1. ENDURING THE NEW DEAL PROGRESSIVISM FULFILLED The Great Depression

2. Underlying Causes Boom goes bust Stock market speculation – “on margin “ buying Overproduction – under- consumption – economy dependent on consumer spending Excessive reliance on credit Maldistribution of wealth -0.1 % held as much wealth as bottom 42% -- limited buying power – MC dependent on salaries Technological unemployment Economic ties to Europe – tariffs, end of Dawes Plan – more global economy Weak economic areas – RR, agriculture, construction, coal – over-invested and developed Limited political and economic leadership in gov’t and Federal Reserve – Galbraith

3. NY Stock Market Crash Babson Break SM Crash = trigger or catalyst

4. Impact “Hard Times” (Turkel) GNP 104.6 billion 1929 ----56.1 b 1933 Unemployment – 20-25% -- not really counting the self employed -- minorities more like 30-33% “last hired, first fired” Income decreased by 54%; farm income by 55%; labor by 41% 22% of all banks failed Breadlines, homelessness, migrations – “Army of the Dispossessed”, Hoovervilles Marriages and birth rates decrease – so does divorce – families often drifted apart Women often had to give up jobs Loss of identity and worth “invisible scars” - Bird Fears of class warfare and revolution Freedom limited

5. Hoover’s Response Schlesinger “crisis of the old order” Voluntarism /associationalism – state and private charities Mellon advises to let it “bottom out” Commitment to the balanced budget “Rugged Individualism”

6. Hoover’s Response OFTEN TOO LITTLE – TOO LATE Public Works – Hoover Dam Federal Farm Loan Board Glass – Steagall Act Home Loan Banking Act Moratorium on debt collection from Europe but Hawley Smoot Tariff Reconstruction Finance Corporation – bridge to the New Deal – but focus on RR, businesses, banks

7. The People Reno – Farm Holiday Association Bonus Army – Hoover’s Response Election of 1932 – income for most 50% of 1929 Hoover v. FDR Emergency Banking Act & First Inaugural Address  Leadership – the analogy of war Brain Trust Fireside Chats “reform to save” – goals: preserve capitalism and democracy The Hundred Days – 15 key pieces of legislation The Three Rs – Relief, Recovery and Reform

11. Nevins – Effective Greatness Characteristics that fit the needs of the time Three Qualities:  Willingness to experiment  Timing – met each crisis w/ action  Spiritual strength and optimism Two transformations:  Helps American become more socially minded  Moves the nation from isolation to leadership and participation in the world

12. First New Deal 1933-1935 Focus = Recovery Key Programs:  Relief – FERA, TVA, PWA, CCC – Hopkins  Finance – Emergency Banking Act, FDIC, HOLC, off gold standard, Sec  AAA – key to recovery ---Butler v US Strikes Down  STFU  NRA – section 7a – problems – Schechter v US Strikes Down

13. Critics The Right – American Liberty League – businessmen The Left – those pushing for greater changes  Upton Sinclair – EPIC – Progressives  Huey Long – “Share Our Wealth”  Dr. Townsend – the elderly  Father Coughlin – radio priest demogogues

15. The Second New Deal 1935-1938 Trickledown v Pump-priming – Keynesian theory Focus = Relief and Reform Key Programs:  Relief – WPA, Federal One, NYA, RA  Finance – Revenue Act of 1935  Reform – response to critics  Social Security  National Labor Relations Act – Wagner Act  REA  2 nd AAA  FSA  Fair Labor Standards Act – last major ND legislation

16. End of the New Deal Court- Packing Scheme - Impact Failed Purge of Conservative Democrats Sit-Down Strike – GM 1937 Roosevelt Recession 1938 Focus shifts to foreign policy – war in Europe 1939 New Deal doesn’t end Depression – ameliorates and preserves – only embracing deficit federal spending as the US becomes the “Arsenal of Democracy” brings productivity, employment and $ flowing through the system

18. Impact of the New Deal Labor: CIO formed – Lewis UAW 1937 GM Strike & 1937 Republic Steel Strike – gains in union membership Women: cabinet positions, E Roosevelt – but limited gains African Americans: “black cabinet” - limited real gains – SS doesn’t apply to most, hiring discrimination & in federal programs Native Americans: Collier – Indian Reorganization Act Hispanic Americans: job discrimination Communism & the Popular Fronts – the Common Man

19. Legacy of the New Deal The system – democracy and capitalism is preserved  Leutchenberg – Halfway Revolution; Friedel – conservative revolution - no re-arrangement of wealth or power The Broker State model emerges – if organized – but limited response to the “voiceless” or unorganized Political Re-Alignment ---Roosevelt Coalition Increased power to the executive branch and the federal level of government New perception of the relationship between the people and the government – the “guarantor” state – a transformation of consciouness” -- Progressivism revived Tools & processes for stabilizing the economy New Definition of Freedom – economic security – work – impact of economic inequalities

20. Assessment “Roosevelt was a pragmatist – impatient w/ theory – he kept what worked and discarded the rest. The result was paradoxically, both profoundly revolutionary and profoundly conservative.” Capitalism’s basic structure and problems were dealt w/ through traditional democratic processes. Third American Revolution --- Missed opportunity for broader reforms Leutchenberg –”halfway revolution” – helped some –ignored others