AP/IB American History
Mr. Blackmon
Franklin Delano Roosevelt and the New Deal
I.
The Election of 1932
A.
The Republicans unenthusiastically renominate Herbert Hoover
B.
The Democrats nominate Franklin Delano Roosevelt
1.
Cousin of Theodore Roosevelt
2.
Wealthy, patrician
3.
Served in the New York legislature
4.
Served as Assistant Secretary of the Navy during World War I
5.
Vice Presidential candidate in 1920
6.
A vigorous and effective campaigner, handsome, charming and articulate
7.
Stricken by poliomyelitis in 1921
a.
Henceforward was unable to stand without the aid of heavy steel
braces
b.
This great, enormously dynamic and forceful leader was actually a
cripple
8.
Re-entered politics in 1924, nominating Al Smith for President
9.
Governor of New York from 1928-1932
10.
Astutely won support from both the urban and rural wings of the party.
a.
Cultivated good relations with Tammany Hall and other machine
politicians.
b.
He also cultivated good relations with conservative rural
Democrats
11.
He was conservative economically, but believed in an active, positive,
and humane government.
12.
Had no clear-cut policy or ideas when he ran in 1932. Walter Lippman
wrote that he was "a pleasant man who, without any important
qualifications for the job, would very much like to be President."
13.
Making sense out of FDR can sometimes be maddening. I believe that the
single most essential point to bear in mind with him is that he is a
politician. He is not a moralist, a theorist, an idealist, or an economist. As
a politician, he instinctively wishes to build coalitions, to bring disparate
forces into harmony, to achieve practical solutions. As we shall see, he is
a pragmatist without any definite ideology.
C.
FDR as a Theorist
1.
Richard Hofstadter write in The Age of Reform, "the New Deal . . .
was a chaos of experimentation." (307)
2.
He continues, "[The New Deal] showed a strong and candid
awareness that what was happening was not so much moral
reformation as economic experimentation." (317)
"At the core of the New Deal then, was not a philosophy . . . but an
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 2
attitude, suitable for practical politicians, administrators, and technicians,
but uncongenial to the moralism that the Progressives had for the most
part shared with their opponents." (325)(emphasis added)
3.
4.
5.
6.
D.
1.
2.
3.
4.
Eric Goldman in Rendezvous With Destiny writes, "Franklin
Roosevelt was the most complete devotee of playing by ear the
White House had ever known. Restless and mercurial in his
thinking, a connoisseur of theories, but impatient with people who
took theories too seriously, he trusted no system except the
system of endless experimentation." (emphasis added) (251)
Dexter Perkins in The New Age of Franklin Roosevelt adds, "The
absence of a coherent political philosophy and the contradictions in
policy of the Roosevelt administration may be unfavorably
judged." (79)
Speech at Oglethorpe University: "The country needs bold,
persistent experimentation. It is common sense to take a
method and try it. If it fails, admit it frankly and try another.
But above all, try something." (emphasis added)
Commonwealth Club (San Francisco) Speech: "Government
owes to everyone an avenue to possess himself of a portion of
that plenty sufficient for his needs, through his own work."
(emphasis added)
a.
Government must "assist the development of an economic,
constitutional order"--economic planning.
b.
The government should do whatever necessary to protect
the unfortunate and to advance the public good.
Roosevelt as a Campaigner
He radiated confidence, a stark contrast with Hoover
He broke tradition by flying to Chicago to accept the nomination
personally.
"Let it be symbolic that I broke traditions. Republican leaders
not only have failed in material things, they have failed in
national vision, because in disaster they have held out no hope.
I pledge you, I pledge myself, to a new deal for the American
people."
a.
I believe that FDR has expressed a profound truth in
political leadership. Truly great leaders must have some
vision for the nation and the future, and must effectively
communicate that vision. This is particularly important in a
democracy. Man does not live by bread alone.
Had deep sympathy "for the forgotten man at the bottom of the
economic pyramid."
AP/IB American History
New Deal Lecture
5.
E.
II.
A.
B.
C.
Mr. Blackmon
Page 3
Leadership is an amalgam, both expressing and molding public
opinion: "I have looked into the faces of thousands of
Americans. They have the frightened look of lost children.
They are saying 'We're caught in something we don't
understand. Perhaps this fellow can help us out."
6.
Tried to please everyone in the campaign as much as possible
a.
Ex. on the balanced budget,
(1)
He attacked Hoover for having the "greatest
spending administration in peace time in our
history," and called for sharp reductions in federal
spending and a balanced budget.
(2)
"If starvation and dire need on the part of any of
our citizens make necessary the appropriation of
additional funds which would keep the budget out
of balance, I shall not hesitate to ask Congress to
authorize the expenditure of that additional
amount."
The Campaign
1.
Hoover claimed FDR's policies "would destroy the very
foundations of our American cities" and predicted that, if he were
elected "grass will grow in the streets of a hundred cities, a
thousand towns."
2.
FDR argued that the crisis was domestic, not European, and thus
was controllable.
3.
Despite the suffering, the radicals were rejected
a.
The Socialists polled only 2.2% of the vote
b.
The Communists polled 8 times less than the Socialists.
(1)
Hardly anything points out more vividly the deep
commitment of all Americans to capitalism and
private property
4.
The Democrats crush the Republicans with 57% of the vote, and a
472-59 margin in the Electoral College
5.
In addition, the Democrats won large majorities in both houses of
Congress.
Interregnum
There is a four month gap between election and inauguration
Hoover, during a growing crisis in 1932-33, tried to get FDR to affirm the
sanctity of the gold standard, believing that uncertainty over the policies of
the new administration would cause instability.
The banking system collapses in February.
1.
The governor of Michigan declares a "bank holiday" and closes the
doors of state banks
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 4
2.
D.
E.
III.
A.
Other states follow suit.
Hoover writes to FDR: "The problem was a result of 'steadily
degenerating confidence' in the incoming administration. The only way to
restore calm, he insisted, was for Roosevelt to give prompt public
assurances that there would be no tinkering with the currency, no heavy
borrowing, no unbalancing of the budget. 'I realize,' he wrote a Republican
senator at the time, 'that if these declarations be made by the presidentelect, he will have ratified the whole major program of the Republican
Administration.'" (Current *)
1.
Not surprisingly, FDR refused to comply.
Inaugural Day, March 4, 1933
1.
Hoover's point of view: "We are at the end of our rope. There is
nothing more we can do."
a.
A day of deep personal bitterness for Hoover.
The Hundred Days
FDR's inaugural address
1.
FDR projected optimism, strength, and confidence
a.
His magnetism so won over the reporters that he was never
photographed being lifted in or out of his chair or being
wheeled.
2.
"This great Nation will endure as it has endured, will revive and
will prosper. So, first of all, let me assert my firm belief that the
only thing we have to fear is fear itself, nameless, unreasoning,
unjustified terror which paralyzes needed efforts to convert
retreat into advance. . . .
