Depth Study: 4. How Successful Was The New Deal? Flashcards
How did the New Deal change after 1933?
The “Second New Deal” reforms were more concentrated on labour rights and improved welfare.
The Wagner Act, 1935: this replaced part of the NRA which the Supreme Court deemed unconstitutional. It allowed workers to join a trade union.
The Social Security Act, 1935: this was a scheme which set up pensions, unemployment benefits, and help for the sick or disabled. It was based on a national insurance scheme.
The Workers Progress Administration (WPA), 1935: it supported efforts to find jobs through many projects and work programmes.
The Resettlement Administration (RA), 1935: it moved over 500,000 farming families to better land.
Who opposed the New Deal?
The Republicans:
They claimed Roosevelt was like a dictator. They felt the economic schemes were similar to those in Communist USSR. They believed the Social Security Act made people lazy. They also opposed the cost.
The rich:
Employers disliked paying social security contributions for their workers. Wealthy Americans also opposed the higher taxes feeling that their power was being reduced.
Business interests:
Business leaders felt that the government was too involved in their affairs. They disliked trade unions. They objected paying social security contributions. They criticised the NRA. They even formed the Liberty League in 1934 to oppose the New Deal.
The Supreme Court:
Their main task was to decide if measures passed were in line with the Constitution. 9 judges were old, conservative, and Republican. They declared the NRA and AAA unconstitutional. In 1936, Roosevelt threatened to pack the courts with 6 more judges. The Supreme Court dropped it’s opposition.
Huey Long:
Governed of Louisiana. He wanted all personal wealth over $5 million to be confiscated and shared so that every family would be given $4000-5000 to buy a home, car, and radio. He had 7.5 million supporters in 1935 but was assassinated.
Doctor Francis Townsend:
He proposed that everyone over 60 should get a pension of $200 a month as long as they spent it all. 7000 Townsend Clubs were created.
Why did unemployment persist despite the New Deal?
Unemployment never fell below 14% of the workforce between 1933-1939.
- the work offered by the New Deal was not permanent.
- the incomes of many Americans remained low, not allowing them to buy many goods.
- the foreign markets weren’t purchasing as much as the depression was worldwide.
- changes in manufacturing required fewer labourers.
- improvements were very slow.
How successful was the New Deal?
Reasons for it being a success:
- unemployment did reduce by 30% between 1933-1939.
- trade union members increased by 7 million following the Wagner Act.
- working conditions and salaries improved.
- large-scale farmers benefitted from the reduction of agricultural land and the increase in prices.
- welfare benefits helped millions of Americans.
- 200,000 black Americans benefited from the CCC programme.
- many businesses were saved by Roosevelt’s banking programme.
- future industrial development was stimulated by the construction projects.
- there were no corruption scandals: the head of the CWA distributed more than $10 billion in schemes and programmes but never earned more than his salary of $15,000.
Reasons for it being unsuccessful:
- unemployment never fell below 14% of the workforce between 1933-1939.
- businessmen disliked the Wagner Act: violence was used to break up riots: in 1937, ten Chicago steel workers were shot dead while taking part in a strike march.
- 1/20 black people had jobs compared to the 1/3 white people.
- confidence remained low: Americans only spent and invested 75% of what they did before 1929.
- Native American and women, etc.
