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FDR AND THE FIRST NEW DEAL

FDR AND THE FIRST NEW DEAL. 1933-1934. Hundred Days. “The country needs bold, persistent experimentation…Above all, try something.” FDR 15 major acts passed within 100 days of taking office. Origins of the New Deal. No clear plan or strategy No strong political ideology

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FDR AND THE FIRST NEW DEAL

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  1. FDR AND THE FIRST NEW DEAL 1933-1934

  2. Hundred Days “The country needs bold, persistent experimentation…Above all, try something.” FDR 15 major acts passed within 100 days of taking office.

  3. Origins of the New Deal • No clear plan or strategy • No strong political ideology • Ideas were taken from academia, business, agriculture, government, law and social work.

  4. FDR and the National Bank Holiday • FDR took office-closed all banks • Called a national bank holiday

  5. Banks and the Stock Market • Emergency Banking Relief Act • Passed after 38 minutes of debate • Required federal examiners to survey the nation’s banks • Issue Treasury Department licenses to those financially sound • “I assure you that it is safer to keep your money in a reopened bank than under the mattress.” FDR • Following day….banks re-opened and deposits outweighed withdrawals

  6. Regulating BanksSecurities Act of 1933 • Securities and Exchange Commission (SEC) • Regulated the stock market and prevented fraud

  7. Regulating Banks Glass-Stegall Act • Separated commercial banking from investment banking. • Banks could no longer speculate on the stock market.

  8. Regulating Banks • Federal Deposit Insurance Corporation • Provided government insurance for bank deposits. • Original amount insured was $ 5,000.00 • Today amounts up to $ 250,000 are insured.

  9. The New Deal…

  10. What do YOU think? • What New Deal Program do you think made the people feel more secure? • Why? • Would you put money into a bank in 1933? Why or why not?

  11. Farms and Industries…. Agricultural Adjustment Administration (AAA) Government paid farmers NOT to raise certain crops AAA paid cotton farmers to plow under cotton and slaughter 6 million piglets. Why?????

  12. Farmers… Over next two years • Farmers pulled millions of acres from production. • Received more than $1 billion in support from the government. Results: • Surplus fell • Food prices __________ • Farm income ___________ (by 50 percent)

  13. Industrial Recovery • National Industrial Recovery Act (NIRA) • Suspended anti-trust laws • Allowed business, labor and government to cooperate in setting up voluntary rules for each industry…also known as codes of fair competition • Run by the National Recovery Administration (NRA)

  14. National Recovery Administration Businesses put these in their windows to show support of the NRA.. “WE DO OUT PART”

  15. NRA • Supreme Court rule the NRA unconstitutional in 1935…. WHY?????

  16. Codes of Fair Competition • Set prices • Established minimum wages • Limited factories to two shifts per day • Shortened workers’ hours • Right to form unions ANSWER…. BECAUSE NOT ALL COMPANIES COULD FOLLOW THE ABOVE GUIDELINES….

  17. 1930-1939 Life in America…..

  18. Spending and Relief Programs The quickest way to get out of the Depression was to get money directly to the people…..

  19. Programs…. Civilian Conservation Corp • Men only • Aged 18-25 years old • Planting trees, fighting forest fires, and building reservoirs. • Lived in camps • Six months to one year

  20. Programs…. Federal Emergency Relief Administration (FERA) • Headed by Harry Hopkins • Granted federal money to state and local governments to be used to help the unemployed…. SOUND FAMILIAR ????

  21. Programs…. Public Works Administration • Construction • Highways, dams, sewer systems, waterworks, public schools and government facilities • Money given to companies, not individuals…required African American contractors be hired…. THIS PROGRAM HELPED TO BREAK DOWN SOME LONG STANDING RACIAL BARRIERS.

  22. Programs…. Civil Works Administration • Hired workers directly, became federal employees • Males and females • Built or improved airports, roads, schools, playgrounds, parks and playing fields

  23. Programs…. Tennessee Valley Authority Built dams in the south to produce hydroelectricity 20 dams and employed 40,000 workers

  24. FDR’s Second New Deal • First New Deal….in effect for 2 years but little to no change in economic growth. • 2 million jobs had been established, yet 10 million still remained unemployed. • FDR had several individuals outspoken against him because of these facts. • Deficit spending-spending monies earmarked for other programs..FDR abandoned a balanced budget and began borrowing to pay for his New Deal programs……

  25. Opponents of FDR’s New Deal • American Liberty League Formed to “teach the necessity of respect for rights of person and property.” • Huey Long-senator from Louisiana Spoke out against the rich Supporters formed 27,000 Share Our Wealth Clubs. • Father Couglin-popular Catholic radio personality Impatient with the moderate reforms of the New Deal Wanted to heavily tax the wealthy Wanted a nationalized banking system Organized the National Union for Social Justice.

  26. The Townsend Plan • Proposed by Dr. Francis Townsend • Federal government would pay persons over 60 a pension of $200.00 a month. • Those taking a pension would have to retire AND spend their 200.00 every month. RESULTS: Increased spending Remove people from the work force, freeing up jobs for the unemployed.

