What measures did Roosevelt introduce in his 'New Deal' to bring recovery in banking, agriculture and industry? How successful were they by 1939?

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Felicity Weston

History Essay

‘F.D. Roosevelt was elected president in 1932 to end the depression. He promised to do so by offering a New Deal to the American people.’

What measures did Roosevelt introduce in his ‘New Deal’ to bring recovery in banking, agriculture and industry? How successful were they by 1939?

        Roosevelt promised ‘Action, and action now’. However, he did not have a clear idea what exactly should be done or how much it was going to cost. He worked intimately with a panel of experts called the ‘Brain Trust’, to put together a programme of new laws, which would help America out of its depression. He called it the ‘New deal’.

        This new deal programme had three main aims: Relief, recovery and reform. Relief was to relieve extreme poverty, feed the starving and stop people losing their homes or farms. Recovery was to revive the economy by getting industry going and people working again; and Reform was to make the USA a better place for ordinary people by bringing in measures such as unemployment insurance and old-age pensions, and help for the sick, disabled and needy.

        Roosevelt realised how important it was to gain the trust of the American people and arouse their confidence. Therefore, just eight days after his inauguration, he gave the first of his famous radio broadcasts, which became known as ‘fireside chats’. He explained his actions in a simple and direct way, and asked Americans to work with him. Roosevelt’s broadcasts were astoundingly successful, none more so than the first one, which dealt with the important issue of the banks.

        In becoming President, Roosevelt’s most urgent problem was to rescue the banks. Since 1930, over 5000 banks had been forced to close down, and the banking system was on the point of collapse. This is because savers had withdrawn their money and businesses had not been able to repay bank loans. Therefore immediately FDR, ordered all of America’s banks to close and remain closed until they had been checked fully. This closure was known as a “four day holiday”. After this break 5000 banks, which were thought to be honest and trustworthy were re-opened. If needed, the banks would be supported by the government loans to help them continue operating and to reassure people that their money would be safe. Roosevelt had achieved his first aim in the New Deal. He did this by reassuring the public’s confidence in the banking system, therefore they would deposit more money in banks because it was in “safe hands”. To make sure everything went to plan, FDR and his advisers came up with a set of rules, which would prevent the reckless speculation, which contributed to the Wall Street crash. The emergency Banking Act and Securities Exchange Commission gave the American people a taste of what the New Deal was going to consist of. They started to feel more secure under FDR’s presidency.

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        The reform method was a long-term solution, the depression shaved up shortfall in the way society was organised. Two examples of relief alphabet agencies were the Federal Emergency Relief Administration and the Civilian Conservation Corps. The FERA helped thousands of Americans who were homeless, penniless and on the brink starvation. More soup kitchens were introduced. Also with $500m employment schemes were set up therefore trying to give more people jobs and money. If people got money they would spend it in shops, then the shops would make a healthy profit and an end to the depression would be in sight. ...

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