unit 18
By the people,
for the people
session preparation
Read the following material before attending the workshop. As you read the
excerpts and primary sources, take note of the “Questions to Consider” as
well as any questions you have. The activities in the workshop will draw on
information from the readings and the video shown during the workshop.
unit introduCtion
The Great Depression drew attention to problems with the United States
economy that needed government regulation. To address these problems,
the Roosevelt administration implemented a “New Deal” of work and
benefit programs that established the idea that the federal government was
responsible for the well-being of Americans. As the Depression worsened,
Americans from the left and right questioned the effectiveness of New Deal
programs to relieve people’s suffering. In spite of this opposition, Roosevelt
benefited from popular attitudes that reflected a communitarian spirit.
unit learning oBJeCtives
After reading the text materials, participating in the workshop activities,
and watching the video, teachers will understand
• the structural problems that contributed to the Great
Depression;
• how the left and right criticized the Roosevelt
administration for further reforms;
• how cinema and radio reflected the shift from American
individualism to a communitarian spirit;
• how the policies and programs of the New Deal
transformed the relationship between the federal
government and Americans.
Table of Contents
Unit Themes
2
Unit Content Overview
2
Video Related Materials
3
Theme One Materials
4
Theme Two Materials
19
Theme Three Materials
26
Timeline
43
Reference Materials
44
Further Reading
44
Appendix
45
this unit features
•
•
•
Textbook excerpts (sections of U.S. history surveys, written
for introductory college courses by history professors)
Primary sources (documents and other materials created
by the people who lived in the period) including a poster,
photographs, statistics, a map, lyrics, and letters
A timeline at the end of the unit, which places important
events in this period
1
Content Overview
A combination of economic forces, practices, and policies brought about the most
severe worldwide economic collapse in history, which tested American democracy
and capitalism until the onset of World War II. During the last week of October
1929, stock-market investors traded 16 million shares—and 30 billion dollars
vanished. The stock market crash was only one factor that contributed to the Great
Depression, however. Even before the crash, some regions of the nation were
already in a depression. Rural America faced an economic crisis caused, in part,
by overproduction, which the artificial markets during World War I had stimulated,
when European production was low and demand high. Economic depressions had
taken place since the beginning of the 1800s, but the economy had changed by
the 1920s because the majority of Americans lived and worked in the cities rather
than on farms. When economic downturns took place, families who lived on farms
were able to feed themselves and had a place to live; when city dwellers lost their
jobs, however, they also lost the ability to pay for food and housing.
The fundamental shift in the economy that occurred in the early twentieth century
was a move to mass production, which depended on mass consumption to keep
the economy going. By the end of the 1920s, the distribution of wealth was out of
balance, contributing to the inability of Americans to consume what they produced.
Hoover and Roosevelt responded to the Great Depression through different
policies. Hoover encouraged voluntary action of city and state leaders to create
public works projects, supported a tax cut, and tried to persuade the American
people that the economy was sound. Hoover believed that it was the role of the
federal government to give loans rather than direct subsidies, and it was the role
of state and local governments to give direct relief to the unemployed and needy.
Theme 1:
Coming out of an unprecedented
period of prosperity, the Great
Depression revealed structural
problems with the economy—
pointing to the need for
government regulation, and
calling into question the viability
of democracy and capitalism.
Theme 2:
A shift in popular attitudes
questioned the rise of American
individualism and a purely marketbased economy, creating a
community atmosphere that was
reflected in popular culture.
Theme 3:
The New Deal and World War II
fundamentally changed the
relationship between the people
and the federal government.
When elected president in 1932, Franklin Delano Roosevelt launched a “New
Deal” in an attempt to stimulate the economy. The New Deal was a set of
government-sponsored work and benefit programs founded on the idea that
government was responsible for the well-being of its citizens. This new safety net
marked a change in the relationship between people and the federal government.
Prior to the advent of the New Deal, most Americans had little experience with
the federal government unless they had served in the military. On the local level,
Roosevelt pushed a federal response to the economic crisis—a response based
on a sense of national responsibility that was outside the experience of many
Americans. To foster community acceptance of federal programs, the Roosevelt
Administration handed over various facets of control and distribution to local
authorities, but local control sometimes translated into abuse and inequalities.
Though Roosevelt faced opposition on some of his policies and programs,
he benefited from the emergence of a new, more inclusive, national culture.
Hollywood movies reflected this renewed sensibility, depicting Americans
embracing values of community and interdependence.
Despite the success of New Deal programs and renewed optimism under
Franklin Roosevelt’s leadership, the economy never fully emerged from the
Depression until the country’s entry into World War II and massive spending
fueled the labor and industry sectors.
Unit 18 By The People, For the People Video Related Materials
Historical Perspectives
Even before the stock market crash of
October 1929, some regions of the United
States were in a depression. By the end of
the 1920s, the distribution of wealth was
out of balance, and rural America faced
an economic crisis caused, in part, by an
overproduction of goods.
In response to the Depression, the
Roosevelt administration implemented
new work and benefit programs called
the “New Deal,” which ultimately
changed the relationship between
people and the federal government.
Many Americans welcomed government
assistance, although some viewed the
New Deal with suspicion. Still others,
whose ideas represented the entirety
of the political spectrum, proposed
radical actions and believed Roosevelt’s
policies did not go far enough in ending
the Depression. In spite of opposition,
Roosevelt benefited from a new and
more inclusive national culture that was
reflected in Hollywood movies.
Will Rogers, a goodwill ambassador for
rural America, became a famous humorist
and social commentator, and often
criticized the economic disparity within
the United States.
In the first quarter of the twentieth
century, Henry Ford changed American
life, industry, and labor. Although he was
known to pay his workers double the
industry average, he opposed unions
and used violence to prevent labor from
organizing during the Depression.
Hands on History
How do consultants imbue fictionalized
history with detailed accuracy?
Retired Colonel John Antal, a historical
consultant for Gearbox Software, uses
historical research, aerial photography,
rifles, and German weather almanacs to
help software engineers design a World
War II video game.
Faces of America
Anne Marie Low, a survivor of the Dust
Bowl; Will Rogers, a populist social critic;
and Henry Ford, founder of the Ford
Motor Company, illustrate the effects the
Great Depression had on individuals and
how they responded to a national crisis.
Ann Marie Low’s diary recounts the
economic hardships endured by
American farmers and the efforts by
federal agents to buy the family farm
so that the Civilian Conservation Corps
could build a wildlife refuge.
Unit 18 By The People, For the People Theme One
Theme One: Coming out of an unprecedented period of prosperity,
the Great Depression revealed structural problems with the economy,
pointing to the need for government regulation, and calling into question
the viability of democracy and capitalism.
Overview
When Franklin Delano Roosevelt took office in 1933, the Depression was already
a global phenomenon. As some European nations turned to fascism and socialism,
Roosevelt introduced a “New Deal” of economic programs and policies aimed at
stimulating the economy and bringing the nation out of the Depression. The reform
movements of the Progressive Era, the nation’s experience in World War I, and even
Hoover, inspired Roosevelt’s New Deal programs. During the first New Deal (1933
through early 1935), Roosevelt’s policies differed from Hoover because the federal
government took an active role in helping people—providing immediate relief to the
poor, aiding businesses, and funding public works programs to get Americans back to
work. His pragmatic approach established the idea that the federal government should
subsidize farmers for limiting production, but he also levied a tax to pay for
the program.
As the Depression deepened, people from the left and right questioned the
effectiveness of New Deal programs. While private industry wanted to protect its own
interests, leaders from the left, workers, and third parties argued that Roosevelt’s
policies did not go far enough in relieving suffering. Roosevelt’s economic policies
provided immediate relief, but not enough, largely out of a concern to control spending.
Some African American industrial workers and farmers joined the Communist Party, as
did some white laborers, but the Communists found more support among intellectuals
than among workers. Senator Huey Long from Louisiana, among others, supported the
idea that the rich should share their wealth, while the major labor upheavals of 1934
pressured Roosevelt for better pay and working conditions.
Questions to Consider
1. Why was the Great Depression so mush more severe than previous depressions
and recessions? 2. Why and how did the Depression call into question the viability of capitalism
and democracy?
3. Why did many people think that Roosevelt’s policies of the first New Deal did
not go far enough in providing economic relief?
Unit 18 By The People, For the People Theme One Excerpts
1. The Depression Begins
Few people anticipated the stock market crash in the fall of 1929. But even after the
collapse of the stock market, few expected the entire economy to go into a tailspin.
General Electric stock, selling for 396 in 1929, fell to 34 in 1932; U.S. Steel declined
from 261 to 21. By 1932, the median income had plunged to half of what it had
been in 1929. Construction spending fell to one-sixth of the 1929 level. By 1932,
at least one of every four American breadwinners was out of work, and industrial
production had almost ground to a halt.