Plenty is at our doorstep, but a generous use of it languishes in the
very sight of the supply. Primarily this is because the rulers of the
exchange of mankind's goods have failed, through their own
stubbornness and their own incompetence, have admitted their failure,
and abdicated. . . .
They know only the rules of a generation of self-seekers. They have no
vision, and when there is no vision, the people perish. Happiness lies
not in the mere possession of money; it lies in the joy of achievement,
in the thrill of creative effort . . . These dark days will be worth all they
cost us if they teach us that our true destiny is not to be ministered
unto but to minister to ourselves and to our fellowmen.
This nation asks for action, and for action now.
We do not distrust the future of essential democracy. The people of the
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 5
United States have not failed. In their need they have registered a
mandate that they want direct, vigorous action. They have asked for
discipline and direction under leadership. They have made me the
present instrument of their wishes. In the spirit of that gift, I take it.
3.
B.
1.
2.
C.
1.
2.
3.
4.
5.
6.
7.
The implication, as Hofstadter notes, is that government is not
just a negative power (challenging inequities and special
privilege) but is a positive force, taking active responsibility for
the welfare of American citizens.
The Hundred Days involved a special session of Congress from March 9
to June 16
A whirlwind of legislation
No comprehensive plan
National Bank Holiday March 5
Embargo on the export of gold
Solvent banks would be allowed to reopen
Insolvent banks were reorganized and absorbed (about 2,000) all
told
Congress ratified these acts by passing his bills in 8 hours from
start to finish
Confidence was restored in banks and $2,000,000,000 in hoarded
dollars flowed back into financial system
Bank failures after 1933 sharply reduced
Money problem--a distinct breach with the past
a.
FDR never committed to a dollar with a specific gold
content
b.
FDR preferred to balance the budget, but was not
doctrinaire
c.
Tide of public opinion was for a departure from gold
standard orthodoxy
d.
Clamor for an inflationary policy in 1933
(1)
cf the silver campaign in 1896 for a similar clamor
(2)
The decline of prices had been catastrophic
e.
FDR's budget director Lew Douglas opposed him on taking
the country off the gold standard, saying "It is the end of
Western civilization."
f.
FDR was advised to do so by head of the Farm Credit
Administration Henry Morgenthau, later Secretary of the
Treasury.
g.
FDR was not an inflationist at heart: "I have always
favored sound money, and do now, but it is too damned
sound when it takes so much of farm products to buy a
AP/IB American History
New Deal Lecture
dollar."
The Thomas Amendment to the Agricultural Adjustment
Act of 1933 authorized FDR
(1)
To coin silver at 16:1
(2)
To issue paper money
(3)
To change the gold content of the dollar
i.
FDR chose by far most desirable course by taking the U.S.
off the gold standard
(1)
Great Britain went off the gold standard in 1931
without a disaster
(2)
Silver made no sense economically
(3)
Paper was viewed with hostility
(4)
Orthodox business interests were shocked
(5)
FDR hoped that going off the gold standard would
raise prices and stimulate foreign trade
(6)
His policy was neither as successful as he had
hoped nor as disastrous as his opponents feared.
j.
FDR embarked on a gold purchase program to raise
commodity prices. It failed but allowed FDR to control
monetary policy in the face of pressure from inflationists
and bankers.
(1)
In 1934, he abandoned the effort and stabilized the
dollar at $35/oz of gold with the Gold Reserve Act.
(2)
The Gold Act of 1934 empowered the Treasury to
manage value of the dollar abroad and conditions of
credit at home.
k.
The fiscal policies of 1933-34 shifts financial center of the
nation from Wall Street to Washington. This is a very
important as well as a permanent shift of power. The
relationship between the public and private sectors will
never again be quite the same.
Glass-Steagall Act of 1933
Creates the Federal Deposit Insurance Corporation (FDIC) to
guarantee deposits
Commercial and investment banking divorced (a source of
previous embarrassment to say the least).
Federal Reserve is reorganized to increase power over credit.
The first two powers make this a truly critical piece of legislation.
Home Owners' Loan Corporation
Similar to Hoover's Home Loan Banks on a broader basis.
Refinanced 1/6 of the mortgages in the nation
Served the interests of mortgagor and mortgagee: families get to
h.
D.
1.
2.
3.
4.
E.
1.
2.
3.
Mr. Blackmon
Page 6
AP/IB American History
New Deal Lecture
4.
F.
1.
2.
3.
G.
1.
2.
3.
4.
5.
H.
1.
2.
I.
1.
2.
J.
Mr. Blackmon
Page 7
keep their homes and banks do not get stuck with an empty
building that they cannot sell.
Designed to reduce human misery as well as to help the banks.
Truth in Securities Act
Stock promoters must make full disclosures (imagine that! Stock
brokers are now expected to tell the truth to clients!!! Rampant
liberalism! I say, "Caveat emptor!")
a.
Federal Trade Commission has a right to regulate stock
transactions.
b.
This power transferred to the Securities and Exchange
Commission (SEC) in 1934.
Note the decline of the financial establishment. Financiers could
have blocked such legislation earlier, but now can barely obtain a
hearing.
Criminal trials of prominent Wall Street leaders, like Richard
Whitney, the head of the New York Stock Exchange, for larceny
and fraud, erode the authority which businessmen wield.
Economy Act of 1933 (an example of FDR's conservatism)
Designed to balance the budget
Cut government salaries
Cut veterans' benefits by 15%
Saved about $300 million
Bill reveals that at heart FDR was a fiscal conservative
Amendment to the Volstead Act to allow the sale of beer with a 3.2%
alcohol content as a prelude to the passage of the XXI Amendment, which
repealed the XVIII Amendment (Prohibition).
Now you know why Democrats sang "Happy Days Are Here
Again!"
Note: FDR has just defeated two very powerful lobby groups:
veterans and the Prohibitionists
The Civilian Conservation Corps--one of most positive New Deal
programs
Recruited young men between 18-25 years of age to work on
conservation projects to help prevent or alleviate a Dust Bowl and
also provide income for these families.
Among other things, they planted a "shelter belt" of trees along the
100th meridian. The loss of topsoil and flooding as the result of
deforestation of hillsides along major rivers had become a very
serious problem indeed. We have lost a colossal quantity of
amazingly fertile soil due to our waste and carelessness. The CCC
tries to address this on a large scale.
Farm Credit Administration
AP/IB American History
New Deal Lecture
1.
IV.
A.
B.
C.
D.
Mr. Blackmon
Page 8
Very similar to the HOLC except that it serves a different
constituency.
2.
Protected farms and homes from foreclosure.
National Industrial Recovery Act (NIRA): this is part of the 100 Days, but it is
so important that I have set it off separately.
Perhaps the most ambitious project of the New Deal
FDR called it "the most important and far reaching legislation ever enacted
by the American Congress."
