The First New Deal
Published on Nov 25, 2015
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PRESENTATION OUTLINE
THE HUNDRED DAYS BEGIN
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Origins of the New Deal
The New Deal was not based on a clear strategy shaped by a single philoso- phy. Roosevelt was not an intellectual, nor did he have a strong political ideology. He was a practical politi- cian. FDR was willing to try a variety of approaches both to see whether they worked and whether they were helping or hurting him politically.
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A Divided Administration
Roosevelt’s advisers were divided roughly into three main groups. Despite their disagreements, most of the advisers had grown up in the Progressive Era, and their approaches reflected progressive ideas. They generally favored some form of government intervention in the econ- omy—although they disagreed over what the govern- ment’s role should be.
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FIXING THE BANKS AND THE STOCK MARKET
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The Emergency Banking Relief Act
On his very first night in office, Roosevelt told Secretary of the Treasury William H. Woodin he wanted an emergency banking bill ready for Congress in less than five days. The following afternoon, Roosevelt declared a national bank holiday, temporarily closing all banks, and called Congress into a special session scheduled to begin on March 9, 1933.
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Regulating Banks and Brokers
Although President Roosevelt had restored confidence in the banking sys- tem, many of his advisers who favored trust-busting and fair competition urged him to go further. They
pushed for new regulations for both banks and the stock market. Roosevelt agreed with their ideas and threw his support behind the Securities Act of 1933 and the Glass-Steagall Banking Act.
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MANAGING FARMS AND INDUSTRY
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The Agricultural Adjustment Administration
The nation’s farmers had been hit hard by the Depression. One week after calling Congress into special session, Roosevelt announced plans for a new farm program. Working closely with the leaders of the nation’s farm organizations, Secretary of Agriculture Henry Wallace raced to complete a new farm bill before planting season began.
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A Blueprint for Industrial Recovery
The govern- ment turned its attention from farming to manufac- turing in June 1933, when Roosevelt and Congress enacted the National Industrial Recovery Act (NIRA). The NIRA suspended the antitrust laws and allowed business, labor, and government to cooper- ate in setting up voluntary rules for each industry.
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PROVIDING DEBT RELIEF
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The Home Owners’ Loan Corporation
To help homeowners pay their mortgages, Roosevelt asked Congress to establish the Home Owners’ Loan Corporation (HOLC). The HOLC bought the mort- gages of many homeowners who were behind in their payments. It then restructured them with longer terms of repayment and lower interest rates. Roughly 10 percent of the nation’s homeowners received HOLC loans.
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The Farm Credit Administration
Three days after Congress authorized the creation of the HOLC, it authorized the Farm Credit Administration (FCA) to begin helping farmers refinance their mortgages. Over the next seven months, the FCA lent four times as much money to farmers as the entire banking sys- tem had done the year before. It was also able to push interest rates substantially lower. “I would be with- out a roof over my head if it hadn’t been for the gov- ernment loan,” wrote one of the millions of farmers who were saved by FCA loans.
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The CCC
The most highly praised New Deal work relief program was the Civilian Conservation Corps (CCC), which combined Roosevelt’s love of nature and commitment to conservation with the need to help the unemployed. Beginning in March 1933, the CCC offered unemployed young men 18 to 25 years old the opportunity to work under the direction of the national forestry service planting trees, fighting forest fires, and building reservoirs.
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Public Works and Emergency Relief
A few weeks after authorizing the CCC, Congress established the Federal Emergency Relief Administration (FERA). FERA did not initially create projects for the unem- ployed. Instead, it channeled money—a half-billion dollars in all—to state and local agencies to fund
their relief projects. The leader of FERA was Harry Hopkins, whose nervous energy and sarcastic man- ner put off many people. Despite his personality, Hopkins became one of the most influential people in Roosevelt’s administration.
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The CWA
By the fall of 1933, neither FERA nor the PWA had reduced unemployment significantly. Hopkins realized that unless the federal government acted quickly, a huge number of unemployed would be in severe distress once winter began. After Hopkins explained the situation, President Roosevelt authorized him to set up the Civil Works Administration (CWA).
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