28.3 What was Franklin Delano Roosevelt's plan to
end the Great Depression?
As we have seen the Great Depression had a devastating impact on the
American economy and the American people. President Hoover believed,
basically, in waiting things out. As result of Hoovers inactivity America
turned to a new, dynamic leader: Franklin Delano Roosevelt. Today we will
discuss his basic strategy for improving the economy.
I. Franklin Delano Roosevelt
A. Early Years
1. Raised in upper class family in Hyde Park N.Y.
2. Attended Harvard and Colombia
3. Lawyer then active in NY politics
4. 1912 - Assistant Sec. Of Navy
5. 1918 Narrowly won Governorship of NY,
6. 1920 - VP Candidate with James A. Cox
7. 1921 - Contracted Polio, lost use of legs. This deeply effected Roosevelt.
Now he truly knew what human suffering was all about. He could identify. He
was also a fighter and a winner. He overcame his handicap and this later
would inspire Americans during the depression.
8. 1930 Reelected Governor of New York State - His innovative programs
gained national attention and were eventually called the Little New Deal - NY
Model
9. Ran for Pres. In 1932 - Used song: "Happy Day's Are Here Again."
Pledged to America; "I Pledge to you, I pledge myself, to a new deal for the
American people!"
B. What did Roosevelt do when he got elected?
1. Inauguration Speech: Told America "We have nothing to fear but fear
itself!" He wanted to inspire optimism and hope. He did not want America
paralyzed by fear. He was a man of action.
2. Appointed the "Brain Trust" - These were a group of brilliant social,
economic and political thinkers who comprised Roosevelt's cabinet. He
surrounded himself with the best, not just political allies and supporters.
-Harry Hopkins - Social Worker and the architect of much of the New Deal.
-Henry Morgenthau
-Louis Lowe
-Cordell Hull
-Frances Perkins - Sec. of Labor and first female in the cabinet.
-Sam Rosenman
-Raymond Moley
-Rexford Tugwell
3. First Hundred Days - For the first hundred days of his administration
Roosevelt and his Brain Trust where a whirlwind of activity. Legislation was
introduced and passed at a furious pace as Congress mostly acted as a
rubber stamp. Roosevelt called Congress into session and asked for
executive power to wage war against poverty and pessimism. He said he
wanted a power "as great as the power that would be given me if we were in
fact invaded by a foreign foe." At first he ordered a bank holiday, which
closed every bank in the nation and stopped people from withdrawing all of
their money. This ended the panic. He then signed legislation called the
Emergency Banking Act. This closed all of the insolvent lending institution
and only reopened the solvent ones. While many lost money at least the panic
was eased.
B. What was Roosevelt's underlying philosophy?
1. Keynesian or "pump priming" economics. Based on the beliefs of economist
John Maynard Keynes it held that money should be invested in the people,
the working class. Then spending would increase with new money in
circulation. As spending increased it was expected that businesses would
expand to meet the new demand and hire new workers. This would spur on
more spending and more growth. This plan was the opposite of the
Republican plan ascribed to by Hoover and earlier leaders. They had believed
in supply side or "trickle down" economics. In this philosophy money was to
be invested at top, in business. Then businesses would expand, hire new
workers and this in turn would spur on spending and further economic
growth.