The New Deal

Problems:•Failing industries•Unemployment

•No public confidence or securityWhat should the Government do about these?

A New Deal Fights the Depression

• To combat the lack of work, food & hope:– Franklin Delano Roosevelt (FDR)

• Distant cousin of TR• Reform minded Gov NY

– 4 months– Hoover: Lame Duck. • No action taken

– FDR established the New Deal Program

1st 100 days

• Mar- June: more than 15 new laws– 1. Bank Holiday: closed banks until they could prove

solvency (emergency banking relief act)– 2. Fireside chat: to explain how banking works and

that the system is fixed.– 3. Glass-Steagall Act: set up FDIC; insured deposits

up to 5k– 4. Federal Securities Act: (corps must report Truth

abo. Stocks)– 5. Securities & Exchange Commission (SEC) to

regulate market– 6. Beer & Wine Act: made some alcohol legal;

employed many

Helping People:

• Farmer Relief:– Agricultural Adjustment Act (AAA) ltd

production, to raise prices• Farmers paid not to grow/ destroy crops

– Tennessee Valley Authority (TVA) fixed & built dams, created thousands of jobs, supplied cheap electricity to 5 state region

Work Projects

• Civilian Conservation Corps (CCC)– Men, 18-25, in camps- drain swamps, built

parklands, forests etc; food & tents, pay to send home

• Public Works Admin (PWA) $$$ to states to make jobs- construction

• Civil Works Admin (CWA) set up 4 mill jobs immediately, “make work program”- pd teachers, construction, etc

Fair Business Practices:

• National Industrial Recovery Act: (NIRA) regulated business’ production, wages, prices– Under National Recovery Administration

(NRA)• Set up codes for each industry

Food, Clothing, Shelter

• Home Owners Loan Corp. (HOLC) refinanced mortgages

• Federal Housing Administration (FHA) cheap loans for home repairs, etc

• Federal Emergency Relief Admin (FERA) $$$ to states for direct relief, jobs, clothes, food

Attacking the New Deal

• Conservatives charged it cost too much (deficit spending)– Esp. hated giving farmers money, NRA

regulations on businesses

• Liberals charged it didn’t help the poor enough or reform the economy enough– Huey Long & socialists wanted equal wealth

for all

Supreme Court• Case struck down NIRA- codes were beyond

executive power; (congress can regulate interstate commerce)

• Case struck down AAA- grounds that agriculture is a local matter & should be regulated by the states, not fed gov.– FDR proposed a Court Reform bill: 6 new justices;

one for each current Justice over age 70. To help with work load.

• Seen as ‘court packing’• Cost FDR much public support• But some old Justices retired; were replaced with FDR

appointments• Decisions began to favor the New Deal more

Other Critics:

• Father Coughlin: radio priest; Catholic, at first supported, then criticized New Deal; grew more and more anti-Semitic & supported Hitler.– Huge following in US

• Dr. Charles Townsend wanted poor and elderly to get a pension of $200 month– His ideas led to est. of Social Security

program