Represents a merger of the Associational ideas of the U.S. Chamber of
Commerce and Hoover's legacy with TR's New Nationalist thinking.
1.
Product of the Brain Trust
a.
Advocates included Raymond Moley, Rexford Guy
Tugwell, and Hugh Johnson
2.
The NIRA has very little of the trust busting of the New Freedom.
3.
Like Sesame Street (which is, as everyone knows, a Commie front
organization to undermine the rugged individualism of our
defenseless children and turn them into Marxist/atheist zombies)
the NIRA tries to replace competition in American society with
cooperation.
4.
Businessmen hailed the NIRA as a new era of cooperation between
government and industry.
5.
Labor unions hailed the NIRA as a Magna Carta for labor.
6.
Demonstrates FDR's desire to knit together all segments of society
in cooperative work, and also to stave off truly radical legislation
from either the left or the right. FDR genuinely sees this as a
conservative measure in a profound sense: conserving the
essentials of capitalism.
7.
Represents the "New Nationalism" phase of the New Deal.
8.
Its compulsory aspects were attacked by Herbert Hoover, who
simply could not accept compulsory government controls.
9.
Similar to experiments conducted at the same time by Benito
Mussolini and Adolf Hitler.
The National Recovery Administration (NRA) is set up by the NIRA, and
headed by Hugh Johnson. It is symbolized by the Blue Eagle ("We Do
Our Part").
1.
"Essentially, what the advocates of the NIRA proposed was a
restoration of orderly methods and agreements to restrict
competition and to fix the conditions of labor and of sales prices in
industry. The project was a very far reaching one; it was a wide
departure from the notion of a free economy; it suggested what the
Europeans described as cartelization." (Perkins 16)
2.
"Blanket Codes" were developed for industry which defined fair
AP/IB American History
New Deal Lecture
3.
4.
5.
a.
b.
c.
6.
a.
b.
c.
d.
7.
8.
a.
b.
c.
d.
e.
f.
g.
Mr. Blackmon
Page 9
business practices.
Specific codes were then written for specific industries.
Anti-trust laws were suspended for business groups formed under
this law.
Some important Progressive reforms are enacted under the NRA
A minimum wage of $ .30- .40 / hr is set
A maximum work week of 35-40 hours is set
Child labor is abolished.
Section 7-A
Provided legal protection to the right of workers to form
unions and engage in collective bargaining; the CIO will
argue that the President wanted workers to form unions.
Unions must be formed by the free choice of workers, and
not be management sponsored.
Committed management to bargain with unions.
Section 7-A, which is later repassed as the Wagner Act, is
the most important piece of labor legislation ever passed.
FDR did more for the ordinary industrial worker than all
other Presidents combined.
Pause, if you will, and reflect on the groups within the nation
whom FDR has served already: homeowners (HOLC); farmers
(FCA); all bank depositors (Glass-Steagall and FDIC); investors
(SEC); management (NRA); labor (7-A); urban dwellers (repeal of
Prohibition); conservationists and farmers and poor families
(CCC). Do you find it at all surprising that FDR wins reelection?????
Weaknesses of the NRA:
The codes, in practice, were dominated by the principal
figures in each industry and were often just re-written New
Era Trade Association codes in the same way that the
Black Codes were just modified slave codes.
The codes favored large businesses and protected marginal
businesses.
The codes provided for de facto price fixing, often at a rate
higher than necessary for a reasonable profit.
The codes decreased the probability for new investment,
which would have stimulated the economy.
Hugh Johnson proved to be slow to prosecute violators of
the codes
Wages did not rise as quickly as prices since many
employers wanted a quid pro quo for 7-A
The Recovery Review Board, headed by Clarence Darrow
AP/IB American History
New Deal Lecture
E.
V.
A.
B.
C.
Mr. Blackmon
Page 10
in 1934 concluded, "[I]n virtually all the codes, we have
examined, one condition has been persistent. . . . In Industry
after Industry, the larger units, sometimes through the
agency of what is called an Institute [a trade association] . .
. have for their own advantage written the codes, and then,
in effect and for their own advantage, assumed the
administration of the code they have framed. To deliver
industry into the hands of its greatest and most ruthless
units when the protection of the anti-trust laws had been
withdrawn was a grave error. It may safely be said that not
in many years have monopolistic tendencies in industry
been so forwarded and strengthened." (Goldman 270)
The NIRA also creates the Public Works Administration (PWA) which is
not to be confused with the WPA (easier said than done).
1.
Headed by Harold Ickes and was authorized to spend $3.3 billion
on public works
2.
Specialized on heavy, durable projects such as dams, bridges, and
irrigation projects.
3.
The PWA is de facto Keynesian economics, from John Maynard
Keynes, a British economist who is the most important man in his
field in the first half of the 20th century. Government spending put
money in the pocket of consumers, who could then spend it, and
thus stimulate the economy.
4.
The PWA is not engaged in "make work" projects, like raking
leaves.
5.
Ickes proves to be cautious in spending the money. Ironically, this
means that the PWA does not stimulate the economy as much as it
should or could have. FDR will not fire him, but he will create an
overlapping federal agency.
6.
FDR was on the way to abandoning the NRA when the Supreme
Court struck it down. His disillusionment with the NRA marks a
shift from his "New Nationalism" stage on to the "Second New
Deal," or his "New Freedom" stage.
Agricultural Adjustment Act of 1933 (AAA): this is also part of the 100 Days,
but it is so important that I have set it off separately as well.
This is, at last, a serious attempt to deal with the fundamental problems
that farmers face.
The objective was to increase farm income by controlling production.
1.
The means of controlling production was to make benefit payments
to farmers who limited production according to a national plan; in
other words, pay farmers not to grow crops.
The payment program was financed by processing taxes collected at flour
AP/IB American History
New Deal Lecture
D.
E.
F.
G.
H.
I.
J.
K.
L.
M.
VI.
A.
B.
C.
Mr. Blackmon
Page 11
mills, packing houses or processing plants; that is, the consumer paid for
the program.
No plan would take effect until a majority of farmers accepted it.
Administration was to be local as much as possible.
The price level sought was the purchasing power of farm products as of
1909-1914--the "parity" benchmark--when farm prices were relatively at
their highest.
Act gave authority to grant loans on non-perishable crops which then went
into government storage (the old Populist subtreasury plan now put into
action).
The act also authorized the federal government to build up a surplus or
reserve for lean years, sort of like Pharaoh preparing for the 7 lean years-Henry Wallace called it the "ever normal granary."
The act authorized the President to issue greenbacks, remonetize silver, or
alter the gold content of the dollar (the Thomas Amendment; cf above).
Since crops were already in the ground when the bill was passed, 10
million acres of cotton was plowed under and 6,000,000 pigs and 220,000
pregnant sows slaughtered
1.