Why did the nation sink deeper and deeper into depression? After all, only about
2 percent of the population owned stock of any kind. The answer is complex, but it
appears in retrospect that the prosperity of the 1920s was superficial. Farmers and
coal and textile workers had suffered all through the 1920s from low prices, and
the farmers were the first group in the 1930s to plunge into depression. But other
aspects of the economy also lurched out of balance. Two percent of the population
received about 28 percent of the national income, but the lower 60 percent got
only 24 percent. Businesses increased profits while holding down wages and
the prices of raw materials. This pattern depressed consumer purchasing power.
American workers, like American farmers, did not have the money to buy the
goods they helped to produce. There was a relative decline in purchasing power in
the late 1920s, unemployment was high in some industries, and the housing and
automobile industries were already beginning to slacken before the crash.
. . . Other factors were also involved. The stock market crash revealed serious
structural weaknesses in the financial and banking systems (7,000 banks had
failed during the 1920s). The Federal Reserve Board, fearing inflation, tightened
credit—exactly the opposite of the action it should have taken to fight a slowdown
in purchasing. But the Depression was also caused by global economic problems
created by World War I and the peace settlement. Large reparations exacted
against Germany had led to the collapse of the German economy, and high tariffs
had reduced international trade. When American investment in Europe slowed
in 1928 and 1929, European economies declined. Americans purchased fewer
European goods, and Europeans got along without American products. As the
European financial situation worsened, the American economy spiraled downward.
The federal government might have prevented the stock market crash and the
Depression by more careful regulation of business and the stock market. Central
planning might have ensured a more equitable distribution of income. But that kind
of policy would have taken more foresight than most people had in the 1920s. It
certainly would have required different people to be in power, and it is unlikely that
the Democrats, had they been in control, would have altered the government’s
policies in fundamental ways.
Gary B. Nash et al., eds. The American People: Creating a Nation and a Society. 6th ed.
(New York: Pearson Education, 2004), 816.
Unit 18 By The People, For the People Theme One Excerpts
2. Hoover and the Great Depression
. . . Hoover acted aggressively to stem the economic collapse. More than any
president before him, he used the power of the federal government and the office
of the president to deal with an economic crisis. Nobody called it a depression
for the first year at least, for the economic problems seemed very much like
earlier cyclic recessions. Hoover called conferences of businessmen and labor
leaders. He met with mayors and governors and encouraged them to speed up
public works projects. He created agencies and boards, such as the National
Credit Corporation and the Emergency Committee for Employment, to obtain
voluntary action to solve the problem. Hoover even supported a tax cut, which
Congress enacted in December 1929, but it did little to stimulate spending.
Hoover also went on the radio in his effort to convince the American people that
the fundamental structure of the economy was sound.
Nash et al., 816.
3. Economic Decline
Voluntary action and psychological campaigns could not stop the Depression.
The stock market, after appearing to bottom out in the winter of 1930–1931,
continued its decline, responding in part to the European economic collapse that
undermined international finance and trade. Of course, not everyone lost money
in the market. William Danforth, founder of Ralston Purina, and Joseph Kennedy,
film magnate, entrepreneur, and the father of a future president, were among
those who made millions of dollars by selling short as the market went down.
More than a collapsing market afflicted the economy. More than 1,300 additional
banks failed in 1930. Despite Hoover’s pleas, many factories cut back on
production, and some simply closed. U.S. Steel announced a 10 percent wage
cut in 1931. As the auto industry laid off workers, the unemployment rate rose
to over 40 percent in Detroit. More than 4 million Americans were out of work
in 1930, and at least 12 million were unemployed by 1932. Foreclosures and
evictions created thousands of personal tragedies. There were 200,000 evictions
in New York City alone in 1930. While the middle class watched in horror as their
life savings and their dreams disappeared, the rich were increasingly concerned
as the price of government bonds (the symbol of safety and security) dropped.
They began to hoard gold and fear revolution . . .
Nash et al., 817.
Unit 18 By The People, For the People Theme One Excerpts
4. A Global Depression
. . . Hoover increasingly blamed the Depression on international economic
problems, and he was at least partly right. The legacy of the war and the global
economic policies of the 1920s had been one cause of the economic downturn
in the United States, and as the United States sunk into depression, the world
followed. In May 1931, the leading Austrian bank collapsed; by June, the German
financial system, which had gone from hyperinflation to false stability, was in
chaos. In September, England abandoned the gold standard, precipitating a
decline in international lending and trade. Soon most of the industrialized world,
including Argentina, Brazil, and Japan, were caught in the Great Depression . . .
Hoover did try innovative schemes. More public works projects were built during
his administration than in the previous 30 years. In the summer of 1931, he
attempted to organize a pool of private money to rescue banks and businesses
that were near failure. When the private effort failed, he turned reluctantly to
Congress, which passed a bill early in 1932 authorizing the Reconstruction
Finance Corporation. The RFC was capitalized at $500 million, but a short time
later that was increased to $3 billion. It was authorized to make loans to banks,
insurance companies, farm mortgage companies, and railroads. Some critics
charged that it was simply another trickle-down measure whereby businessmen
and bankers would be given aid while the unemployed were ignored. Hoover,
however, correctly understood the immense costs to individuals and to
communities when a bank or mortgage company failed. The RFC did help shore
up a number of shaky financial institutions and remained the major government
finance agency until World War II. But it became much more effective under
Roosevelt because it lent directly to industry . . .
Nash et al., 818.
Unit 18 By The People, For the People Theme One P rimary Source
Photograph of a Run on a Bank
Question to Consider
Creator:
New York WorldTelegram
Context:
A run on banks to
withdraw money in
Why was a policeman brought in to announce the bank’s closure?
1933
Audience: Readers of the New
York World-Telegram
Purpose:
To report people’s
reaction during a
banking panic
Historical Significance:
During the Great Depression there
were multiple bank panics. Throughout
the 1930s, 9,000 banks failed. A
bank run occurred when customers
feared that their bank would become
insolvent and “run” to withdraw their
savings. Because banks only held a
small percentage of their deposits
Item 4014
New York World-Telegram, LIKE MODERN TOWN CRIERS, POLICEMEN
BOOM THE NEWS TO DEPOSITORS THAT THE BANK IS CLOSED (1933).
Courtesy of the Library of Congress.
See Appendix for larger image – pg. 45
as cash reserves, banks were unable
to pay the customers who wanted
to withdraw money. Faced with
bankruptcy, banks “called in” all the
loans made to customers. This, in
turn, often forced the bank’s debtors
into bankruptcy, particularly if the
customer had already invested the
loan in machinery that would take
time to sell. When Roosevelt became
president, he declared a three-day
“bank holiday” to allow banks to get
their finances in order.
Unit 18 By The People, For the People Theme One Excerpts
5. Roosevelt and the First New Deal
The first New Deal, lasting from 1933 to early 1935, focused mainly on recovery
from the Depression and relief for the poor and unemployed. Congress passed
legislation to aid business, the farmers, and labor and authorized public works
projects and massive spending to put Americans back to work. Some of the
programs were borrowed from the Hoover administration, and some had their
origin in the progressive period. Others were inspired by the nation’s experiences
in mobilizing for World War I. No single ideological position united all the programs,
for Roosevelt was a pragmatist who was willing to try a variety of programs.
More than Hoover, however, he believed in economic planning and in government
spending to help the poor.
Roosevelt’s caution and conservatism shaped the first New Deal. He did not
promote socialism or suggest nationalizing the banks. He was even careful
in authorizing public works projects to stimulate the economy. The New Deal
was based on the assumption that it was possible to create a just society by
superimposing a welfare state on the capitalistic system, leaving the profit
motive undisturbed. While the progressives believed in voluntary action, and
only reluctantly came to the conclusion that the federal government needed to
intervene to promote a just society, the New Dealers, from the beginning, believed
in an active role for the government. During the first New Deal, Roosevelt believed
he would achieve his goals through cooperation with the business community.
Later he would move more toward reform, but at first his primary concern was
simply relief and recovery . . .
Nash et al., 820.
Unit 18 By The People, For the People Theme One P rimary Source
Creator:
Gardiner C. Means and
Raymond Moley
Context:
1971 oral history
interviews with
Roosevelt’s advisors
during the Great
Depression
“At the beginning of the New Deal, they called it a
revolution. Then they began to say it wasn’t a revolution.
Our institutions were being shored up and maintained.
What really happened was a revolution in point of view.
We backed into the twentieth century describing our
actual economy in terms of small enterprises of the
nineteenth century.
We were an economy of huge corporations, with a high
degree of concentrated control. It was an economy that
was in no sense described by classical theory. What
Roosevelt and the New Deal did was to turn about and
face the realities . . .
Audience:
Readers of Hard Times
and listeners to “The
Studs Terkel Program’
Purpose:
To show the views of
Roosevelt’s advisors in
implementing New Deal
policies and programs
Before that Hoover would loan money to farmers to
keep their mules alive, but wouldn’t loan money to keep
their children alive. This was perfectly right within the
framework of classical thinking. If an individual couldn’t
get enough to eat, it was because he wasn’t on the ball.
It was his responsibility. The New Deal said: Anybody
who is unemployed isn’t necessarily unemployed
because he’s shiftless.
Program” on WFMT radio in Chicago.
