Studied by 14 people
Unemployment rate (1933)
25% (highest ever)
unemployment rose until the New Deal started, then fell during the New Deal until the Roosevelt Recession
Herbert Hoover/philosophy on government intervention in the economy
He believed in a limited government because excessive federal intervention posed a threat to capitalism & individualism
Gold standard
a monetary system where a country's currency or paper money has a value directly linked to gold
Hoover was attached to the gold standard which allowed the depression to be so long and severe
His administration feared abandoning it would weaken the dollars
In 1933 the Roosevelt administration removed the U.S. from the gold standard
Smoot-Hawley Tariff
High tariff enacted in 1930 during Great Depression. By taxing imported goods, Congress hopes to stimulate American manufacturing, but tariff triggered retaliatory tariffs in other countries - further hindered global trade & led to greater economic contraction
Reconstruction Finance Corporation
Agency established in 1932 to provide emergency relief to large businesses, insurance companies, and banks
Lent money too cautiously, only 20% of $1.5 billion in funds, wasn't aggressive enough
Reasons for Hoover's declining popularity
His treatment of the Bonus Army where he allowed troops to attack protestors, his lack of action during the Great Depression
Said that economic outcomes are product of peoples characters, their fate was in their own hands, and success would come to deserving people
Voluntary action, businesses rover w/o relying on government assistance
Hoovervilles
Depression shantytowns, named after the president whom many blamed for their financial distress
Differences between Hoover + FDR
FDR believed in a much more direct government that would directly affect the lives of Americans. Hoover was much more limited and did not pass much reform. FDR was willing to experiment
Bonus Army
Group of 15,000 unemployed WWI veterans who set up camps near Capitol building in 1932 to demand immediate payment of pension awards due to be paid in 1945
FDR/political career before becoming president
He was the governor of New York city where he staged inflated innovate relief & unemployment programs
FDR/polio
He contracted polio and couldn't move from the waist down. He was still an active political figure who made change, but his wife Eleanor traveled around the country for him seeing Americans as he could not
National bank holiday
4 days in which all banks were closed. Failing banks were reorganized, and the Emergency Banking Relief Bill provided backup for banking industry.
Fireside chats
Series of informal radio addresses FDR made to nation in which he explained New Deal initiatives
Hundred Days
Legendary session during first three months of FDR's administration in which Congress enacted 15 major bills that focused primarily on 4 problems: banking failures, agricultural overproduction, the business slump, & soaring unemployment, emergence of new American state
"Brains Trust"
Professors from leading universities that helped Roosevelt draft Great Depression legislation & policies
Glass-Steagall Act
1933 law that created Federal Deposit Insurance Corporation (FDIC), which insured deposits up to $2,500 (& now up to $250,000). The act also prohibited banks from making risky, unsecured investments w/ customers' deposits
Agricultural Adjustment Act (AAA)
New Deal legislation passed in May 1933 that aimed at cutting agricultural production to raise crop prices and thus farmers' income, direct governmental regulation of farm economy for first time
To solve the problem of overproduction, AAA provided cash subsidies to farmers who cut production of 7 major commodities: wheat, cotton, corn, hogs, rice, tobacco, & dairy products. Policymakers hopes farm prices would rise as production fell
Money is farmers' hand - AAA briefly stabilized farm economy, but act's benefits not evenly distributed
National Recovery Administration
Federal agency established in June 1933 to promote industrial recovery during the Great Depression, encouraged industrialists to voluntarily adopt codes that defined fair working conditions, set prices, and minimized competition
Large companies ran this association
Solidified their power at expense of smaller enterprises & consumer interests
Public Works Administration
New Deal construction program established by Congress in 1933. Designed to put people back to work, built the Boulder (renamed Hoover) dam & Grand Coulee Dam, among other large public works projects
2.6 million men & women put to work, repaired bridges, built highways, constructed public buildings with Civil Works Administration
Civil Conservation Corps
Federal relief program that provided jobs to millions of unemployed young men who built thousands of bridges, roads, trains, & other structures in state & national parks, bolstering the national infrastructure
Federal Housing Administration
An agency established by the Federal Housing Act of 1935 that refinanced home mortgages for mortgage holders facing possible foreclosure
Securities and Exchange Commission
Commission established by Congress in 1934 to regulate the stock market. The Commission had broad powers to determine how stocks & bonds were sold to the public, set rules for margin (credit) transactions, and to prevent stock sales by those with inside information about corporate plans
Liberty League
A group of Republican business leaders & conservative Democrats who banded together to fight what they called the "reckless spending" and "socialist" reforms of the New Deal
