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Challenges to the New Deal

Challenges to the New Deal. I. Alternatives to the New Deal. Reactions to FDR. Conservative American Liberty League (1934-1940): Anti-New Deal Father Coughlin (Blame the Jews, Communists, Socialists) Liberal (Radical) Francis Townsend ($ for the elderly (to spend)) “Kingfish” Huey Long

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Challenges to the New Deal

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  1. Challenges to the New Deal

  2. I. Alternatives to the New Deal

  3. Reactions to FDR • Conservative • American Liberty League (1934-1940): • Anti-New Deal • Father Coughlin (Blame the Jews, Communists, Socialists) • Liberal (Radical) • Francis Townsend ($ for the elderly (to spend)) • “Kingfish” Huey Long • (“Share the Wealth”)

  4. Huey Long’s “Share the Wealth” • Governor of Louisiana from 1928 to 1932 • US Senator from 1932 until his assassination in 1935 • “Every man a King”

  5. In 1918 Long wrote an article saying that with 65% of the wealth controlled by the top 2% of the population “there is not the opportunity for Christian uplift and education and cannot be until there is more economic reform.”

  6. Share the Wealth • Plan to correct the mal-distribution of wealth • Limit the size of fortunes to whatever degree necessary to provide $5000 to each family in America. • 30 hour work week and one month vacation • Old age pension • Free college tuition • Government purchase of agricultural surplus

  7. 1934-5 there were 27,000 Share the Wealth Clubs nationally • At least 4.7 million members • After Long’s death, the leadership fell to a right-wing radical minister, Gerald Smith. • Advocated a national movement to “seize the government of the U.S.” • “The democratic method is a lot of baloney. It doesn’t mean a thing.”

  8. Dr. Francis Townsend • Assistant director of city health in Long Beach, California • Devised his old-age pension plan in 1933 after watching three old women dig through garbage for food. • Townsend Plan • $200 per month for every person over 60 • Financed by 2% tax on all wholesale and retail transactions • 1936—Townsend Clubs had 3.5 million members and had 20 million signatures on a petition to Congress to implement the plan.

  9. Upton Sinclair • Novelist and socialist • (EPIC) End Poverty in California • August 1933 • Start idle factories to benefit unemployed • Make untilled land available to farmers • Distribute goods and services through a system of statewide cooperatives • $50 per month to those over 60 • Financed by high taxes on wealth

  10. II. Battling the Supreme Court

  11. The Court • Nine man court was divided • 4 conservatives • 3 liberals • 2 floaters • Conservatives usually won 5-4 • Decisions in the 1920s reflected the pro-business ethos of the era.

  12. Attack on the New Deal • Schecter decision, May 1935 unanimously outlawed Title I of NIRA • on the grounds that it delegated legislative power to the president and exceeded the authority of the federal government to regulate intrastate commerce • Butler decision, January 1936 struck down AAA by a vote of 6-3. • Dissenting judges argued that the court was subverting the role of Congress and not reflecting the will of the people.

  13. Court Packing • FDR feared that the Supreme Court’s decisions in 1935 and 1936 meant that they would strike down second New Deal reform legislation. • FDR sought the means to make the Court more amenable to social reform legislation.

  14. Supreme Court Reform Bill • January 1937, FDR sent the Supreme Court Reform Bill to Congress. • Agued that the Court action was hindered by advanced age of justices. (5 were over 70 and youngest was 66.) • Proposed that justices should retire at 70. • For every justice that remained past 70, the President could appoint an additional justice up to 6. • Court would vary in size from 9-15.

  15. “Court Packing” • Even FDR’s supporters opposed “court packing” • Similar to a bill drafted by William McReynolds (the leader of the conservative justices) when he was Wilson’s Attorney General in 1914. • FDR was portrayed by Republicans (and even Southern Democrats) as power hungry.

  16. Changing Court • Court decisions began to change in 1937. • April—Wagner Act was upheld in NLRB v. Jones & Laughlin • May—Unemployment provisions of Social Security were upheld in Steward Machine Co. v. Davis • June—Willis VanDevanter suddenly resigned and was replaced by Hugo Black.

  17. Court reform bill failed, but FDR was still able to reshape the court through resignations. • By 1940, he had appointed • Hugo Black (author of 30 hour legislation) • Frank Murphy (friend of UAW) • Felix Frankfurter (Keynesian) • William O. Douglas • James Byrnes

  18. New Deal Part II WPA - Libraries, Roads, Artists NYA - Youth RA - Resettle tenant farmers REA - Rural Electrification Public Utility Holding Company - Regulate Utilities Wagner Act (NLRB) - Collective Bargaining/Labor Rights CIO - “One Big Union” Again? Social Security

  19. The “Second” New Deal 1st New Deal = Relief/Recovery 2nd New Deal = Social Reform Election of 1936 - Cements “New Deal Coalition” South Farmers Labor Urban Blacks

  20. Election of 1936

  21. FDR the Dictator? *Court-Packing Scheme The “Last Gasp” AAA (1938) Housing Act (1937) Fair Labor Standards Act - Min. Wage Oh by the way: How was this paid for? “Keynesian” Economics - Deficit Spending OK

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