. . . Laissez-faire as such did not come to an end with the
New Deal. We still have a tremendous amount of freedom
of decision-making in the individual corporate enterprise.
The new element is the government’s positive responsibility
for making our economy run.”
founding member and leader of the
Oral History Interview with
Gardiner C. Means
Question to Consider
Why does Means think that the New Deal was different from
economic policies that preceded it?
Studs Terkel, interview with Gardiner C. Means,
The Studs Terkel Program, WFMT, Chicago, 1971.
Historical Significance:
Studs Terkel conducted hundreds of
oral history interviews for his book on
the Depression, and later used some of
these interviews for “The Studs Terkel
The first interview is with Gardiner C.
Means, who served as the economic
adviser on finance to Henry Wallace,
the secretary of agriculture. Means
explains his perspective on how the
New Deal changed the economy of the
United States. The second interview
is with Raymond Moley. Moley was a
“Brain Trust,” a group of economists
and professors who served as
Roosevelt’s advisers. Although some
newspaper editorials and political
cartoons portrayed the Brain Trust
as idealists, these men helped to
formulate the policies of the first New
Deal. Moley supported cooperation
between business and government,
and leaned to the right in his views on
New Deal policies.
Unit 18 By The People, For the People 10
Theme One P rimary Source
Oral History Interview with
Raymond Moley
Questions to Consider
1. Why does Moley think that the bank rescue of 1933 was a key
turning point in the Depression?
2. What are the similarities and differences between the views of
Gardiner and Moley?
“. . . The rescue was done not by Roosevelt—he signed the
papers—but by Hoover leftovers in the administration. They
knew what to do.
The bank rescue of 1933 was probably the turning point
of the Depression. When people were able to survive the
shock of having all the banks closed, and then see the banks
open, up, with their money protected, there began to be
confidence. Good times were coming. Most of the legislation
that came after didn’t really help the public. The public
helped itself, after it got confidence.
The guarantee of bank deposits was put through by Vice
President Garner, Jesse Jones [a Texas banker], and Senator
Vandenburg—three conservatives. They rammed it down
Roosevelt’s throat, and he took credit for it ever after. If you
can quiet the little fellows, the big fellows pretty much take
care of themselves . . .
The first New Deal was a radical departure from American
life. It put more power in the central government. At the
time, it was necessary, especially in the farm area of our
economy. Left to itself, farming was in a state of anarchy.
Beyond that, there was no need to reorganize in industry. We
merely needed to get the farms prospering again and create
a market for the industrial products in the cities . . .
Unemployment insurance is a welfare measure. It isn’t
insurance in any sense of the word. More and more people
were living off fewer and fewer people . . . In 1935, I took a
firm stand. I said welfare is a narcotic, because it will never
end. We’ll have to stop this business and put people to work.
The best way to put people to work is to encourage the
development of industrial science. The government can’t put
people to work . . .”
Studs Terkel, interview with Raymond Moley,
The Studs Terkel Program, WFMT, Chicago, 1971.
Unit 18 By The People, For the People 11
Theme One Excerpts
6. Relief Measures
Roosevelt believed in economy in government and in a balanced budget, but he
also wanted to help the unemployed and the homeless. One survey estimated
in 1933 that 1.5 million Americans were homeless. One man with a wife and six
children from Latrobe, Pennsylvania, who was being evicted wrote, “I have 10
days to get another house, no job, no means of paying rent, can you advise me
as to which would be the most humane way to dispose of myself and family, as
this is about the only thing that I see left to do.”
Roosevelt’s answer was the Federal Emergency Relief Administration (FERA),
which Congress authorized with an appropriation of $500 million in direct
grants to cities and states. A few months later, Roosevelt created a Civil Works
Administration (CWA) to put more than 4 million people to work on various state,
municipal, and federal projects. [Harry] Hopkins, who ran both agencies, had
experimented with work relief programs in New York. Like most social workers, he
believed it was much better to pay people to work than to give them charity . . .
The Public Works Administration (PWA), directed by Harold Ickes, in some
respects overlapped the work of the CWA, but it lasted longer. Between 1933
and 1939, the PWA built hospitals, courthouses, and school buildings. It helped
construct structures as diverse as the port of Brownsville, Texas, a bridge that
linked Key West to the Florida mainland, and the library at the University of New
Mexico. It built the aircraft carriers Yorktown and Enterprise, planes for the Army
Air Corps, and low-cost housing for slum dwellers.
One purpose of the PWA was economic pump priming—the stimulation of the
economy and consumer spending through the investment of government funds.
Afraid that there might be scandals in the agency, Ickes spent money slowly and
carefully. Thus, during the first years, PWA projects, worthwhile as most of them
were, did little to stimulate the economy.
Nash et al., 823.
Unit 18 By The People, For the People 12
Theme One Excerpts
7. Agricultural Adjustment Act
In 1933, most farmers were desperate, as mounting surpluses and falling prices
drastically cut their incomes. Some in the Midwest talked of open rebellion, even
of revolution. But most observers saw only hopelessness and despair in farmers
who had worked hard but were still losing their farms.
Congress passed a number of bills in 1933 and 1934 to deal with the agricultural
crisis. But the New Deal’s principal solution to the farm problem was the
Agricultural Adjustment Act (AAA), which sought to control the overproduction of
basic commodities so that farmers might regain the purchasing power they had
enjoyed before World War I. To guarantee these “parity prices” (the average prices
in the years 1909–1914), the production of major agricultural staples—wheat,
cotton, corn, hogs, rice, tobacco, and milk—would be controlled by paying the
farmers to reduce their acreage under cultivation. The AAA levied a tax at the
processing stage to pay for the program.
The act aroused great disagreement among farm leaders and economists, but the
controversy was nothing compared with the outcry from the public over the initial
action of the AAA in the summer of 1933. To prevent a glut on the cotton and pork
markets, the agency ordered 10 million acres of cotton plowed up and 6 million
young pigs slaughtered. It seemed unnatural, even immoral, to kill pigs and plow
up cotton when millions of people were underfed and in need of clothes . . .
Nash et al., 824.
8. Industrial Recovery
The legislation during the first days of the Roosevelt administration contained
something for almost every group. The National Industrial Recovery Act (NIRA)
was designed to help business, raise prices, control production, and put
people back to work. The act established the National Recovery Administration
(NRA), with the power to set fair competition codes in all industries. For a time,
everyone forgot about antitrust laws and talked of cooperation and planning
rather than competition . . .
NIRA . . . guaranteed labor’s right to organize and to bargain collectively and
established the National Labor Board to see that their rights were respected.
But the board, usually dominated by businessmen, often interpreted the labor
provisions of the contracts loosely. In addition, small businessmen complained that
the NIRA was unfair to their interests. Any attempt to set prices led to controversy.
Many consumers suspected that the codes and contracts were raising prices,
while others feared the return of monopoly in some industries . . .
Nash et al., 824.
Unit 18 By The People, For the People 13
Theme One Excerpts
9. Protest and Pressure from the Left and the Right
Challenges to Roosevelt’s New Deal took many forms. In spite of FDR’s efforts
to help businesses survive and remain profitable during the Depression, many
business leaders continued to oppose the New Deal, charging that FDR was a
dictator and that his program amounted to socialism. At the same time, FDR
faced criticism from the left. Many people believed that Roosevelt’s policies did
not go far enough to ease the suffering caused by the economic crisis. Some
thought that New Deal policies aimed at bolstering capitalism were ill-advised,
and that capitalism itself was the problem . . .
. . . By 1934 and 1935 much of the pressure on Roosevelt came from workers,
whose hopes that the NIRA would guarantee collective bargaining rights were
dashed by the intransigence of employers. The 1920s had taken a toll on labor
unions. Membership had declined from a high of 5 million in 1920 to 2 million
by 1933. But workers continued to strike for improved wages and working
conditions. In 1934 nearly 1.5 million workers participated in 1800 strikes . . .
Workers all over the country organized for better working conditions. Birmingham,
Alabama, provides an apt example. The Depression hit Birmingham early and
hard. By 1928, unemployment had reached 18 percent. Many impoverished black
steelworkers, along with farm laborers in the surrounding countryside, joined the
“invisible army” of the Communist party. Together, they fought for better working
conditions and racial justice. One young black coal miner, Angelo Herndon,
recalled the dangers of organizing and the need for secrecy: “With our few
pennies that we collected we ground out leaflets on an old rickety mimeograph
machine, which we kept concealed in the home of one of our workers. We were
obliged to work very quietly, like the Abolitionists in the South during the Civil War,
behind drawn shades and locked doors.”
. . . Mexican laborers in California launched similar efforts. They faced not only
persistent exploitation in fields and factories but also the constant threat of
deportation. During the Depression, approximately one-third of the Mexican
population in the United States—more than half a million people—was deported
to Mexico, even though the majority were native-born citizens. Some of
those who remained organized unions and struck for better pay and working
conditions. During 1933, agricultural workers mounted 37 major strikes in
California alone. They scored a number of successes; more than half of the
conflicts led to wage increases . . .
