Explain the Features of the New Deal - Roosevelt and the American Presidential Election 1932.

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History Coursework – The New Deal

Ben Hall

  1. Explain the Features of the New Deal            (7)

When Roosevelt won the American Presidential Elections in 1932, he needed to act quickly to provide the general public what he had promised. His first hundred days in office was a time of dramatic change to the American system of government. Never before had American Presidents been so involved with the every day life of their people or worked so hard to improve the country in almost every aspect affecting the lives of the public and the economy. However, it can not be doubted that the period that followed the Wall Street Crash in 1929 were times of desperation and depression for the vast majority of people from all walks of life. As people obviously thought during the era of Roosevelt’s presidency; desperate times call for desperate measures and the Great Depression was probably the period of greatest desperation in American history

One of the most notable and dramatic changes he made right from the start of his presidency was to completely ignore the Republican policy of ‘Self-Help’ or Laissez-Faire. The prospect of the government not meddling with the everyday lives of the American people had been a long standing tradition in the American way of life and drastically went against the idealistic visions of the ‘American Dream.’  The main concept of this belief was that if you tried hard in life, you would succeed and lead a prosperous lifestyle. On the other, and more popular side (at least in the 1930’s) was Roosevelt’s New Deal, which provoked anger from its oppositions, who claimed it was unconstitutional. For the first time in American history, the President had become directly involved with the lives of the general public. He needed to take drastic action to sort out the chaos the Wall Street Crash had caused to the economy and in turn, people’s lives. He could not hope, like Hoover had done, that if people began to work again the economy would simply sort itself out – it didn’t just work like that. People could not start to work again because there weren’t the jobs available any longer as industries had been forced to shut down during the depression. Roosevelt believed in ‘active governing,’ trying to improve the lives of ordinary people and therefore, as President felt it was his duty to use his initiative to bring back the American economy to its former glory. Much of his active governing was done on the ground, directly giving help to those that needed it. Yet he did not posses super human powers and could therefore not be at two places the same time. An example of his direct work with the general public of America was part of the way in which he restored the population’s confidence. He broadcast live talks with the public on the radio which were immensely popular and became known as the ‘fireside chats.’ He was aiming to reassure them that everything would turn out alright in the end, influencing the American public to feel secure within the direct care of Roosevelt’s safe hands.    

During the depression that followed the Wall Street Crash, people began to panic and there came a sudden rush of people wishing to withdraw their money form the banks. If action was not taken soon, there would be nothing to stop America’s banks becoming starved of money, therefore going bust. The banks therefore temporarily closed themselves down to stop people being able withdraw their money and yet if they stayed shut it would mean that no one would have had any money to spend. It was decisive that Roosevelt prevented this from happening before he began to solve the countries other problems. He needed solid foundations from which he could begin to support the growth of the countries economy and this was clearly not going to be achieved until the security of the banks were certain. To tackle this problem, one of the first measures Roosevelt introduced was the Emergency Banking Act in order to prevent banks from having to shut down permanently. Roosevelt acted quickly, ordering all banks to stay closed for four days whilst he tried to convince the public to put an end to withdrawing their money and return the money they had already taken out. He also established the Security Act, which forced all banks to provide full public information and only allowing the trustworthy banks to reopen. He then gave grants to these banks so that they could pay back debts and would no longer have to risk the prospect of becoming bankrupt as they once again opened.

Possibly the hardest hit group of people in American society by the Great Depression were the farmers. The problem was that American farming methods were simply too efficient and productive creating a surplus in food which therefore, started to become worth next to nothing. Farmers, in particular small-scale, could no longer make any profit and many were forced to sell up and move to the cities in search of more profitable jobs. Roosevelt realised that he needed to once again raise the prices of the food being produced in order to reassure farmers that they would be able to make a living. Crops literally had to be incinerated, as no one needed the amount being produced. It was impossible to sell it abroad due to the tariffs that had been introduced by most countries against American goods in retaliation to taxes Hoover had put on all foreign imports. Roosevelt needed to put an end to this and so he decided to start paying farmers for not actually producing anything. The AAA was set up to sort out the American farming industry and helped farmers who were in danger of losing their homes, as they could not pay the mortgage after the Wall Street Crash. The AAA brought and slaughtered millions of young livestock to increase the prices again and gave the farmers compensation for any excess crops produced.

As a result of the Wall Street Crash, many companies became insolvent or were forced to close down completely. To remain in business the surviving companies were forced to cut their overheads by inter-alia laying off their work force in whole or in part. Some aspects of the New Deal were brought into being in order to tackle the ever-increasing problem of mass unemployment. In order to do this, Roosevelt set up numerous agencies such as the Civilian Conservation Corps (CCC), which were aimed at creating jobs for unemployed young men. This particular agency set the unemployed on environmental projects such as strengthening riverbanks and controlling mosquitoes to prevent malaria. Another such agency was the Public Works Administration (PWA), who provided jobs in the construction of public buildings such as schools and hospitals. However, some of the codes of the PWA were found to infringe on individual states rights and it was therefore banned, but in 1935 the Works Progress Administration (WPA) was set up to take its place doing near enough the same job. The WPA was actually more successful than the PWA, finding, in total work for 8 million young men. Agencies such as these all contributed to dramatically reducing unemployment, taking a large step to fulfilling one of Roosevelt’s main criteria.

As a consequence of the mass unemployment that came along with the Wall Street Crash, many families were facing the realistic prospect of being evicted from their homes. Thousands were made homeless after not being able to repay their mortgage when the banks collapsed during the depression, leaving families on the streets dying from both hunger and exposure. One of the most immediate decisions Roosevelt had to make was how to deal with these victims of the Wall Street Crash. His ideas were simple, to ensure those at risk from losing their homes did not get kicked out, and to allow those already on the streets back into their homes. He responded to this crisis by setting up the Federal Emergency Relief Administration (FERA) who gave money to state and local governments who, in turn provided relief by building soup kitchens and handing out blankets. It also set up the Home Owners Loan Corporation, which gave low interest loans, which enabled homeowners to adjust mortgage repayments in order to cope with temporary unemployment. Tennessee Valley, which was already a deprived region, was badly affected by the depression, as the areas main industry was agriculture. On top of that, the region suffered from frequent floods during the early 1930’s, which left over half the population dependant on government relief for survival. The Tennessee Valley Authority was launched to regenerate the area by encouraging industry and agriculture. It tamed the river with damns in order to put an end to the floods, which were then also used to create HEP.

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During the economic boom of the 1920’s, American industry was considered the most technologically advanced and efficient in the world. However, this soon led to over-production on a catastrophic scale. They could not sell their products overseas due to the tariffs imposed upon American goods and thus, industries began to lose profits, being one of the causes resulting in the Wall Street Crash. This was therefore yet another aspect Roosevelt aimed to tackle by the introduction of his New Deal; helping the countries industry back on its feet again. He needed to act, or else soon, the few companies that ...

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