A kind of Amiable Boy Scout



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FDR &

The New Deal

Study GuideNew Deal Study Guide

"A Kind of Amiable Boy Scout"
Franklin Delano Roosevelt's campaign for the White House in 1932 gave little indication that FDR's presidency would prove to be one of the most consequential in American history.
Roosevelt was a scion of privilege, born into a family of old wealth and heavy political influence. (His fifth cousin Teddy Roosevelt had been the most popular American politician of the early twentieth century.) Franklin Roosevelt was affable and gregarious—to borrow a phrase popularized in a more recent presidential campaign, "the kind of guy you'd like to have a beer with." But he had never distinguished himself as a particularly deep or innovative thinker, and it was often difficult to discern whether any bedrock principles underlay his evident political ambition.
In the campaign of 1932, FDR was—to borrow another term from our current politics—a giant "flip-flopper." One day, candidate Roosevelt proudly defended Wilsonian internationalism; another day, he demonized the League of Nations, to win the support of isolationist kingpin William Randolph Hearst. One day, he criticized Herbert Hoover for centralizing power in Washington; another day, he demanded bold new "social planning" by government. One day, he called for increased federal spending to kick-start the stalled economy; another day, he blasted Hoover's deficit spending and promised retrenchments to balance the budget. Roosevelt's frequent attacks on Hoover for excessive government spending look bizarre in retrospect; indeed, one of FDR's advisers later wrote that "given later developments, the campaign speeches often read like a giant misprint, in which Roosevelt and Hoover speak each other's lines."7
Even FDR's famous New Deal began not as a detailed policy platform but merely as a throwaway applause line in a speech. "I pledge you, I pledge myself," Roosevelt told the delegates at the 1932 Democratic Convention in Chicago, "to a new deal for the American people."8 It was not FDR but newspaper headline writers who attached great significance—and a capital "N" and "D"—to the phrase. The specific policies that comprised the New Deal would only emerge later.
Candidate Roosevelt's vacillating campaign left many political observers deeply unimpressed. Elmer Davis, a prominent journalist, figured that FDR was "the man who would probably make the weakest President of the dozen aspirants" for the Democratic nomination.9 Walter Lippman—even more prominent than Davis, one of the great newsmen in American history—privately called FDR "a kind of amiable boy scout," and wrote a column that described Roosevelt as "a highly impressionistic person, without a firm grasp of public affairs and without very strong convictions... Franklin D. Roosevelt," Lippman wrote, "is no crusader. He is no tribune of the people. He is no enemy of entrenched privilege. He is a pleasant man who, without any important qualifications for the office, would very much like to be president."10
Kicking Out Our Unluckiest President
Important qualifications or not, Roosevelt was able to get away with a weak campaign because, by 1932, the American people had come to despise incumbent President Herbert Hoover. Hoover, surely our unluckiest president, took office to great acclaim just months before the 1929 stock market crash plunged the country into Great Depression. The Depression wasn't Hoover's fault, but Hoover's policies, which mixed faith in the free market with appeals to voluntary cooperation among businessmen in the interest of the public, proved entirely unable to restore prosperity. And, fairly or not, Americans blamed their president. Shantytowns of jobless workers, which cropped up in cities across the nation, became "Hoovervilles." Old newspapers became "Hoover blankets" for the homeless. Broken-down cars became "Hoover wagons," pulled by mules when the owners couldn't afford gasoline. Empty boxcars became "Hoover Pullmans" transporting hoboes on fruitless transcontinental journeys in search of work. Small varmints became "Hoover hogs," hunted and eaten by starving Americans. Many of the worst miseries of the Great Depression came to bear the name of Hoover, which—to say the least—did not bode well for the president's campaign for re-election.
By the time the 1932 vote rolled around, the American people were more than ready to kick Herbert Hoover to the curb. Roosevelt won almost just by showing up, sweeping into office by winning 57% of the popular vote (to less than 40% for Hoover). Roosevelt carried the electoral votes of all but six states. Voters' disgust with Republican governance didn't end with Hoover; the GOP also lost twelve Senate seats and a shocking 101 House seats, meaning that Roosevelt entered office backed by a strongly Democratic Congress.

