FDR and the New Deal: Part 1

1. FDR and the New Deal: Part 1

2. In his inaugural address in March, 1933 FDR uttered one of the most famous quotations in American history:

3. “Let me assert my firm belief that the only thing we have to fear, is fear itself.” Huh?

4. New Deal Roosevelt had basic problems to solve: - Banks were failing. - Millions were out of work. - Farmers and homeowners were unable to make regular payments on their mortgages. - Cities and states had run out of funds to feed the unemployed. - Factories stood idle.

5. Working with his advisors and cabinet, a group known as the “Brain Trust,” Roosevelt cobbled together a host of programs to put people back to work and get the nation back on its feet.

6. Brain Trust Cordell Hull, Secretary of State. Harold L.Ickes, Secretary of Interior. Henry A.Wallace, Secretary of Agriculture. James A. Farley, Postmaster General. Henry Morgenthau Jr, Secretary of Treasury. Frances Perkins, Secretary of Labor. 1st Woman Cabinet Member Louis Howe, Chief Political Advisor Rexford Tugwell, Raymond Moley, Adolph Berle, Jr., Economic Advisors

7. Some of what the Briantrust proposed was merely an expansion on some of what Hoover had already attempted.

8. Other things that Roosevelt and the Braintrust proposed were sweeping, fundamental, and revolutionary changes.

9. Either way, the group of programs, which came to be known as the New Deal, were all designed to achieve one or more of three overall goals.

10. Relief FDR wanted to provide immediate, direct government assistance to those who needed most.

11. Relief He also hoped to alleviate the fear many Americans had about the health of the economy and America’s financial institutions.

12. Recovery He then hoped to put people back to work, providing them a paycheck. They would then use this paycheck to purchase consumer goods, stimulating the economy.

13. Reform He also needed to make changes to the American system, placing regulations on American businesses and financial institutions to prevent any future economic collapse.

14. During his fist 100 days in office, Roosevelt, and the Democratic Congress, secured a list of laws and bills designed to achieve the three R’s.

15. One of Roosevelt’s first tasks was to restore America’s faith and trust in in two areas: 1. Financial Institutions. 2. The ability of the federal government to solve the problems of the Depression.

16. To do this he engaged in a series of “fireside chats,” essentially a number of pep-talks to the American people broadcast over the radio.

17. His first such “chat” focused on the status of American banks. He ordered all remaining banks to take a “holiday” lasting from March 6 to March 10 1933. This would allow time for the government to ensure the stability of those banks.

18. Emergency Banking Relief Act (1933) - Authorized the President to proceed with the Bank Holiday. - All banks would then be inspected by the Treasury Dept. - Banks deemed safe and secure would be permitted to reopen. - Banks deemed unfit would either be closed permanently or offered loans from the U.S. government and allowed to reopen.

19. How was this supposed to help?

20. Glass-Steagall Banking Act (1933) - Created the FDIC which ensured individual bank deposits up to $5,000. - Designed to stop the string of bank failures dating back to the wildcat banks of Andrew Jackson. - Separated savings / commercial banks from investment banking.

21. Roosevelt also took the U.S. off of the gold standard, hoping to create inflation of paper currency easing the debt burden of Americans.

22. Roosevelt also needed to help those Americans who had no job and no hope. He took to the airwaves to unveil still more government programs.

23. U.S. Govt loaned over $3 Billion to state governments. • ½ of the money was to be given directly to the needy through welfare organizations within each state. • ½ of the money was to be used to create public works jobs within each state. Federal Emergency Relief Act (1933)

24. Civilian Conservation Corps (1933) • Jobs for men 18-25 • Put to work “outdoors” planting trees, preventing soil erosion, cutting trails, building roads. • Provided with food, clothing, shelter on the job site. • Required to send $25 of every $30 made home to their families. Why?

25. National Industrial Recovery Act (1933) The NIRA created two additional government agencies, each with a different purpose: The Public Works Administration The National Recovery Administration

26. The PWA was designed to create even more jobs available to all Americans. These jobs were facilitated by the states and were mostly found in massive public works projects like roads, dams, and construction of govt. and public buildings.

27. Required a code of “fair competition” and initially set a minimum price for many products. Why set a minimum price? Enforced a maximum 9 hr. work day, 45 hr. week. How would this help? Established a minimum wage. Formally recognized and protected organized labor unions.

28. All of this was voluntary. A business could choose to live by the codes or not. Problem? To deal with this, the government created the Blue Eagle, a symbol of the NRA.

29. Companies and businesses who agreed to live by the rules hung the Blue Eagle in their windows. How was this supposed to help?

30. Things were bad across America during the Depression, but the suffering was especially bad in the Tennessee River Valley.

31. - Unemployment and poverty were rampant. - Health care sucked. - The farmland had been overused. - Many towns and homes didn’t yet have reliable electricity. - Flooding along the river was common.

32. To solve all of these problems, Roosevelt proposed the Tennessee Valley Authority.

33. - Established a company (TVA) owned and operated by the U.S. government. - Hired workers to construct a series of dams on the Tennessee River. These dams controlled flooding and generated electricity. More importantly, they created jobs. - The electricity was distributed throughout the area and sold by the U.S. government. Tennessee Valley Authority (1933)

34. Roosevelt also proposed a New Deal for minority groups in America.

35. Roosevelt provided women with a prominent role including his wife Eleanor and Sec. of Labor Francis Perkins.

36. While not supporting full civil rights, FDR appointed more than 100 African-Americans to high level government jobs, including Mary McLeod Bethune as head of the National Youth Admin.

37. Roosevelt also appointed John Collier as the Commissioner of Indian Affairs.

38. Indian Reorganization Act 1934 • AKA the Wheeler-Howard Act • - Authorized the formation of federally recognized tribal govt. • - Allowed those tribal governments to take control of reservation lands • - Dismantled assimilation / Dawes Act

39. If things were bad for workers and minority groups in 1933, things for farmers were worse.

40. Farm prices were still incredibly low and the Dust Bowl was raging.

41. Agricultural Adjustment Act (1933) - Paid farmers to not grow crops, or destroy a % of crops already planted. How would this help? - Bought up surpluses of crops already grown - Set a fixed “parity” price for items independent of true market prices

42. Parity Prices 1918 Price Parity Price Price farmers need to make a profit 1933 Price

43. Thus, the AAA attempted to do two things: - Give farmers money now! - Deal with the low price of food so that farmers could once again take care of themselves.

44. As the size, scope, and expense of the New Deal became apparent to the nation, critics began to attack FDR from all sides.

45. More conservative, big business oriented laissez faire Republicans began to repeat one word: Socialism.

46. The most famous critic was Sen. Huey Long, who argued that for all that the New Deal had done, it had not done enough.

47. He put forth his own “Share Our Wealth” proposal. - Wanted to make “every man a king.” - Promised a minimum yearly income of $5,000. - Would be paid for by raising huge taxes on the wealthy. - Assassinated in 1935.

48. FDR was also attacked by Father Charles Coughlin. - Used a weekly radio address to attack the New Deal - Called for a minimum guaranteed income and for nationalizing America’s banks. - Wanted more government support for those in need. - Popularity was hurt by ant-Semitic remarks.

49. Dr. Francis Townsend forced the nation to deal with the plight of yet another group of Americans who were desperately in need: The Elderly Why were many older Americans particularly hurt by the Depression?

50. By 1935 Roosevelt came to two conclusions: 1. His critics had offered up some valid points and he wanted to respond to some of what they had said. 2. His initial efforts through the New Deal had helped, but they had not yet solved the problem of the Depression.