Some people were appalled at such ruthlessness when hunger was
a reality in the U.S. The New Dealers replied (correctly) that the
problem was not the supply of food but the method of distribution.
a.
100,000,000 lbs of pork was thus provided to feed the
hungry.
The logic of scarcity worked--prices rose from 55% of parity in 1932 to
90% of parity in 1936
Chief beneficiaries were commercial farmers, owners of large holdings
and the recipients of disproportionate benefits (who also tended to be the
local farmers who dominated the administration of the program).
Chief weakness: AAA did nothing at all for small farmers or
sharecroppers, who of course were most desperate. In fact, many
sharecroppers lost their already miserable livelihood when landlords chose
their land to be taken out of production.
Tennessee Valley Authority (TVA)
Also part of the 100 Days, also of tremendous importance as well as
complexity.
Proposal first made during World War I to build an electric generation
plant at Muscle Shoals, Tennessee.
Sen. George Norris of Neb. wanted the site run by the government (it was
government property) and blocked attempts to give the plant to private
interests.
1.
The idea of a government project was argued by Norris throughout
the Twenties and opposed by the Republicans.
AP/IB American History
New Deal Lecture
2.
D.
E.
F.
G.
H.
VII.
A.
B.
Mr. Blackmon
Page 12
FDR supported the program wholeheartedly, while cheerfully
admitting that TVA was indeed socialism (government ownership
of the chief means of production).
FDR called for "a corporation clothed with the power of government but
possessed of the flexibility and initiative of a private enterprise" which
was charged with "national planning for a complete river watershed."
TVA completed the Muscle Shoals dam for a hydroelectric plant
TVA undertook redevelopment of the entire region
1.
Produced power at cheaper rates, which then became a yardstick
for the actual cost of electrical power generation; that in turn
forced power rates nationally to drop in order to reflect actual costs
plus a reasonable profit instead of the unrestrained price gouging
which had heretofore ruled. It was realized after the fact that an
important source of private business opposition to TVA is that
it revealed the extent of their greed and cupidity.
2.
TVA built 20 dams
3.
TVA built an extensive inland waterway that came to be heavily
used, which stimulates long-term economic growth in a deeply
depressed region of the U.S.
4.
Flood control programs are part of the dams and canals as well as
power generation (after the summer of '93, we will not soon forget
the potential for damage of heavy floods along our great inland
waterway system)
5.
Major reforestation programs were started (which, among other
things, helps prevent soil erosion and provides flood control)
6.
Electric generation, economic stimulus, and conservation are
obviously enormous benefits to the entire region. the Tennessee
River crosses state boundaries, only the federal government could
have undertaken such a project
Program administered by David Lilienthal
TVA was not perfect
1.
Lilienthal's "grass roots democracy" was for whites only. TVA
was one of the few New Deal programs which excluded Black
Americans. The cause lies in the administrator, in this case
Lilienthal.
2.
Nevertheless, TVA was recognized as an extremely successful
program that raised the standard of living throughout the region.
The New Deal Spirit
FDR attracted many young, capable men into government service.
Gains for women
1.
Eleonor Roosevelt was very prominent; indeed, she must be
regarded as the greatest of all First Ladies.
AP/IB American History
New Deal Lecture
a.
2.
3.
4.
C.
1.
2.
3.
4.
5.
D.
1.
2.
3.
4.
Mr. Blackmon
Page 13
She regarded herself as FDR's conscience. FDR is a
political animal to the point of amorality. Eleonor provides
a brake to that tendency.
b.
She gave special attention to the problem of Black
Americans.
Molly Dewson of the Democratic National Committee was quite
influential
Frances Perkins, with a distinguished Progressive pedigree,
became the first woman named to a cabinet position, where she
proved to be an exceptionally able Secretary of Labor during a
critical period for organized labor.
In general, women are named to more posts and gain more party
influence.
"The New Deal lacked any consistent ideological base." (Garraty 661)
FDR detested rigid theorists
Populist roots
a.
antipathy to bankers
b.
willingness to allow inflation
New Nationalist roots
a.
NRA and de-emphasis of anti-trust laws
New Freedom roots
a.
monetary reform
World War I
a.
labor policy grows out of the War Labor Board
The Brain Trust
Actually several groups rather than just one group. Different
groups are prominent at different times.
Brain Trust proper includes Raymond Moley, Rexford Guy
Tugwell, Hugh Johnson, Gardiner Means, and Adolf Berle.
a.
All but Johnson were university professors or economists
Berle and Means write The Modern Corporation and Private
Property: "The trend toward economic concentration, they
contended, was irreversible. Already, it had transformed great
parts of the old free market of classical economics into
'administered' markets, in which basic economic decisions were
made, not by equations of supply and demand, but by the policies
of those who ran the great corporations. In Berle and Means'
opinion, this change in the structure of the market rendered
classical laissez-faire theory obsolete." (Blum 672) (emphasis
added)
If concentration was inevitable, Tugwell argued, then control over
the nation's economic life could not be safely left in private hands."
AP/IB American History
New Deal Lecture
a.
VIII.
A.
B.
Mr. Blackmon
Page 14
This group are heirs of the New Nationalism
5.
The New Freedom wing.
a.
Becomes more prominent after 1936 after the death of the
NRA
b.
Included Louis D. Brandeis, Felix Frankfurter, Harold
Ickes, and Harry Hopkins.
c.
These men rejected the thesis of inevitable concentration
and distrusted central planning (I know this looks odd from
Hopkins and Ickes; neither man envisioned a command
economy, however. Hopkins is a compassionate
Keynesian; the sign on his desk encapsulated his
philosophy: "Hunger is not debatable."
6.
Even conservatives like Budget Director Lew Douglas, who was
committed to the gold standard and a balanced budget found a
place in the New Deal.
7.
Special interest groups become prominent--William Leuchtenberg
called it "interest group democracy." This is the best description
of modern U.S. practice that I know of.
a.
While this is not ideal, since unorganized groups are
slighted, it was superior to predecessors, who allowed only
one interest group--big business--to dominate. People
assumed that FDR's objective was to improve everyone's
lot.
The Unemployed
In 1934, the unemployed still numbered 9,000,000.
1.
Yet the elections of 1934 increased the Democratic majorities in
Congress (contrary to the usual result in off-year elections which
cost the incumbent party seats.)
Federal Emergency Relief Administration (FERA)
1.
Run by Harry Hopkins, who really became the most important
man of the New Deal. He was a charismatic bureaucrat, who
insisted on getting things done quickly and getting them done
honestly. His own life style was rather Spartan, and he regularly
worked 18 hour days. Before the New Deal was over, he had 2/3
of his stomach removed for cancer, and had great difficulty
obtaining sufficient nourishment from his food to stay alive. When
World War II began, he became FDRs roving eyes and ears, and he
presided over Lend-Lease and US mobilization for war. He spent
money like water, but there are no major scandals involving money
in any program that he administered--a record perhaps without
equal; certainly rare.