"Bold, Persistent Experimentation"


Roosevelt's campaign may have been a muddle of inconsistent and contradictory statements, but in at least one of FDR's speeches, the candidate did reveal the core principle that would come to drive his presidency. Speaking at Oglethorpe College in May 1932, Roosevelt declared that "The country needs and, unless I mistake its temper, the country demands 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."11 Roosevelt may not have entered office with a coherent ideological position or a well-developed policy platform, but his commitment to activist, pragmatic government became the hallmark of the New Deal.

How was Roosevelt able to win the election in 1932?

You will need to discuss Roosevelt’s personality and make reference to the steps that Roosevelt took to gain support. Explain also what is meant by the “3 R’s”

Following a bleak, four-month interregnum between FDR's election and inauguration, Franklin D. Roosevelt finally assumed office on 4 March 1932. "Let me assert my firm belief," the president famously declared, "that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror... Plenty is at our doorstep, but a generous use of it languishes in the very sight of supply. Primarily this is because rulers of the exchange of mankind's goods have failed through their own stubbornness and their own incompetence, have admitted their failure, and have abdicated."12 Roosevelt's tone—defiant, confident, populist, borderline radical, and, above all, hopeful—struck a chord with the American people, seeming to break the spell of despondency that had fallen over the nation.



The Hundred Days
President Roosevelt called Congress into special session on 9 March 1933, determined to put his plan of "bold, persistent experimentation" into action. What ensued was "The Hundred Days," a flurry of legislative accomplishment unprecedented in American history.

How did Roosevelt solve the banking crisis?

The banking bill worked. On 12 March, Roosevelt went on the radio for the first of his "Fireside Chats," in which he confidently reassured the American people that their banks were once again safe; when the bank holiday ended the next morning, customers across the country deposited more money than they withdrew, and the banking crisis ended.


Buoyed by the success of his first legislative venture, Roosevelt pressed on to push Congress to implement the rest of his agenda with startling speed.
It took two days for Congress to pass Roosevelt's second piece of legislation, an ultraconservative measure to slash government spending by cutting half a billion dollars in scheduled payments to veterans and federal employees. Less than a week later, Congress passed FDR's third bill, ending Prohibition by legalizing the sale of beer and wine. (When a few old-line "dry" Senators fought to save Prohibition via filibuster, impatient House members invaded the Senate chamber, chanting "Vote! Vote! We want beer!"14)
Read through the descriptions of each of the Alphabet Agencies that were created in Roosevelt’s first 100 days. You should note down how each of the measures of the First New Deal benefited different parts of the US economy
AGRICULTURAL ADJUSTMENT ACT (Recovery): Created in 1933, The AAA paid farmers for not planting crops in order to reduce surpluses, increase demand for seven major farm commodities, and raise prices. Farm income rose, but many tenants and share-croppers were pushed into the ranks of the unemployed. In 1936 the Supreme Court voided the AAA.
CIVILIAN CONSERVATION CORPS (Relief): Created in 1933, the CCC took unmarried men aged 18-25 from relief rolls and sent them into the woods and fields to plant trees, build parks, roads, and fight soil erosion on federal lands. Young men sent their $30 a month home to their families and left a legacy of outdoor recreation areas (including the Blue Ridge Parkway). The CCC provided jobs for 2.5 million young men during its ten years.

