America Past and Present Ninth Edition Chapter 26

America: Past and Present Ninth Edition Chapter 26 Franklin D. Roosevelt and the New Deal America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Great Depression • 1920 s Optimism about good economy • 1929 – “Black Thursday” Stock market collapsed, factories closed, unemployment went up, optimism shattered • Result in 25% unemployment • Wealth of 1920 s not distributed boardly enough • Profits used for dividends, and stock speculation America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Great Crash • Souring stock prices attract investment • Corporate investor’s obsess with speculation on stock market • Money not used for wage increases • Productivity increased 43%, wages only by 11% • Demand for consumer goods declines • Businesses laid off workers • 1929: Stock market crashed America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Unemployment, 1929– 1942 America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Effects of the Depression • Hardship affected all classes – unemployment and poverty undermined self-worth and caused despair • The middle class lost belief in everincreasing prosperity – hit them hard • Thousands of young homeless, jobless • 25% unemployed America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Fighting the Depression • Republican party struggles to overcome depression • Depression gives Democrats opportunity to regain power America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Hoover and Voluntarism • Hoover initially sought solution through voluntary action, private charity • Aided farmers with Farm Board to buy surpluses and bankers with loans through Reconstruction Finance Corporation • Hoover Dam • White House business conference • Hoover too cautious and too late with programs America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Hoover and Voluntarism • Bonus Army and General Mac. Arthur • Resisted Democratic efforts to give direct aid to the unemployed – Perceived as indifferent to human suffering – Hoover blamed for the Depression America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Bank Failures, 1929– 1933 America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Emergence of Roosevelt • Franklin Roosevelt – – Born to wealth and privilege 1921: Crippled by polio – prepared him to be sensitive to downtrodden 1928: Elected governor of New York Talented and persuasive politician • 1932: Defeated Hoover with farmer- workerimmigrant-Catholic coalition • Roosevelt healed division in Democratic party • People remembered Bonus Army America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Hundred Days • FDR inaugural inspired with the term “nothing to fear but fear itself” • Called special session of Congress • Banking system saved from collapse – closed all banks - strong banks saved, weak eliminated – gave money to strong banks and FDIC • Fifteen major laws provided relief • Tennessee Valley Authority was the most ambitious one – jobs, electricity and modernization to rural South • New Deal aimed to reform and restore, not nationalize, the economy America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Tennessee Valley Authority America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Roosevelt and Recovery • National Recovery Administration • National economic planning – – – Industries formulated guidelines and codes to eliminate cutthroat competition, ensure labor peace Codes favored big business, NRA ruled unconstitutional because it favored large corporations – not small ones America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Roosevelt and Recovery • Agricultural Adjustment Act of 1933 – – Farmers paid to take land out of cultivation – farmers must cut production Prices increased, mainly because of government payments, but Dust Bowl helped by cutting supply Sharecroppers, tenant farmers dispossessed Found unconstitutional in 1936 – mainly helped large farms not small ones America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Roosevelt and Relief • 1933: Harry Hopkins placed in charge of Relief programs to give aid to unemployed – seen as “color blind” • 1933: Civilian Conservation Corps (CCC) provided employment to young people • 1935: Works Progress Administration (WPA) placed unemployed on federal payroll • Programs never sufficiently funded America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Roosevelt and Reform • 1933– 1934: Focus on immediate problems • 1935: Shift to permanent economic reform, America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Challenges to FDR • Critics of FDR demanded radical reforms for small guy • Father Charles Coughlin advocated nationalizing banks, anti-Semitism • Francis Townsend called for $200 per month pensions to all those over 60 if they spent it within the month • Huey Long and the Share the Wealth Clubs called for redistribution of wealth by seizing private fortunes – popular with those not benefiting from New Deal America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Social Security • 1935: Social Security Act passed – most significant reform of New Deal • Criticisms: – – – Too few people would collect pensions Unemployment package inadequate Too conservative • Passed because of duty to help unemployed, aged, and handicapped America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Labor Legislation • 1935: Wagner Act – – Allowed unions to organize and collectively bargain – New Deal good for Unions Outlawed unfair labor practices • 1938: Fair Labor Standard Act – – Maximum hour – Minimum wage Rural Electrification Administration brought electricity to 90% of farmers who did not have it in 1930 America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Impact of the New Deal • Had a broad influence on the quality of life in the U. S. in the 1930 s • Helped labor unions most • Helped women, minorities least • Harry Hopkins helped minorities America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Rise of Organized Labor • 1932: National Recovery Act spurred union organizers • Congress of Industrial Organization (CIO) formed by John L. Lewis • CIO unionized steel, auto industries • 1940: CIO membership hit 5 million, 28% of labor force unionized • Promoted all workers – not just skilled America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The New Deal Record on Help to Minorities • Crop reduction program allowed whites to fire or evict blacks, Hispanics • Public works programs helped by providing employment • New Deal figures convinced minorities that the government was on their side • 1934: Indian Reorganization Act gave American Indians greater control America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

Women at Work • Position of women deteriorated in the ‘ 30 s – – Jobs lost at a faster rate than men Hardly any New Deal programs help • Progress in government – – – Frances Perkins, Secretary of Labor, the first woman cabinet member Women appointed to several other posts Eleanor Roosevelt a model for activism America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

End of the New Deal • 1936: New Deal peaked with Roosevelt’s reelection and brought about powerful political coalition • Blacks shifted from Republican to Democrat (FDR) because FDR hired Blacks in cabinet and Harry Hopkins • Congress resisted programs after 1936 • New Deal lasted 5 years America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Election of 1936 • FDR’s campaign – – – Attacked the rich Promised further reforms High point of New Deal – downhill after that • Democrats won majorities in both houses of Congress • FDR coalition: South, cities, labor, ethnic groups, African Americans, poor America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The Supreme Court Fight • Supreme Court blocked several of FDR’s first-term programs • 1937: FDR sought right to “pack” Court and remove threat to New Deal • Congressional protest forced retreat – even Democrats against “packing” the Court • FDR’s opponents emboldened America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The New Deal in Decline 1936: Cutbacks for relief agencies 1937: Severe slump hit economy Roosevelt blamed Programs require massive spending that could not be sustained • Some feel FDR was too conservative and should have spent more • 1938: Republican party revived • • America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.

The New Deal and American Life • Overall New Deal – Slow and halting • New Deal’s limitations: – – – Depression not ended Economic system not fundamentally altered Little done for those without political clout • Achievements: – – – Wagner Act helped labor Political realignment of the 1930 s Most important was Social Security Act America: Past and Present, Ninth Edition Divine • Breen • Frederickson • Williams • Gross • Brands Copyright © 2011, © 2007, © 2006 by Pearson Education, Inc. All rights reserved.