IF WE HELP THE BUSINESSESWE WILL BE HELPING THE

PEOPLE BECAUSE THE MONEY WILL“TRICKLE DOWN”

didn't believe gov't should play an active role in the economy

persuaded bankers/business to follow his policy of VOLUNTARY NON - COERCIVE COOPERATION › Promise to keep wage rates› End of 1931 most got pay cuts

Democrats in Congress passed a high tariff (Hawley-Smoot Tariff) to protect U.S. industry› hoped to stimulate purchasing of U.S.

goods this turned out to be a fatal error... Congress did not understand that the

world had become a GLOBAL ECONOMY

in retaliation other countries passed high tariffs and no foreign markets purchased American goods, so U.S. productivity decreased again

PLAN BACKFIRES

he persuaded Congress to establish the RECONSTRUCTION FINANCE CORPORATION› had power to make emergency loans to banks

but it was too little too late…

Hoover wouldn't involve himself in any programs where the government directly provides aid to individuals› He didn't want to erode Americans sense of

"RUGGED INDIVIDUALISM” Don’t take away their personal freedoms and self-reliancy The belief that the individual can do it on their own!

1932 ELECTION1 out of 4 was unemployed…nat'l income was 50% of what it had been in 1929Repubs. nominated Hoover no hopewinner by a landslide = FRANKLIN DELANO ROOSEVELT (Dem - N.Y. governor)

“This campaign is more than a contest between two men. It is more than a contest between two parties. It is a contest between two philosophies of government.”

- What is this saying about Hoover & FDR?

- Their political ideologies?- How was the federal government’s

role going to change?

FDR: Keynesian or "pump priming" economics - Based on beliefs of economist John Maynard Keynes - More involvement from the government- Money should be invested in people, the working

class- Then, spending would increase with new money in

circulation, then businesses would expand to meet the new demand and hire new workers

Hoover: supply side or "trickle down" economics- Money was to be invested at top, in business- Then, businesses would expand, hire new workers and in

turn, spur on spending and further economic growth

Painting

Grant WoodAmerican Gothic

Literature

Literature

Of Mice and Men

Literature/Cinema

Margaret Mitchell

Only president electedFor over 2 terms.1933-1945

Eleanor Roosevelt

A woman is like a tea bag- you never know how strong she is until she gets in hot water.

Great minds discuss ideas; Average minds discuss events; Small minds discuss people.

No one can make you feel inferior without your consent.

It is not fair to ask of others what you are unwilling to do yourself. I could not at any age be

content to take my place in a corner by the fireside and simply look on.

The The FirstFirst

From his inauguration in March through June 1933 FDR pushedPrograms through Congress to provide relief, create jobs and stimulate the economy

1. ReliefImmediate action to halt economy’s

deterioration

2. Recovery"Pump - Priming" Temporary programs to

restart flow of consumer demand

3. ReformPermanent programs to avoid another

depression & insure citizens against economic disasters

 

Bank Holiday› Closed all banks for inspection› Reopened “safe” banks (some with loans)› Americans’ confidence in banks returned

Federal Emergency Relief Act (FERA)› Direct loans to people to prevent

foreclosures Civilian Conservation Corps (CCC)

› Jobs building roads, plants trees, soil erosion Civilian Works Administration (CWA)

› Jobs building bridges, causeways, hospitals

Tennessee Valley Authority (TVA)› Jobs building factories & dams (elec. to

farms) Works Progress Administration (WPA)

› Work for artists & build roads, libraries, schl. National Recovery Act (NRA)

› Priced products, set min. wage, fair business practices, better working cond

Agricultural Adjustment Act (AAA)› Paid to reduce certain crops, unseeded

acres, plow under crops/kill animals

Security & Exchange Commission (SEC)› Watch stock market – no fraud / insider

trading Federal Deposit Insurance Corporation (FDIC)

› Insured all bank accounts up to $5,000 National Labor Relations Act / Board (NLRA/B)

› Wagner Act – fair business (no monopolies)

Social Security (SS)› Today’s workers pay for today’s retirees

Changing the Supreme Court…. WHY???Since the Supreme

Court vetoedmany of FDR’s

reforms he changed

its makeup. For every justice over

age 70 he was able to add one,

a total of 6 putting the S.C. in his favor!

PROS- Unemploy.

decreased- Increased income- Preserved resources- Cushion for

elderly/sick- Supported unions- Ensured bank safety

CONS- National debt

increased- Doubled fed.

Bureaucracy- Didn’t increase

small business activity

Set a precedent that the federal government is

responsible for the economic welfare

of the people

“You have nothing to fear, except

fear itself”

Evaluate the effectiveness of FDR’s NEW DEAL legislation. Look at: impact both short and long term. What should have been done differently? Are there any lessons that Barack Obama should specifically learn from FDR, in your opinion? How has this recession impacted or how will impact you in the long run?