The New Deal
(Jansson Ch 7 & 8)
Dana Ryan
Andrea Bunce
JoLane Blaylock
SW 510
Era of Denial
1929-1933
• Despite the Depression, most assumed economic growth
•
•
•
•
•
•
would resume
Reconstruction Finance Corporation (RFC) passed, with
$2 billion for projects and banks that were to encourage
economic growth
Hoover felt private service agencies could take care of the
problems being faced
Very small group of reformers attempted to expand social
services
FDR was not a liberal, but was a moderate who
supported social services, to an extent
After 3 Republican presidents, country was ready to try a
Democrat and FDR won 1932 election by a landslide
FDR was made even more powerful by his wife, Eleanor,
who was an avid social reformist
Era of Emergency Reforms
1933-1935
• Forces that promoted major reforms
– Working class voters who elected FDR
– Horrific human suffering of the 1930s
– Republicans & conservatives in complete
chaos, allowing FDR to push his ideas
through
– The legislation & programs he enacted
transformed the country and created the
welfare state we now know.
• Forces that limited Roosevelt’s initial policy
initiatives
– Churches, as most were extremely conservative
– Labor leaders who were too preoccupied with their
own right to organize
– Democratic party that was taken over by corporate
interests
– Supreme Court rulings that nullified aspects of the
New Deal
– No fiscal or government institutions to carry out
reforms
– No radical movement active in the country
– Dissention among his own advisors
Emergency Relief
• 1932: Federal Emergency Relief Administration (FERA)
- provided funds to states for people who needed
monetary help
- authorities had right to federalize in states who were
mired in corruption or excessive patronage (was
actually done in 6 states)
* First major welfare program in our history.
• Civilian Works Administration (CWA): part of FERA
- used FERA monies to create public works
- gave government new social welfare responsibilities
• Civilian Conservation Corps (CCC): 1933
– Provided conservation work in national & state
parks for young men
– Most popular reform measure of New Deal
– Helped youth and reduced the welfare rolls
– Run by Army & Dept of Interior
• Works Progress Administration (WPA)
– Developed in 1933
– CWA thought not to have lasting economic
benefits, so amended into this
– First massive peacetime movement by govt in
public projects
– Constructed bridges, airports, dams, & schools
Wagner-Peyser Act
• Passed in 1933
• Federal monies used to fund
unemployment offices
• Offices used frequently to recruit people
for work in CCC, CWA, & PWA
Reform of the Economic
System
• Federal revenue was not sufficient to cover mounting
•
•
•
•
•
costs of New Deal programs
FDR under constant pressure to cut social spending
National Industry Recovery Act of 1933 passed to
convene industry leaders and agree on prices, establish
common wages for workers, and set production quotas;
intended to stop cycles that furthered the Depression;
also established the National Recovery Administration
(NRA)
NRA criticized for creating illegal monopolies
FDR tried to use NRA to indirectly stop child labor and to
legitimize union organization
NRA terminated in 1935 when Supreme Court declared it
unconstitutional
• Agricultural Adjustment Agency (AAA) created to stop
•
•
•
•
agricultural depression so that millions of farmers wouldn’t
become bankrupt; gathered producers of same crops to
settle the acreage amounts to be grown and paid farmers
for not planting some of their land.
AAA created ways to stop tenant farmer abuse by
landowners, but was unmonitored and ineffective
Emergency Farm Mortgage Act & Farm Relief Act were
both enacted in 1933 to let govt purchase & refinance
farm mortgages
National Housing Act of 1934 established the Federal
Home Administration (FHA), to insure mortgages so banks
would be willing to refinance
Tennessee Valley Authority (TVA) of 1933 oversaw
development of dams and power plants; region was site of
vast economic rebirth with minimal costs
Emergency or Permanent
Programs?
• Overriding question: Would Americans
institutionalize the new social reforms of
1933 & 1934 or dismantle them
immediately?
• FDR terminated CWA in 1934
• Conservative interests forming coalitions
and cohesive political consciousness
• FDR hoped that social reforms would ease
the depression so they could be reduced
Evolution of the Reluctant
Welfare State
Chapter 7 Analysis
• 1933 & 1934 were decisive years of
modern welfare state
• Taboo social policy ideas were now
acceptable & operational
• Once new policies were in place, there
was no way to turn back
• Traditional approaches now seemed meanminded and callous to general public
Toward Ongoing Programs
1935-1936
• Second New Deal: new reforms introduced to
•
•
•
•
supplement or replace earlier programs
New reforms intended to decide which ongoing
welfare functions govt should assume and how
they relate to organized labor
Pressure on FDR from reformers and social
workers continues to escalate
Unions of unskilled workers also putting
enormous pressure on FDR
Workers, liberals, & African Americans were
critical of FDR, but preferred him to the
increasingly conservative Republicans who were
growing more stringent about reform since the
1934 elections
End Poverty in America (EPIA) Plan
Included:
• Ongoing federal jobs program
• Massive low-cost housing program
• Insurance programs
• Creation of large manufacturing centers
• Rural programs to help poor farmers
gather land & equipment
The Social Security Act 1935
• Foundation of the American welfare state
• Seen by FDR as one piece of legislation that
•
•
•
•
encompassed many facets he would be unable to pass
otherwise
Contained 2 social insurance programs, 3 relief
programs, and many other smaller programs
Regressive tax system that placed stiffer taxes on lowincome workers than on the more wealthy
Broadened in 1939 to include family members of the
worker
Excluded those not involved in taxed employment
Aid to Dependent Children (ADC)
• Some social workers wanted to grant relief only
•
•
to children they decided lived in “suitable”
homes.
