The New Deal

The Emergency Banking Act

FDR temporarily closed all banks and had them inspected. Only well run banks with enough money would be given loans and reopened. When they did, people could put money back into their accounts. Well run banks could now lend money to well run businesses, which could create jobs

The Economy Act

All government employees’ pay was cut by 15%, saving nearly $1 billion

The Beer Act

Prohibition was ended, putting the gangsters out of business. The government could raise money by taking alcohol

The Alphabet Agencies

FDR created new organisations to deal with some of the country’s palmes. They wee nicknamed the Alphabet Agencies since they were known by their initials

FCA (Farm Credit Administration)

Lent money to farmers who couldn’t keep up with loan payments

AAA (Agricultural Adjustment Agency)

Paid farmers to produce less. As a result, food prices rose and farmers’ incomes increased. The AAA was criticised since food was being destroyed while millions went hungry

NRA (National Recovery Administration)

Encouraged workers and employers to work out a code of fair conditions and pay and gave workers the right to join a trade union. However, it was a voluntary scheme and many employers refused to join, leading to strikes

TVA (Tennessee Valley Authority)

Provided work building dams and electric power stations along the Tennessee River area, one of the poorest in America

HOLC (Home Owners Loan Corporation)

Gave loans to people struggling to pay their mortgages

CCC (Civilian Conservation Corps)

Jobless 18-25 year olds were put to work in the countryside, creating 2.5 million jobs

CWA (Civil Works Administration)

Provided temporary jobs for 4 million people, building schools, airports and roads

FERA (Federal Emergency Relief Agency)

$500 million was given to states to help the homeless. Soup kitchens, blankets, clothes and nursery school places were provided

Why did the rich oppose the New Deal?

To pay for the New Deal, FDR raised taxes for rich people which angered them

Why did business people oppose the New Deal?

Many business owners didn’t like the way the New Deal agencies “interfered” with business and gave no rights to workers

Why did Republicans oppose the New Deal?

Many Republicans who believed in ideas like “laissez-faire” and “rugged individualism” were horrified by the way the New Deal dominated people’s lives

Why did the Supreme Court oppose the New Deal?

America’s highest court ruled that the AAA Alphabet Agency was illegal. Said that giving help to farmers was a matter for state governments, not the federal government. The Supreme Court declared many if the NRA codes illegal