CIVIL WORKS ADMINISTRATION (Relief): Created in 1933, the CWA employed four million people--paid an average of $15 a week--many in useful construction jobs such as repairing schools, laying sewer pipes, building roads. Some CWA jobs, however, were criticized as useless (e.g., leaf raking). Roosevelt disbanded the program after less than a year.
FAIR LABOR STANDARDS ACT (Reform): The last major piece of New Deal legislation (1938), this important labor law set minimum wage (25 cents an hour) and maximum hour standards (establishing the 40-hour work week). It also severely curbed the use of child labour.
FARM SECURITY ADMINISTRATION (REFORM): The FSA was created in 1937 (formerly called the Resettlement Administration in 1935) to aid sharecroppers. The FSA set up temporary housing for "Okies" and "Arkies" (Dust Bowl refugees from Oklahoma and Arkansas) who migrated to California in hope of finding work.
FEDERAL EMERGENCY RELIEF ADMIN (Relief): Created in 1933, FERA supported nearly five million households each month and funded thousands of work projects for the unemployed. It also provided vaccinations and literacy classes for millions of poor people.
FEDERAL HOUSING ADMINISTRATION (Recovery): The FHA was created in 1934 to stimulate the building industry by providing small loans for home construction. A related program, also created in 1934, was the Home Owners' Loan Corporation (HOLC).
NATIONAL RECOVERY ADMINISTRATION (Recovery): The National Industrial Recovery Act of 1933 created the NRA to promote economic recovery by ending wage and price deflation and restoring competition. The NRA set business codes and quotas. Under its symbol of a blue eagle and slogan ("We Do Our Part"), the NRA temporarily restored investor confidence and consumer morale, but it failed to stimulate industrial production. In 1935 the Supreme Court declared the NIRA unconstitutional.
PUBLIC WORKS ADMINISTRATION (Relief/Recovery): Established by the NIRA in 1933, the PWA was intended both for industrial recovery and unemployment relief. Eventually over $4 billion was spent on 34,000 construction projects including public buildings, highways, bridges (e.g., San Francisco's Golden Gate Bridge), and dams for water and power.
SECURITIES AND EXCHANGE COMMISSION (Reform): The SEC was created in 1934 to serve as a federal "watchdog" administrative agency to protect public and private investors from stock market fraud, deception and insider manipulation on Wall Street. The SEC is still in existence [its reputation was tarnished a bit by the Enron collapse in 2001-02].
SOCIAL SECURITY ADMINISTRATION (Reform): The Social Security Act of 1935 established the SSA to administer a national pension fund for retired persons, an unemployment insurance system, and public assistance programs for dependent mothers, children, and the physically disabled. The pension was financed by a payroll tax to begin in 1937. It exists to this day as the nation's most important and expensive domestic program, covering over 40 million Americans and accounting for about one-fourth of the federal budget.
TENNESSEE VALLEY AUTHORITY (Reform): Perhaps the most ambitious undertaking of the New Deal, the TVA was a comprehensive federal agency created in 1933 for the economic development of the Tennessee River watershed. The TVA built twenty dams to control flooding, generate hydroelectrical power, increase agricultural production, and revitalize the Tennessee Valley region. The TVA also provided jobs, low-cost housing, reforestation and other services.
WORKS PROGRESS ADMINISTRATION (Relief): Established under the $4.8 billion Emergency Relief Appropriation Act of 1935, the WPA lasted until 1943 and employed at least 8.5 million people at an average of $2 a day. They built thousands of roads, bridges, schools, post offices and other public construction projects. In addition, under the WPA's Arts Program, thousands of unemployed writers, musicians, artists, actors, and photographers temporarily went on the federal payroll, producing public projects ranging from murals to national park guidebooks.*
FEDERAL HOUSING ADMINISTRATION (Recovery): The FHA was created in 1934 to stimulate the building industry by providing small loans for home construction. A related program, also created in 1934, was the Home Owners' Loan Corporation (HOLC).
BANKING ACT OF 1933: created Federal Deposit Insurance Corp., guaranteeing the safety of bank deposits.
COMMUNICATIONS ACT OF 1934: Federal housing administration insured loans of private banks and trust companies for construction of homes.



Act, date

Agriculture

Manufacturing

Finance

Employment

AAA















FARM CREDIT

ACT














CCC
















FERA
















TVA















NRA
















PWA
















BANKING


ACT














FCC
















FHA
















SEC















HOLC
















Ideologically, Roosevelt's Hundred Days program was all over the map; his first government spending bill was more conservative than anything Hoover ever proposed, while HOLC and FERA fulfilled liberal aspirations for government activism and the NRA embodied a downright radical departure from long-established American norms regarding the relationship between government and industry. If any one principle unified the legislative thrust of the first New Deal, it was the principle of "bold, persistent experimentation." No one could accuse Franklin D. Roosevelt or the Hundred Days Congress of failing to "above all, try something."