2.
Given $500 million in immediate grants to state relief
AP/IB American History
New Deal Lecture
3.
C.
D.
IX.
A.
B.
Mr. Blackmon
Page 15
Hopkins recognized the need to spend it fast, unlike Ickes in the
PWA
4.
Hopkins worked toward providing jobs (even if he had to make the
job up)rather than just hand-outs. He opposed direct relief except
as a last resort. A job reaffirmed the self-respect of the recipient,
and also improved the community in some way.
The Civil Works Administration (CWA)
1.
Hopkins the fireman again
2.
Spent $1 billion in 5 months on roads, bridges, etc.
3.
FDR was frightened at that level of spending and abolishes the
CWA
The Works Progress Administration (WPA) 1935
1.
Harry Hopkins again
2.
Represented a movement away from central planning
3.
Reflected FDR's growing disenchantment with the NRA, which
was invalidated by the Court anyway.
4.
From 1935-43, the WPA spent $11 billion and gave jobs to 8.5
million.
5.
Specialized in light public works (in contrast to the WPA), such as
building schools, repairing roads, building airports, improving
parks and waterways, and sponsoring artists, theater, music, and
literature
a.
Sponsorship of artists is remarkably farsighted and liberal
and was conducted with very little censorship of content.
Americans' exposure to culture significantly increased, and
thousands of artists were able to make a living. The social
imagination of the WPA revealed here is remarkable.
6.
The WPA had limited success nevertheless
a.
Until World War II, unemployment remained 10% or more
b.
FDR feared unbalancing the budget drastically and never
went quite far enough to end unemployment. The
recession of 1937 was caused by FDR's cutting back on
government spending as the result of modest recovery.
Massive government spending during World War II
ended unemployment.
The Extremists
FDR's program arouses critics from the left and the right.
Business groups hated FDR with a ferocity perhaps unmatched in U.S.
political history. Gradually, FDR came to welcome their animosity. The
following is a sample of his defense, delivered in Chicago on October 14,
1936
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 16
"Tonight, in this center of business, I give [a] message to the businessmen
of America-". . . Do you have a deposit? It is safer today than it has ever been in our
history. . . . Are you an investor? Your stocks and bonds are up. . . . . Are
you a merchant? Your markets have the precious lifeblood of purchasing
power. . . . Are you in industry? Industrial earnings . . . are the highest in
four, six, or even seven years. . . .
"Behind the growing recovery of today is a story of deliberate government
acceptance of responsibility to save business, to save the American system
of private enterprise and economic democracy. . . . What had the previous
administration in Washington done for four years? Nothing. . . . It was
finance-minded--manned and controlled by a handful of men who in turn
controlled, and by one financial device or another took their toll, from the
greater part of all other business and industry. . . .I am speaking about a
minority which . . . says that popular government cannot be trusted and,
therefore, that the control of business of all kinds and, indeed, of
government itself, should be vested in the hands of 100 or 200 all-wise
individuals controlling the purse strings of the nation. . . .
"All that this administration has done . . . is to use every power and
authority of the federal government to protect the commerce of America
from the selfish forces which ruined it.
"Always, month in and month out, during three and a half years, your
government has had but one sign on its desk--'Seek only the greater good
of the greater number of Americans.' And in appraising the record,
remember two things. First, this administration was called upon to act
after a previous administration and all the combined forces of private
enterprise had failed. Secondly, in spite of all the demand for speed, the
complexity of the problem, and all the vast sums of money involved, we
have had no Teapot Dome. . . .
"Because we cherished our system of private property and free enterprise
and were determined to preserve it as the foundation of our traditional
American system, we recalled the warning of Thomas Jefferson that
'widespread poverty and concentrated wealth cannot long endure side by
side in a democracy.'
"Our job was preserve the American ideal of economic as well as political
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 17
democracy against the abuse of concentration of economic power that had
been insidiously growing up among us in the past fifty years, particularly
during the twelve years of the preceding administrations.
"I believe, I have always believed, and I will always believe in private
enterprise as the backbone of economic well-being in the United States. . .
.
"It was this administration which saved the system of private profit and
free enterprise after it had been dragged to the brink of ruin by these same
leaders who now try to scare you. . . .
"The struggle against private monopoly is a struggle for, and not against,
American business. It is a struggle to preserve individual enterprise and
economic freedom.
"I believe in individualism. I believe in it in the arts, the sciences, and
professions. I believe in it in business. I believe in individualism in all of
these things--up to the point where the individualist starts to operate at the
expense of society. The overwhelming majority of American businessmen
do not believe in it beyond that point. We have all suffered in the past
from individualism run wild. Society has suffered and business has
suffered. . . .
"The people of America have no quarrel with business. They insist only
that the power of concentrated wealth shall not be abused.
"We have come through a hard struggle to preserve democracy in America.
Where other nations in other parts of the world have lost that fight, we
have won." (Roosevelt 379-83)
1.
Note FDR's insistence that he is preserving traditional American values.
"I am that kind of a liberal because I am that kind of conservative."
There is great continuity to American political traditions.
2.
Another example is FDRs defense of his policies against the criticism of
the conservatives:
a.
"In the summer of 1933, a nice old gentleman wearing a silk hat
fell off the end of a pier. He was unable to swim. A friend ran
down the pier, dived overboard, and pulled him out; but the silk hat
floated off with the tide. After the old gentleman had been revived,
he was effusive in his thanks. He praised his friend for saving his
life. Today, three years later, the old gentleman is berating his
AP/IB American History
New Deal Lecture
3.
C.
1.
2.
3.
4.
5.
D.
1.
2.
3.
4.
5.
6.
E.
1.
Mr. Blackmon
Page 18
friend because the silk hat was lost"
There is a stylistic note. This is a very effective campaign speech.
He adopts a different tone, more intimate and chatty, for the
Fireside Chats, where FDR pioneered the use of new means of
mass communication (radio in this instance) to reach the people.
In formal speeches, he can be almost as eloquent as even Churchill.
In total, the range of communication styles is enormous. One of
the measures of a great political leader is the ability to
communicate his vision to his nation. Bill Moyers draws a parallel
in this respect (in part) between FDR and Hitler, both of whom
reach power in the same year. As the leader of a democracy, FDR's
communication challenge is far greater than Hitler's. Of American
presidents, only Lincoln exceeds FDR in the gift of
communication.
Father Charles E. Coughlin, the "Radio Priest"
Originally supported FDR
Broke over FDR's "failure" to deal harshly enough with "money
powers."
Stands in the Populist tradition of inflation
a.
Called for the remonetization of silver, issuance of
greenbacks, and nationalization of banks.
Founded the National Union for Social Justice in 1935
Uses the radio for constant and bitter attacks against FDR.
Dr. Francis E. Townsend
An elderly California physician
Proposes the Townsend Plan for "Old Age Revolving Pensions."
a.
