New Deals (1932-41) Flashcards
3
Describe the 3 pillars of the New Deals
- Relief
- Recovery
- Reform
5
Describe the failings of Hoover in the 1932 election
- Only ran for 2nd term as saw no other viable Republican candidate
- Public works programmes in 1932 came too late to turn around depression
- Became synonymous with depression and prohibition
- only made 7 radio speeches - unlike the utilisation of radio by FDR
- lacked charisma of FDR
3
Describe FDR as NY Governor
- Had enacted intervention policies in New York
- built hydroelectric power on St Lawrence River
- Allowed test for ND policies, which proved effective
3
Describe the image of FDR in 1932
- courted press
- in national radio address in April 1932, called for govt to help ‘the forgotten man’
- talked directly to voters through radio
3
Describe FDR’s risk-free campaign
- Wide expectation he would win - aimed to avoid any criticism
- Was not associated with clear ideology, unlike Bryan
- Few, vague policies and even self-contradictory platform
1
Describe FDR’s support of interventionist policy in 1932
- In Georgia, promised ‘bold experimentation’ to beat Depression and initiate economic redistribution
3
Describe FDR’s criticism of interventionist policy in 1932
- attacked Hoover’s ‘extravagant’ spending
- pledged a 25% cut in federal budget
- in SF, made a speech advocating economic regulation as last resort
5
Describe the New Deal Coalition
- Northern support for Dems
- urban Catholic voters
- blue-collar workers
- racial and religious minorities
- powerful interest groups: city machines, universities, labour unions, etc
4
Describe the results of the 1932 election
- Dominated electoral college, winning 472 votes
- Won 57% of the popular vote the highest ever for Democrat Presidents
- New Deal Coalition reflected voter shift to North
- Arguably, nomination of North-eastern reformer Al Smith in 1928 started this shift
3
List the different stages of the New Deal
- 1st - 1933-34
- 2nd - 1935-37
- 3rd - 1938-40
1
How many Alphabet Agencies were there?
59 new agencies were set up between 1933 to 1938
4 - (3) (4) (2) (2)
Describe the Acts/agencies of the 1st ND
-
Agriculture
- AAA 1933
- TVA 1933
- Farm Credit Act 1933
-
Banking
- Emergency Banking Relief Act 1933
- Glass-Steagal Act 1933
- Truth-in Securities Act 1933
- Securities Act (SEC) 1934
-
Industry
- National Industrial Recovery Act (NIRA) 1933 - NRA and PWA
- Civil Works Administration (CWA) 1933
-
Relief
- Federal Emergency Relief Act 1933 (FERA)
- Civilian Conservation Corps 1933 (CCC)
6
Describe the Acts/agencies of the 2nd New Deal
- Works Progress Administration (WPA)
- Wagner Act 1935
- Social Security Act 1935
- Banking Act 1935
- Rural Electrification Administration 1935
- Farm Security Administration (FSA) 1937
6
Describe the first 100 days
- Set presidential convention
- 15 Acts in first 100 days
- Not fully cohesive plan - often even contradictory
- FDR wanted to allow for econ recovery + reform banking and finance infrastructure
- thus could better address any downturn in future
- Spoke to electorate with fireside chats’ on radio to explain policies
4
Describe the problems in agriculture by 1933
- Mechanisation, fertiliser and pesticides led to overproduction and low prices
- Prohibition reduced demand for grain
- 25% land lost between 1929-33
- Floods had washed away crops and topsoil in Tenesee Valley
2
Describe the problems in cotton by 1933
- 1933, unsold cotton in the US exceeded the annual world consumption of American cotton
- 1933, farmers had planted 400k acres more than in 1932
3
Describe how agriculture was valued in the New Deal
- Given higher priority than industrial recovery:
- 30% of labour force worked in agriculture
- If agricultural workers could afford more, industry would be stimulated
4
Describe the Agricultural Adjustment Act 1933 (1ND)
- Government would subsidise farmers to reduce production of staple items of corn, tobacco, rice
- By producing less, prices and farmers incomes would increase
- Set up Agricultural Adjustment Agency (AAA)
- Programme meant to be self-financing - tax imposed on food processing companies
2
Describe how the Agricultural Adjustment Act 1933 reduced overproduction of cotton
- 10.5m acres destroyed by AAA
- Price of cotton (bale?) rose from 6.5c (1932) to 10c (1933)
3
Describe how the agricultural Adjustment Act reduced overproduction of meat (beef)
- Western ranchers sought to bring beef cattle under the production of the AAA in 1934
- By 1935, the Government had purchased 8.3 million cattle
- In return, ranchers agreed to reduce breeding cows by 20% in 1937
2
Describe how the agricultural Adjustment Act reduced overproduction of meat (pork)
- 6 million piglets were bought and slaughtered
- Many carcasses were processed and fed to the unemployed
4
How effective was the Agricultural Adjustment Act 1933?
