(Class 18) The New Deal Flashcards
1
Q
Franklin D. Roosevelt
A
- Born in 1882
- Grew up at Hyde Park, New York
- Harvard and Columbia (law) educated
- Fifth cousin of Theodore Roosevelt
- Like his cousin was Assistant Secretary of the Navy and New York Governor before President
- Married Theodore Roosevelt’s niece – Eleanor Roosevelt
- Democrat
- Vice President candidate in 1920
- Energetic candidate and campaigner
2
Q
“The only thing we have to fear is fear itself”
A
- FDR is inaugurated on March 4, 1933
- Inauguration speech heard on the radio
- Promised “direct, vigorous action”
- Termed the first months in office: “the Hundred days”
- A whirlwind of government initiatives that launched the New Deal
- New Deal had 3 goals: The 3 “R’s”: Relief, Recovery, Reform
- term coined by Franklin Roosevelt
3
Q
The New Deal
A
- Provide relief to the destitute (unemployed)
- Foster the economic recovery of farms and businesses – create jobs and reduce need for relief
- Reform the government and the economy in ways that would reduce the risk of devastating consequences in future economic slumps and thereby strengthen capitalism
- Expanded government’s role in the nation’s economy and society
4
Q
The role of consumption in the economy
A
- Although many New Deal policies were viewed as Socialism the New Deal was a capitalistic endeavor
- The New Deal sought capitalist solutions to the economic crisis
- Roosevelt had no desire to eliminate private property
- Did not favor public ownership of production resources
- Wanted to save capitalism by correcting its flaws
- The greatest of the flaws was underconsumption
- Could choke the economy
- A Balance between production and consumption needed to be restored
- “Our task now is…meeting the problem of under-consumption…adjusting production to consumption…[and] distributing wealth and products more equitably.”
5
Q
Federal Deposit Insurance Company (FDIC)
A
- When Roosevelt took office the banking system was crumbling
- Inaugurated on March 4, 1933 (last March inauguration)
- On March 6th he declared a four-day banking holiday that kept all banks shut until Congress could act.
- Emergency Banking Act passed on March 9th
- To get confidence of depositors Congress passed Glass-Steagall Banking Act (Banking Act of 1933)
- Separated commercial from investment banking (Main street separated from Wall Street)
- Set up the Federal Deposit Insurance Corporation (FDIC) – guaranteed deposits
6
Q
Securities and Exchange Commission (SEC
A
- Roosevelt criticized financiers for greed and incompetence
- In large part contributed to crash of 1929
- Created the SEC to oversee Wall Street and protect investors
- License investment dealers, monitoring stock transactions
- Full disclosure
- Prevent insider trading
- Roosevelt appointed Joseph P. Kennedy (father of JFK) to be first head of SEC
- Helped to clean up and regulate Wall Street
7
Q
Fireside Chats
A
- Sunday, March 12th with banks still closed FDR gave his first radio fireside chat
- Explained the new banking legislation – “safe to keep your money in bank”
- Plain talk, in friendly manner
- Restored confidence in the banks
- This first fireside chat and subsequent ones tied Roosevelt to millions of Americans
8
Q
Agricultural Adjustment Act
A
- Since World War I there was overproduction and underconsumption of farm products
- Agricultural Adjustment Act (AAA) passed in May 1933
- Authorized the domestic allotment plan
- Paid farmers not to grow crops
- Allotment payments made if crops not planted and livestock not slaughtered
- But many went hungry and it did not work well with sharecroppers
- Other farm programs made loans and mortgages to farmers
9
Q
Tennessee Valley Act
A
- Most ambitious new deal program – May 1933
- Build dams along Tennessee River to supply cheap electricity to rural areas
- Partnership between the federal government and local residents
- Improved lives of millions with power, flood protection, soil reclamation and jobs
- TVA still in existence today
10
Q
Huey Long and Share the Wealth
A
- Democrat Huey Long of Louisiana
- The “Kingfish”
- Governor and then Senator
- Championed the poor – wanted more reform
- Proposed program to “Share the Wealth” – An equitable distribution of wealth
- Proposed outlawing high incomes and high inheritance with a tax bill
- Challenged the New Deal after 1932
- Assassinated in 1935
11
Q
Works Progress Administration (WPA)
A
- Americans needed jobs
- Private industry still left 8 million jobless in 1935
- Roosevelt did not believe in handouts – felt it crippled recipients
- Wanted to create jobs for Americans
- Works Progress Administration (WPA) with $5 billion budget was created
- Gave Americans jobs on public works projects – roads, bridges, parks, public buildings, creation of art, music, literature
- By 1936 WPA provided 7% of the American work force with jobs
- Put 13 million men and women back to work
12
Q
Wagner Act
A
- New Dealers supported labor unions
- A marked departure from unions in the Gilded Age
- Bill sponsored by Senator Robert Wagner of New York – passed in 1935
- Authorized the federal government to intervene in labor disputes
- Authorized government to supervise the organization of unions
- Guaranteed industrial workers the right to organize
- If the majority of workers at a company voted for a union, the union became the sole bargaining agent for the entire workplace, and the employer was required to negotiate with elected union leaders.
13
Q
Social Security (Act)
A
- Called the single most important element of the New Deal welfare state
- Permanent reform to give the elderly a modest income
- At the time only 15% of Americans had private pension plans
- Opposed by conservative groups including Chamber of Commerce
- Passed by Democratic majority in Congress in August 1935
- Contributions came from workers and employers
- Benefits went to all not just the needy
- Also created unemployment insurance when workers lost their jobs
- Supreme Court upheld Social Security in 1937
14
Q
Court Packing
A
- Attempt to remove remaining obstacle to his New Deal reforms after 1936 election
- Decided to target Supreme Court
- Conservative justices had invalidated 11 New Deal measures as unconstitutional
- Social Security, Wagner Act, SEC were now going in front of the court
- FDR proposed adding new justices to the Supreme Court
15
Q
Court Packing Plan
A
- To avoid a dismantling of his New Deal he proposed the following plan:
- Add one new justice for each existing judge who had served for 10 years and was over the age of 70, Would give Roosevelt the power to pack the court with up to 6 judges, They could out vote the elderly conservative judges
- Most Americans felt Supreme Court should be independent and free of political interference
- Judiciary Act of 1869 Congress established that the Supreme Court would consist of the Chief Justice and eight associate justices
- The Judicial Procedures Reform Bill of 1937 was defeated
