• Prior to FDR’s inauguration, hundreds of banks were forced to close

• “Bank Holiday” – bank shutdown by government decree

• 21st Amendment – repealed prohibition

• Partisanship was subordinated to the needs of the nation

• First programs enacted to fight the depression

• Economy Act – reduced salaries of government employees and cut veterans’ benefits

• National Bank Holiday• Prohibition of exportation of gold• Fireside chats – president speaking

to the public• Banks reopened under Treasury

Department license

• US taken off the gold standard – hoped prices would rise

• Established the FDIC (Federal Deposit Insurance Corporation) – protected bank deposits

• Established the Home Owners Loan Corporation (HOLC) – refinanced mortgages and prevented foreclosures

• Federal Securities Act – regulated stock transactions

• Created the Civilian Conservation Corps (CCC) – provided jobs to men 18-25 in reforestation and conservation

• Congress passed National Industrial Recovery Act (NIRA) Established to stimulate industryEstablished Public Works

Administration (PWA) – allowed some monopolistic practices but also gave union rights

NIRA a variant of the corporate state similar to experiments carried out by fascist Germany and Italy

Created the National Recovery Administration (NRA) – supervised drafting and operation of business codes. Participating industries received the Blue Eagle symbol.

Did not significantly impact the depression – businesses did not increase labor force and unions increased membership

John L. Lewis formed the Committee for Industrial Organization (CIO) – organized workers without regard for craft lines

American Federation of Labor (AFL) expelled these unions and CIO became Congress of Industrial Organizations (a union rival to AFL)

• FDR concerned that farmers getting short shrift in comparison to industry

• Combined restrictions on production with subsidies – goal was to raise agricultural prices

• 1933 crops already planted when law went into effect – government paid farmers to destroy crops and kill livestock (6 million baby pigs and 200,000 pregnant cows killed)

• After 1933, acreage limitations proved sufficient to raise prices

• Dairy farmers, cattlemen, and railroads hurt by new laws as were consumers

• AAA also hurt tenant farmers and sharecroppers (land taken out of cultivation was often their land)

• Reliance on machinery also hurt as land could be cultivated more cheaply than the sharecropper / tenant farmer

• 1933 law creating a board that authorized the building of dams, power plants, transmission lines, and to sell fertilizer and electricity to individuals and communities

• Improved the standard of living of valley inhabitants and provided a “yardstick” for pricing for private power companies

• Roosevelt administration filled with energy and optimism

• “Brain Trust” – academics asked for new ideas

• New Deal actually drew on old populism

• Rival bureaucrats clashed over policy

• “Spenders” versus strict economists

• Despite continued unemployment, Democrats swept the elections• 1933 Federal Relief Administration (FERA) created

Headed by Harry HopkinsEstablished the Civil Works Administration (CWA) to create jobs building

and repairing government roads and buildings, teaching, and painting murals

Cost frightened FDR ($5 billion in <5 months) so CWA abolished

• 1935 Hopkins put in charge of Works Progress Administration (WPA)Helped American culture by

hiring artists, writers, actors, etc. Federal Writer’s Project

produced guidebooks and collected local lore

Unemployment still remained at high levels – FDR afraid of unbalancing budget

• Many Depression authors critical of American life

• Many intellectuals enamored with communism

• John Dos Passos- wrote anti-capitalist description of life in America in USA

• John Steinbeck- depicted desperate plight of an American family in the Depression in The Grapes of Wrath

Huey Long Father Coughlin Dr. Townsend

Who? Who? Who?

Goals? Goals? Goals?

Accomplishments? Accomplishments? Accomplishments?

Impact? Impact? Impact?

• The Depression was still bad, conservatives were denouncing Roosevelt, extremists were luring away supporters, and the Supreme Court was knocking down many key New Deal reforms

• Schecter v. United States – Supreme Court made NIRA unconstitutional

• FDR launched the Second New Deal

• National Labor Relations Act (aka Wagner Act) gave unions more rights

• National Labor Relations Board (NLRB) established to supervise plant elections and act to influence big business in labor matters

• Social Security Act - set up old-age pensions and unemployment insurance

• Rural Electrification Administration – lent money to companies and cooperatives to bring electricity to rural areas

• Wealth Tax Act - raised taxes on wealthy and included gift and estate taxes

• Roosevelt never accepted Keynesian economics (John Maynard Keynes)- spending out of Depression

• Republican opponent- Alf Landon (governor of Kansas)

• Third Party- The Union Party supported by Coughlin and Townsend nominated Congressman William Lemke