Every American over 60 would receive $200/month
provided that he/she quit any job (freeing it for someone
else) and spent it all within the month (thus circulating
currency)
A transaction tax would pay for the program.
The cost would have been $24 billion/yr, or 50% of national
income.
The Townsendite magazine reached a circulation of 200,000
While his plan is utopian, Townsend is the first to focus attention
to the plight of the elderly in an urban society where a greater and
greater percentage of the population is getting older.
Sen. Huey "Kingfish" Long of Louisiana
I personally find Long to be very interesting in that he defies
simple categorization. I was raised to regard him as a demagogue,
a crook, and a tyrant (all of which is true); he has other sides to him
as well.
AP/IB American History
New Deal Lecture
2.
3.
a.
4.
5.
6.
a.
7.
a.
b.
c.
8.
a.
9.
Mr. Blackmon
Page 19
By 1933, Long ruled Louisiana with an iron fist. He was a dictator
who enjoyed overwhelming popular support.
He is a Southern demagogue in the Populist tradition (which goes
back at least to Tom Watson and Pitchfork Ben Tillman, and ended
[I hope] with George Wallace.
To give the devil his due, Long has some solid
achievements. He is driven by egotism and compassion--an
uneasy mixture.
He came to power by furiously assailing the banks, oil companies,
and utilities along with the arch-conservative Bourbon Democratic
oligarchy which supported them. Louisiana has a long history of
serious state corruption, and the Bourbon Democrats are pretty
seriously corrupt. Long is corrupt also. But the Bourbon
Democrats, using that old stand-by, racial baiting, protect a
government for the few at the expense of the many.
Long built schools, roads, hospitals, revised the tax code, lowered
utility rates.
He assisted poor people, all poor people--also a Populist trait
Long did not question white supremacy or segregation, but
he conspicuously did not engage in racial baiting, nor did
he exclude poor Black Americans from his programs. He
repeatedly stated that all poor people, white or black,
should have a chance to earn a living.
(1)
Since Louisiana did not permit Black Americans to
vote, this is not a ploy to garner votes.
Long is very flamboyant
Accused of violating the constitution, Long says, "I am the
constitution here." (shades of "L'etat, c'est moi!")
"I'm for the poor man--all poor men, black or white, they
all gotta have a chance. 'Every man a king,' that's my
slogan." g, always a king, but once a knight is enough."
When the leader of the Ku Klux Klan announced he would
go to Louisiana to campaign against Long, he replied with
(this is one of my two favorite insults), "Quote me as
saying that that Imperial bastard will never set foot in
Louisiana, and when I call him a sonofabitch, I am not
using profanity, but am referring to the circumstances of
his birth."
Early supporter of the New Deal
Broke with FDR in 6 months, calling him a "stooge for
Wall Street." (!!!)
"Share Our Wealth" movement
AP/IB American History
New Deal Lecture
a.
b.
c.
F.
G.
X.
A.
Mr. Blackmon
Page 20
4.6 million followers by 1935
Planned to use it as a springboard to the White House.
The Depression could be ended by confiscating via taxation
all income over $1 million and all capital accumulation and
inheritances over $5 million.
d.
This money would be used to guarantee every family a
homestead of $5,000 and a minimum wage of $2,500
10.
His popularity was so formidable that the Democratic National
Committee believed he could command 10% of the vote as a Third
Party candidate. They were seriously worried.
11.
His drive for the White House was ended when he was
assassinated in 1935
a.
While controversy and speculation swirl around his death,
and probably always will (his assailant did not testify owing
to the inconvenience of numerous gunshot wounds from
some highly embarrassed body guards), present evidence
supports the conclusion that Long was assassinated by one
man acting alone for purely personal reasons (Long had
insulted his wife by suggesting that she had Negro
ancestry).
All three appealed to the same audience, "baffled and disoriented members
of the lower middle-class who were seeking attention and protection."
(Blum 681)
1.
Dissident politics posed a very real threat to established political
parties
2.
Advisers warned FDR that he needed something bold and dramatic
to insure victory in 1936.
FDR's shift
1.
Brandeis-Frankfurter group urged FDR to abandon NRA and stress
restoring competition and to tax corporations more heavily.
2.
FDR learns in the NRA period that corporation executives could be
very unsatisfactory partners. (Goldman *)
3.
Between 1936-38, FDR becomes convinced that the New Deal was
threatened by selfish and shortsighted big capital. (Goldman 285)
4.
Decision was pushed by Schechter v. U.S. (1935) which declared
the NIRA unconstitutional on the grounds that Congress could not
delegate power to the President to make the codes legally binding.
The Second New Deal
Reasons
1.
Depression had not ended
2.
Extremists threatened FDR's support
3.
Conservatives were hostile
AP/IB American History
New Deal Lecture
4.
B.
1.
2.
3.
C.
1.
2.
D.
1.
2.
3.
4.
E.
1.
F.
1.
2.
3.
4.
Mr. Blackmon
Page 21
Court had struck down NIRA
Court actions
Invalidated a federal pension provision for RR workers by a 5-4
decision in 1935
"Black Monday" 5/27/35
a.
killed a farm mortgage relief act
b.
challenged FDR's removal of an officer on the FTC for
political incompatibility
c.
Schechter v. U.S. strikes down the NRA
All three decisions were unanimous
National Labor Relations Act--Wagner Act
Restored labor guarantees lost in NRA
The Wagner Act is 'in itself perhaps the most revolutionary single
measure in American labor history." (Degler 403)
a.
Replicated the language of Section 7-A of the NIRA
b.
Workers should be free to choose their own unions
c.
Required employers to accept duly constituted unions
d.
Creates the National Labor Relations Board (NLRB)
(1)
Supervises union elections
(2)
Hears complaints against employers
e.
Listed 5 "unfair" labor practices
f.
Virtually outlawed the company union.
Fair Labor Standards Act
Established minimum wage
Established maximum hours
Outlawed child labor
Repeats similar provisions of Section 7-A of NIRA
Acceptance by the unions of government assistance marks a departure
from American labor tradition, and from the European tradition. (Degler
403-5)
Another matter of difference is the advocacy of the closed shop by
Americans. The Wagner Act made it illegal to refuse to sign a
closed shop agreement. Europeans have looked upon a closed
shop as an infringement of a workers' right to join or not to join
any association he pleases.
Social Security Act of 1935
Old age insurance financed by a tax on wages and payrolls.
Provides a federal system of unemployment insurance
Did not cover agricultural workers, domestics, or self-employed
workers
It is the first step in what is the nation's most important program for
the elderly.
AP/IB American History
New Deal Lecture
5.
G.
H.
I.
J.
K.
XI.
A.
B.
Mr. Blackmon
Page 22
This may well be the most enduring legacy of the New Deal. To
put it bluntly, no President to date has had the guts to touch Social
Security.
Public Utility Holding Company Act
1.