Peter H. Wood et al., eds. Created Equal: A Social and Political History of the United States
(New York: Pearson Education, 2003), 756.
Unit 18 By The People, For the People 14
Theme One P rimary Source
The EPIC Plan
Question to Consider
Creator:
Upton Sinclair
Context:
California gubernatorial
race of 1934
Audience:
Californians
Purpose:
To show Sinclair’s
How does the EPIC plan propose to end poverty in California?
. . . An act of the legislature repealing the present sales
tax, and substituting a tax on stock transfers at the rate of
4 cents per share.
. . . An act of the legislature providing for a State income
tax, beginning with incomes of $5000 and steeply
graduated until incomes of $50,000 would pay 30% tax.
. . . An increase in the State inheritance tax, steeply
graduated and applying to all property in the State
regardless of where the owner may reside. This law would
take 50% of sums above $50,000 bequeathed to any
individual and 50% of sums above $250,000 bequeathed
by any individual.
. . . A law increasing the taxes on privately owned public
utility corporations and banks.
. . . A law providing for the payment of a pension of $50
per month to every needy person over sixty years of age
who has lived in the State of California three years prior to
the date of the coming into effect of the law.
. . . A law providing for the payment of $50 per month to
all persons who are blind, or who by medical examination
are proved to be physically unable to earn a living; these
persons also having been residents of the State for
three years.
. . . A pension of $50 per month to all widowed women
who have dependent children; if the children are more
than two in number, the pension to be increased by $25
per month for each additional child. These also to have
been residents three years in the State.
EPIC (End Poverty in
California) plan
Historical Significance:
In the 1930s, Upton Sinclair organized
the End Poverty in California (EPIC)
plan in his bid to become governor.
He had repeatedly run unsuccessful
campaigns as a Socialist candidate.
In 1934, Sinclair won the Democratic
Party primary and came close to
winning the election. The Republican
Party waged a propaganda campaign
that called Sinclair a “Red” and a
“crackpot,” resulting in his defeat
by Frank F. Merriam in the general
election. The large turnout for Sinclair
showed the electorate’s willingness to
vote for politicians with new ideas and
approaches to bring the nation out of
the Great Depression.
Upton Sinclair, Immediate EPIC: The Final Statement of the Plan
(Los Angeles: The End Poverty League, 1934);
available at http://xroads.virginia.edu/~MA01/kidd/thesis/sinclair3.html
(accessed April 3, 2007).
Unit 18 By The People, For the People 15
Theme One Excerpts
10. Protest and Pressure from the Left and the Right
. . . In addition to the communists, socialists, labor unions, and grassroots
organizations that sprang up all over the country, a number of individuals
proposed alternatives to Roosevelt’s program and gained large followings. The
most influential of these were Dr. Francis Townsend, Father Charles E. Coughlin,
and Senator Huey P. Long. In 1934, Townsend, a retired physician and health
commissioner from Long Beach, California, introduced an idea for a pension plan
that sparked a nationwide grassroots movement. Townsend proposed a 2 percent
national sales tax that would fund a pension of $200 a month for Americans over
age 60. The “Townsend Plan” became hugely popular, especially among elderly
Americans. In 1936, a national survey indicated that half of all Americans favored
the plan. Though the plan was never implemented, the groundswell of support
that it generated probably hastened the development and passage of the old age
insurance system contained in the 1935 Social Security Act.
Coughlin also inspired a huge following. A Catholic priest from Canada, he
served as pastor of a small church outside Detroit, Michigan. He began to
broadcast his sermons on the radio, using his magnetic personality to address
political as well as religious issues. Soon he became a media phenomenon,
broadcasting through 26 radio stations to an audience estimated at 40 million.
The “Radio Priest” called for a redistribution of wealth and attacked Wall Street,
international bankers, and the evils of capitalism. When a Minnesota radio station
polled listeners to see whether they wanted to hear Coughlin’s program, 137,000
said yes. Only 400 said no.
Initially, Coughlin strongly supported Franklin Roosevelt and the New Deal. But
he soon grew impatient with what he considered the slow pace of New Deal
reforms. In 1934, Coughlin launched his own political party, the National Union
for Social Justice, which he used to challenge Roosevelt’s leadership. The
activist priest promoted a populist message that was hostile to both capitalism
and communism. He told his radio listeners, “I call upon every one of you who is
weary of drinking the bitter vinegar of sordid capitalism and upon everyone who is
fearsome of being nailed to the cross of communism to join this Union . . .” Soon,
his message turned from social justice populism to right-wing bigotry. His virulent
anti-Semitism and admiration for the fascist regimes of Adolf Hitler in Germany
and Benito Mussolini in Italy drove away many of his followers. By 1940, Coughlin
had ceased broadcasting and abandoned all political activities, under orders of
the Catholic Church.
Huey P. Long was among the most powerful, and colorful, politicians of the era
Unit 18 By The People, For the People 16
Theme One Excerpts
. . . In 1928, Long won the governorship of Louisiana. His progressive leadership
inspired tremendous loyalty, especially among poor workers and farmers. He
did more for the underprivileged people of Louisiana than any other governor.
He expanded the state’s infrastructure; developed social services; built roads,
hospitals, and schools; and changed the tax code to place a greater burden on
corporations and the wealthy . . .
In 1932 Long . . . won election to the U.S. Senate. Soon, he gained a huge
national following. Initially he supported FDR, but by 1933 he had broken with the
president and forged his own political movement based on his Share-Our-Wealth
Plan. Giving voice to the resentments many Americans felt toward “wealthy
plutocrats,” Long advocated a radical redistribution of the nation’s wealth. He
called for new taxes on the wealthy and proposed to use the funds to guarantee
a minimum annual income of $2500 for all those in need. As he put it, “How many
men ever went to a barbecue and would let one man take off the table what was
intended for nine-tenths of the people to eat? The only way you’ll ever be able to
feed the balance of the people is to make that man come back and bring back
some of the grub he ain’t got no business with.” Long’s plainspoken radicalism
won the hearts of his followers, including Will Rogers, who publicly urged FDR
to back Long’s proposals. However, many of his congressional colleagues
considered him an agitator. Such skepticism did little to limit Long’s ambition,
and by 1935 he was planning to challenge FDR in the next presidential election.
But he never had the chance. In September 1935 the son-in-law of one of his
vanquished political opponents assassinated him . . .
Wood et al., 756.
Unit 18 By The People, For the People 17
Theme One
Conclusion
During the first New Deal (1933–35), the Roosevelt administration implemented
economic policies that provided immediate relief to large sections of the impoverished,
helped businesses, and funded public works programs to stimulate job creation.
The goal of the first New Deal was to grant economic relief without fundamentally
changing the capitalist system. By 1935, many people questioned the effectiveness
of Roosevelt’s policies, and presented radical ideas that included the redistribution of
wealth and a national sales tax to fund pensions for the elderly.
Questions to Consider
1. If Roosevelt’s policies were designed to save capitalism by making small
modifications to it, why was the New Deal so unpopular with many
corporate leaders?
2. Did Roosevelt’s policies during the first New Deal do much more than ease
the pain of the Depression? Why or why not?
3. Why were the movements on the left so popular in 1934 and 1935?
Unit 18 By The People, For the People 18
Theme T
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Theme Two: A shift in popular attitudes questioned the rise of American
individualism and a purely market-based economy, creating a community
atmosphere that was reflected in popular culture.
Overview
During the relatively prosperous 1920s, many people had bought into the extreme
individualism, consumerism, and Social Darwinism pushed by business leaders and
advertisers. After the economy collapsed, Americans began to question these approaches
during the 1930s. The nation witnessed a resurgence of community orientation and a
willingness to cooperate that harkened back to the community spirit of an earlier time: Often,
the less people had, the more they were willing to share with others. There was a rejection of
big business and bankers. These widespread public sentiments were reflected both politically
in the New Deal and culturally in several forms, especially movies.
The motion-picture industry suffered during the Depression and many theaters throughout
the country closed. Attendance picked up, in part, because of the motion picture industry’s
adoption of a new decency code pushed by religious groups. After 1934, the motion picture
industry focused on producing movies in which evil was punished, traditional family values
triumphed, and American democracy was not questioned. Popular movies during the midto late-1930s touted traditional values and looked back to a time when people were more
community-oriented.
Questions to Consider
1. How was a sense of community reflected through movies and the movie-going
experience?
2. Why was it important for people see movies rather than saving the money?
3. How did the “golden age of movies” reflect the Great Depression?
Unit 18 By The People, For the People 19
Theme T
Owo
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xcerpts
1. A New Americanism
The New Deal coalition reflected not only Roosevelt’s popularity but also a
new and more inclusive American identity. An expanding mass culture fostered
this sensibility, spread largely through the national media. It is no accident that
Franklin Roosevelt found his way into the homes and hearts of Americans through
his “fireside chats” over the radio; his mastery of that technology made him
the first media-savvy president. During the 1930s, 70 percent of all households
owned a radio—more than owned a telephone . . .
Wood et al., 764.