Schechter v. United States
SCotUS unanimously ruled that National Industrial Recovery Act unconstitutional because it delegated Congress's lawmaking powers to the executive branch & extended federal authority to intrastate commerce
Townsend Plan
Plan proposed by Francis Townsend in 1933 that would give $200 a month (about $3,300 today) to citizens over the age of 60. Townsend clubs sprain up across the country in support of plan, mobilizing mass support for old-age pensions
Huey Long/Share Our Wealth Society
Democratic governor of Louisiana from 1928-1932, increased taxes on corporations, lowered utility bills of consumers, built new highways, hospitals, & schools. To push through these measures, he seized almost dictatorial control of the state government. As U.S. senator, he broke with the New Deal in 1934 and established a national movement, Share Our Wealth Society, that said inequalities in the distribution of wealth prohibited millions of ordinary families from buying goods, which keeps factories thriving. The society advocated a tax of 100% on all income over $5 million, populist program, take some money from wealthy and distribute to poor Americans
Welfare state
Term applied to industrial democracies that adopt various government-guaranteed social-welfare programs. The creation of Social Security & other measures of the 2nd New Deal fundamentally changed American society & established national welfare state for the first time
National Industrial Recovery Act
Part of 1st New Deal, suspended antitrust legislation, establish codes of fair competition for each industry, provision allowing labor unions to organize, eventually ruled unconstitutional by SCotUS
Wagner Act (NLRA)
1935 act that upheld right of industrial workers to join unions & established National Labor Relations Board (NLRB), a federal agency w/ the authority to protect workers from employer coercion & to guarantee collective bargaining
Social Security Act
1935 act w/ 3 main provisions: old-age pensions for workers; a joint federal-state system of compensation for unemployed workers; and a program of payments to widowed mothers and the blind, deaf, and disabled, Townsend & Long movements as well as children's welfare advocates concerned on fate of fatherless families pressed Roosevelt to act on this
Classical liberalism v. liberal welfare state
This ideology was based on the concept that individual liberty was the foundation of democracy. Liberal originally meant support for free-market societies, and weak government. Welfare state was the idea that the government would provide help for the weak and in doing so, expand government to protect their liberties.
Works Progress Administration
Federal New Deal program established in 1935 that provided government-funded public works jobs to millions of unemployed Americans during the Great Depression in areas ranging from construction to the arts
Federal Number One
Controversial bill that offered work to artists, musicians, theater people, and writers
helped provide public employment for artists who had no recourse to ply their trades
New Deal coalition (new makeup of Democratic Party)
Ethnic groups, city dwellers, organized labor, African Americans, & cross section of middle class
New voters joined the party after benefiting from New Deal programs like WPA or they knew people who had
Court-packing plan
FDR's failed plan to pack the court with hand picked judges after the SCotUS was blocking many of his New Deal programs
Roosevelt Recession
Recession from 1937 to 1938 that occurred after President Roosevelt cut the federal budget thinking the depression had passed
Unemployment declined from 25% to 14%
Keynesian economics
Theory developed by British economist in the 1930s that said purposeful government intervention in the economy (through lowering or raising taxes, interest rates, and government spending) can affect level of overall economic activity & thereby prevent severe depressions & runaway inflation
Frances Perkins
First woman named to a cabinet post. Secretary of Labor throughout Roosevelt's presidency
Growth of federal power/federal intervention in the economy
FDR's Great Depression era policies were directly involved with the lives of Americans
Bank reform: Emergency Banking Act only allowed banks w/ sufficient cash reserves to reopen after bank holiday
Social Security: Old-age pensions for workers, people thought the government was intervening in their lives
With the New Deal and Second New Deal, federal power increased with the many social welfare programs put into place. Federal intervention in the economy changed, in that the government had more of a relationship with its people in regards to the economy.
Sit-down strike/ GM plant in Flint, MI
Method of boycotting work by sitting down at work and refusing to leave the establishment. Workers would block machinery so nothing could be made
On December 30, 1936, workers in GM plant went on a sit down strike to fight for recognition of their union and to keep their jobs from going to non-union workers
Dust bowl
Series of dust storms from 1930-1941 during which a severe drought afflicted the semiarid states of Oklahoma, TX, NW, CO, Ark, & KA.
Tennessee Valley Authority
Agency funded by Congress in 1933 that integrated flood control, reforestation, electricity generation, & agricultural & industrial development in the Tennessee Valley area, Roosevelt saw as first step to modernizing South, funded by Congress, controversial because critics saw it as government getting too close to socialism
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