Outlawed pyramiding of control of gas and electricity companies.
Included a "death sentence" clause which dismembered utility
complexes twice removed from actual operating companies.
a.
Most famous example was Samuel Insull who controlled
65 companies in 32 states.
Farm Security Act
1.
Helped tenants become landowners and tried to help migrant
workers.
Rural Electrification Administration
1.
Created by executive order
2.
Major impact on rural culture. The arrival of electricity (especially
radio) helps to bring rural areas more closely in harmony with
urban culture. (cf Degler)
Wealth Tax Act of August 1935
1.
So-called "soak the rich" tax
2.
Raised taxes on large incomes and corporations
3.
Well-to-do asked to bear a larger share of all government activities.
Evaluation of the Second Hundred Days
1.
Social Security has longer range effect than the NIRA, but was less
radical
2.
Arthur M. Schlesinger Jr. writes: "Where the first New Deal
contemplated government, business, and labor marching
hand in hand toward a brave new society, the Second New
Deal proposed to revitalized the tired old society. The First
New Deal characteristically told business what it must do.
The Second New Deal characteristically told business what it
must not do." (qtd in Garraty 666)
The Influence of John Maynard Keynes
Keynes pointed out that the economic system can be in perfect balance on
the bottom as well as at the top. The business cycle is less a pendulum as
an elevator
How can people save for future capital investment if no one has any
money?
1.
The economy satisfies demand, not wants or needs.
2.
Social misery is not effective in stimulating the economy
3.
The difficulty is not a moral problem but a technical one.
a.
An economy in depression might well stay there; there was
nothing inherent in the economic mechanism to pull it out.
AP/IB American History
New Deal Lecture
b.
XII.
A.
B.
Mr. Blackmon
Page 23
Prosperity depended on investment; for if business
spending for capital investment fell, the spiral of
contraction would begin.
c.
Investment was an undependable drive wheel for the
economy. Through no fault of the businessman, it was
constantly threatened with satiety, and satiety spelled
economic shrinkage.
4.
The solution was a deliberate undertaking of abnormal government
spending to stimulate the economy: "priming the pump."
a.
The peace time economy was not able to accept the idea of
all-out spending
b.
Government spending was meant to help business out but
was interpreted by business as a threat.
c.
FDR was attacked by fiscal conservatives as irresponsible.
The Election of 1936
Republicans named Alf Landon
1.
His platform was, essentially, that he could administer the New
Deal more efficiently than FDR could.
FDR wins easily
1.
Organized labor poured money and votes into his campaign
2.
Black Americans abandon the Republican Party
a.
A conjunction of the ballot and urban concentration gave
them real voting power
b.
Their traditional view was that of Frederick Douglass'
"The Republican Party is the ship. All else is the sea."
3.
FDR recognized Black Americans
a.
Eleanor Roosevelt pushed their interests hard
(1)
Example is her arranging for Marian Anderson to
give an Easter concert at the Lincoln Memorial after
the DAR had denied her the use of their auditorium
(the only one in Washington DC large enough).
75,000 came to hear her, and turned the concert into
the first modern civil rights demonstration.
(a)
In one sense, this was ironic. Anderson was
not an activist. She was an opera singer,
with a truly extraordinary voice--the kind
that comes along only once in a generation.
On the other hand, it is entirely appropriate
in that one of the world's greatest singers
was denied an opportunity to perform simply
because of her race. Her talent was
irrelevant to the DAR.
AP/IB American History
New Deal Lecture
b.
XIII.
A.
Mr. Blackmon
Page 24
The federal government used its powers to ease
discrimination
c.
FDR was basically sympathetic
(1)
He believed that other problems were more
pressing than civil rights and therefore did not
push the issue as hard as some have thought he
should.
(a)
When one considers that he had to deal with
the Great Depression and then World War II,
it is difficult to disagree with FDR on this
point.
(2)
As a practical politician, he tried to avoid losing
Southern support by becoming too identified with
the race issue.
(3)
He appointed Black Americans to second-level jobs
(a)
Development of a "Black Cabinet of
advisers," such as Robert Weaver, William
Hastie, Mary MacLeod Bethune.
(4)
Eleanor's close friends Ickes and Hopkins saw to it
that Blacks were not discriminated against by the
New Deal programs which they ran (although some
programs, like the CCC and TVA, did
discriminate). Simply not being discriminated
against was a big step forward for African
Americans.
4.
Farmers supported FDR
a.
When U.S. v. Butler declared the AAA unconstitutional,
FDR rushed the Soil Conservation and Domestic
Allotment Act to achieve the same goal by paying farmers
to divert land to soil building plants.
5.
The elderly supported FDR (Social Security)
6.
Home owners supported FDR (HOLC)
7.
FDR not only holds his lead, but increases his margin.
Roosevelt and the Court
Second Inaugural Address 1937
1.
A third of the nation was "ill-housed, ill-clad, ill-nourished."
2.
FDR saw the Court as blocking vital reforms
3.
Only Brandeis, Benjamin Cardozo, and Harlan Fiske were
sympathetic
4.
Chief Justice Charles Evans Hughes was more open minded
5.
Some key decisions, like Schechter, were unanimous
6.
FDR complained about a "horse and buggy" interpretation of the
AP/IB American History
New Deal Lecture
7.
B.
1.
2.
3.
4.
5.
6.
Mr. Blackmon
Page 25
Constitution
In 1937, he was convinced that all important Hundred Days
measures were doomed as court challenges worked their way up.
FDR and Court Packing
FDR proposes that the number of justices be increased under the
pretext of easing the work load.
Constitutionally, he was well within his rights, since Congress
determines the size of the Court, and FDR was proposing
legislation.
He had, however, skirted the issue during the election campaign.
Court packing is a major political error, which simply proves that
even great politicians can make serious political misjudgments.
a.
Conservatives opposed the measure on principle.
b.
Many liberal New Deal Democrats also oppose him. They
perceive clearly that the work load was a sham (the oldest
justice was Brandeis, a supporter) and that the real reason
was to secure his legislation. They are unwilling to tamper
with Constitutional liberties or with the structure of the
government.
c.
Public opinion turns against him.
FDR is defeated solidly by Congress.
a.
He suffers a permanent loss of prestige and power in
Congress.
b.
From here on, FDR will not enjoy virtually automatic
Congressional support for his policies, whether foreign or
domestic. Republican strength in Congress will grow
steadily. Also, conservative Democrats (usually Southern
Democrats) will become more intractable. Northeastern
liberal New Deal Democrats do not have that much in
common with Southern Democrats. One of the issues
that split the wings was, of course, civil rights. FDR
found himself increasingly in conflict with Southern
Democrats; even his political skills are not sufficient to
bridge the gap. This is the beginning of a long term trend
that will end in the defection of large numbers of Southern
Democrats to the Republican party by Nixon's terms.