Unit 18 By The People, For the People 20
Theme Two P rimary Source
Creator:
Woody Guthrie
Question to Consider
Context:
The Great Depression
How does Guthrie capture the plight of the migrant worker
through his lyrics?
Audience:
Listeners of Woody
Guthrie’s music
It’s a mighty hard row that my poor hands have hoed
My poor feet have traveled a hot dusty road
Out of your Dust Bowl and Westward we rolled
And your deserts were hot and your mountains were cold
Purpose:
To express the
I worked in your orchards of peaches and prunes
I slept on the ground in the light of the moon
On the edge of the city you’ll see us and then
We come with the dust and we go with the wind
Historical Significance:
Pastures of Plenty
hardships of the
common people
through folk music
Woody Guthrie’s folk music described
the struggles of hobos, miners,
migrants, and many others during
the Depression. Guthrie lived in hobo
California, Arizona, I harvest your crops
Well its North up to Oregon to gather your hops
Dig the beets from your ground, cut the grapes from your vine
To set on your table your light sparkling wine
camps, rode the rails, and traveled
Green pastures of plenty from dry desert ground
From the Grand Coulee Dam where the waters run down
Every state in the Union us migrants have been
We’ll work in this fight and we’ll fight till we win
the Bonneville Power Administration
It’s always we rambled, that river and I
All along your green valley, I will work till I die
My land I’ll defend with my life if it be
Cause my pastures of plenty must always be free
Woody Guthrie, Pastures of Plenty (1941).
Courtesy of the Richmond Organization.
around the country singing what he
referred to as the “people’s songs.”
“Pastures of Plenty” was one of
twenty-six songs that Guthrie wrote for
for a movie that promoted the value
of hydroelectricity along the Columbia
River. He extended his subject matter
to include the stories of migrants
and other laborers who came to
the Northwest during the 1930s.
“Pastures of Plenty” and “So Long, It’s
Been Good to Know You” captured
the conditions that drove migrants
westward, while other songs inspired
future songwriters such as Bob Dylan,
Bruce Springsteen, and Billy Bragg to
write protest songs that sought social
and political justice.
Unit 18 By The People, For the People 21
Theme T
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xcerpts
2. The Silver Screen
The 1930s were the golden decade of the movies. Between 60 and 90 million
Americans went to the movies every week. The medium was not entirely
Depression-proof, but talking films had replaced the silent variety in the late
1920s, and attendance soared. Though it fell off slightly in the early 1930s, by
1934 movie viewing was climbing again. For many families, even in the depth of
the Depression, movie money was almost as important as food money.
. . . [O]ne could go to an elaborate movie palace and live in a fantasy world far
removed from the reality of Depression America . . .
The movies were a place to take a date, to go with friends, or to go as a family
. . . The animated cartoons of Walt Disney, one of the true geniuses of the movie
industry, were so popular that Mickey Mouse was more famous and familiar than
most human celebrities. In May 1933, halfway into Roosevelt’s first 100 days,
Disney released The Three Little Pigs, whose theme song “Who’s Afraid of the
Big Bad Wolf?” became a national hit overnight. Some people felt it boosted the
nation’s morale as much as New Deal legislation. One critic suggested that the
moral of the story, as retold by Disney, was that the little pig survived because he
was conservative, diligent, and hard-working; others felt that it was the pig who
used modern tools and planned ahead who won out.
Nash et al., 846.
3. A New Americanism
Movie plots portrayed the triumph of common people over the rich and powerful
and celebrated love across class and ethnic lines. Although racial stereotypes
persisted in motion pictures throughout the decade, notable exceptions, such
as Will Rogers’s films, featured strong minority characters. Popular movies
also challenged traditional gender and class hierarchies. Female stars, such as
Katharine Hepburn, Rosalind Russell, Bette Davis, and Mae West, portrayed
feisty, independent women . . .
Wood et al., 764.
Unit 18 By The People, For the People 22
Theme Two P rimary Source
Oscar Micheaux Movie Poster
Question to Consider
Creator:
Unknown
Context:
Leading up to the
Depression, the nation
In what ways does the depiction of the male lead run counter to
other depictions in popular culture?
had a thriving black
cinema.
Audience:
African American
movie-goers
Purpose:
Micheaux’s films were
often a direct response
to biased portrayals of
blacks by mainstream
filmmakers.
Historical Significance:
Oscar Micheaux was a pioneer in the
movie industry, producing 48 films for
African American audiences. In 1918,
Micheaux produced Homesteader,
the first full-length African American
movie. In 1931, Micheaux successfully
made the leap from silent films to
talkies with The Exile. Micheaux’s
films featured African American casts
in melodramas, comedies, musicals,
and Westerns. Micheaux also tackled
controversial topics in such films as
Within Our Gates, where a Southern
white mob lynched an African
American sharecropper and his wife.
In promoting his films, Micheaux
marketed his actors as the equivalent
of Hollywood superstars.
Item 6795
Unknown, MOVIE POSTER FOR THE EXILE (1931).
Courtesy of the Micheaux Film Corp./Photofest.
See Appendix for larger image – pg. 46
Unit 18 By The People, For the People 23
Theme T
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xcerpts
4. Recovering the Past - The Movies
. . . The year 1934 was a dividing line for two reasons. The motion picture
industry, like all other industries, had suffered during the Depression; 1933
marked the low point in attendance, with more than one-third of the theaters in
the country shut down. The next year, however, attendance picked up, heralding a
revival that lasted until 1946. Also in 1934, the movie industry adopted a code for
which the Catholic Legion of Decency and other religious groups had lobbied. The
new code prohibited the depiction of “sex perversion, interracial sex, abortion,
incest, drugs and profanity.” Even married couples could not be shown together
in a double bed. Although a movie could depict immoral behavior, sin always had
to be punished. “Evil and good should never be confused,” the code announced.
Before the code, Hollywood had indeed produced graphic films, such as The
Public Enemy (1931) and Scarface (1932), with a considerable amount of violence;
musicals, such as Gold Diggers of 1933, filled with scantily clad young women;
films featuring prostitutes, such as Jean Harlow in Red Dust (1932) and Marlene
Dietrich in Blond Venus (1930); and other films that confronted the problems
of real life. But after 1934, Hollywood concentrated on movies that created a
mythical world where evil was always punished, family moral values won out
in the end, and patriotism and American democracy were never questioned.
Although the code was modified from time to time, it was not abandoned until
1966, when it was replaced by a rating system . . .
Nash et al., 845.
Unit 18 By The People, For the People 24
Theme Two
Conclusion
Radio and movies reflected the popular attitudes of the New Deal by portraying a
communitarian spirit and an anti-big-business attitude. The radio became a central
part of people’s homes and brought together families and neighborhoods. Radio also
helped Roosevelt establish a direct, seemingly personal relationship with millions of
citizens. Movies served as an escape from the Depression, but focused on themes
where good (common people) won out over evil (the rich), traditional values triumphed,
and American democracy was rarely questioned.
Questions to Consider
1.How did the content and themes of movies change during the New Deal period?
2.How accurately did movies reflect the popular mood of the time?
3.How did radio influence politics in the New Deal?
Unit 18 By The People, For the People 25
Theme T
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Theme Three: The New Deal and World War II fundamentally changed the
relationship between the people and the federal government.
Overview
The New Deal set forth the idea that government was responsible for the well-being of
its citizens. Before the New Deal programs, Americans were subject to fluctuations in the
economy; relied on financial help from families, churches, and local communities in hard
times; and had no government-guaranteed pension when they could no longer work. The
second New Deal (1935–36) created a system of social security for many of the elderly,
established unemployment compensation, enacted a minimum wage, and provided financial
assistance to women and children who had no means of support. It also regulated banks
and the stock market, as well as protected the right of most workers to unionize and bargain
collectively. The second New Deal aided the West more than any other region through largescale water projects. For example, the Grand Coulee Dam in Washington generated large
amounts of cheap electricity for the Pacific Northwest and irrigated more than a million acres
of land. In the long run, New Deal housing legislation created the first, long-term, fixed-rate
mortgages, which allowed more than a million people to save their homes from foreclosure.
Though viewed with suspicion by some, Roosevelt’s New Deal programs marked a change in
people’s attitudes toward receiving assistance.
Questions to Consider
1.How did the second New Deal change the role of the federal government in
people’s lives?
2.Why were Americans, who had traditionally been distrustful of big government,
willing to accept the expanded role of the federal government during the Great
Depression and World War II?
3.What groups of people were least helped by the New Deal programs?
Unit 18 By The People, For the People 26
Theme T
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ne Excerpts
Excerpts
1. The New Deal and the West
The New Deal probably aided the West more than any other region. The CCC,
AAA, drought relief measures, and various federal agencies helped the region to
an extent that was out of proportion to the people who lived there. In fact, the top
14 states in per capita expenditure by federal agencies during the 1930s were all
in the West. Most important were the large-scale water projects. The Boulder Dam
(later renamed the Hoover Dam) on the Colorado River not only provided massive
amounts of hydroelectric power but, with the construction of a 259-mile aqueduct,
also provided the water that caused the city of Los Angeles to boom . . .
