Roosevelt's New Deal Flashcards
What did FDR earn in 1920? What was a key contributor to this?
Vice Presidential candidate under Al Smith
popularity with Democratic politicians
Who did FDR replace as governor of New York?
Al Smith
When was FDR notably re-elected as governor of New York?
1930 - notable since was following the onset of Depression
FDR won by a landslide in 1932. How many states did he not carry?
6
How many states did FDR not carry in 1936?
2
Why was FDR lucky to get the nomination within the Democratic party?
many thought he was too left wing
What did Keynes describe FDR as?
an “economic illiterate”
When did FDR wins first election?
November 1932
When did FDR take over as President?
March 1933
What was notable about FDR’s time as mayor of New York?
took Progressive action
introduced extensive policy for industrial welfare
was the first comprehensive system of unemployment relief in the USA
What was FDR aided by in his manipulation of Congress?
had a democratic majority in both the Senate and House of Representatives
In public how was Roosevelt presented, why was this important?
Always grinning
Large part of New Deal involved giving people not only the means but the confidence to spend
An early example of how FDR had no fixed ideas for recovery
flexible approach to tariffs during his 1932 campaign (both pro and anti)
What was a criticism of Roosevelt that may be seen as an attempt by him to inspire confidence?
What was different about Truman?
varied message according to whom / where he was speaking
so much so that people saw Truman as “refreshingly honest”
FDR was not revolutionary. What was his fundamental objective?
Preservation of American society and capitalism
What do a vast number of historians suggest the New Deal Programmes were secondary to?
giving hope and confidence in a time of despair
At the heart of the New deal there “was not a philosophy, but a temperament”
What did FDR state in terms of the budget in his acceptance speech?
- criticised Hoover for spending too much
- called for a balanced budget
What did FDR suggest the government had the responsibility for in his acceptance speech?
Responsibility to guarantee every man a right to make a comfortable living
What did FDR’s fiscal policy suggest about his economic principles?
that he was an economic conservative
What were the X3 R’s of the New Deal?
Relief
Recovery
Reform
What X4 categories can the New Deal be broken into?
Agriculture
Banking
Unemployment / Industry
Alphabet Industries
What was the role of Congress vs FDR in the New Deal?
FDR didn’t necessarily create the new deal, it was passed by Congress
What % of the vote did FDR win in 1932?
57%
What was the ‘100 Days’
FDR asked Congress for 100 days of total cooperation
Period of Congress breaking from obstructionism
When did the 100days last?
19th March - 16th June
How many significant measures passed through Congress during the 100days?
16
What was the 100days initially meant to deal with?
the banking / financial crisis
What did FDR do with the 100days
tackled other problems apart from banking
e.g planting season approaching - increasing farmer militancy
How many days was the Emergency Banking Bill constructed in?
5 days
What bill notoriously involved cooperation between Roosevelt and Hoover’s administrations?
Emergency Banking Bill
Where did FDR announce that the Emergency Banking Bill would allow banks in 12 cities to reopen?
In a fireside chat
Evidence that people had faith and increased confidence in Roosevelt’s economic policy
Day after FDR announces 12 cities banks to reopen bank deposits > withdrawals
Roosevelt’s reaction to the second round of Bonus Marchers
Mrs. Eleanor roosevelt greets warmly
but FDR still does not concede to providing bonus
FDR’s statement on what the New Deal would be;
“it will be a well thought out blueprint for radical change”
DATE : Trading with the Enemy Act
5th March 1933
Purpose : Trading with the Enemy Act
recovery of banking system
stop run on the banks
Action : Trading with the Enemy Act
federal gov. took on increased powers to govern banking
declaration of X4 day bank holiday to stop run on the banks
How many states had already shut their banks prior to the Trading with the Enemy Act?
32
Who first introduced the Trading with the Enemy Act?
Wilson
DATE : Emergency Banking Act
9th March 1933
Action : Emergency Banking Act
- authorised government to buy bank stock and assume bank debt
- banned export of gold
Purpose : Emergency Banking Act
ensured banks soundness to encourage greater public confidence
attempted to get people to deposit money again into banks
What legacy of Hoover’s administration did the Emergency Banking Act ironically deploy?
Reconstruction Finance Corporation
By 1935 what fraction of American banks did the RFC own stock in?
1/3
What did the RFC (under the Emergency Banking Act) seek to do?
increase banks capital
What did Hoover do with the RFC which the RFC did not do under FDR?
Hoover leant money to banks (but this increased their debt)
FDR sought to increase banks capital
What did FDR announce in his fireside chat after the Emergency Banking Act
“together we cannot fail”
By the end of March 1933 what fraction of banks had reopened?
3/4
By beginning of April 1933 what amount had been registered in bank deposits? What did this show?
$1billion
showed increase in public confidence in the banking system only a month after FDR became President
What was the Emergency Banking Act entirely reliant on?
entirely reliant on public confidence and people putting deposits back into banks
DATE : Cuts in Civil Service Salaries & Veteran Benefits
March 1933
Purpose : Cuts in Civil Service Salaries & Veteran Benefits
show public FDR’s willingness to save money
hoped to encourage the rich to spend it
part of method of reducing federal spending (one of Democrat’s pledges)
What did Cuts in Civil Service Salaries & Veteran Benefits show about FDR’s fiscal policy?
Despite deficit spending that would occur, there was never absolute abandonment of fiscal conservatism
What was a patriotic phrase to encourage the public to be active in fighting the depression?
