FDR’s “New Deal” Libertyville HS FDR and Eleanor, 1936.

FDR’s “New Deal”

Libertyville HS

FDR and Eleanor,1936

“The First Hundred Days”• FDR’s emergency plan,

approved by Congress• Based on “3 Rs”

– Relief (for banks & unemployed)– Recovery (for agr, industry,

commerce, labor)– Reform (of economy)

• Relief– Emergency Bank Relief Act

• Bank holiday” closed all banks for four days

• Inspectors reopened only fi-nancially secure banks

• Restored confidence in banks

Relief

• Federal Emergency Relief Admin. (FERA) (1933): $3 billion in grants to states, for relief of destitute

• Public Works Admin(PWA) (1933): Ks to private firms to build public works

• Works Progress Admin (WPA) (1935): $6.3 billion to create (public) jobs (largest New Deal agency)

Relief

• Civil Conservation Corps (CCC)(1933): jobs for unemployed, focused on natural resource conservation

• National Youth Admin (NYA) (1935): part time jobs for HS, college men & women

Recovery• Farm Credit Admin.

(FCA) (1933): farmers refinanced mortgages

• Agricultural Adjustment Admin (AAA) (1933): created higher food prices through restrictions & subsidies– AAA Problem: favored

farmers (1/4 of population)– Farmers purchase power up– Large farms = most benefit

Relief

Recovery• National Industrial Recovery

Act (1933) (NRA)– Cooperation, not competition– Developed “code of practice”

• Pro NRA– Labor’s right to organize– Ended child labor– Ended unfair trade practices

• Anti NRA– Big business made codes– Codes enforced against small

businesses – Costs passed on in higher

prices– Stimulation of unionization

• Ruled unconstitutional, 1935

Recovery• US and the gold standard

– FDR ordered citizens to turn in all gold to Fed Reserve bank

– Paid $20.67 / oz– Hoarding gold made a crime =

ten years in prison– After confiscation of gold, gov’t

set price of gold at $35 / oz– Effect = Dollar devalued by

40%– Gov’t also got gold from Eu-

rope

Reform• Federal Deposit Insurance

Corporation (FDIC)(1933): Insured bank deposits

• Fed. Savings & Loan Ins. Corp.: insured S&L acc’ts

• Securities & Exchange Commission (SEC): supervises securities, stock exchanges

• Home Owners Loan Corp. (HOLC)(1933): lent $ to people facing foreclosure

Reform• Federal Housing Admin.

(FHA) (1934): housing loans to middle inc. families

• Tennessee Valley Authority (TVA) (1933): provided power, flood control, conservation, employment in seven southern states– Objections: tax free

monopoly, gov’t interfering in private sector

1934 Congressional Elections• First opportunity to test popularity of New Deal

• Critics of FDR, from the Right– Cons. opposed to public relief,

gov’t interference, financial in-terference

• Critics of FDR, from the Left– Senator Huey Long (LA):

Populist: “Share the wealth” (100% tax over $1 million inc.)

– Dr. Francis Townsend: radio personality; called for $200 / month pension for elderly (founded Union Party)

– Al Smith, NY gov. & the Liberty League – pro bus, anti New Deal (former ally of FDR)

“Second New Deal”

• Tax changes– 1935 Revenue Act created

graduated tax system– $50k-$1 million = 31%– Over $1 million = 75%

• Public Utility Holding Co. Act (1935): regulated gas, electric companies

“Second New Deal”• Social Security Act of

1935– Tax to pay for direct aid

(Unemployment, old age pensions, subsidies to cer-tain groups)

• National Labor Relations Act (“Wagner Act”) (1935)– Guaranteed right to union or-

ganizing– Right to collective bargain

agreements– Est. National Labor Re-

lations Board

“Second New Deal”

• Impact of NLRA on Unions– AFL organized trade unions– New group, Committee of

Industrial Organizations (CIO) formed to unionize industrial labor

• Competition between AFL, CIO– Jurisdictional strikes– NLRB mediated differences

• AFL & CIO merged, 1955