What was the significance of the First New Deal? (Modern America, p.119)


Persistent Poverty
The Hundred Days marked a huge triumph for the new president, and the New Deal inspired hope among many Americans that recovery would soon be at hand. But the New Deal didn't solve the Depression. The economy did improve under Roosevelt's tutelage; in retrospect, it became clear that the darkest days of the Great Depression had passed in the winter of 1932-33, after FDR was elected but before he assumed office. But economic progress under the New Deal was painfully, brutally slow. Under Roosevelt the economy began to grow again, rather than shrink as it had throughout Hoover's term, but growth came at a glacial pace. (The country's gross national product wouldn't match its 1929 level until 1941.) Under Roosevelt unemployment declined from its 1932-33 peak, but still remained shockingly high. (The unemployment rate, which peaked at 25% just as FDR took office, still hovered above 20% as late as 1935, and never dropped below 14% until World War II.) Throughout Roosevelt's first term, despite the New Dealers' best efforts, the American economy remained broken.
The continuing economic malaise inspired a number of radical (and, to many minds, dangerous) alternatives. Louisiana's populist Senator Huey Long proposed simply taking money from the rich and giving it to the poor, à la Robin Hood. A California doctor named Frances Townsend proposed to spend nearly half the national wealth to fund a generous state-funded retirement plan for the elderly. Socialist writer Upton Sinclair almost won the governorship of California on a platform of collectivized production. Communists organized unions of the urban unemployed, teaching class consciousness in hopes of inspiring revolution.

What alternatives were there to the New Deal and what were the criticisms from Huey Long and Father Coughlin (Clements, p.140)


Roosevelt, frustrated by the New Deal's slow progress in restoring prosperity and feeling pressure to pre-empt more radical alternatives, pushed for a second round of reform.


The Second New Deal
In 1935, FDR pushed through his second round of reforms, seeking to make many of the emergency measures of 1933 permanent while striking a more populist tone by overtly attacking big business and the rich. The so-called "Second New Deal"—much of it passed in the "Second Hundred Days" in the summer of 1935—included much of the most important and long-lasting legislation of the New Deal era.


Why was a Second New Deal necessary? (Willoughby, p.134 and Clements, p.146-147)


Therefore, in the run up to the 1936 election and after it, Roosevelt followed a much more radical 'reform' agenda.


New Legislation (The Second New Deal)
1. National Labour Relations Act (1935):
● Also known as the Wagner Act.

● To replace the banned NRA.

● Protected workers' right to join a trade union/

● Set up the National Labour Relations Board (NLRB) to prevent employers from victimising workers.


2. Soil Conservation Act (1935):
● To replace the banned AAA.

● Allowed the government to continue subsidising farmers.


3. Social Security Act (1935):
● Provided America's first system of social welfare.

● set up a national system of old-age pensions

● gave help to people with physical disabilities

● gave help to children in need

● set up a national system of unemployment insurance.

4. National Housing Act (1937):


Provided loans to buy houses

● Reduced excessive rents.

5. Fair Labour Standards Act (1938):
● Set hours and conditions of work

● Fixed a minimum wage.




The Second New Deal


ACT, DATE

PURPOSE (how was the nation helped by the Second New Deal?)

NLRA







SCA







NHA







SSA







FLSA







The final piece of the Second New Deal was a tax reform bill that unleashed a largely symbolic attack upon the wealthy. Admitting in private that the "Wealth Tax" of 1935 was aimed at "stealing Huey Long's thunder," Roosevelt boosted the top marginal tax rate for those earning more than $5 million to a staggering 79%. Considering, however, that this new tax bracket was populated by exactly one person—John D. Rockefeller—the new tax rate had little real impact on redistributing wealth from the rich few to the poor many. One congressman accurately described the tax as "a hell raiser, not a revenue raiser."16 More than 95% of American families continued to pay no federal income tax whatsoever, and even taxpayers at the 99th percentile of the income distribution faced tax rates of only 5%. Still, Roosevelt's supposed "soak the rich" plan had its desired political effect; Huey Long's "Share The Wealth" movement was pre-empted, FDR's status as a hero to the working class was cemented, and the plutocrats denounced Roosevelt as a class traitor. William Randolph Hearst rather preposterously called the tax "Communism," and even began calling FDR "Stalin Delano Roosevelt."17