Despite all the federal aid to the region, many westerners, holding fast to the myth
of frontier individualism, bitterly criticized the regulation and the bureaucracy
that went with the grants. The cattlemen in Wyoming, Colorado, and Montana
desperately needed the help of the federal government, but even as they
accepted the aid, they denounced Roosevelt and the New Deal.
Nash et al., 831.
Unit 18 By The People, For the People 27
Theme Three P rimary Source
Social Security Poster
Question to Consider
How do the posters sell the idea of registering for Social Security?
Creator:
Social Security Board
Context:
New Deal legislation
Audience:
Employees
Purpose:
To encourage people
to register for Social
Security
Historical Significance:
Roosevelt’s idea for social insurance
was to create a system for employees
to contribute to their future retirement
through payroll taxes. Roosevelt’s goal
was to provide long-term economic
security for the elderly. In 1935,
Roosevelt signed the Social Security
Act, creating a social insurance
program to provide income to workers
who were 65 and older. The Act also
provided unemployment insurance,
old-age assistance, and aid to
dependent children. The newly formed
Social Security Board contracted with
the Postal Service to help register
workers for Social Security benefits.
Between 1936 and 1937, the federal
government displayed posters to
encourage people to register for
Social Security.
Item 4106
Social Security Administration, Join the March to Old Age Security (1936).
Courtesy of the Social Security Administration.
See Appendix for larger image – pg. 47
Unit 18 By The People, For the People 28
Theme T
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ne Excerpts
Excerpts
2. Aiding the Farmers
The Social Security Act and the Works Progress Administration were only two
signs of Roosevelt’s greater concern for social reform. The flurry of legislation
in 1935 and early 1936, often called the “second New Deal,” also included an
effort to help American farmers. Over 1.7 million farm families had incomes of
under $500 annually in 1935, and 42 percent of all those who lived on farms were
tenants. The Resettlement Administration (RA), motivated in part by a Jeffersonian
ideal of yeoman farmers working their own land, set out to relocate tenant farmers
on land purchased by the government. Lack of funds and fears that the Roosevelt
administration was trying to establish Soviet-style collective farms limited the
effectiveness of the RA program.
Much more important in improving the lives of farm families was the Rural
Electrification Administration (REA), which was authorized in 1935 to lend money
to cooperatives to generate and distribute electricity in isolated rural areas not
served by private utilities. Only 10 percent of the nation’s farms had electricity
in 1936. When the REA’s lines were finally attached, they dramatically changed
the lives of millions of farm families who had been able only to dream about the
radios, washing machines, and farm equipment advertised in magazines . . .
Nash et al., 829.
Unit 18 By The People, For the People 29
Theme T
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Secondary Source
Taylor Grazing Act, 1934
The Taylor Grazing Act of 1934 ended the federal government’s transfer of
public lands to private ownership. What government agency controlled the most
land in the West? What effect did the Taylor Grazing Act have on land use and
management?
Nash et al., 832.
Unit 18 By The People, For the People 30
Theme Three P rimary Source
Photograph of Arvin Migratory Labor Camp
Questions to Consider
Creator:
Quartermaster Review
Context:
In 1937, the Farm
Security Administration
opened the Arvin
Migratory Labor
Camp in an attempt to
remedy the sanitation
and public-health
problems among
California’s 250,000
migrant workers. It also
hoped to alleviate the
financial costs placed
on local and state
governments.
Audience:
Unknown
Purpose:
The goal of labor
camps was to provide
a safe place with a
community atmosphere
in which migrants were
responsible for running
the camps’ activities,
governance, and court
sessions.
1. Why were the migrant labor camps controversial?
2. What does this primary source reveal about the changing role of
the federal government during the New Deal?
Item 5883
W.F. Baxter, “Migratory Labor Camps,” The Quartermaster Review (July 1937).
Courtesy of the Library of Congress.
See Appendix for larger image – pg. 48
Historical Significance:
C. B. Baldwin served as an assistant
to Henry Wallace, the secretary of
agriculture until 1945. Baldwin fought
for federal funding for migrant labor
camps. The exchange between
Baldwin and Congressman Elliott
shows the changing role of the
federal government: “I was on the
stand during one of these hearings. A
congressman, Al Elliott of California,
was cross-questioning me. I had all
the information, photographs—the
plight of the migrant workers. He
argued against the camp. The real
reason the big farmers didn’t want
continued…
Unit 18 By The People, For the People 31
Theme Three P rimary Source
Historical Significance:
them built is that they were places where the migrants got together and
organize[d] . . . When Elliott finished his slambang cross-examination, I said,
‘You haven’t convinced me not to build the camp. I’m issuing instructions
for it to be started.’ He stormed across the room. He was a heavyweight
boxer, about six-three, weighing about 210. I weighed in at 155. (Laughs) He
hollered, ‘You don’t represent the people of my district! I represent them!’ I
said, ‘I have a national constituency. And a very important part of that are the
migrant workers of this big country. I’m telling you again, Congressman Elliott,
I’m gonna build this camp.’ We built it.”
C. B. (Calvin Benhan) Baldwin, interview (February 25 1965), Archives of American
History, available from http://archivesofamericanart.si.edu/collections/oralhistories/
index.cfm/fuseaction/OralHistories.ViewOralHistory/CollectionID/12303.
Unit 18 By The People, For the People 32
Theme T
Ohree
ne Excerpts
Excerpts
3. The New Deal for Labor
Like many progressive reformers, Roosevelt was more interested in improving
the lot of working people by passing social legislation than by strengthening the
bargaining position of organized labor. Yet he saw labor as an important balance
to the power of industry, and he listened to his advisers, especially Frances
Perkins and Senator Robert Wagner of New York, who persistently brought up the
needs of organized labor.
After strikes in San Francisco, Minneapolis, and Toledo, Roosevelt supported
the Wagner Act, officially called the National Labor Relations Act, which
outlawed blacklisting and a number of other practices and reasserted labor’s
right to organize and to bargain collectively. The act also established a Labor
Relations Board with the power to certify a properly elected bargaining unit. The
act did not require workers to join unions, but it made the federal government a
regulator, or at least a neutral force, in management–labor relations. That alone
made the National Labor Relations Act one of the most important New Deal
reform measures . . .
Nash et al., 833.
4. Controlling Corporate Power and Taxing the Wealthy
In the summer of 1935, Roosevelt also moved to control the large corporations,
and he even toyed with radical plans to tax the well-to-do heavily and
redistribute wealth in the United States. The Public Utility Holding Company Act,
passed in 1935, attempted to restrict the power of the giant utility companies,
the 12 largest of which controlled more than half the country’s power. The act
gave various government commissions the authority to regulate and control
the power companies and included a “death sentence” clause that gave each
company five years to demonstrate that its services were efficient. If it could not
demonstrate this, the government could dissolve the company. This was one of
the most radical attempts to control corporate power in American history . . .
Nash et al., 831.
Unit 18 By The People, For the People 33
Theme T
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Excerpts
5. America’s Minorities in the 1930s
. . . Black leaders attacked the Roosevelt administration for supporting or allowing
segregation in government-sponsored facilities. The TVA model town of Norris,
Tennessee, was off limits for blacks, and AAA policies actually drove blacks off
the land in the South. The CCC segregated black and white workers, and the
PWA financed segregated housing projects . . .
Roosevelt, fearing that he might antagonize southern congressmen whose
backing he needed, refused to support the two major civil rights bills of the era,
an antilynching bill and a bill to abolish the poll tax. Yet Harold Ickes and Harry
Hopkins worked to ensure that blacks were given opportunities in New Deal
agencies. By 1941, black federal employees totaled 150,000, more than three
times the number during the Hoover administration. Most worked in the lower
ranks, but some were lawyers, architects, office managers, and engineers.
. . . Hundreds of thousands of Mexicans, brought to the Unites States to work in
the 1920s, lost their jobs in the Depression. Drifting to the Southwest or settling in
the urban barrios and the small towns and farms in the Southwest, they met signs
such as “Only White Labor Employed” and “No . . . Mexicans, or Dogs Allowed.”
Some New Deal agencies helped destitute Mexicans. A few worked for the CCC
and the WPA, but to be employed, an applicant had to qualify for state relief, and
that eliminated most migrants. The primary solution was not to provide aid for
Mexicans but to ship them back to Mexico. In Los Angeles and other cities, the
police and immigration authorities rounded up aliens and held them illegally. A
trainload of repatriates left Los Angeles every month during 1933, and officials
deported thousands from other cities. One estimate placed the number sent back
in 1932 at 200,000, including some American citizens.
Not all the Mexicans were repatriated, however, and some who remained adopted
militant tactics to obtain fair treatment. Mexican strawberry pickers went on strike
in El Monte, California, and 18,000 cotton pickers walked away from their jobs
in the San Joaquin valley in 1933. On August 31, 1939, during a record-breaking
heat wave, nearly all of the 430 workers, most of them Mexican-American women,
staged a massive walkout at one of the largest food processing plants in Los
Angeles. In Gallup, New Mexico, several thousand Mexican coal miners walked
out on strike. They constructed a village of shacks and planned to wait out the
strike. The miners, who were aided by writers and artists from Santa Fe and Taos,
were evicted from their village by the city authorities. Federal agents arrested their
leader, Jesus Pallares, and deported him to Mexico.
