FDR’s Second Term

The First Term  ’34 Mid-term elections  Dems dominate  Impact of Eleanor = ACTIVIST, AGITATOR  “No woman has ever so comforted the distressed or distressed the comfortable.”  Social service, human welfare for women, blacks  Why?  “The bottom dropped out of my own particular world.” 1918

New Deal Criticism  Stabilized economy, but unemployment 10%+  “We have been patient and long suffering. We were promised a New Deal. Instead we have the same old stacked deck.” –farmer, ‘33  Executive power increased  Welfare capitalism  Worker entitlement  American Liberty League = opposition to New Deal  Businessmen + politicians  Al Smith, John Davis

Alternate solutions  “Kingfish” of LA- Huey P. Long  Lawyer, politician, “clown”  For LA- roads, schools, hospitals, better public services  How?  Share Our Wealth program  5k/family, $2,500/year, pensions, low working hours, bonus pay for vets, college ed.  No econ. recovery

 Dr. Francis Townsend- CA  Townsend Plan, ‘34  Pensions,$200/month to 60+, jobs for young  Affect only 9% of population, cost ½ the budget  Father Charles Coughlin- the “radio priest” (CBS)  National Union for Social Justice, ‘34  Coinage of silver, attacks on bankers (anti-semitism)

Court Opposition  5/27/35- Schechter Poultry Corp. v. U.S.  “sick chicken case”  Schechter sold “unfit” chicken, violated NRA code  SC ruled Congress gave too much power to Exec. Branch when code-making authority was given to NRA, Congress exceeded power by attempt to regulate INTRASTATE commerce  Killed NRA

The Second New Deal, 1935  “I’m fighting communism, Huey Longism, Coughlinism, Townsendism.” –FDR, 1936  Move LEFT  Laws, influence of SC Justices L. Brandeis, Felix Frankfurter

 Wagner Act (Nat’l Labor Relations Act)  Workers given right to bargain w/ employers through unions, employers stay out of union activities  Revenue Act (Wealth Tax Act)  Soak the rich tax  Raise tax rates on incomes $50k+, estate/gift taxes, corporate tax  Tax failed to increase fed. Revenue significantly, no redistribution of wealth  FDR = radical

 Social Security Act  Movement away from individual self-reliance  For aged, indigent, disabled, unemployed 1. Pension fund for retired (65+) 2. Unemployment insurance program 3. Social welfare  State-administered programs get $ from Fed. Grants  Old age, dependent children, blind, maternal & child welfare, public health services  Funded by payroll taxes on employees and employers  Fixed tax, hurt poor, removed $ from circulation  Went to trust fund  shrinking of $ supply  Excluded farm laborers, domestic servants, self-employed

1936 Election  FDR v. Kansas Gov. Alfred Landon  FDR- solid south, blacks, urbanites, poor, new immigrants, farmers  Landon- conservatives, business leaders  FDR victorious  EC: 523 – 8  Pop: 27 m. – 16 m.

The Court-Packing Plan  SC still a block to FDR/Congress reforms to expand gov.  Cases in waiting for Wagner Act, Social Security  Size of court left to Congress  ‘37- 9 justices  2/5- FDR send plan to Congress to create new judgeships (50 federal, 6 SC), diminish power of those having served 10+ years or 70+ yrs  Backfired- too political, insult to older judges, fear by public  Failed, BUT…  ‘37- court caved  Wagner & SS Act upheld, new liberal justice to replace conservative who resigned

The Roosevelt Recession: ‘37-’38  ‘35-’36  Improvement in econ.  gov. spending, relief payments, public-works, bonus to vets  ‘37 = cuts in federal spending, social security payroll taxes  Inflation, deficit   “recession”  4 m. unemployed, scenes of early depression

 FDR image eroded  Debate in administration  Less fed. Spending & balanced budget v. more gov. spending & enforcement of antitrust laws  Early Congress approve spending program  Aim? Increase purchasing power, public works  No full recovery  Decline reversed  No massive, sustained gov. spending  Few major reforms

 Wagner-Steagall Nat’l Housing Act (‘37)  USHA (Dept. of Interior)  loans to clear slums, public housing  Bankhead-Jones Farm Tenant Act (‘37)  Farm Security Admin.  loans to tenants to purchase own farms, prevent small farm owners from falling to tenancy  Problem?  Fair Labor Standards Act (‘38)  Min. wage =.40/hr, 40 hr workweek, 16 age limit

Legacy of the New Deal  By ‘38, much anti-ND opinion  State of the Democratic Party  House of Un-American Activities  A Plan to Purge the Party  By ‘39, the New Deal “has been reduced to a movement with no program, with no effective political organization, with no vast popular party strength behind it.”

Halfway Revolution  CHANGES  BIG government  HOPE to people  SHIFT in liberalism  TR/WW- aggressive regulation  equal opportunities  FDR- gov. respond AND take steps to AVOID social crises  Min. levels of: well-being, labor conditions, public welfare  Middle class helped to keep $$, homes, farms  FDIC, unemployment pay, SS = safeguard vs. future depression

 First New Deal = experiment of managed economy under NRA  Abandoned in favor of competition, gov. spending  FDR policies revolutionary AND conservative  Gov = regulations, expanded social welfare  Fell short of socialism  Capitalist structure still in place  = halfway revolution