The New Deal Coalition
Franklin Roosevelt's election ended a long period of Democratic futility in national politics. Between William McKinley's election in 1896 and Herbert Hoover's defeat in 1932, only one Democrat—Woodrow Wilson—occupied the White House. And Wilson only won because his two Republican predecessors, Teddy Roosevelt and William Howard Taft, ran against each other in the election of 1912, splitting Republican support and allowing Wilson to sneak in with a plurality of the votes.
Roosevelt's 1932 victory was due more to disgust with Hoover than to enthusiasm for the Democratic program. Through the implementation of the New Deal, FDR was able to construct a new political coalition that created a solid Democratic majority that would endure for a generation.
The New Deal coalition began with the Democrats' traditional core of support—the "Solid South," where traditionalist Southern whites still resented the Republican Party for its leading role in leading the North to victory in the Civil War and destroying slavery. Southern Democrats' conservatism made for an awkward partnership with Roosevelt's progressive agenda, but the "Solid South" did heavily influence the New Deal by setting certain boundaries beyond which Roosevelt could not go without upsetting his coalition. The New Deal's very mixed record on race, for example, is largely due to Southern Democrats' leverage in blocking progressive measures to benefit African-Americans.
The other groups that comprised the New Deal coalition—trade unionists, farmers, city-dwellers, minorities, and liberal intellectuals, all beneficiaries of federal programs—tended to be more simpatico with Roosevelt's progressive instincts.
New Deal legislation provided, for the first time, government protection of the rights of workers to organize unions, allowing the unionized population to skyrocket from 11% of the workforce in 1930 to an all-time high of 35% in 1945. The labor vote has been heavily Democratic ever since.
Roosevelt's measures to prop up farmers were far from perfect, but they still went farther than any previous president had gone to address agricultural grievances that dated back to the nineteenth century. A large bloc of progressive farmers, epitomized by FDR's Secretary of Agriculture (and later Vice President) Henry A. Wallace, offered fervent support to FDR and his agenda.
Much of the New Deal's relief spending was funneled through liberal and Democratic political machines in the nation's large cities. That spending sustained huge patronage operations and won devoted adherents among the large populations of blacks, Catholics, Jews, and other ethnics who inhabited America's metropolises, and who came to view the New Deal as a lifeline in a time of industrial collapse. Roosevelt won further support among his urban boosters for his role in ending Prohibition, which had always been a policy pushed by rural conservatives.
Roosevelt's New Deal Coalition was not without its tensions; the divide between conservative Southerners and progressive Northern urbanists had wracked the Democratic Party for decades, and would continue to bedevil the coalition until the Southerners finally flipped to the Republicans in the wake of the Civil Rights Movement of the 1960s. Still, through the magnetism of his personality and the largesse of his programs, Roosevelt was able to hold the coalition together to create a Democratic majority that endured for decades. Between 1932 and 1968, the Republicans elected only one president, war hero Dwight Eisenhower. Even more remarkably, the Democrats maintained control of both houses of Congress for all but four years from 1932 to 1980.
It was an impressive achievement for a politician once dismissed as "a pleasant man who, without any important qualifications for the office, very much would like to be president."


What were the main criticisms of the New Deal? (Modern America)



Unconstitutional Reform
Was the New Deal unconstitutional?
In 1935, the Supreme Court of the United States ruled that much of it was, tossing out both the Agricultural Adjustment Act and the National Industrial Recovery Act—the two main pillars of FDR's 1933 recovery program—on the grounds that they granted vast new powers to the president in ways that violated the spirit and letter of the Constitution.
Supreme Court as Bulwark of Laissez-Faire
In overturning much of Roosevelt's anti-Depression program, the Supreme Court held firm to a role it had been playing in American politics for more than 50 years. After the Civil War, the Supreme Court became a rigid defender of the principle that any government attempt to regulate the economy represented a substantive violation of individuals' rights to due process by abrogating their freedom of contract. Thus, for example, legislation mandating a minimum wage was unconstitutional because it restricted an individual's freedom to sell his labour for less than the minimum wage. The Supreme Court's long, consistent stand on substantive due process and liberty of contract maintained laissez-faire as the law of the land and frustrated generations of reformers, who hoped to use the power of government to moderate the free market.
By the time Roosevelt took office, a large majority of the American people had seen enough of laissez-faire, and demanded government intervention to right the economy. But a bare majority of the Supreme Court still consisted of elderly adherents of nineteenth-century laissez-faire doctrine.
The Supreme Court's 1935 overturning of the AAA and NRA gutted the First New Deal and set the judiciary on a collision course with FDR. The old men of the Court, fierce defenders of the Constitution as they understood it, seemed determined to thwart Roosevelt's manifestations of "bold, persistent experimentation" to address the Great Depression.

