
Sweeping economic and social reforms
Balanced budget
1932 Election
FDR won by a landslide. Popular
Vote was 57% to 40% and
Electoral vote was 472-59.
Overall, American people were
Ready to give Roosevelt and the
Democrats a chance at solving
The Depression mostly due to the
Ineffectiveness of Hoover’s
Policies.
In this election, marked the first time
that black voters moved away from
eh Republican party and voted
Democratic.
Lame Duck period difficult because
Roosevelt did not want to take charge
until formally given the role of
president. Thus, for a long and
agonizing 4 months, the depression
got worse.
Three R’s of the New Deal

Relief- get people immediate food and shelter

Recovery-get people jobs, so they have money
to spend, so that factories and businesses can
hire again

And Reform -make long-term change to the
laissez-faire capitalistic policies to make it more
fair and equitable for all Americans
Monetary and Banking Relief

From March 6-10 1933, Roosevelt declared
them bank holidays to restructure banking to
make it safe again to make deposits. Two
banking laws passed:

Emergency Banking Relief Act of 1933
• Gave president power to regulate banking transactions and
foreign exchange. Also gave him power to reopen solvent
banks.

Glass-Steagall Banking Reform Act
• Established the FDIC, insured deposits up to 5,000 dollars.
(Today it is $250,000 per account)
• This help end the embarrassment of bank closures and
protected deposits
Monetary and Banking Relief

To protect against the hoarding of gold and
protect the dwindling gold reserve, Roosevelt
ordered all private gold to be surrendered to the
Treasury in exchange for paper currency.
 He also took the country off the gold standard
 Roosevelt established a “managed currency”



Goal was inflation to relieve debtors and stimulate
new production.
Gold increased from $21 a ounce to $35 an ounce.
People traded in their gold for the elevated price and
this helped increase available currency. Thus,
infaltion occurred.
This scheme came to an end in February of 1934.
Gold standard returned on a limited basis for foreign
trade.
Further Relief
 Civilian
Conservations Corp
 Federal Emergency relief Act

(Federal Emergency Relief Administration)
 Agricultural Adjustment Act
 Civil
Works Administration
 All passed in 1933
Civilian Conservations Corp

CCC
 3 million uniformed young men sent to work at
camps to perform reforestation and conservation
tasks (firefighting, swamp drainage, flood
control). Removed surplus of workers from
cities, provided healthy conditions for boys,
provided money for families
 Both natural resources and also human
resources were conserved, especially because it
kept many of these young men from committing
crimes during the depression
Federal Emergency Relief Act

FERA


Established the Federal Emergency Relief
Association
Distributed billions of dollars of direct aid to
unemployed workers
 Harry Hopkins was in charge of the agency
 Main goal was to distribute money to states for
direct assistance to unemployed citizens,
preferably for wages on work projects
Agriculture Adjustment Act
 AAA
 Protected
farmers from price drops by
providing crop subsidies to reduce
production, educational programs to teach
methods of preventing soil erosion.
 Also gave millions of dollars to help
farmers pay their mortgages
Home Owners Loan Corporation
 HOLC




Refinance mortgages on non-farm housing.
Assisted about 1 million households.
This also indirectly assisted mortgage lending
banks.
Lastly, helped secure the middle class to the
Democratic Party
Civil Works Administration
 CWA




Provided public works jobs at $15/week to
four million workers in 1934.
It was a branch of FERA, also led by Harry
Hopkins
Most jobs were considered make-work jobs
like leaf raking.
Many criticized the agency because they
stated “ The only thing we have to fear is work
itself.”
Demagogues

Father Charles Coughlin

Radio priest, had 40 million
listeners. Spoke in favor of
Roosevelt and the New
Deal but later changed and
argued against the New
Deal. His rants became
very anti-Semitic and
fascistic, in support of
some of the ideas from
Hitler and Mussolini. In
1942, his superiors kicked
him off the air. He was a
priest at Royal Oak Shrine.
Demagogues

Senator Huey Long



From Louisiana,
supported his “Share
our Wealth” program.
Every family was to
receive 5,000 dollars,
at the expense of the
prosperous.
He was shot by an
assassin in Louisiana
in 1935, out of fear of
Long becoming a
fascist dictator.
Demagogues
 Dr.