- Drought helped make the 1933 wheat crop the poorest since 1896 and agreements were reached to limit the acreage in subsequent years
- Total farm income rose from $4.5bn in 1932 to $6.9bn in 1935
- Popularity of the AAA was high among farmers - 95% of tobacco growers signed up
- SC ruled AAA unconstituional in 1936 - though achieved signficant progress before this
3
Describe the Tennessee Valley Authority 1933 (1ND)
- Set up to deal with underdevelopment and poverty in the Tennessee Valley
- Most grandiose project of ND
- TVA effectively became central planning authority for region
6
Describe the tasks of the TVA
- construct 20 huge dams to control floods
- create hydroelectricity for region (existing supplies limited to 2% farms)
- control soil erosion through forest restoration
- provide jobs by setting up fertiliser factories
- to develop welfare and edu programmes
- teach farmers in ways of modern methods e.g. crop rotation
4
Describe the success of the TVA
- built 16 hydroelectric dams between 1933-44
- By 1934, more than 9k people found employment with the TVA
- Residents saw increase in average earnings by 200% from 1929-49
- modernisation can be largely credited to TVA
3
Describe the failures of the TVA
- roughly 3.5k families in eastern Tennessee lost their homes when the Norris Dam was built
- project flooded an area of roughly 239 square acres in the Norris Basin
- federal govt offered little help in resettling displaced families
2
Describe the Farm Credit Act 1933
- Enabled farmers to keep homes and land
- gave security to farmers
6
Describe the situation in banking at the time of F Roosevelt’s election
- 1932, banks were closing at the rate of 40 per day
- Oct 1932, Governor of Nevada declared bank holiday and closed every bank in state
- By inauguration, banks fully closed in many states
- 5500 banks failed by 1933 (1 in 5)
- Local banks held limtied physical cash
- Money supply had fallen by 30% by 1933 due to little confidence
5
Describe how FDR dealed with banking upon inaugaration
- At inauguration stated: ‘the only thing to fear is fear itself’
- 6th March 1933 - FDR closed all banks for 4 days to allow treasury officials to draft emergency legislation
- RFC authorised to buy stock to support banks and take on their debts - in doing so effectively became largest bank in world
- FDR used ‘fireside chats’ to encourage the public to refill bank deposits
- By April 1933, $1bn returned to bank deposits , ending crisis
2
Describe the Emergency Banking Relief Act 1933
- gave Treasury power to investigate all banks threatened with collapse (‘stress-test’)
- passed by Congress after only 40 mins of debate
5
Describe the Glass-Steagall Act 1933 (1ND)
- Individual bank deposits insured up to $2500
- insurance fund would be administered by FDIC (Federal Deposit Insurance Corporation)
- Bank officials not allowed to take personal loans from own banks
- Government authority over purchase of governmentt securities centralised from Fed Reserve Banks to Fed Reserve Board in Washington
- Commercial banks relying on small-scale deposits banned from type of investment banking that fuelled 1920s speculation
1
Describe the Truth-in-Securities Act 1933 (1ND)
- Required brokers to offer clients realistic info about the securities they were selling
2
Describe the Securities Act 1934 (1ND)
- Set up a new agency, the Securities Exchange Commission (SEC)
- Would oversee stock market activities to prevent fraudulent activities such as insider dealing
2
Describe the two bodies of the National Industry Recovery Act (NIRA), June 1933 (1ND)
- National Recovery Administration (NRA)
- Public Works Administration (PWA)
6
Describe the NRA (1ND)
- Headed by General Hugh Johnson
- Aimed to offer something to all groups
- Suspension of anti-trust legislation for 2 years benefitted businessmen
- set wage and price controls via codes
- codes agreed between management, labour and government
- codes included 40hr working week, minimum weekly wage, ban on u16 working
4
Describe the failures of the NRA
- Johnson attempted ‘Buy Now’ campaign in Oct 1933 to encourage spending and thus stimulate production
- Unsuccessfully advocated for 10% wage increase and 10 hour cut in the working week
- Arguably only served to legalise worker exploitation - opposite of intention
- SC deemed it unconstitutional in 1935
3
Describe the Public Works Administration (1ND)
- Headed by Sec of Interior, Harold Ickes
- Given $3.3bn to ‘pump-prime’
- Would build roads, dams, hospitals, schools, etc to stimulate econ growth through multipliers
3
Describe the successes of the PWA
- 13k schools built
- 50k miles roads built
- 4 vast National Parks, dams, electricity created in West
3
Describe the failures of the PWA
- Discontinued in 1939
- Did not provide ‘going rate’
- ‘Crowded out’ private investment - jobs dependent on govt spending