Explain the opposition from the Supreme Court including the “packing” crisis and “sick chicken” case



What problems were there to do with agriculture? (Dust Bowl)

Strained Coalitions: Blacks and Whites


The New Deal coalition contained within its ranks both large numbers of African Americans and a huge constituency of racially conservative Southern whites. The racial tension inherent in such a political alignment is obvious; FDR usually tried to hold his coalition together by providing benefits for all while sidestepping racial controversy. He wasn't always successful, and the vexed issue of race in America limited the potential of the New Deal to truly transform our society.
Roosevelt was no racist (and his wife Eleanor was an early hero of the civil rights movement) but the President knew he needed the support of Southern Democrats to pass his legislation and he wasn't willing to risk his program for the sake of racial justice.

"I Just Can't Take that Risk"

The harsh logic of Roosevelt's racial stance was expressed most clearly in 1938, when liberal congressmen attempted to pass federal anti-lynching legislation to halt the most horrific type of anti-black terrorism. (Several thousand blacks were killed by lynching in the United States between the 1880s and 1960s.) Southern Senators angrily filibustered, and FDR defied black leaders and his own wife by refusing to throw his support behind the measure. "I did not choose the tools with which I must work," he explained. "Had I been permitted to choose them I would have selected quite different ones. But I've got to get legislation passed by Congress to save America. The Southerners... occupy strategic places on most of the Senate and House committees. If I come out for the anti-lynching bill now, they will block every bill I ask Congress to pass to keep America from collapsing. I just can't take that risk."18


Roosevelt's need to accommodate southern racists often complicated the implementation of his programs. Distribution of relief in the South, for example, slowed to a trickle because Southern relief administrators didn't want to distribute money to blacks. One Georgia relief agent told Roosevelt's emissary Lorena Hickok that "any Nigger who gets over $8 a week is a spoiled Nigger, that's all... The Negroes regard the President as the Messiah, and they think that... they'll all be getting $12 a week for the rest of their lives."19 Domestic workers and agricultural laborers—the leading employment sectors for black women and men, respectively—were excluded from many of the benefits of labour legislation and social security.

Rise and the Fall of the New Deal Order

In the end, while Franklin and Eleanor Roosevelt became beloved figures to millions of American blacks, the New Deal did little to advance the cause of racial equality in America. Roosevelt's unwieldy coalition of blacks and southern whites survived the 1930s intact, but ultimately broke apart under the strains of the civil rights movement in the 1950s and 1960s. It was no accident that the conservative revival in America in the late twentieth century began with the mass defection of southern whites from the Democratic Party following desegregation.




Which sections of America did not see the benefits of the New Deal?

(Long term unemployed, Afro-American migrants, dust bowl migrants, Mexicans and women)


How successful was the New Deal?

The New Deal also responded vigorously to one of the greatest problems of the Depression – an unemployment rate that had reached twenty-five percent, and in some cities as much as seventy-five percent. In the first year of the new administration, Congress created the Federal Emergency Relief Administration, which tried to shore up the exhausted state and local relief agencies; the Civil Works Administration, which hired the unemployed to work for the government – sometimes on significant capital projects, and sometimes on menial activities, but always in ways that channeled money to people who needed it. At the same time, the Public Works Administration began what became an almost decade-long process of building major infrastructure projects, which over time helped support economic activity in areas that previously had had no prospect of growth. Two years later, the New Deal created the Works Progress Administration, the most extensive federal work-relief program ever created, which kept an average of two million people employed throughout its eight-year history.

In 1935, with the Depression still in progress, Roosevelt launched what has often been called the “second New Deal,” a period of activism comparable to the first hundred days, but in many respects far more productive. It produced the Social Security Act, which created unemployment insurance, aid to dependent children, assistance for the disabled, and most important of all, pensions for older Americans. The “second New Deal” also helped create the Wagner Act, which gave unions the right to bargain collectively with employers and created an enforcement mechanism; over time, it helped raise wages and benefits for millions of workers and increased aggregate purchasing power. In 1938, Roosevelt signed the Fair Labor Standards Act, which created the minimum wage and the forty-hour work week, which also, if belatedly, helped increase consumption.

No president had ever before intervened in the economy as extensively or aggressively as Franklin Roosevelt did in the 1930s, and the sheer magnitude of his activism and his legislative achievements awed not only many Americans, but much of the world.



