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Objective: To examine the formation of the New Deal.

Franklin Delano Roosevelt


• Franklin Delano Roosevelt (FDR) won the 1932 Presidential
election.
• In his inauguration speech, FDR stated that, “the only thing
we have to fear is fear itself.”

Inauguration of FDR, March 4, 1933


FDR’s Inauguration Speech - March 4, 1933
I am certain that my fellow Americans expect that on my
induction into the Presidency I will address them with a candor
and a decision which the present situation of our people impel.
This is preeminently the time to speak the truth, the whole truth,
frankly and boldly. Nor need we shrink from honestly facing
conditions in our country today. This great Nation will endure as
it has endured, will revive and will prosper. So, first of all, let me
assert my firm belief that the only thing we have to fear is
fear itself — nameless, unreasoning, unjustified terror which
paralyzes needed efforts to convert retreat into advance. In every
dark hour of our national life a leadership of frankness and vigor
has met with that understanding and support of the people
themselves which is essential to victory. I am convinced that you
will again give that support to leadership in these critical days.
In such a spirit on my part and on yours we face our
common difficulties. They concern, thank God, only material
things. Values have shrunken to fantastic levels; taxes have risen;
our ability to pay has fallen; government of all kinds is faced by
serious curtailment of income; the means of exchange are frozen
in the currents of trade; the withered leaves of industrial
enterprise lie on every side; farmers find no markets for their
produce; the savings of many years in thousands of families are
gone.
More important, a host of unemployed citizens face the
grim problem of existence, and an equally great number toil with
little return. Only a foolish optimist can deny the dark realities of
the moment.
• FDR gathered
information from
many economic
experts, known as the
Brain Trust, on how
to fight the
depression.
Saving the Banks

Bank run, New York City, 1931


• Roosevelt declared a “bank holiday”, closing every bank in
the nation for eight days.
• Congress then
passed the
Emergency Banking
Relief Act, which
only allowed banks to
open if they had
enough funds to pay
their depositors.

FDR signing the


Emergency Banking
Relief Act into law.
Fireside Chats
• FDR gave 30 radio speeches to the nation, which became
known as fireside chats.

FDR’s
first
fireside
chat on
the bank
crisis.
(March
12,
1933)
Fireside Chat On the Bank Crisis - March 12, 1933

I want to talk for a few minutes with the people of the United
States about banking -- with the comparatively few who
understand the mechanics of banking but more particularly
with the overwhelming majority who use banks for the making
of deposits and the drawing of checks. I want to tell you what
has been done in the last few days, why it was done, and what
the next steps are going to be. I recognize that the many
proclamations from State Capitols and from Washington, the
legislation, the Treasury regulations, etc., couched for the most
part in banking and legal terms should be explained for the
benefit of the average citizen. I owe this in particular because
of the fortitude and good temper with which everybody has
accepted the inconvenience and hardships of the banking
holiday.
I know that when you understand what we in Washington have
been about I shall continue to have your cooperation as fully
as I have had your sympathy and help during the past week.
First of all let me state the simple fact that when you
deposit money in a bank the bank does not put the money into
a safe deposit vault. It invests your money in many different
forms of credit-bonds, commercial paper, mortgages and many
other kinds of loans. In other words, the bank puts your money
to work to keep the wheels of industry and of agriculture
turning around. A comparatively small part of the money you
put into the bank is kept in currency -- an amount which in
normal times is wholly sufficient to cover the cash needs of
the average citizen. In other words the total amount of all the
currency in the country is only a small fraction of the total
deposits in all of the banks.
What, then, happened during the last few days of February and
the first few days of March? Because of undermined
confidence on the part of the public, there was a general rush
by a large portion of our population to turn bank deposits into
currency or gold. -- A rush so great that the soundest banks
could not get enough currency to meet the demand. The reason
for this was that on the spur of the moment it was, of course,
impossible to sell perfectly sound assets of a bank and convert
them into cash except at panic prices far below their real
value.
By the afternoon of March 3 scarcely a bank in the
country was open to do business. Proclamations temporarily
closing them in whole or in part had been issued by the
Governors in almost all the states.
It was then that I issued the proclamation providing for the
nation-wide bank holiday, and this was the first step in the
Government's reconstruction of our financial and economic
fabric.
The second step was the legislation promptly and
patriotically passed by the Congress confirming my
proclamation and broadening my powers so that it became
possible in view of the requirement of time to entend (sic) the
holiday and lift the ban of that holiday gradually…
• FDR’s
first
fireside
chat
reassured
people
that
banks
were safe
to use
again.
Fireside chat #15 On National Defense, May 26, 1940
The New Deal

• FDR developed many


new bills that created
programs to help end the
Great Depression.

• These programs were


known as the New Deal.
II. plans for
I. Relief for economic
the unemployed
Recovery

The New Deal had three major goals:

III. Reforms to
prevent another
depression
Criticism of the New Deal

Senator Huey Long:

· He wanted to put heavy


taxes on the rich and to use the
money to give every American
family a house, a car, and a
decent income.
Criticism of the
New Deal

Father Coughlin:
(listen: “Somebody
Must be Blamed”)

· He criticized FDR
on his radio show
for not taking
stronger action
against bankers and
rich investors.
Criticism of the
New Deal

Liberty League:

· It complained that
the New Deal
interfered too much
with business and
people’s lives.
Criticism of the
New Deal

Francis Townsend:

• He proposed giving
every American over
age 60 a pension of
$200 per month.