“Roosevelt has done his part: now you do something”
DATE : Securities Act for Regulating Wall Street
May 1933
Action : Securities Act for Regulating Wall Street
- demanded full info to be made public whenever new securities issued
- demanded companies make regular financial disclosures
- directors who issue misleading prospectuses liable to prosecution as criminals
Purpose : Securities Act for Regulating Wall Street
Reform Banking and Wall Street
What publication revealed the majority of wealth was controlled by 200 corporations?
The Modern Corporation and Private Property by Meanes and Berle
What did the publication of “Modern Corporation and Private Property” increase the popularity of to the public?
the Securities Act for Regulating Wall Street
DATE : Securities and Exchange Commission
1934
Action : Securities and Exchange Commission
- oversee stock exchange + punish wrongdoers
- prohibit buying of stock without funds to pay
- limit speculation
Purpose : Securities and Exchange Commission
aimed to increase consumer confidence via reducing manipulation, insider trading + speculation
What was the result of the Securities and Exchange Commission?
created better conditions for American business
made more equitable markets for American investors
DATE : US leaving gold standard
June 1933
Purpose : US leaving gold standard
hoped would counter deflationary effects of Depression
DATE : Glass-Steagall Act
June 1933
Action : Glass-Steagall Act
prohibited commercial banks from participating in the investment banking business
decreased number of banks engaging in speculative activity
When was the Glass-Steagall Act first proposed?
In 1932
Republicans too slow to pass it
Purpose : Glass-Steagall Act
attempted to sever linkages between commercial and investment banking
wider hopes in restoring public confidence in US banking
wanted to stop run on the banks
What Corporation was created under the Glass-Steagall Act?
Federal Deposit Insurance Corporation
What did the Federal Deposit Insurance Corporation guarantee?
guaranteed bank deposits to a specified limit
When did the Federal Deposit Insurance Corporation fund become permanent? What did it get raised to?
July 1934
raised to $5000
The Federal Deposit Insurance Corporation was long term. When was the Federal Deposit Insurance Corporation repealed?
1999
Criticism of the Federal Deposit Insurance Corporation
arguably kept operation many smaller unit banks which should have been nationalised
these small banks were part of the fundamental economic problem
DATE : London Economic Conference
July 1933
What did FDR reject at the London Economic Conference?
attempts by emissaries to achieve stabilisation of world currencies
DATE : Trade Agreements Act
1934
Action : Trade Agreements Act
allowed Roosevelt to revise tariffs by up to 50%
What was the passing of the Trade Agreements Act FDR acknowledging?
FDR had gone too far in rejecting international cooperation
What did the Trade Agreements Act show about the New Deal?
New Deal never developed coherent trade policy
= one of chief causes of Depression virtually untouched
Between when was the Gold Buying Act in place?
October to December 1933
Whose tactic was gold buying?
Warren-Pearson
What was the Gold Buying Act a method of doing?
Devaluing the dollar
What happened between November-December 1933 due to the Gold Buying Act?
Commodity prices actually decreased
Farm prices fell
(although not dramatically damaging)
What was the real damage of the Gold Buying Act?
FDR put valuable, critical time into a panacea economists warned him would not work
What did FDR’s administration do in terms of protectionism?
saw no reason to modify high tariff barriers
allowing cheap foreign goods onto American markets would destroy any hope of raising prices through controlling production
What was federal spending in 1931
$3.6billion
What was federal spending in 1936
$8.4billion
What was the budget deficit in 1936
$4.4billion
After when did Roosevelt begin to cut expenditure?
1936
What was federal spending in 1937?
$7.7billion
What was federal spending in 1937 compared to 1936?
$0.7billion less
What was the colloquial name for taxes put on tobacco and liquor?
“sin taxes”
In 1935 what was the colloquial name for the higher income tax on the rich?
“Soak the rich”
When was the Wealth Tax Act introduced?
1935
In what act was a tax on corporation profits not distributed to shareholders introduced?
Wealth Tax Act 1935
When was a tax on corporation profits not distributed to shareholders voted out?
1938
What % of federal expenditure was paid for using taxes in 1938?
82%
In what year was 82% of federal expenditure paid for using taxes?
1938
In the budget following 1938 what type of fiscal policy did FDR accept? What did he abandon?
accepted deficit financing
abandoned progressive taxation
Inflationists wanted what to occur in terms of currency
pleased when Roosevelt brought USA off gold standard
wants increase in silver in circulation + reduction of gold
hoped would allow value of money to fall + prices rise
What did Progressives hoped would occur under the New Deal?
break up of corporations
Who on the Supreme Court was a notorious progressive
Brandeis
Example of advisor who sought government to take control over economic planning from corporations
Berle
What did economic planners e.g Berle oppose in terms of the budget?
idea of balanced budget
budget deficit to finance recovery e.g via public works
Money and Marcus described FDR as
“improvising all the time..very hit and miss”
Evidence that FDR was able to differentiate between ‘emergency’ and ‘normal’ government business
- spent government funds on ‘emergency’ measures e.g public works / RFC
- reduced government expenditure on normal measures
e. g cutting federal salaries
Insiders in government spoke of what? suggesting a new era of government had begun
‘air of expectancy’
Why could Roosevelt not implement radical change (X4)
- structures / personnel not in place
- needed farmer / business / bank cooperation
- element of voluntarism needed in many (e.g NRA codes)
- too radical = subject to supreme court (AAA / NRA)
What can the first New Deal be regarded as in conclusion?
a response to crises and an alleviation of suffering, rather than a solution to the Depression
By the end of 1932 how many self-help organisations were present? How many members?
330
300,000 members
FDR quote which shows there was no great plan behind the New Deal
stated he would promulgate
“bold persistent experimentation”
