Constructing the New Deal
#1 Restoring Confidence / The First Days
Within the first 100 days of his term beginning in March 1933, FDR began
to pass legislation to at least give the US temporary economic stability. FDR
pushed legislation such as the Emergency Banking Act, in the wake of the bank
holiday’s temporary relief which protected the strong banks from the weaker
ones, and the Economy Act, which balanced the federal budget by cutting
government salaries. FDR was able to gain support with his style, using such
tactics as his fireside chats, which reached out to everyone through radio.
#2 Agricultural Adjustment
During his presidency, Roosevelt was faced with the Farm Bureau
Federation which was a gathering of 300,000 farmers in 1933 to pay dues of $10
a year or more on programs to limit the planting of crops. Poorer farmers were
associated with the Farmer’s Union and the Farm Holiday Association. They
argued that they could not afford to cut production. Reforms written by Roosevelt
were to be administered by the Agricultural Adjustment Administration. The
Commodity Credit Corporation lent farmers money on the basis of their existing
crops or non-perishable commodities and had them in storage from future
shortages. The Farm Credit Administration provided farmers with assistance in
meeting mortgage payments.
#3 Industrial Recovery
In June of 1933 the NIRA (National Industrial Recovery Act) was passed
which created the National Recovery Administration (NRA). The NRA was led by
Hugh Johnson, had a symbol of the blue eagle and their slogan was, “We do our
part.” Their main accomplishment was setting up the blanket codes which
created a minimum wage of 30-40 cents, maximum work hours of 35-40 hours
and eliminated child labor. The Public Works Administration (PWA) was also set
up to administer spending programs. One problem was that the NRA gave
workers the right to engage in collective bargaining. In 1935, the Supreme Court
intervened in the Schecter Case and said the NRA was unconstitutional, because
the federal government cannot regulate intrastate commerce.
# 4 An Experiment in Regional Planning
The government experimented in the idea of stimulating the economy through
urban development and regional planning. The Tennessee Valley Authority took
what was an abandoned dam (the Muscle Shoals Project) and turned it in to a
way to both develop an impoverished area and to establish a cheap public power
utility (though the later aim came under fire from private utility companies).
#5 Financial Reforms
Roosevelt directed Henry Morgenthau Jr., head of the Farm Credit
Administration to make purchases of gold along with meat. corn and oats.
Congress passed the Silver Purchase Act of 1943 for the purchase of silver. The
Glass-Steagall Act of June 1933 gave the government the authority to curb
irresponsible speculation by banks. This established the FDIC. Congress
passed the Truth in Securities Act of 1933, which required corporations to issue
new securities and to register them with the Federal Trade Commission. In June
1934, Congress established the Securities and Exchange Commission to police
the stock market.
#6 Growth in Federal Relief
The Federal Emergency Relief Act was established by FDR to give money
back to the states. Henry Hopkins was head of FERA and ran it effectively. This
whole program was a relief plan to try to start up the economy again. The CWA
was also established to try to give people jobs. It was pumping money into the
economy effectively. The CCC was established to also provide work, but for
young men to work and to send money back to their families. The HOLC loaned
out about $3 billion to refinance mortgages over millions and millions of
households. They didn’t want to keep houses; the banks wanted the
homeowners to keep homes.