• However, people receiving the pension would have to retire,


freeing up the job for a younger American.
• In addition, every person that receives the pension would be
required to spend it immediately in order to spur the economy.
FDR and the
Supreme Court
The Conflict:
· The Supreme
Court ruled that
many New Deal
laws were
unconstitutional.
Ex.) AAA

February 10, 1937,


Columbus (Ohio)
Dispatch,
"Trying to Change
the Umpiring"
· After winning the
1936 presidential
election, FDR
proposed increasing
the number of
Supreme Court
Justices from 9 to
15.

February 14, 1937,


Waterbury (CT)
Republican, "Do We
Want A
Ventriloquist Act In
The Supreme
Court?"
* This would allow FDR
to appoint 6 new pro-New
Deal Justices to the
Supreme Court.

February 18, 1937,


Oakland (California)
Tribune, "New Blood"
The Results:

· Many Americans,
including New Deal
supporters, felt that FDR
was unfairly trying to
control the Supreme
Court.

February 28, 1937,


Richmond (Virginia)
Times Dispatch,
"What Has Become of
the Old-Fashioned
Man...?"
March 11, 1937,
Cleveland (Ohio) News,
"The Three Must Pull
Together"
June 16, 1937,
Providence (R.I.)
Bulletin,
" Pulling No
Punches"
August 26, 1937
Newport (R.I.) News,
"And That's The Versatile
Quarterback Who Said If
One Play Didn't Work He'd
Try Something Else."
· FDR withdrew his plan
six months later.

* However, one anti-New


Deal Justice eventually
changed his mind, and
FDR appointed a pro-New
Deal Justice to the
Supreme Court after an
anti-New Deal Justice
retired.

August 30, 1937


Brooklyn Citizen,
"Good For Another Meal"
Objective: To examine the labor problems of the 1930’s.

Do Now: What is a union, and what is their purpose?

Union - an organization of workers formed to protect the


rights and advance the interests of its members concerning
wages, benefits, and working conditions
Labor Reforms
Wagner Act (1935):
· Protected workers
from unfair
management practices

Ex.) firing a worker (:53)


for joining a union
The Wagner Act was the single
most important piece of labor
legislation enacted in the United
States in the 20th century. It was
enacted to eliminate employers'
interference with the organization
of workers into unions.
· Guaranteed workers the right to collective bargaining
(video – 2:09)

* Union membership grew from 3 million to 9 million


during the 1930’s.

* Unions increased their bargaining and political power.


Sitdown strikes were
used successfully by
workers when
businesses refused to
recognize their unions.

The 44-day Flint Sit-


down Strike ended on
Feb. 11, 1937. It
established the UAW as
the sole bargaining
representative for
workers at the world’s
largest corporation.
. Flint sit-downers reading and relaxing
Battle of Bull’s Run
February 11, 1937
Flint sit-down strike ends on
February 11, 1937, after 44 days.
Fair Labor Standards Act (1938):
- Set a minimum wage at 40 cents an hour
- Set the maximum workweek to 44 hours and the
minimum working age to 16 in certain industries.
FEDERAL MINIMUM HOURLY WAGE RATES UNDER
THE FAIR LABOR STANDARDS ACT:

OCT. 24, 1938 $0.25 FEB. 1, 1971 $1.60


OCT. 24, 1939 $0.30 MAY 1, 1974 $2.00
OCT. 24, 1945 $0.40 JAN. 1, 1975 $2.10
JAN. 25, 1950 $0.75 JAN. 1, 1976 $2.30
MAR. 1, 1956 $1.00 JAN. 1, 1977 $2.30
SEPT. 3, 1961 $1.15 JAN. 1, 1978 $2.65
SEPT. 3, 1963 $1.25 JAN. 1, 1979 $2.90
SEPT. 3, 1964 $1.15 JAN. 1, 1980 $3.10
SEPT. 3, 1965 $1.25 JAN. 1, 1981 $3.35
FEB. 1, 1967 $1.40 APR. 1, 1990 $3.80
FEB. 1, 1968 $1.60 APR. 1, 1991 $4.25
FEB. 1, 1969 $1.30 OCT. 1, 1996 $4.75
FEB. 1, 1970 $1.45 SEPT.1, 1997 $5.15
Business leader’s
opposition to FDR
and his New Deal
intensified in
1934 and 1935.
"I did not vote for
that"-- the Court plan
was not universally
popular with FDR
supporters
The New Deal: Good or Bad?

New Deal Critics:


• People worried about the increased power of the
government.

• The New Deal used deficit spending, causing a large increase


in the national debt.

• Business leaders thought that unions had become too


powerful.
The public looked for leadership in 1932, and some
celebrated FDR's "bold experimentation" speech
Cartoons
showed the
NRA as
FDR's
"shield",
and as an
agency
which could
unite labor
and
management
New Deal Supporters:

• New Deal programs were necessary for the public good.

• They believed that industries needed to be regulated by the


government in order to prevent another depression.