Roosevelt And The New Deal, 1933-41 Flashcards
Aims for Roosevelt and the New Deal
- Recovery: increased income for farm workers, higher rates of industrial production, end of baking crisis
- Relief: provide money to states to meet immediate needs for relief from hunger and poverty, short term work relief projects for unemployed
- Reform: social security system, improvements in bank and business running for long term recovery
First 100 days of FDR
- 30 fireside chats, on 12 March 1933, discussed banking, asking American’s to deposit their savings again, by April $1 mill in banks
- Emergency Banking Act ( all banks closed 4 days, financial checks, only ‘financially sounds’ could reopen)
- Passed a law to insure bank deposits of up to $2,500 and restricted how banks coud use money - restored faith in banking system again
Alphabet Agencies for Farming
- Agricultural Adjustment Administration (AAA) for farmers, aiming to raise price of agricultural goods by offering subsidies to farmers who limited production, i.e. if a farmer kept an acre empty, he received around $11 to make up in lost income = less product = prises rose
- AAA even bought 8.5 million pigs, income of farmers rose 10% and 100 million pounds of pork to the poor
BUT… in the long term not good enough because left over stores, so Commodity Credit Corporation set up to pay farmers to keep good in warehouses
- Farm Credit Administration (FCA) improved farmers mortgage arrangements for 20% USAs farms
- Electric Home and Farm Authority (EHFA) aimed to help farmers buy electrical appliances by getting companies to make cheaper models, providing loans and organising instalment plans
Alphabet Agencies for Industry
- National Recovery Administration (NRA) for industry rules on production, prices, wages, working hours and banning child labour. Unions: 3.1 mill in 1932 to 3.9 mill in 1939. Incentive: Blue Eagle symbol, 2.3 million businesses took part by July 1933.
- Economy Act reduced government running costs by 25%, reducing federal spending by $450 mill
- Beer and Wine Revenue Act taxing alcohol (only below 3.2%) to raise funds
Alphabet Agencies for Unemployment
- Federal Emergency Relief Administration (FERA) provided short-term relief payment (of $500 million) for those unemployed and unable to feed families
-Civilian Conservation Corps (CCC) took unemployed men 17-23 into the countryside and gave them tough outdoor work for $30 a month, only 500,000 men employed by 1935 though
- Public Works Administration (PWA) for greater numbers and bigger projects like the Grand River Dam in Oklahoma with a budget of $3.3 billion, BUT took a long while to start up so…
- Harry Hopkins, head of FERA, set up temporary agency: Civil Works Administration (CWA) with a budget of $400 million for things like refurbishing schools and helped 4.2 million workers survive the winters by 1934
- Tennessee Valley Authority (TVA) helped 7 states provide work for southerners, generate and extent coverage of electricity to remote farms, control flooding and improve productivity of land - 20 dams built while farmers educated on new methods to avoid future environmental disasters
The Second New Deal (for employment and the poor)
After 2 years of the 1st New Deal, national income was still low, strikes and unemployment, supreme court had shut down some 1st deal agencies and new congress had politicians who wanted reforms, so…
- May, 1935, Works Progress Administration (WPA), led by Hopkins, helped to employ 8 mill, spending $11 bill, to help young people, women, manual labourers, writers and performers and both white and black
- CCC and PWA received $4 billion
- Resettlement Administration built new suburban towns for urban families, BUT only 3 were constructed so the Housing Act was passed to build houses to replace shanty towns
The Second New Deal (for the farmers)
- Resettlement Administration restyled families from over-worked land, BUT only a few thousand were resettled so was replaced by the Farm Security Administration (FSA) which helped the rural poor buy their own farms and get new equipment. By 1941, $1 bill in loans
- Set up Migrant Camps to provide shelter to those Migrant farmers who had left the Dustbowl for California and paid for doctors and dentists for them
- 2nd AAA created compulsory measure to limit production, i.e. quotas. These were effective because didn’t rely on farmers and were instead enforced by heavy taxing on sales above the quota
The Second Deal (for workers and banks)
- National Industrial Recovery Act in 1933 declared invalid in 1935
- Robert Wagner proposed the National Labour Relations Act / Wagner Act, help improve working lives of industrial workers, helped inspire minimum wage ad maximum hours in industry later on, strengthened labour unions, firing union members and company unions were banned, offered federal protection to unions = National Labour Relations Board (NLRB) set up which supervised union negotiations…
… as a result, membership rose to 9 mill by 1940, to only skilled workers in unions but factory workers too, NLRB rose from 14 to 226 lawyers by 1939, BUT many unions had to strike to be recognised and these could get violent
- Banking Act 1935: created a Board of Governors of the Federal Reserve System chosen by the President and gave various financial powers to them, taking them away from Banks, AS A RESULT… in 1936 no national bank closed and very little had to be paid out in deposit insurance
Second New Deal (for the elderly)
Social Security Act in 1935
- federal pension system which employees paid into and were matched by tax on employer initially 1% then to 3%
- employers of more than 8 people paid a tax to federal government to provide unemployment pay for up to 16 weeks at half the normal rate
- support funded by federal matching grants provided money for the very poor or old, families with dependants or disabled groups
- $50 mill was set aside for immediate needs of elderly, $25 mill for children and by 1939, 7000 grants helped had children
- BUT… it was self-funded so pensions could not be paid out immediately and economy took longer to recover, pay-outs to disadvantage groups varied between states and domestic servants no agricultural labourers were not included
Rural Electrification
1930, 10% of farms had it, but only 1% in some of the poorest areas because it wasn’t profitable for private electricity supplies to run lines out to the masses of remote farms, which meant domestic and farming life was much harder without any new technology
From 1935, the Rural Electrification Administration (REA) took over electrification programme and made loans to rural co-operatives, they… electrified farmers = by 1941, 35% farms had electricity and by 1945, 40% had, supported local groups = 417 co-operatives had been helped with loans to lay wires for new customers, booted demand for electricity = the EHFA by 1939 had arranged 100,000 contracts for electrical goods
BUT the process of rural electrification was slowed down by utility companies = SPITE LINES: lines linking u richer companies along a proposed REA route, worried about losing profit