• FDR carried all but Maine and Vermont

• Democrats again dominated both houses of Congress

• A majority of the nine members of the Supreme Court were anti- New Deal

• Many New Deal laws overturned or in danger as was Second New Deal legislation

• FDR asked Congress to increase number of justices

• Congress and others denounced FDR’s request – “court-packing” dangerous

• FDR was forced to back down• Second New Deal legislation

was allowed to stand as some judges voted against conservatives

• FDR was able to appoint new judges upon the retirement of oldest

• FDR’s prestige suffered permanent blow

• New Deal had brought power to labor unions

• 1937 – series of sit-down strikes

• Tolerant attitude of FDR caused auto manufacturers to meet most labor demands

• Union tactics caused many average Americans to end support

• 1937 – improving economic conditions caused FDR to cut back on programs causing a recession

• FDR’s popularity plummeted especially due to Hoover-like attitude

• Conflict erupted in the administration between Keynesian spenders and conservatives

• FDR finally committed to spending more but alienated many Southern Democrats

• A purge of the old-timers only resulted in resentment – the old-timers won reelection

• Conservative Democrats and Republicans were able join together to stop much of FDR’s later legislation

• The Depression ended as Europe went to war and ordered goods from America

• FDR given credit for ending Depression but not true

• He vacillated over policy and vastly increased the federal bureaucracy

• More aspects of American life came under federal regulation

• The New Deal did help labor and farmers

• The TVA and Rural Electrification program changed the lives of millions of Americans

• Government projects like the Grand Coulee Dam helped develop America

Women Blacks Indians

Problems Faced Problems Faced Problems Faced

Impact of New Deal Impact of New Deal Impact of New Deal

Key Figures Key Figures Key Figures

• FDR an internationalist but protective of US economy

• Took US off of gold standard – move denounced by Europe (fiat money)

• Forms of embargoes considered in light of increased belligerency overseas

• Munitions makers against all embargoes – caused Senate investigation led by Gerald Nye (ND) – investigation more inquisition than honest effort

• Nye - munitions makers led US into WWI (see Eisenhower and Influence of military-industrial complex)

• New history of WWI argued that British propaganda, heavy trade between Allies and US, and Wilson’s preference to Britain caused US to enter war

• Result was increased isolationism

• Danger of new world war mounted as Fascist Germany, Italy, and Japan became increasingly belligerent

• Congress responded with Neutrality Act of 1935 – prohibited sale of munitions to all belligerents when president proclaimed state of war existed

• FDR did not want the legislation but could not stand up to isolationists

• October 1935 – Italy invaded Ethiopia

• Second Neutrality Act passed forbidding all loans to belligerents

• 1936 Spanish Civil War began – clash between fascism and democracy

• Congress passed another neutrality act broadening arms embargo to civil wars

• April 1937 – Congress passed another neutrality act – continued arms embargo, forbade loans, forbade travel on ships belonging to belligerents, and placed sale of goods to belligerents on cash and carry basis

• 1938 – Congress narrowly defeated the Ludlow Amendment that would have prohibited Congress from declaring war without vote by nation

• Neutrality laws aided fascist powers and hurt democratic powers

• Japan’s increasing aggression worried FDR – “quarantine speech” met with isolationist backlash

• Hitler’s demands on Poland caused FDR to urge Congress to repeal the Neutrality Act so the US could sell arms to Britain and France

• Congress refused

• Hitler’s invasion of Poland in 1939 caused WWII

• Again FDR asked for the Neutrality Act to be repealed

• Congress allowed sales of arms on a cash and carry basis and short-term loans

• Reacting to the Fall of Europe to Hitler and warnings by Einstein, FDR committed to the Manhattan Project

• FDR illegally sold surplus government weapons to Britain and France

• Fall of France caused FDR to ask Congress for $4 billion for defense

• Britain asked the US for 50 destroyers – the sale or loan of the vessels would violate US and international law

• Delay would might mean defeat for Britain so FDR “traded” the destroyers for six British naval bases in the Caribbean

• The deal helped Britain and was approved by the public as the bases for 50 ships was a “good deal”

• In 1940 Congress approved the first peacetime draft bringing in 1.2 million men for 1 year’s service and calling to active duty 800,000 reservists

• Election of 1940 pit FDR against Republican Wendell Willkie

• Reviving economy and the fact that much of FDR’s policies he agreed with made his campaign difficult

• He made war the issue – said FDR would have US in war by April 1941

• FDR assured US American boys would not be sent to war

• The cash and carry system was draining Britain and FDR was resolved to help

• Created the Lend-Lease Program• Pushed his ideas to public through

fireside chats – public approved• Asked Congress for $7 Billion for war

materiel he could lend, lease, sell, exchange, or transfer to any country he deemed vital to the US defense

• According to FDR the war was being fought for the “Four Freedoms” – speech, religion, want, and fear

• US began shadowing German U-Boats

• April 1941 – US occupied Greenland

• US helped USSR after German invasion

• July 1941 – US occupied Iceland

• September 1941 – U-Boat attacked USS Greer

• FDR ordered navy to shoot on sight any submarines in waters west of Iceland

• USS Reuben James sunk by U-Boat

• October 1941 – Congress authorizes arming of US cargo ships and permit them to travel to Allied ports

• For all intents and purposes – US at war