Economic Recovery Flashcards
Topic sentence
Some Historians argue that FDR successfully used the New Deal to support the economic recovery of American people.
Background
Before the passing of the New Deal, there was a banking collapse as over 100 000 banks had collapsed between 1929 and 1933, there was also a collapse in agriculture and farm prices halved. Additionally there was no financial support from the Goverment at this time.
Evidence 1
In 1933, the Emergency Banking Act was put in place, Roosevelt closed the bank s for 4 days to help banks get back up on their feet before re-opening.
Analysis 1
This helped support the economic recovery of America as by April $1 billion in currency had been returned to banks, meaning that the banking crisis was officially over!
Evidence 2
Furthermore, the Agriculture Adjustment Act (AAA) was passed in May 1933 which paid farmers subsides to limit production and push up prices.
Analysis 2
Thsi was successful in supporting the economic recovery of America because the majority of farmers signed up to it and total farm income rose from $4.5 billion in 1932 to $6.9 billion by 1935.
Counter analysis
However, it could be argued that the AAA wasn’t fully successful because the destruction of food including the slaughter of 6 million piglets was continuous as Americans were hungry.
Evaluation
To evaluate it is clear that the American economy has been successfully recovered through FDRs New Deal as a large sum of money had been returned to the bank and back into farming. This is exemplified through the Glass-stealgall Act of 1933 which stated that commercial banks that relied on small scale depositors were not allowed to be involved in investment. This and the other measures of this Act effectively saved American capitalism and restored faith in the US banking system. Furthermore, it is obvious that FDRs New deal was more