And yet this impressive array of achievements – achievements that have had a profound and lasting impact on the government’s capacity to support and protect its citizens – did not, in the end, do very much to end the Great Depression. At no time in the first eight years of the New Deal did unemployment drop below fifteen percent. At no time did economic activity reach levels comparable to those a decade earlier, and none of the periods of recovery during the peacetime New Deal lasted very long. So what went wrong? Why did this bold, active, and creative moment in our history prove such a failure at its first and most important task? Part of the explanation was a result of actions the New Deal took, but a larger part of the explanation was a result of things the New Deal did not do.

Read through p.146-149 (Willoughby)

ACHIEVEMENTS

CRITICISMS

HOW HAS THE NEW DEAL BEEN INTERPRETED BY HISTORIANS?

Support for the New Deal

Criticism of the New Deal


FDR and the New Deal: The Roosevelt Reconstruction

by William E. Leuchtenburg
In eight years, Roosevelt and the New Dealers had almost revolutionized the agenda of American politics. "Mr. Roosevelt may have given the wrong answers to many of his problems," concluded the editors of The Economist. "But he is at least the first President of modern America who has asked the right questions." In 1932, men of acumen were absorbed to an astonishing degree with such questions as prohibition, war debts, and law enforcement. By 1936, they were debating social security, the Wagner Act, valley authorities, and public housing....
The New Dealers displayed striking ingenuity in meeting problems of governing. They coaxed salmon to climb ladders at Bonneville; they sponsored a Young Choreographers Laboratory in the WPA's Dance Theater; they gave the pioneer documentary film maker Pare Lorentz the opportunity to create his classic films The Plow That Broke the Plains and The River.
At the Composers Forum-Laboratory of the Federal Music Project, William Schuman received his first serious hearing. In Arizona, Father Bernard Haile of St. Michael's Mission taught written Navajo to the Indians. Roosevelt, in the face of derision from professional foresters and prairie states' governors, persisted in a bold scheme to plant a mammoth "shelterbelt" of parallel rows of trees from the Dakotas to the Panhandle. In all, more than two hundred million trees were planted-cottonwood and willow, hackberry and cedar, Russian olive and Osage orange; within six years,the President's visionary windbreak had won over his former critics. The spirit behind such innovations generated a new excitement about the potentialities of government. "Once again," Roosevelt told a group of young Democrats in April 1936, "the very air of America is exhilarating,"....
Under the New Deal, the federal government greatly extended its power over the economy. By the end of the Roosevelt years, few questioned the right of the government to pay the farmer millions in subsidies not to grow crops, to enter plants to conduct union elections, to regulate business enterprises from utility companies to airlines, or even to compete directly with business by generating and distributing hydroelectric power. All of these powers had been ratified by the Supreme Court, which had even held that a man growing grain solely for his own use was affecting interstate commerce and hence subject to federal penalties. The President, too, was well on his way to becoming "the chief economic engineer," although this was not finally established until the Full Employment Act of 1946. In 1931, Hoover had hooted that some people thought "that by some legerdemain we can legislate ourselves out of a world wide depression." In the Roosevelt era, the conviction that government both should and could act to forestall future breakdowns gained general acceptance. The New Deal left a large legacy of anti-depression controls-securities regulation, banking reforms, unemployment compensation-even if it could not guarantee that a subsequent administration would use them.

In the 1930's, the financial center of the nation shifted from Wall Street to Washington. In May 1934, a writer reported: " Financial news no longer originates in Wall Street." That same month, Fortune commented on a revolution in the credit system which was "one of the major historical events of the generation." "Mr. Roosevelt," it noted, " seized the Federal Reserve without firing a shot." The federal government had not only broken down the old separation of bank and state in the Reserve system but had gone into the credit business itself in a wholesale fashion under the aegis of the RFC, the Farm Credit Administration, and the housing agencies. Legislation in 1933 and 1934 had established federal regulation of Wall Street foe the first time. No longer could the New York Stock Exchange operate as a private club free of national supervision. In 1935, Congress leveled the mammoth holding-company pyramids and centralized yet more authority over the banking system in the federal government. After a tour of the United States in 1935, Sir Josiah Stamp wrote: "Just as in 1929 the whole country was 'Wall Street-conscious' now it is 'Washington-conscious.' "...