Unit 18 By The People, For the People 34
Theme T
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Excerpts
Asians (Chinese, Japanese, and a smaller number of Koreans and Asian Indians)
also suffered during the Depression. Most lived in ethnic enclaves, lost their jobs,
and were treated as foreigners—not quite black, but not white either. Asians,
especially the second generation who were automatically citizens if they were
born in the United States, were troubled by a “twoness.” They were both Chinese
or Japanese and American. At least their parents wanted them to retain ties to the
old country and the old culture. One young Chinese student from San Francisco
had to go to Chinese school after her regular school. “We never became proficient
in reading or writing Chinese, “ she recalled, “probably because we never thought
of ourselves as needing Chinese. After all, weren’t we Americans?” A Japanese
Nisei remembered the “queer mixture of Occident and the Orient. I sat down to
American breakfast and Japanese lunch. My palate developed a fondness for
rice along with corned beef and cabbage. I became equally adept with knife and
fork and with chopsticks. I said grace at mealtime in Japanese, and recited the
Lord’s prayer in English.” But one Japanese father told his son to learn Japanese
because there was no future for him in the United States. Most Americans failed
to appreciate the sense of “twoness” that the Asians suffered with; indeed, they
treated all Asians as aliens, and they had great difficulty distinguishing a Chinese
from a Japanese from a Korean.
Native Americans also experienced alienation, disease, and despair during the
Depression, and their plight was compounded by years of exploitation. Since
the Dawes Act of 1887, government policy had sought to make the Indian into a
property-owning farmer and to limit tribal rights. Native Americans lost over 60
percent of the 138 million acres granted them in 1887. The government declared
some of the land surplus and encouraged individuals to settle on 160 acres
and adopt the “habits of civilized life.” Few Native Americans profited from this
system, but many whites did . . .
Nash et al., 835.
Unit 18 By The People, For the People 35
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6. Women and the New Deal
Women made some gains during the 1930s, and more women occupied high
government positions than in any previous administration . . . Despite some
gains, the early New Deal programs did nothing for an estimated 140,000
homeless women, or the 2 to 4 million unemployed women. Married women
often were fired from their jobs on the grounds that they should be home caring
for their families rather than depriving men of employment. Single, divorced,
and widowed women were usually ignored. Eleanor Roosevelt was genuinely
concerned over the plight of poor women. She sponsored a White House
Conference in November 1933 on the Emergency Needs of Women. She also
advocated including more women in the CCC, the WPA, and other programs, but
in the end the New Deal did little for poor women.
Nash et al., 837.
7. Completing the New Deal
Despite increasing hostility, Congress passed a number of important bills in
1937 and 1938 that completed the New Deal reform legislation. The BankheadJones Farm Tenancy Act of 1937 created the Farm Security Administration
(FSA) to aid tenant farmers, sharecroppers, and farm owners who had lost their
farms. The FSA, which provided loans to grain collectives, also set up camps
for migratory workers. Some people saw such policies as the first step toward
communist collectives, but the FSA in fact never had enough money to make a
real difference.
Congress passed a new Agricultural Adjustment Act in 1938 that tried to solve
the problem of farm surpluses, which persisted even after hundreds of thousands
of farmers had lost their farms. The new act replaced the processing tax (which
the Supreme Court had declared unconstitutional) with direct payments from the
federal treasury to farmers; added a soil conservation program; and provided for
the marketing of surplus crops. Like its predecessor, the new act tried to stabilize
farm prices by controlling production. But only the outbreak of World War II would
end the problem of farm surplus, and then only temporarily . . .
In the long run, New Deal housing legislation had a greater impact on middleclass housing policies and patterns. During the first 100 days of the New Deal,
at Roosevelt’s urging, Congress passed a bill creating the Home Owners Loan
Corporation (HOLC), which over the next two years made more than $3 billion
in low-interest loans and helped over a million people save their homes from
foreclosure. The HOLC also had a strong impact on housing policy by introducing
the first long-term, fixed-rate mortgages. Formerly, all mortgages were for periods
of no more than five years and were subject to frequent renegotiation.
Unit 18 By The People, For the People 36
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The HOLC also introduced a uniform system of real estate appraisal that tended
to undervalue urban property, especially in neighborhoods that were old,
crowded, and ethnically mixed. The system gave the highest ratings to suburban
developments where, according to the HOLC, there had been no “infiltration of
Jews” or other undesirable groups. This was the beginning of the practice later
called “redlining,” where lending agencies drew lines around neighborhoods and
made it nearly impossible for prospective home buyers of certain ethnic or racial
backgrounds to obtain a mortgage.
The Federal Housing Administration (FHA), created in 1934 by the National
Housing Act, expanded and extended many of these HOLC policies. The FHA
insured mortgages, many of them for 25 or 30 years, reduced the down payment
required from 30 percent to under 10 percent, and allowed over 11 million families
to buy homes between 1934 and 1972. The system, however, tended to favor
purchasing new suburban homes rather than repairing older urban residences.
New Deal housing policies helped make the suburban home with the long FHA
mortgage part of the American way of life, but the policies also contributed to the
decline of many urban neighborhoods.
Just as important as housing legislation was the Fair Labor Standards Act,
which Congress passed in June 1938. Roosevelt’s bill proposed for all industries
engaged in interstate commerce a minimum wage of 25 cents an hour, to rise
in two years to 40 cents an hour, and a maximum workweek of 44 hours, to be
reduced to 40 hours. Congress amended the legislation and exempted many
groups, including farm laborers and domestic servants. The act covered only 20
percent of the labor force and only 14 percent of working women. Nevertheless,
when it went into effect, 750,000 workers immediately received raises, and by
1940, some 12 million had received pay increases. The law also prohibited child
labor in interstate commerce, making it the first permanent federal law to prohibit
youngsters under the age of 16 from working. And without emphasizing the
matter, the law made no distinction between men and women, thus diminishing,
if not completely ending, the need for special legislation for women. The passage
of the bill widened the split between Roosevelt and conservative southern
Democrats, because it was in the South where nearly 20 percent of industrial
workers earned below the minimum wage. “Cheap wages mean low buying
power,” Roosevelt announced. “And let us remember that buying power means
many other kinds of better things, better schools, better health, better hospitals,
better highways.”
The Fair Labor Standards Act was the last New Deal measure passed. The
New Deal had many weaknesses, but it did dramatically increase government
support for the needy. In 1913, local, state, and federal governments spent
$21 million on public assistance. By 1932, that had risen to $218 million; by
1939, it was $4.9 billion.
Nash et al., 839–40.
Unit 18 By The People, For the People 37
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8. New Deal and beginnings of the Welfare State
The New Deal set in place a welfare state that established the principle of
government responsibility for the well-being of vulnerable citizens. Before
the New Deal, people suffered the fluctuations of the market economy with
no recourse beyond the assistance of kin, communities, and charities. Older
Americans who could no longer work had no government-guaranteed pensions
and often faced poverty in old age. Bank failures could wipe away life savings.
Unemployment could mean starvation for a worker’s family. The New Deal
provided Social Security for the elderly, unemployment compensation for workers
who had lost their jobs, minimum hours and wages, and economic aid to women
and children who had no means of support. It also established national economic
regulations, such as the Federal Deposit Insurance Corporation (FDIC) and the
Security and Exchange Commission (SEC), as well as the right of workers to
unionize and engage in collective bargaining. These government protections
offered many Americans an unprecedented level of economic security.
The Roosevelt administration addressed many of the nation’s problems and
used the federal government in innovative ways to intervene in the economy and
to mitigate some of the misfortunes caused by the Depression. Most New Deal
policies protected factory workers in large companies. The safety net did not
extend to many of the neediest Americans, including Mexican American migrant
workers, African American and white sharecroppers, seasonal agricultural
laborers, or domestic workers . . .
The United States’ system of social welfare was not as extensive and inclusive
as those that emerged in some western European democracies. But it was part
of a larger trend toward government intervention in the economy and greater
protections for citizens. Within the United States, the New Deal neither reached
nor satisfied everyone. Some groups thought that it went too far; others believed
it did not go far enough. But it eased some of the harshest effects of the
Depression and established a national safety net that endured for more than half
a century.
Wood et al., 765.
Unit 18 By The People, For the People 38
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9. Preparation For War
[Despite the tremendous cost and effort behind New Deal programs, deficit
spending levels were not high enough to pull the nation out of the Depression.
The only way the federal government was willing to spend that much was in the
event of war.] The war reached into every aspect of national and personal life.
Although wartime brought prosperity, the rationing of essential goods and the
scarcity of consumer products brought nearly all Americans into the war effort. As
soldiers and war industry workers moved around the country, local and regional
sensibilities gave way to a stronger national identity. Factories stopped making
consumer items and instead turned out war machines. Scientists developed
new weapons of mass destruction. Cities burgeoned as workers flooded into the
lucrative war industries. The U.S. military and defense establishment expanded to
the formidable scale it would maintain during and after the war, making the United
States the most powerful nation in the world.
