The FERA, or Federal Emergency Relief Act had the task of handing out relief funds – or handouts – to the unemployed and poor. $500 million was put into the policy and was divided equally amongst the states. Half of that money was given directly as relief, and the other half was used as incentive for the initiative. Harry Hopkins ran the program. The operation of FERA was a significant change to American society. FERA was largely successful, despite limited funds and corruption. It was an example of direct government aid, and a relationship between the government and people. Therefore, it contradicted the principles of laissez-faire and rugged individualism that many Americans believed in, and Roosevelt was in fact altering the system. Roosevelt, through FERA was slightly modifying the idea of capitalism by giving direct relief without expecting any services in return. However, he was not drastically changing the system or trying to overthrow it.
The CCC, or Civilian Conservation Corps was an initiative created in March 1933 that employed young men (aged between 17 and 24) in areas such as national forests and parks, and public lands. The initiative cost approximately $5,500 million and employed 250,000 recruits in its first year. The basic idea behind the initiative was that the men would send home $25 of the $30 that they earned each month, providing relief and aid for the family. As the men were working for their pay, Roosevelt was not seen to alter the capitalist system. However, the program did encompass a slight change to the system as the government themselves and not the free market were providing these jobs. The CCC created a relationship between the government and its people.
One policy designed to revive the economy was the National Industry Recovery Act. This act came in two parts, one of which was the NRA, or National Recovery Administration. This initiative was headed by General Hugh Johnson, and aimed to increase workers wages (thus putting more money into the economy), to increase prices of factory goods to help factory owners make profit and to give workers better conditions in the workplace. Codes were drawn up for each industry, which fixed prices for various goods, set standard for workers such as minimum wages and maximum hours and forbiddance of child labour. Workers were also govern the right to join trade unions. Businesses were encouraged to sign this code, and although it wasn’t compulsory, it was seen as the ‘patriotic’ and ‘American’ thing to do. Businesses that were part of the NRA could display the ‘Blue Eagle’ – the NRA’s logo, and the public were encouraged to buy goods from these businesses. The administration of the NRA involved significant changes to the way that the economy was run. There was a direct involvement of the government in business, as well as government control in business. The NRA, as it was administered and managed by the government was a definite change from Hoover’s policies. As the NRA was affecting the economy, Roosevelt was altering the way that the capitalist system of America was run. This policy also changed the way that businesses were run, and the flow of money all over America, as businesses supporting the NRA would be supported by the general public.
The Tennessee Valley Authority was another initiative which was designed to recover the economy. It was designed to develop the Tennessee Valley area, which cut through seven states. This area was poverty stricken and suffered from soil erosion and flooding. The TVA’s role was to develop and utilize the area for the production of goods which would benefit the area and the economy. It would also benefit the inhabitants of the area by making the area prosper and creating jobs. The TVA constructed 20 dams in the area, developed ecological schemes to sustain the area, educated farmers towards more economical methods of farming, developed welfare and educational programs, and produced hydro-electric power. This initiative had significant effects on the economy and that region as a whole. As it was a government run initiative and related to the economy, Roosevelt had to be very careful about the specifics of the TVA’s outline so that he wouldn’t appear to be changing the USA too dramatically. Furthermore, many would probably not want the government making money from the electricity sold. It was therefore stated in the TVA that the production of electricity was only a by-product of this initiative. The TVA also involved aspects of reform – as it was improving the lifestyle of people in the area. The TVA involved change to the relationship between the government and people, and also saw the government become involved in the economy – a significantly different approach to laissez-faire.
Many people in the region benefited greatly from this initiative, both in an increase of living standards and a doubling of their salaries. However, there was very little change or ‘threat’ to the capitalist system through this – Roosevelt, through ensuring production of goods in an area was simply maintaining it.
By the 1930s many countries in Europe had introduced social security – a system where the old, sick and unemployed could receive benefits. Americans in the past however, had believed in rugged individualism and self help. However, in 1935 Roosevelt introduced the SSA, or Social Security Act. This act was part of the Reform section of the New Deal. The SSA also supported the disabled and others in need. The SSA also included unemployment insurance. This scheme was definitely a change to Hoover’s laissez-faire policies, and involved a direct link between the people and the government. For the nation as a whole, the SSA would be a change. The capitalist system was not going to be drastically changed, however, the idea of self-help and working for money and aid did change slightly with the introduction of policies such as the SSA.
Another example of reform is the Wagner Act. This act, introduced in 1935 gave workers more rights. Senator Robert Wagner was responsible for this initative. The Wagner Act encouraged trade unions and wanted to prevent employers from sacking workers. This act was relatively successful. Trade unions did gain some power, and many employers were forced to listen to them, and to give workers better rights. This act would have changed people’s lives all over the nation, specifically of workers and employers. This policy did involve change to previous ideas that the government should not intervene in the lives of people in general, and more specifically in the business sector. This initiative created a link between the government and its people. It was not making significant changes to the capitalist system; it was simply giving those working under the system a better quality of life.
The degree of change in the various policies varies. In some areas, such as relief, the degree of change is quite significant. As Roosevelt did not wish to dramatically alter the capitalist system, recovery of the economy did not involved a significant degree of change. Reform didn’t involve a significant degree of change, nor a small degree of change – it was somewhere in between the two. Different policies were set up to assist different areas. For example, the TVA was directed to help the rural sector. With respect to recovery and to some degree relief, much of the aid that was needed, especially when seeking to help unemployment was targeted at the urban areas. What is common to most of the initiatives of the New Deal, however, is that they all involved some form of chage to society. As the government was getting involved in the lives of people, and to an extent in the workplace, Hoover’s old laissez faire policies and ideals of rugged individualism were replaced and dramatically changed by the New Deal.
