The Great Depression and the “New Deal” How the greatest economic crisis in American history shaped American politics, culture and society
Mar 31, 2015
The Great Depression and the “New Deal”
How the greatest economic crisis in American history shaped American
politics, culture and society
I. The Stock Market Crash
• Republican responsibility for the economy
• Stock market outraces real economic growth
• The problem of buying stock “on margin”
• Public concern over the stock market by 1929
• The crash• “Deflationary
Psychology”
II. The Great Depression
• Initial governmental optimism
• Catastrophic unemployment figures
• Urban poverty, especially for immigrants, is the worst
• State and local governments as well as private charities can do little
II. The Great Depression
• Corporate failures• Drop in farm income• Even the wealthy had
problems
--Howard Johnson restaurant chain
• “Riding the rails” looking for work
III. Contributing Causes to this Economic Catastrophe
• American farmer in trouble
• Unstable American foreign trade
• The Gold standard forsaken in Europe
• Weak and vulnerable American banks
• Large individual debt• Corporate profits enriched
only a few
IV. The Response of the Hoover Administration
• Positive statements aggravate the Depression crisis
• Hoover’s background
• Hoover’s actions to stem the economic crisis
• Creation of the Reconstruction Finance Corporation (1932)
• “Trickle Down” Solutions
IV. Hoover’s Response (cont.)
• Unemployment continued and farm prices dropped dramatically
• Violent farm protests by 1932
• Hoover was limited by his own governmental philosophy
• Hoover championed “voluntarism” as a solution
IV. Hoover’s Response (cont.)
• Growing inability to compromise with Congress
• Hoover’s unpopularity grows
• His name becomes synonymous with the Depression
• Economic and Political blunders
• The Bonus March (Summer of 1932)
V. The Election of 1932
• Democrats nominated Franklin Roosevelt
• FDR’s background
• Republicans nominated Hoover
• Roosevelt’s campaign
• FDR projects the image that he will take action as President
• Results of the Election
VI. “The New Deal”: A “Revolution”?
• Origins of the phrase• Contrast with
progressivism• Major success =
restoration of confidence• FDR’s “Brain Trust”• Military analogy• Reliance on Social
Workers--Frances Perkins and Harry Hopkins
VI. The “New Deal”: A “Revolution”? (cont.)
• Bi-partisan support for FDR publicly and in Congress
• How revolutionary was the “New Deal”?
• “New Deal” may have prevented a revolution
• Really not a revolution in the truest sense
VII. Changes Made
• Federal government directly provided services to the American people -- “welfare state”
• Vast centralization of national power
• Increase in power of the presidency
• Democratic party becomes majority party
• Blacks vote for Democrats
VIII. Franklin Delano Roosevelt: The Man
• Strong president who enjoyed leading
• Great politician• Used the radio effectively
-- “fireside chats”• Not a systematic thinker• Great ability to project
empathy• Many Americans think of
FDR as part of the family• More loved and hated than
any other president
IX. First Lady Eleanor Roosevelt
• Creates model for the active first lady
• Activist, especially for Blacks and women
• Real concern for the poor
• FDR’s “eyes and legs”• Reputation for being
constantly on the go
X. The “New Deal” and American Banking
• Emergency Banking Act (March 6, 1933)
• Use of the “fireside chat” to explain the bank holiday to the American public
• Initial success• Federal Deposit Insurance
Corporation (1933)• US abandoned the gold
standard
XI. The “New Deal” and the Problem of Individual Economic Relief
• Justification for the “alphabet soup” agencies of the “New Deal”
• Federal Emergency Relief Administration (FERA—spring, 1933)
--directed by Harry Hopkins
• Civil Works Administration (1933-34)
XI. Problem of Individual Economic Relief (cont.)
• Civilian Conservation Corps (CCC—spring, 1933)
• Public Works Administration (PWA—June, 1933)
--Directed by Harold Ickes
• Works Progress Administration (WPA—1935)
XI. Problem of Individual Economic Relief (cont.)
• WPA directed by Harry Hopkins
• Federal Writers and Artists projects
• National Youth Administration (NYA)
• National Recovery Administration (NRA—1933)
XII. The “New Deal” and the American Farmer
• Agricultural Adjustment Act (AAA—spring, 1933)
• Commodity Credit Corporation (1933)
• “Dust Bowl” migrations-- “Okies”
• Tennessee Valley Authority (TVA—spring, 1933)
• Farm Security Administration (FSA—1937)
XIII. The “New Deal” and Organized Labor
• FDR’s sympathy with union concerns grows
• Growth in union membership
• Wagner Act (1935)--Creation of NLRB
• Congress of Industrial Organizations (CIO) created in 1935
XIII. The “New Deal” and Organized Labor (cont.)
• The Leadership of John L. Lewis and others
• Use of the “sit down strike”
• Fair Labor Standards Act (1938)
--minimum wage: 40 cents
--prohibition of child labor
--maximum work week of 40 hours
XIV. The Social Security Act (1935)
• Myth of poor being lazy exposed
• 13 weeks of unemployment insurance
• Pension fund for retired people over 65
• Funds also for disabled and single parent families
• Response to more radical schemes
XIV. The Social Security Act (cont.)
• Huey Long’s “Share Our Wealth” program
• Revenue Act of 1935 (“Soak the Rich” Tax)
• Health insurance pulled due to congressional resistance
• Problems with Social Security initially and long-term
• Important “New Deal” legacy
XV. The Culture of the 1930’s
• Return to political and social concern in ‘30’s literature--John Reed Clubs
• John Dos Passos-- U.S.A. (1938)
• John Steinbeck--Grapes of Wrath (1939)
• Richard Wright--Native Son (1940)
XV. The Culture of the 1930’s (cont.)
• I’ll Take My Stand (1930)• Thomas Wolfe• William Faulkner
--Absalom! Absalom! (1936)• James Agee and Walker
Evans--Let Us Now Praise Famous Men (1941)
• 1930’s Movies-- “The Wizard of Oz”--The Marx Brothers
XVI. Roosevelt’s Second Term (1937-1941)
• Election of 1936• FDR vs. Alf Landon
(R-Kan)• Biggest landslide since
1820• The “Roosevelt
Recession” of 1937-1938
• Harsh CIO strikes
XVII. The Court Reorganization Act (Spring, 1937)
• Supreme Court attack on the “New Deal” (1934-1936)
• FDR’s proposals for change• Court fight eroded public
confidence in Roosevelt administration
• Supreme Court suddenly begins to reverse itself on the “New Deal”
• Congressional opposition takes shape
XVIII. Summary of the Results of the “New Deal”
• Did not end the Depression• Many agricultural problems unsolved, especially for
southern Blacks and tenant farmers• Did restore national hope• Controls were built into the economy to avert future
crises--Federal Securities Act of 1933 and SEC (1934)
• The Government as “broker state”• Restoration of confidence in U.S. government and
economy—but both different than before 1932