Strom Thurmond and Jesse Helms began as Democrats;
they will end as the conservative wing of the Republican
Party. Neither man has changed much, if at all. The nation
has changed, and the Democratic Party has changed.
Ironically, the Court Packing issue does seem to turn the tide. The
Court seems to have become alarmed at legislative tampering if it
AP/IB American History
New Deal Lecture
XIV.
A.
B.
C.
Mr. Blackmon
Page 26
were too far out of line with the expressed will of the people. It
changes course.
a.
The minimum wage is upheld
b.
Social Security is upheld
c.
The Wagner Act is upheld.
7.
Conservative judges begin retiring--a natural process, since the
Court was rather old to begin with. FDR was elected President
four times, which gave him an unprecedented opportunity to
influence the Court via appointments.
The End of the New Deal
Three things mark the end of the New Deal
1.
The Court Packing crisis
2.
The recession of 1937, which was accompanied by labor strife
3.
The deteriorating international picture, which diverts attention to
foreign threats.
Development of the Congress of Industrial Organizations (CIO)
1.
The craft union organization of the AF of L was not equal to the
upsurge of workers in mass industries.
2.
The AFL mishandled a number of disputes.
3.
"The craft form, where unionization proceeded along the lines of
the job, rather than the factory, made no sense whatsoever in any of
the great industries where the mass of workers were semiskilled or
unskilled rather than skilled." (Degler 401)
4.
John L. Lewis of the United Mine Workers led a walkout from the
AFL in 1935 (just after a knocked out an AFL officer at the
podium) to form the Congress of Industrial Organizations.
5.
The CIO began a massive organization drive in industries like
steel, rubber, autos, textiles, lumber, aircraft.
6.
Membership in unions increases from 3.7 million in 1935 to 8.5
million in 1940.
7.
"Under the impact of the depression, the American labor
movement had come of age." (Degler 402)
8.
The CIO's "great innovation was its effective use of the industrialunion form." (Degler 402)
9.
"By organizing recent immigrants, the unskilled, Negroes and
women on a scale and with a determination never attempted by the
AF of L, the CIO revived a broad approach to unionism which had
been sidetracked in American labor ever since the AF of L had
beaten out the old Knights of Labor." (Degler 402)
Introduction of "sit down strikes" for the first time against GM
1.
The auto manufacturers except Ford give in and recognize the
United Auto Workers.
AP/IB American History
New Deal Lecture
2.
D.
XV.
A.
B.
Mr. Blackmon
Page 27
The CIO was recognized by U.S. Steel (but not Little Steel with the
"Memorial Day Massacre.")
3.
4720 strikes in 1937, with 80% settled favorably for the unions.
4.
Sit down strikes were clearly illegal, and unconcern for non-union
rights alarmed some moderates and cooled their ardor to help
organized labor.
Recession of 1937
1.
Believing the economy was on the mend, FDR cut spending
2.
There was promptly a sharp slide.
3.
Keynesians within the New Deal like Hopkins, Ickes, and Marriner
Eccles of the Fed finally win over conservatives like Morgenthau.
4.
FDR commits again to heavy spending
a.
New AAA of 1938
b.
Commodity Credit Corporation to lend money on surplus
crops.
c.
Fair Labor Standards Act--abolished child labor and set a
national minimum wage ($ .40/hr) and a maximum work
week (40 hrs) with time and a half for overtime.
5.
These measures alienated conservatives.
a.
FDR attempted to purge the party in 1938 by campaigning
vigorously against his opponents. The strategy fails as
Southern voters reject outside interference.
The Significance of the New Deal
Failures
1.
Did not restore full employment
2.
Vacillated between Keynesian spending and traditional balancing
of the budget; between trust busting and regulation limits its
achievements.
3.
Established many new agencies with overlapping responsibilities.
Valuation
1.
An immensely constructive response to a massive crisis.
2.
For the first time, and for henceforth, government is committed
to preventing another depression.
3.
Laissez faire is dead. The classical market economy will
henceforward come under continual scrutiny.
4.
The Roosevelt Revolution in politics
a.
The Great Depression justified the Democratic Party just as
the Civil War justified the Republican Party.
b.
There is a shift of farmers, labor, and Black Americans to
the Democratic Party.
5.
There is increasing assistance to Black Americans and the
beginning of real movement toward better conditions.
AP/IB American History
New Deal Lecture
6.
C.
1.
2.
3.
4.
D.
Mr. Blackmon
Page 28
The first steps were taken toward improving the lot of Native
Americans
a.
The Indian Reorganization Act of 1934 allowed tribal
control of lands and ended the official policy of
assimilation (which was frequently a pretext for theft).
FDR was
A brilliantly effective leader
A legislative leader like Wilson
Representative of all the people, like Jackson
A brilliant communicator.
"The conclusion seems inescapable that, traditional as the words may
have been in which the New Deal expressed itself, in actuality it was
truly a revolution in ideas, institutions, and practices, when one
compares it with the political and social work that preceded it . . . The
searing ordeal of the Great Depression purged the American people of
their belief in the limited powers of the federal government and
convinced them of the necessity of the guarantor state." (Degler 413)
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 29
Works Cited
Blum, John M., Morgan, Edmund S., McFeely, William S., Schlesinger, Jr., Arthur M., Stampp,
Kenneth M., and Woodward, C. Vann. The National Experience: A History of the United
States. 6th ed. New York: Harcourt Brace Jovanovich, 1985.
Current, Richard N., Williams, T. Harry, Freidel, Frank, and Brinkley, Alan. American History:
A Survey. 6th Ed. New York: Alfred A. Knopf, 1983.
Degler, Carl. Out of Our Past: The Forces That Shaped Modern America. 3rd ed. New York:
Harper and Row, 1984.
Garraty, John A. The American Nation: A History of the United States. 5th ed. New York:
Harper and Row, 1983.
Goldman, Eric. Rendezvous With Destiny: A History of Modern American Reform. New York:
Vintage Books, 1977.
Heilbroner, Robert L. The Worldly Philosophers. 3rd ed. New York: Simon and Schuster,
1967.
Hofstadter, Richard. The Age of Reform. New York: Vintage Books, 1955.
Perkins, Dexter. The New Age of Franklin Roosevelt.
Roosevelt, Franklin Delano. "What the New Deal Has Done for Business."
Vol. 15. Chicago: Encyclopeadia Britannica, 1976. 379-83.
Annals of America.
AP/IB American History
New Deal Lecture
Mr. Blackmon
Page 30
Works Consulted
Friedel, Frank. Franklin D. Roosevelt: A Rendezvous With Destiny. Boston: Little, Brown,
1990.
Hambly, Alonzo L. ed. The New Deal: Analysis and Interpretation. 2nd ed. New York:
Longman, 1981.
Leuchtenburg, William E. Franklin D. Roosevelt and the New Deal: 1932-1940. New York:
Harper, 1963.