Wood et al., 770.
Unit 18 By The People, For the People 39
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10. Mobilizing for War
Converting American industry to war production was a complex task. Many
corporate executives refused to admit that an emergency existed. Shortly after
Pearl Harbor, Roosevelt created the War Production Board (WPB) and appointed
Donald Nelson, executive vice president of Sears, Roebuck, to mobilize the
nation’s resources for an all-out war effort. The WPB offered businesses cost-plus
contracts, guaranteeing a fixed and generous profit. Often the government also
financed new plants and equipment. Secretary of War Henry Stimson explained:
“If you ... go to war ... in a capitalist country, you have to let business make
money out of the process or business won’t work.” Roosevelt seemed to agree.
Even before the United States entered the war, Roosevelt had created a National
Defense Research Committee to organize scientists to help in the war effort. Later
he set up the Office of Scientific Research and Development (OSRD) to perfect
new weapons and other products. The most important science and technology
project carried on during the war was the development of the atomic bomb, but
OSRD also improved radar and developed high-altitude bomb sights, jet engines,
pressurized cabins for airplanes, and penicillin and other miracle drugs. Scientists
under contract to the government also developed DDT and other effective
insecticides, but none of the scientists recognized the dangerous side effects
that DDT would have on the environment. The wartime collaboration of science,
industry, and the government would lay the groundwork for massive projects in
the postwar years.
The Roosevelt administration tried in a variety of ways to gain the cooperation
of businessmen. The president appointed many business executives to key
positions, some of whom, like Nelson, served for a dollar a year. He also
abandoned antitrust actions in all industries that were remotely war-related. The
policy worked. Both industrial production and net corporate profits nearly doubled
during the war . . .
Despite some unfairness and much confusion, the American economy
responded to the wartime crisis and produced the equipment and supplies that
eventually won the war. American industries built 300,000 airplanes, 88,140
tanks, and 3,000 merchant ships. In 1944 alone, American factories produced
800,000 tons of synthetic rubber to replace the supply of natural rubber captured
by the Japanese. Although the national debt grew from about $143 billion in
1943 to $260 billion in 1945, the government policy of taxation paid for about 40
percent of the war’s cost. At the same time, full employment and the increase
in two-income families, together with forced savings, helped provide capital for
postwar expansion. In a limited way, the tax policy also tended to redistribute
Unit 18 By The People, For the People 40
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wealth, which the New Deal had failed to do. The top 5 percent income bracket,
which controlled 23 percent of the disposable income in 1939, accounted for
only 17 percent in 1945.
The war stimulated the growth of the federal bureaucracy and accelerated the
trend, begun during World War I and extended in the 1920s and 1930s, toward
the government’s central role in the economy. The war also increased the
cooperation between industry and government, creating what would later be
called a military-industrial complex. But for most Americans, despite anger at
the OPA and the income tax, the war meant the end of the Depression.
Nash et al., 860–62.
Unit 18 By The People, For the People 41
Theme Three
Conclusion
Great Britain’s colonies became dynamic and prosperous in the century before the
American Revolution. Immigration from across Europe helped fuel a population boom,
cities expanded, and the economy became more sophisticated. However, not all
colonists received the benefits of this expansion—notably slaves and other laborers.
But the colonies as a whole were becoming more powerful.
Questions to Consider
1. Why were the New Deal programs not able to bring the nation out of
the Depression?
2. What effects did the deprivation of the Depression years have on
Americans’ attitudes and values? How are the changes in these areas
reflected in popular culture?
Unit Conclusion
The Great Depression revealed structural problems within the economy, and strained
American democracy and capitalism until the arrival of World War II. Economic
depressions had occurred since the 1800s; in the early 1900s, however, the nation
had come to depend on a mass consumption of goods to keep the economy going.
During the 1930s, many Americans questioned the consumerism and individualism of
the prosperous 1920s, and the nation experienced a resurgence of community spirit,
reflected culturally in movies and politically in the New Deal.
Roosevelt introduced a “New Deal” of economic policies and programs. These
programs marked a fundamental change in the relationship between the federal
government and citizens by providing immediate relief to the poor, aiding businesses,
and funding public works programs to get Americans back to work. As the
Depression worsened, however, many people from the left and right questioned
the effectiveness of Roosevelt’s policies and proposed radical ideas, including the
redistribution of wealth and a national sales tax to fund pensions for the elderly.
The New Deal provided social security, unemployment compensation, a minimum
wage, and financial assistance to women and children who had no means of support.
It also regulated banks and the stock market and protected the right of most workers
to unionize and bargain collectively. Roosevelt’s New Deal programs marked a
change in people’s attitudes toward receiving assistance.
Unit 18 By The People, For the People 42
Timeline
1929 Stock market crash
1930 1352 U.S. banks fail
1932 Reconstruction Finance Corporation established; Federal Home Loan
Bank Act passed; Federal Emergency Relief Act passed; Franklin D.
Roosevelt elected president
1933 Initial New Deal (“Hundred Days”) legislation begins; Adolf Hitler
becomes chancellor of Germany; Public Works Administration
established
1934 Indian Reorganization Act restores self-governing and ownership rights
to tribes; Federal Housing Authority created; unemployment peaks
1935 National Labor Relations (Wagner) Act passed; Committee of Industrial
Organizations (CIO) created; Second New Deal begins; Works Progress
Administration established; Social Security Act passed
1936 United Auto Workers hold sit-down strikes against General Motors;
Roosevelt reelected president
1937 Farm Security Administration established
1939 John Steinbeck publishes The Grapes of Wrath
1940 Roosevelt elected for a third term; Selective Service Act passed
1941 Executive order outlaws discrimination in defense industries; Lend-Lease
Act passed; Japanese attack Pearl Harbor; United States declares war
on Japan
Unit 18 By The People, For the People 43
Unit Reference Materials
- Levin, Lawrence W. The People and the President: America’s Conversation with FDR.
Boston, Beacon Press, 2002.
- Low, Ann Marie. Dust Bowl Diary. Lincoln: University of Nebraska Press, 1984.
- McElvaine, Robert S. Down & Out in the Great Depression. Chapel Hill: University of
North Carolina Press, 1983.
- Nash, Gary B. Julie Roy Jeffrey, John R. Howe, Peter J. Frederick, Allen F. Davis,
and Allan M. Winkler. The American People: Creating a Nation and a Society, 6th
ed. New York: Pearson Education Inc., 2004. Reprinted by permission of Pearson
Education, Inc.
- Wood, Peter, Jacqueline Jones, Thomas Borstelmann, Elaine Tyler May, and Vicki
Ruiz. Created Equal: A Social and Political History of the United States. New York:
Pearson Education Inc., 2003. Reprinted by permission of Pearson Education, Inc.
- ———. The Depression and New Deal: A History in Documents. New York: Oxford
Press, 2000.
Further Reading
1- Cohen, Robert, ed. Dear Mrs. Roosevelt: Letters from Children of the Great
Depression. Chapel Hill: University of North Carolina Press, 2002.
2- Egan, Timothy. The Worst Hard Time. Boston & New York: Houghton Mifflin Company,
2006.
3- MacLeod, Elizabeth. Eleanor Roosevelt: An Inspiring Life. Toronto: Kids Can Press,
2006.
4- McElvaine, Robert S. The Great Depression: America 1929–1941. New York:
Times Books, 1984.
5- Nishi, Dennis. Life during the Great Depression. San Diego: Lucent Books, 1998.
Visit the Web Site
Explore these themes further on the America’s History in the Making Web site. See how
this content aligns with your own state standards, browse the resource archive, review
the series timeline, and explore the Web interactives. You can also read full versions of
selected Magazine of History (MOH) articles or selected National Center for History in
the Schools (NCHS) lesson plans.
Unit 18 By The People, For the People 44
Appendix 1-1
THEME ONE PRIMARY SOURCE
Item 4014
New York World-Telegram, LIKE MODERN TOWN CRIERS, POLICEMEN BOOM THE NEWS TO DEPOSITORS THAT THE
BANK IS CLOSED (1933). Courtesy of the Library of Congress.
Unit 18 By The People, For the People 45
Appendix 2-1
THEME TWO PRIMARY SOURCE
Item 6795
Unknown, MOVIE POSTER FOR THE EXILE (1931). Courtesy of the Micheaux Film Corp./Photofest.
Unit 18 By The People, For the People 46
Appendix 3-1
THEME THREE PRIMARY SOURCE
Item 4106
Social Security Administration, Join the March to Old Age Security (1936).
Courtesy of the Social Security Administration.
Unit 18 By The People, For the People 47
THEME THREE PRIMARY SOURCE
Item 5883
W.F. Baxter, “Migratory Labor Camps,” The Quartermaster Review (July 1937). Courtesy of the Library of Congress.
Appendix 3-2
Unit 18 By The People, For the People 48