Francis E. Townsend
Retired doctor from California, gained the
support of 5 million senior citizens
Called for any citizen over 60 years of age to
get 200 dollars per month that must be spent
each month.
Scheme was estimated to cost half of the
national income.
Works Progress Administration

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

Authorized in 1935, WPA was launched to help
curtail the rise of these proposals from men like
Coughlin, Townsend, and Long.
Goal was employment on useful projects.
Spent 11 million dollars on public buildings,
bridges, and roads for infrastructure
Over a 8 year period, 9 million people given
jobs.
Some jobs given to artists, musicians, and
writers.
Over 1 million pieces of art were created.
Advancements for Women

Frances Perkins


Mary McLeod Bethune


Made huge strides in field of Anthropology with her book
Patterns of Culture
Margaret Mead


Director of Office of Minority Affairs. She was highest ranking
African-American in Roosevelt's office
Ruth Benedict


Secretary of Labor, first cabinet member
Student of Benedict. She became curator at American Museum
of Natural History and made cultural anthropology a more
accepted and popular social science.
Pearl Buck

Novelist, won Nobel Prize for Literature in 1938 for The Good
Earth
National Recovery Administration





Passed in 1933, NRA was designed to assist
industry, labor, and the unemployed
Created NRA to enforce codes of fair
competition, minimum wages, and to permit
collective bargaining of workers.
Labor can collectively bargain through
representation of their own choosing
Blue eagle adopted as symbol
But in the end the program asked for too much
self-sacrifice from labor, industry, and
management.
Public Works Administration





Intended for unemployment and industrial
recovery.
Long-range recovery was the primary purpose.
4 billion spent on some 34,000 projects,
including buildings, highways, and parks.
Built the Grand Coulee Dam on the Columbia
River.
Liquor Industry benefitted too because of taxes
generated from the sale of liquor. 3.2 percent,
light wine and beer.
Dust Bowl

Due to prolonged drought and poor soil
conservation techniques, the winds of the Great
Plains whipped up enormous dust storms.
 Many ways caused by human mistakes




High Wheat prices drove many to till more land
Tractor and new plow allowed for more land to be tore
up
Dry-farming was continued
Consequently, the soil lost its nutrients and couple
that with the drought and it became so loose and dry,
the winds were able to whip up huge storms.
Dust Bowl
Dust Bowl
 350,000
Okies and Arkies migrated from
Oklahoma and Arkansas to southern
California
 Their story was vividly told by John
Steinbeck in the The Grapes of Wrath
 Relief for Dust Bowlers



Frazier-Lemke Farm Bankruptcy Act
Resettlement Act
200 Million trees planted by CCC
Indian New Deal

John Collier, head of Department of Indian
Affairs, wanted to reverse the forced assimilation
policies from the Dawes Act.
 Indian reorganization Act of 1934





Encouraged tribes to establish self-government
Preserve native crafts and traditions
Helped stop loss of lands
Revived interest in Native American identity and
culture
200 established tribal governments, by 75 refused,
thinking it was a ruse to gain museum artifacts and
museum pieces out of the Native Americans
Federal Securities Act
 Passed
during the 100 days Congress, it
required stock brokers to give the investor
sworn information about the soundness
and stability of their stocks and bonds
 1934, Congress pass the Securities and
Exchange Commission (SEC)


Serves as a watchdog of the stock market
Made stock markets more of a trading mart
than a gambling hall, as we saw in the 1920’s
Tennessee Valley Authority

New Dealers claimed that public utility holding
companies price-gauged the public. This
angered them because they often secured
important waterways from the public and then
turned around and charged unfair prices for
desperately needed utilities.
 Tennessee River presented New Dealers with a
great opportunity


River could easily be used for hydroelectric power,
and serve to give jobs and electricity to an area that
needed both
Also, it could serve as a model to later reform the
price gauging of the utility companies.
Tennessee Valley Authority
 TVA passed


by 100 days Congress
One main goal was to determine the exact
cost of developing and delivering electricity
Become a “yardstick” to determine if the utility
companies were indeed over charging clients
 Companies
complained about the new
competition from the government, stating
the lower prices were from bad
bookkeeping and no taxes
Tennessee Valley Authority

Achievements:




Brought to area employment and electricity
Low-cost housing, restoration of eroded soil,
reforestation, improved navigation of the river, and
flood control
Brought prosperity to a region that before had little
Eventually, government built dams built on
Columbia, Missouri, and Colorado rivers.
Bringing electricity and irrigation to the West
Federal Housing Act

Federal Housing Act (FHA)





Wanted to speed recovery and make better homes
Passed in 1934
Small loans given to householders, for improving their homes or
building new ones.
Agency outlasted Roosevelt and the 1930’s.
In 1937, Congress also issued United States Housing
Authority (USHA)



Agency designed to lend money to states or communities for
low-cost housing
650,000 low-income people benefitted.
First time that the slums started to decrease in size or cease
growing
Social Security Act

