The New Deal was a political and social plan that was the presidential campaign platform of Franklin Delano Roosevelt. Although Roosevelt was very vague about what it was and actual measures to be taken while running for president, the New Deal was the shinning hope for many Americans who had lost their jobs or were living in poverty. After the United States had plummeted into the greatest depression to face this country while Herbert Hoover lead the country, many voters were looking for anyone with a promising plan and a bright outlook.
As banks closed and unemployment rates soared, Roosevelt promised a balanced budget, and spoke of Hoover’s rash and excessive spending. The election of 1932 was a landslide in Roosevelt’s favor, and he quickly took over as soon as he began his term. Roosevelt called a special session of Congress lasting from March 9 until June 16 in 1933. Roosevelt began to put his “New Deal” into action. With a democratic majority in Congress on his side, Roosevelt churned out legislation rapidly from the generally sluggish machine of Congress. Banks had been closing all over the country due to frightened citizens withdrawing all of their money.
In order to increase trust in them, Congress passed the Emergency Banking Relief Act of 1933, which allowed the government to reopen closed banks, and regulate banking and foreign exchange. The Glass-Steagall Banking Reform Act was later passed in order to form the Federal Deposit Insurance Corporation, insurance to civilians for their banking deposits up to $5,000, which was later raised. These to bills encouraged the public to once again trust their banks, and to deposit money in the banks instead of hiding it “under their mattresses.
Compared to the more than 4,000 bank failures of 1933, there were only 57 in 1934 because of these actions. The Agricultural Adjustment Act and the Home Owners’ Loan Corporation were both formed to help farmers and other households with paying their mortgages, as well as helping the mortgage-holding banks to stay in business. The Frazier-Lemke Farm Bankruptcy Act suspended mortgage foreclosures for three years, and moved farmers with small amounts of poor land to better areas. Trees were planted in the deserted areas in an attempt to prevent soil erosion and block the wind.
Moving on from this, Roosevelt decreed that all privately owned gold be turned in to the Treasury and to be paid back in paper money. He then took the nation off of the gold standard and cancelled the gold payment clause for all contracts. After this, Roosevelt reduced the gold content of the dollar to 59. 06 cents. All of these measures were taken as an attempt to control inflation and to start up businesses. More difficult than either of the other problems addressed by Roosevelt was unemployment. Many Americans searched for jobs that simply did not exist.
Poverty levels soared, especially in the mid-west, where many families lost their farms due to falling prices of crops and a drought that had lasted for years. The first bill passed by Congress to aid the unemployed was the Civilian Conservation Corps. About 3 million uniformed men were employed in such occupations as flood control, reforestation, swamp drainage, and fire fighting. In order to help the older of the unemployed, the Federal Emergency Relief Act was passed to form the Federal Emergency Relief Administration.
This agency gave about $3 billion to states for wages, work projects, or direct dole payments. The Civil Works Administration was formed as a temporary source of jobs such as leaf raking during the particularly cold winter of 1933. All of these actions were still not enough to completely defeat the monster of unemployment. In 1935, the Works Progress Administration was formed, and spent about $11 billion employing people to construct public buildings, bridges, and hard-surfaced roads.
Part-time jobs were also found for white collar workers; artists painted murals in public buildings and people like John Steinbeck counted dogs. Trying for a national comeback, the National Recovery Administration was formed in order to help with industry, labor, and unemployment. Workers were guaranteed the right to organize and bargain together with their own representative and also forbade businesses from forcing workers to sign an anti-union contract before they were hired.
The Agricultural Adjustment Administration attempted to form as “artificial scarcity” by giving farmers compensation for growing less acreage. However, the intentional destruction of crops and the use of slaughtered pigs as fertilizer increased scrutiny of a plan that wasted food while so many went hungry. This particular plan failed, but a revision of the original idea succeeded with the Soil Conservation and Domestic Allotment Act of 1936. This planned to remove acreage from production while conserving the soil from erosion that had taken so much of the topsoil during drought and high winds.
In order to accomplish this, farmers were paid to plant soil conserving crops or to let the land lie fallow. This was much more successful than its predecessor. The Second Agricultural Adjustment Act, passed two years later, continued conservation payments to farmers for growing less acreage, but also provided parity payments for farmers who conformed to restrictions on specific crops like cotton and wheat. In one of the areas in America hit hardest by the Depression, the Tennessee River Valley, an act named after the valley was formed to create a “planned economy.
The Tennessee River was to be dammed up in several places to prevent flooding in the area, create jobs in building the dams, and to provide large amounts of inexpensive hydroelectric power. Low-cost housing, lots of cheap nitrates, restoration of eroded soil, improved navigation, flood control, and reforestation were other effects of the Tennessee Valley Act. The Federal Housing Administration began to stimulate the building industry by giving homeowners small loans for improving their home or constructing new ones.
The United States Housing Authority lent money to states and communities for more low cost construction. These two actions caused the size of slums in America to not only stop growing, but to decrease in number. The Social Security Act of 1935, one of the most important acts passed by Roosevelt and his “New Dealers”, provided for unemployment insurance and old-age pensions, as well as pensions for other dependents such as the handicapped or the blind. This act has outlasted the New Deal Administration and the Great Depression, and remains one of the legacies of Roosevelt.
The National Labor Relations Act and the National Labor Relations Board reasserted the labor force’s rights of self-organization and chosen representatives. Labor rights continued to improve with the Fair Labor Standards Act, or the Wages and Hours Bill. Any inter-state industry was given regulated minimum-wage and maximum hour levels. Children under sixteen were not allowed to work and sixteen to eighteen year olds were barred from dangerous work. All of these bills were part of Roosevelt’s complicated, experimental, and radical plan, supported by his “three R’s”, Relief, Recovery, and Reform.
Roosevelt’s ideas of a big government were opposed by conservatives and businesses, who had enjoyed years of laissez-faire. However, most Americans gladly embraced the New Deal as saving the country. Roosevelt was criticized for spending so much, but now some economists say that he should have spent more. Roosevelt’s New Deal was a brand new approach to government that greatly limited states rights, strongly favored workers and unions, and formed programs that for many critics were borderline socialist.
The New Deal had Progressive roots in labor, and some plans similar to Hoover’s attempts at helping the country before Roosevelt came into office, but at a much grander scale. The New Deal was evolutionary, but needed a brilliant man such as Roosevelt to guide and lead the movement in order to achieve the success that it did. Without Roosevelt, a plan similar to the New Deal would have occurred, but may not have ever reached the greatness and success without the genius and charisma of the man.