The Second New Deal, 1935-1938 (T2) Flashcards
What were the reasons for the Second New Deal?
- A change in direction.
- Prevention of action in the new Congress.
- Re-introducing measures to replace New Deal legislation.
- Seeking support of the political left.
- To deflect opposition from the wealthy.
What was the Emergency Relief Appropriation Act (EERA), April 1935?
- Authorisation of the largets appropriation for relief.
- Set up new agencies to provide employment through federal works.
How much was allocated to EERA?
$45.5 billion, equivalent to $400 billion today.
What did EERA set up?
The Works Progress Administration (WPA).
What did the WPA do?
Recruited people for public works projects.
How many people did the WPA employ?
About 2 million employees by 1941, 20% of the nations workforce had found employment with it.
What was pay like in the WPA?
Approx. $52 per month, greater than any relief but less than going rate in industry.
What did the WPA build?
1,000 airport landing fields, 8,000 schools and hospitals and 12,000 playgrounds.
What else was the WPA responsible for?
Cutting the Lincoln Tunnel, and building Fort Knox in Kentucky.
What was the Resettlement Administration, May 1935?
Merged all rural rehabilitation projects into one new agency.
What were the plans of RA?
To move 500,000 families from overworked land and resettle them in more promising surroundings.
What did RA need to do to make their aim possible?
- Buying good land
- Encouraging farmers to move to it
- Teaching them how to farm it effectively using modern machinery.
Was the RA a success?
Only ever resettled 4,441 families so could not be judged as a success.
What were the reasons for the RA’s apparent failure?
Partly to do with costs involved and partly to do with people reluctant to move.
What was the Revenue (Wealth Tax) Act, June 1935?
Implemented to pay for New Deal reforms.
How did people view the Revenue Act?
Perceived by those affected by it to be an attack on the fundamental right of Americans to become rich.
What did the government plan to do?
Sought to raise more revenue through taxation and to do this by targeting those who could most afford it.
What did the Revenue Act do?
Created a graduated tax on corporate income and an excessive profits tax on corporations.
How much were tax on incomes increased by?
Max tax on incomes of over $50,000 was increased from 59% to 75%.
How much did the new taxes raise?
Comparatively little: about $250 million.
What was the problem with the new taxes on corporations?
Contained loopholes, which clever lawyers could easily exploit.
How much of the population earned more than $10,000?
1%
What was the impact of this on the increased taxes on income?
Did not raise large amounts of revenue.
Why couldn’t Roosevelt tax the middle classes?
He would have cut their spending power and thus delayed economic recovery.