Designed for unemployment insurance and oldage pensions
 Passed in 1935




Provided federal and state unemployment insurance
Specified categories of retired workers were to
receive regular payments from the federal
government
Financed by a payroll tax on both employers and
employees
Provisions also made to help disabled such as the
blind, handicapped, delinquent children.
Social Security Act

Republicans and Conservatives argued
vehemently against the SSA.
 New Dealers were inspired by other western
industrial nations, especially in Europe, who
provided such plans for its citizens.
 In the new industrialized America, with an
economy based on boom and bust, the federal
government felt it was necessary to look out for
the general welfare of its citizens.
 In America, you had to work to get the benefit
and by 1939, 45 million people were eligible for
Social Security benefits.
Wagner Act
 Passed
in 1935
 Created National Labor Relations Board
 Allowed labor and unions the right to selforganization and also to bargain
collectively with representatives of their
own choosing.
 John L. Lewis

Organized the Commission for Industrial
Organization out of the AF of L.
CIO

John Lewis and CIO were forced to break ranks
with AF of L because of the unskilled and skilled
worker debate
 However, Lewis continued to fight and grew the
union through entering the automotive industry.
 Started using sit-down strike. Used in Flint,
forcing GM to recognize CIO as sole bargaining
agency for its employees.
 United States Steel Company also granted rights
to unionize to the CIO affiliated employees.
Fair Labor Standards Act
 Passed
in 1938
 Industries involved in interstate commerce
had to :



Set up minimum-wage standards and
maximum-hours worked level.
Goals were 40 cents and hour and 40 hours a
week
Labor for children under 16 forbidden
 By
1940, CIO had 4 million members.
Election of 1936
Republican Platform
Criticized the New Deal
For its radicalism,
Experimentation,
Confusing, and waste.
Republicans nominated
Alfred Landon, governor
Of Kansas.
Roosevelt won in a
Landside and both
Houses had Democratic
Majorities.
Election highlighted
Concept of class warfare.
Supreme Court and Roosevelt

20th Amendment


Ratified in 1933, inauguration shortened to six weeks,
so oath taken in January. Shortened the strange
lame duck period.
Roosevelt thought his reelection meant he had a
mandate, but the Supreme Court stood in his
way.



In 9 cases brought against new Deal programs, the
Supreme Court ruled against Roosevelt 7 of 9 times
Court was ultra conservative (remember that Harding
placed 4 of the 9 on the bench)
Roosevelt thought the Supreme Court should get in
line with public opinion and that Democracy meant
rule by the people.
Court Packing Scheme
 To
solve his dilemma, Roosevelt asked
Congress to permit him to add a new
justice tot eh Supreme Court for every
member over seventy who would not
retire.


This would allow for a maximum of 15
Roosevelt was not aware that the court had
become somewhat of a sacred cow, and
Congress nor the public were willing to mess
with it.
Changes in Supreme Court


Roosevelt was vilified for his actions, but……
They kinda worked.




Justice Owen Roberts, a conservative, started to vote
as a liberal
March 1937, upheld minimum wage for women,
reversing a previous case it ruled on
Court later upheld Wagner Act and Social Security Act
Congress never passed court packing deal, but
in many ways Roosevelt won the war.

Through deaths and resignations, FDR made a total
of 9 appointments to the Supreme Court.
Twilight of the New Deal

In 1933, unemployment was 25 percent. in
1936, it was 15 percent.


This was an improvement, but 15 percent is a lot
(Most in recent recession was 10 percent in Oct
2009)
1937, economy took turn for the worst and
slipped into a recession, called Roosevelt's
Recession
 Keynes, embraced idea of deficit spending,
known as Keynesianism. IN 1937, Roosevelt
adopts this idea.
Twilight of New Deal
 By
1938, most of the New Deal reforms
had lost momentum and there is a shift in
the country to more conservatism.
 In 1938 Congressional elections,
Republicans cut deeply into the
Democratic majorities.
 The crisis in international affairs helps
move the conversation from domestic
affairs to international affairs in 1938-1939.
New Deal

Critiques









Foes condemned waste, confusion, contradictions,
and graft.
Many detested the employment of leftist professors
and what they considered Communists
Business people hated the fly by the seat of his pants
policies of Roosevelt
People hated the increased bureaucracy and also
regulation brought on by the New Deal
National Debt rose from 19.5 billion in 1932 to 40.5
billion in 1939.
People said it created more class strife and turmoil
Private enterprise stifled by a planned economy.
Expansion of executive power under Roosevelt also
critiqued.
Worst of all, it failed to curb and cure the depression