Southerners kept benefits low to ensure African
American women & children continued to work
in the fields
Restricted assistance to families with a single
parent or those whom the welfare grants were
only for children and not the parent
Social Security, continued
• ADC, Old-Age Assistance (OAA) and Aid to
the Blind (AB) were the first permanent
and major federal relief programs.
• Many people of that time might have
reconsidered these programs had they
known how they would grow.
• FDR thought of including national health
care, but was afraid of the trouble the
American Medical Association might cause.
Labor and Public Works
Legislation
Wagner Act of 1936
• NRA declared unconstitutional in 1935
• Partly responsible for drastic increase in
union membership
• Employers required to officially recognize
union bargaining agents, could not fire nor
intimidate organizers, and could not claim
that the company union suffered when
workers held elections
Emergency Relief Appropriation Act 1935
• Work program consolidating existing
federal jobs programs
• Socially useful projects designated for
areas in relation to welfare roll numbers
for the region
Works Progress Administration (WPA)
• Dominated FDR’s public works strategy
• Major player in disaster relief work
• Utilized the local, state & federal staff of
FERA, which was phased out after Social
Security Act was passed
National Youth Administration (NYA)
• Advocated by Eleanor Roosevelt
• College aid for poor students
• Aid for high school students
• Public jobs in recreation centers &
municipal services
• Camps for rural youth to teach trade skills
Era of Stalemate
1937-1941
• After FDR’s reelection in 1936, people
asking where New Deal to go next
• He slashed funding for many New Deal
programs to reduce federal deficits
• Middle-class voters begin to suspect him of
socialism
• Conservative coalition now openly
questioning his policies
• Supreme Court and political defeats in
1936 & 1937 tarnished his public image
Policies During Era of
Stalemate
Fair Labor Standards Act of 1938
• Gains made under NRA were erased when
Supreme Court declared it unconstitutional
• FLSA rectified these gaps in policy
• Established minimum wages
• Established maximum hours
Wagner-Steagall Housing Act of 1937
• Established US Housing Authority to offer
low-interest loans for public housing
Reorganization Act of 1939
• Created sub-cabinet Federal Security
Agency (FSA) & Federal Works Agency
• FSA Contained CCC, NYA, Public Health
Service, US Employment Service, Social
Security Board
• Federal Works Agency contained WPA &
PWA
Attempts to make CCC permanent program
failed in both 1937 & 1939
Also defeated was attempt to create sister
acts of TVA in seven other river basins
Out groups & the New Deal
How did the New Deal help them?
African Americans
• FDR refused to support legislation making lynching federal
•
•
•
•
•
crime
Wouldn’t support elimination of the poll taxes of the South
No legislation to counter housing market segregation
FDR felt they were discriminated against because they
were poor, not because of race: therefore, New Deal
programs helped them as they helped all other poor
people
Quotas were not used because they were seen as reverse
discrimination tactics
CCC was segregated
Women
•
•
•
•
•
Eleanor Roosevelt was voracious women’s advocate
No women in CWA
15% of WPA recruits were women
Wagner Act helped to organize women
More job security than men in Depression because their
work was sex-segregated
• NRA labor codes established the gender wage gap
• Since Social Security benefits were based on wage levels
and job history, women had small benefit packages
Latinos
• Farm workers weren’t covered under Wagner
•
•
•
•
Act, where bulk of Latinos were employed
No Social Security or unemployment benefits
Bracero program instituted w/Mexico in 1942:
number of Mexicans allowed in US to work,
which helped ease Mexican unemployment and
US labor shortages on farms
Segregated communities
Los Angeles police known for conducting regular
mass roundups and incarcerations
Asian Americans
• Immigration Act of 1924 limited annual number of
•
•
•
•
immigrants from specified areas
First-generation was denied citizenship since they were
not Caucasian, and then denied access to relief
programs of Depression because they were not citizens
Despite confidential reports before & after Pearl Harbor
that they were not a threat, FDR signed Executive Order
9066 which was the basis for internment camps
EO 9066 & camps are seen by many Asian Americans as
primary example of the impact of racism on US social
policy
Ban on Chinese immigration finally lifted in 1943
Evolution of reluctant welfare
state
Chapter 8 Analysis
• New Deal striking departure from traditional
American policies in two ways
– FDR created a national welfare state that overrode
local programs
– He created social programs rather than maintaining a
regulatory strategy
FDR CREATED REFORMS IN A SOCIETY WHERE
NO NATIONAL SOCIAL PROGRAMS HAD
EXISTED AND IN SPITE OF ENORMOUS
SOCIAL, LEGAL & POLITICAL OPPOSITION.
DISCUSSION QUESTIONS
1. What political, cultural, economic, or other factors
2.
3.
4.
seem to make policy makers deny some problems
while taking others seriously?
Would major social programs such as the New Deal
have been created federally if the Great Depression
had never occurred?
What ethical criticisms would FDR have encountered
had he not developed national programs in the Great
Depression?
Were a truly liberal party to exist in the US, would it be
successful in getting & keeping power with our winnertake-all system of elections?