  27. Townsend Plan • Attracted million of supporters, mainly the elderly. • Mobilized the elderly as a political force for the first time.

  28. Second New Deal • Officially launched in 1935 • Hoped it would ensure his re-election in 1936

  29. The Second New Deal Programs • Works Progress Administration (WPA) Headed by Harry Hopkins Spent $11 Billion, employed 8.5 million people. Constructed: Highways, roads, streets, public buildings and parks. Improved: bridges and airports

  30. Second New Deal • “Federal Number One” Part of the WPA Employed artists, musicians, theater people and writers…. Why do you think this was a controversial program?

  31. Second New Deal • Social Security Act Created an unemployment system Created disability insurance Old age pensions Child welfare benefits • Resettlement Act Assisted poor families and sharecroppers in beginning new farms or purchasing land

  32. The Supreme Court and the New Deal Schechter vs. United States “sick chicken case”….helped to strike down the NIRA This ruling suggested that the entire New Deal could be struck down

  33. Industrial Unions and the New Deal • President Roosevelt knew he needed the votes of the working-class. • Congress and FDR believed that unions were vital in the recovery of the nation. Why? High union wages would let workers spend more money, which in turn would boost the economy.

  34. Industrial Unions • National Labor Relations Act Also known as the Wagner Act • Guaranteed workers the right to organize unions without interference from employers. • The right to bargain collectively. • Run by the National Labor Relations Board

  35. National Labor Relations Board • Organized factory elections by secret ballot to determine whether the employees wanted a union. • Complaints could now be settled by binding arbitration. Binding Arbitration-when a neutral party listens to both sides and decides the outcome of the issue.

  36. The CIO • Committee for Industrial Organization • Set out to organize INDUSTRIAL unions • Included ALL workers, skilled and unskilled from a single industry • First focused on the auto and steel industries

  37. Industrial Unions • First sit-down strike: General Motors in Cleveland, Ohio…stopped working and refused to leave the property. • UAW (United Auto Workers) became one of the most powerful unions in the United States after this. • United Steelworkers achieved a 40 hour work week and a 10 percent pay raise for employees. • Total union membership tripled from 3 million in 1933 to 9 million in 1939.

  38. Social Security Act • Major goal-to provide some security for the elderly and for unemployed workers. • Monthly benefit collected at age 65 • Provides temporary income to unemployed • Left out farmers and domestic workers • 65 percent of African Americans in the 1930s fell into these categories.

  39. FDR Speaks….

  40. The New Deal Coalition Roosevelt’s Second Term: African Americans began switching parties from the Republican to Democratic. Eleanor Roosevelt helped to win votes among women and African Americans.

  41. FDR’s Second Term A “mixed” Cabinet…. First woman appointed to a presidential cabinet: Frances Perkins, Secretary of Labor The “Black Cabinet”- several African American men appointed by the administration.

  42. 1936 Election…. Alfred Landon (republican) vs. Franklin Roosevelt (democrat) Roosevelt won with one of the largest landslides…60 percent of the popular vote and carried all but two states (Maine and Vermont)

  43. Court Packing….. 2nd act of the New Deal declared unconstitutional…the AAA This made FDR mad, called the Supreme Court “nine old men”… Claimed the Supreme Court was blocking the wishes of the majority of the country

  44. Court Packing… FDR sends a bill to Congress proposing the following: • Any justices that had served 10 years & did not retire within 6 months of turning 70, the president would then add an additional Supreme Court justice. • Four of the justices were in their seventies and two were in their late sixties, thus FDR would add six more justices….allowing him to control the Court indirectly

  45. Court Packing The press saw this as FDR’s first serious political mistake…. WHY? It created the impression that FDR was trying to change the Constitution’s separation of powers and undermine the Court’s independence.

  46. Court Packing Court Packing split the Democratic Party.. Southern democrats feared FDR’s plan would overturn segregation African Americans feared that future presidents may pack the Court with Justices opposed to civil rights.

  47. Roosevelt’s Recession 1937: • Economy was on the verge of recovery • Industrial output was on the verge of full recovery THEN….. Unemployment surged !!!

  48. Roosevelt’s Recession… Roosevelt was unconcerned…decided to balance the budget… Cut the WPA and the PWA…at the wrong time..the first Social Security payroll taxes removed $2 million from the economy at the same time as the cuts Late 1937…2 million people were out of work…employers could not pay the Social Security taxes and handle cuts by the government.

  49. Debates….. Henry Morgenthau-Secretary of Treasury Wanted a balanced budget Vs. Harry Hopkins and Harold Ickes-Heads of the WPA and PWA Pushed for more spending, saw no need to balance the budget. Believed and supported “Keynesianism”

  50. Keynesianism • Based on the theories of John Maynard Keynes, a British economist. • The government should spend heavily during a recession, even if it had to run a deficit…this would jump start the economy.

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