Chapter 26 FRANKLIN D. ROOSEVELT

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Chapter 26FRANKLIN D. ROOSEVELT THE NEW DEAL

• America Past and Present

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The Great Depression

• 1920s optimism drove increase in expectations of
  continual improvement
• Stock market collapsed, factories closed,
  unemployment went up, optimism shattered

p.750
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The Great Crash

• Productive capacity of the automobile appliance
  industries grew faster than the demand
• Each yr after 1924, the rate of sales of cars,
  refrigerators, ranges, etc. slowed
• If corporate leaders had understood the warning
  signs, they would have raised wages lowered
  prices, both effective ways to stimulate
  purchasing power
• Those w/ excess cash began investing heavily in
  the stock market, betting prices would bring them
  windfall profits
• The basic explanation for the Great Depression
  lies in the fact that US factories produced more
  goods than the American people could afford to
  consume

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The Great Crash

• Factory productivity had increased 43, but wages
  had gone up only 11. If the Bs that went into
  stock market speculation had been used instead to
  increase consumer purchasing power production
  consumption could have been brought into balance
• The law of supply affordable demand
• Layoffs lowered purchasing power even further

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Unemployment 19291942
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Effects of the Depression

• Difficult to measure the human cost
• People lived in lean-tos made of scrap wood
  metal families went without meat fresh
  vegetables for months, existing on diets of soup
  beans
• Crops rotted in the fields because prices were
  too low to make harvesting worthwhile
• Af Ams who left the South for factory jobs in the
  North were among the first to be laid off
• Missouri Pacific RR reported 200k vagrants riding
  the rails in 1931

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Fighting the Depression

• The Great Depression presented an enormous
  challenge
• The inability of the Republicans to overcome the
  economic catastrophe provided the Democrats w/
  the chance to regain power
• Although they failed to achieve full recovery
  before the out break of WWII, the Democrats did
  succeed in alleviating some of the suffering
  establishing political dominance

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Hoover Voluntarism

• HH was the Great Depressions most
  prominent scapegoat
• He rejected proposals for bold action relied
  instead on voluntary cooperation within
  businesses that said yes then reneged
• HH believed that unemployment relief should come
  from private charities local govt
• By 1932, after some too little, too late govt
  programs, his efforts had clearly failed

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Hoover Voluntarism

• HHs public image suffered its sharpest
  blow when he ordered Gen Douglas MacArthur to
  clear out the Bonus Army, a group of 22k WWI vets
  who marched on Washington to pressure the Senate
  to pay them a bonus that was due them in 1945
• After the Senate turned them down, some of the
  vets stayed in DC, living in ramshackle huts
  along the Potomac River 1932

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Hoover Voluntarism

• Mounted troops drove the vets out of the
  capital, blinding them w/ tear gas burning
  their shacks

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Bank Failures 19291933
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The Emergence of Roosevelt

• Franklin D. Roosevelt
• Born to wealth privilege
• 1921 Crippled by polio
• 1928 Elected governor of New York
• Talented persuasive politician
• 1932 Defeated Hoover
• Farmers workers, immigrants native born,
  Protestants Catholics rallied behind the new
  leader who promised to restore prosperity

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The Hundred Days

• When FDR was inaugurated, unemployment stood at
  25
• Speaking on the steps of the Capitol, he declared
  First of all, let me assert my firm belief that
  the only thing we have to fear is fear itself
• He called Cong into special session requested
  broad executive power to wage war against the
  emergency
• New govt supervision aid to banks prevented
  impending collapse

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The Hundred Days

• FDR sent 15 requests to Cong received 15 pieces
  of legislation
• The creation of the Tennessee Valley Authority
  (TVA) was one of the most ambitious of the New
  Deal measures
• Called for a program to build a series of dams in
  7 states to control floods, ease navigation,
  produce electricity
• Brought modernization jobs to desolate areas of
  the upper rural south

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The Tennessee Valley Authority
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Roosevelt Recovery

• National Recovery Administration (NRA)
• Aimed at achieving economic advance thru
  experimentation w/ planning cooperation among
  govt, biz, labor
• Companies asked to cooperate in writing codes of
  fair competition, production limits, price
  guidelines, protection of labor (max hrs/min
  wages)
• Rules too complicated to easily enforce, big biz
  took advantage didnt really work
• 1935 SC ruled NRA unconstitutional

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Roosevelt Recovery

• Agricultural Adjustment Act (AAA)
• Farmers paid to reduce their production
• Prices increased, mainly because of govt
  payments, but Dust Bowl helped by cutting supply
• Farm income rose for the first time since WWI
• Measures most beneficial to larger farms
• Sharecroppers, tenant farmers did not fare as
  well
• Received very little of the govt payments had
  their land taken out of production
• 3M people left farms crowded into the cities
  where they swelled the relief rolls

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Roosevelt Relief

• 1933 Reconstruction Finance Corporation (RFC)
  estabd to provide direct relief (500M)
• Enabled many to avoid starvation stay out of
  breadlines
• 1933 Civilian Conservation Corps (CCC) provided
  employment to young males from city families on
  relief
• Clear land, plant trees,
  pave roads, build bridges

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Roosevelt Relief

• 1935 Works Progress Administration (WPA) placed
  unemployed on fed payroll
• Similar to CCC in that it did construction
  projects, etc. it also tried to preserve the
  skills of American artists, actors, writers by
  producing plays, circuses, etc.

