The New Deal for America
How to straighten out the finances
1. After
being elected President Roosevelt asked Congress for “broad executive power to wage a war against the emergency”
a. Called
congress into special session, during the first 100 days of his presidency congress approved all 15 measures that made up the heart of the New Deal
2. His
first focus was on the banking system
a. On March
6th he issued a proclamation closing every bank in the nation for a few day
b. The ‘Bank Holiday’ was designed to stop massive withdrawals
c. March
9th Congress passed the Emergency Banking Act, which authorized the
federal government to examine all banks and allow those that were financially stable to reopen
d. Roosevelt
hoped these measures would restore confidence in the banking system
3. March
12th 60 million Americans tuned into listen to President Roosevelt speak from the White House were called “fireside
chats”
a. Explained
how the bank holidays would protect their money
b. Encouraged
people to put their money back into the bank, by the end of the month many banks had reopened and about 1 billion in deposits had flowed into the system
c. Confidence
increased even more the next year when congress created the Federal Deposit Insurance
Corporation (FDIC) which insured people money by the federal government
4. Roosevelt also felt that some of the shady business practices needed to be reformed, he was
a great proponent to the Federal Securities Act which created the Securities and Exchange
Commission (SEC)
a. Thier job was to regulate companies
that sell stocks and bonds
5. April
1933 Roosevelt urged congress to create the Home Owners Loan Corporation; this
measure was designed to assist homeowners that were struggling with their mortgage, by giving them low interest long term
mortgage loans.
6. Federal Housing Administration (FHA) 1934
insured bank loans by the federal government increasing the number
of people that could get loans and boosting the economy
7. Roosevelt then created the Farm Credit Administration;(1933) this provided low interest, long term loans to farmers. This allowed many farmers
to pay off mortgages and back taxes, and buy new equipment to get the farm industry moving in the right direction.
Getting America Back to work
1. May
1933 Congress enacted the Federal Emergency Relief Administration (FERA) its job
was to distribute $500 million in relief aid to state and local agencies, these were grant and not loans
a. The
local governments were responsible for creating the work relief projects
b. By 1935
some 3 billion had been distributed to the needy under this program
2. Most
Americans disliked the direct relief, and didn’t like the handouts, they wanted a job
a. The
Civil Works Administration (CWA) was established to address this problem
b. Most
of the jobs were “make work” jobs like raking leaves and picking up litter, however they put more than 4 million
people to work between 1933-1934
3. Congress in 1933 created the Civilian Conservation Corps
(CCC)
a. This
group was for young men between the ages of 18-25 that would go to army camps to be trained
b. Once
trained they planted trees, created park trails, and developed camp grounds in the nation’s parks and forests.
c. During
its 10 year existence they employed more than 2.5 million people
4. The largest new deal agency created under FERA was
the Works Progress Administration (WPA)
a. The goal of this program was to employ most of the unemployed people in the country until the
economy could recover
b. The program constructed 116,000 buildings, 78,000 bridges, and 651,000 miles of road
c. Also a part of WPA's diversified activities
were the Federal Art Project, the Federal Writers' Project, and the Federal Theatre Project. Close to 10,000 drawings, paintings,
and sculptured works were produced through WPA, and many public buildings were decorated with murals.
d. The agency closed its doors during WWII no
longer needed by the U.S. economy
Recovery
for the Farms
1.
May 1933 Congress passed the
Argicultural Adjustment Act (AAA)
a. This program
paid farmers to reduce their output of corn, cotton, and dairy products, hogs, rice, tobacco, wheat and other commodities
b. The president
believed that these cuts would cause prices of agricultural products to go up, therefore farmers purchasing power would rise,
they would spend more and therefore stimulate the economy
Other
New Deal Acts
1. Social Security was created in 1935, this
act did the following
a. Provided unemployment insurance to workers who lost their
jobs
b. Provided a pension for retired workers
c. Provided payments to people with disabilities, or the beneficiaries
should there have been a death.
