THEME 3: a - The impact of the New Deal on the economy Flashcards
What was the national total of personal income in 1929 & 1939?
1929: $86
1939: $73 bil
^ despite a population increase of 9 mil
What were the average wages in 1929 & 1939?
1929: $25.03 per week
1939: $23.86 per week
^ small drop
Economically, was the New Deal successful?
Not really - it’s economical achievements were slender. It wasn’t until 1940 when rearmament & war economy shifted the economy
However, Roosevelt had social achievements (the social security act) & political achievements (changed infrastructure & more women in politics)
How did unemployment figures change during the New Deal?
1933: 18 mil unemployed
1939: 9 mil (half)
Were the alphabet agencies set up to provide work effective?
NO
- in theory the PWA & WPA would create temporary employment but those workers would then go onto to work in the industries stimulated by the temporary work
- This didn’t happen and many left the agencies unemployed - this was the BIG ISSUE with the ND
Why did the 1939 recession happen?
- Eccles advised R not to cut federal spending until private enterprise had expanded to recruit a big workforce
- R was too concerned with keeping a balanced budget & cutback $66 mil
- RESULT: recession where 1.8 mil lost jobs Sept - Dec 1939
- unemployment wasn’t to fall until WW2
What was the key turning point for economic recovery?
The amendment to the 1935 Neutrality Act in 1939
- meant billigerets could buy from the USA
- within a year there were orders for 10,800 aircraft & 13,000 aeroplane engines
How should we assess the New Deal?
By Roosevelt’s three aims:
Relief, Recovery, Reform
Did Roosevelt achieve relief?
Yes - but to an extent
* FERA & WPA offered hope to millions
* The Social Security Act helped many (old age pension)
* His relief measures transformed the role of gov - direct relief, more interference in people’s lives
However, the amount spent was inadequate for the needs of the population
What were the effects of the expansion of welfare provision?
- huge increase in expenditure
- 1930 states only spent $9 mil together
- by 1940 this rose to $479 mil
- many people saw the federal gov as their saviour & saw the President as someone who cared about them
- more people took part of presidential elections than before
- 1920-14: 49% of electorate voted
- 1936-40: 60% of electorate voted
Did the ND achieve recovery?
No, not really
- measures were contradictory
- desire for a balanced budget meant inadequate federal spending
- failed to see massive state expenditure was necessary
- he didn’t understand how government action could stimulate economic growth (Keynes)
- Roosevelt mostly worked in favour of big businesses (NRA codes written by them)
What economic reforms did Roosevelt achieve?
- banking system made more efficient (centralisation of banking 1935)
- Wall Street & holding companies were exposed & reformed
- Labour unions now allowed to support workers
- Gov recognised their position in settling industrial disputes
What political reforms did Roosevelt achieve?
- Expanded & transformed the role government
- failed in his attempt to reform the Supreme Court
- Expansion in the functions of state & local gov e.g welfare provision
- modernised system to address the needs of citizens
What social reforms did Roosevelt achieve?
- direct relief - Social Security Act & employment agencies (expanded the role of federal gov)
- changed the way people see the government - people felt closer to the President and changed their attitudes towards the federal gov (they wanted to help them)
(many criticise the new deal for losing the opportunity to bring in a socialist economic system - however, this was never one of Roosevelt’s aims/intentions)
How did women in politics change during the New Deal?
- women help more important governmental posts than ever before during ND
- Elanor Roosevelt was the most politically active first ladies
- Francis Perkins - secretary of labour (1933-45)