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Roosevelt Relief

• 1935 Works Progress Administration (WPA) placed
  unemployed on fed payroll

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Roosevelt Reform

• 1935 Focus shifted from relief to reform
• Early New Deal programs tried to assist bankers,
  industrialists, large farmers, members of of
  the labor unions, but it did little to help
  unskilled workers sharecroppers
• The continuing depression high unemployment
  began to build pressure for more sweeping changes

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Social Security

• Democrats (FDRs Party) made significant
  gains in the 1934 Congressional mid-term
  elections
• They were ready to enact virtually any proposal
  FDR made
• At that time, the US, alone among the modern
  industrial nations, had never developed a welfare
  system to aid the aged, disabled, unemployed
• 1935 Social Security Act passed
• Established pattern of govt aid to aged,
  unemployed, handicapped, needy elderly,
  dependent children
• Old age pensions scheduled to begin in 1942 were
  paltry 10 to 85 per month
• Farmers, domestic servants not covered

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Labor Legislation

• 1935 National Labor Relations (Wagner) Act
• Compelled companies to allow workers to organize
  bargain collectively
• Outlawed union busting tactics
• 1938 Fair Labor Standards Act
• Estabd maximum hrs/minimum wage
• 40 hrs/wk 0.40/hr
• Rural Electrification Administration brought
  electricity to 90 of farmers who did not have it
  in 1930

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Impact of the New Deal

• There was a broad influence on the quality of
  life in the US in the 1930s
• Many programs brought long-overdue improvements
• Most important advances came with the growth of
  labor unions
• Conditions for working women minorities in
  non-union industries showed no comparable advance

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Rise of Organized Labor

• Trade unions were weak at the onset of the Great
  Depression
• lt3M belonged, mostly to the AFL which organized
  craft (skilled) workers
• Congress of Industrial Organization (CIO) formed
  by John L. Lewis to organize the steel auto
  industries
• 1940 CIO membership hit 5M
• Still, only 28 of labor force unionized

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The New Deal Record on Help to Minorities

• AAA crop reduction program led to eviction of
  1000s of black tenants sharecroppers
• Relief employment programs helped a little
• Despite the bleak record, Af Ams rallied behind
  FDR began a change from the Republican to the
  Democratic party
• Overall, relatively little federal assistance for
  Mexican Americans
• 1934 Indian Reorg Act attempted to help
• Native Ams remained the most impoverished

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Women at Work

• Position of women deteriorated in 30s
• Jobs lost at a faster rate than men
• Few New Deal programs help women
• Progress in government
• Frances Perkins, Secretary of Labor, the first
  woman cabinet member
• Women appointed to several other posts
• Eleanor Roosevelt a model for activism
• Marion Anderson

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End of the New Deal

• 1936 New Deal reached its high point when
  Roosevelt was overwhelmingly re-elected Demo
  party strengthened its hold on Congress
• In spite of his past success, FDR met with
  resistance in Congress after 1936

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The Election of 1936

• FDRs campaign
• Opposed wealthy industrialists who formed the
  Liberty League saw the New Deal as an attack on
  property rights
• Promised further reforms
• Reps nominated governor Alfred Landon of Kansas,
  a moderate, colorless figure
• He refused to campaign against the New Deal
  programs
• FDR appealed to the common man

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The Election of 1936
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The Supreme Court Fight

• During FDRs first term, the SC ruled several New
  Deal programs unconstitutional (e.g., NRA AAA)
• FDR thought the SC was too old to conservative,
  so he asked Congress to replace each member gtage
  of 70
• Called a Court Packing Scheme
• Cong did not go along
• Surprisingly, after the scheme failed, the SC
  issued rulings approving several New Deal
  programs

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The New Deal in Decline

• Aside from the minimum wage maximum hour law
  passed in 1938, Cong did not extend the New Deal
  into any new areas
• The slow improvement in the economy suddenly gave
  way to a 1937 recession
• The political result was a strong upsurge for the
  Republicans in the 1938 mid-term elections
• Resulted in the formation of a new bipartisan
  Congressional conservative coalition that would
  prevail for a quarter century

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The New Deal American Life

• New Deal lasted only five years
• Impact on American life enduring
• Roosevelts success at relieving human suffering
  must be balanced w/ his failure to achieve
  complete economic recovery during the 30s
• With adoption of Social Security, the govt
  acknowledged for the first time its
  responsibility to provide for those who could not
  care for themselves
• The Wagner Act enabled the labor unions to
  balance their power against the industrial
  corporations the min wage law provided a base
  for many workers
• FDR was the leader America needed in the 30s

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Chapter 26FRANKLIN D. ROOSEVELT THE NEW DEAL

• America Past Present
• End