In the thirties, nineteenth-century individualism gave ground to a new emphasis on social security and collective action. In the twenties, America hailed Lindbergh as the Lone Eagle; in the thirties, when word arrived that Amelia Earhart was lost at sea, the New Republic asked the government to prohibit citizens from engaging in such "useless" exploits. The NRA sought to drive newsboys off the streets and took a Blue Eagle away from a company in Huck Finn's old town of Hannibal, Missouri, because a fifteen-year-old was found driving a truck for his father's business. Josef Hormann urged that fewer musicians become soloists, Hollywood stars like Joan Crawford joined the Screen Actors Guild, and Leopold Stokowski canceled a performance in Pittsburgh because theater proprietors were violating a union contract. In New York in 1933, after a series of town meetings in Heywood Broun's penthouse apartment, newspapermen organized the American Newspaper Guild in rebellion against the dispiriting romanticism of Richard Harding Davis. "We no longer care to develop the individual as a unique contributor to a democratic form," wrote the mordant Edgar Kemler. "In this movement each individual sub-man is important, not for his uniqueness, but for his ability to lose himself in the mass, through his fidelity to the trade union, or cooperative organization, or political party."...
Yet the New Deal added up to more that all of this- more than an experimental approach, more than the sum of its legislative achievements, more than a an antiseptic utopia. It is true the there was a certain erosion of values in the thirties, as well as a narrowing of horizons, but the New Dealers inwardly recognized that what they were doing had a deeply moral significance however much they eschewed ethical pretensions. Heirs of the Enlightenment, they felt themselves part of a broadly humanistic movement to make man's life on earth more tolerable, a movement that might someday even achieve a co-operative commonwealth.
Franklin Roosevelt did not always have this sense a keenly as some of the men around him, but his greatness as a President lies in the remarkable degree to which he shared the vision. "The New Deal business to me is very much bigger than anyone yet has expressed it," observed Senator Elbert Thomas. Roosevelt "seems to really have caught the spirit of that one of the Hebrew prophets called the desire of the nations. If he were in India today they would probably decide that he had become Mahatma-that is, one in tune with the infinite." Both foes and friends made much of Roosevelt's skill as a political manipulator, and there is no doubt that up to a point he delighted in schemes and stratagems. As Donald Richberg later observed; "There would be times when he seemed to be a Chevalier Bayard, sans peur et sans reproche, and times in which he would seem to be the apotheosis of a prince who had absorbed and practiced all the teachings of Machiavelli." Yet essentially he was a moralist who wanted to achieve certain humane reforms and instruct the nation in principles of government. On one occasion, he remarked: "I want to be a preaching President-like my cousin." His courtiers gleefully recounted his adroitness in trading and dealing for votes, his effectiveness on the stump, his wicked skill in cutting corners to win a point. But Roosevelt's importance lay not in his talents as a campaigner or a manipulator. It lay rather in his ability to arouse the country and, more specifically, the men who served under him, by his breezy encouragement of experimentation, by his hopefulness, and-a word that would have embarrassed some of his lieutenants-by his idealism.
The New Deal left many problems unsolved and even created some perplexing new ones. It never demonstrated that it could achieve prosperity in peacetime. As late as 1941, the unemployed still numbered six million, and not until the war year of 1943 did the army of the jobless finally disappear. It enhanced the power of interest groups who claimed to speak for millions, but sometimes represented only a small minority. It did not evolve a way to protect people who had no such spokesmen, nor an acceptable method for disciplining the interest groups. In 1946, President Truman would resort to a threat to draft railway workers into the Army to avert a strike. The New Deal achieved a more just society by recognizing groups which had been largely unrepresented-staple farmers, industrial workers, particular ethnic group, and the new intellectual administrative class. Yet this was still a halfway revolution; it swelled the ranks of the bourgeoisie but left many Americans-sharecroppers, slum dweller, most Negroes-outside of the new equilibrium.
Some of these omissions were to be promptly remedied. Subsequently Congresses extended social security, authorized slum clearance projects, and raised minimum-wage standards to keep step with the rising price level. Other shortcomings are understandable. The havoc that had been done before Roosevelt took office was so great that even the unprecedented measures of the New Deal did not suffice to repair the damage. Moreover, much was still to be learned, and it was in the Roosevelt years that the country was schooled in how to avert another major depression. Although it was which freed the government from the taboos of a balanced budget and revealed the potentialities of spending, it is conceivable that New Deal measures would have led the country into a new cycle of prosperity even if there had been no was. Marked gains had been made before the was spending had any appreciable effect. When recovery did come, it was much more soundly based because of the adoption of the New Deal program.



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