Economic Recoveries

Coming Out of the Great Depression

New Deal

• Franklin Delano Roosevelt (FDR) – President 1933-1945 – Created the New Deal • Massive federal program focused on relief, recovery,

and reform. • During the Hundred Days (time period Congress met in

1933 to work out specifics of New Deal). • Roosevelt was known for having fireside chats where

he explained his policies to Americans by radio.

New Deal Programs

• First New Deal: 1933– Federal Emergency Relief Program (FERA): relief projects given to

13 million unemployed– Public Works Administration (PWA):people hired to build roads,

bridges, etc..– Agricultural Adjustment Administration (AAA): promotes soil

conservation and regulates farm production– Civilian Conservation Corps (CCC): hires young men to work on

conserving environment – Federal Deposit Insurance Corporation (FDIC): protects bank

deposits– National Recovery Act (NRA):regulated industry and raised wages

and prices

• 2nd New Deal: 1935 (focuses mostly on social reform)– Works Progress Administration (WPA): people

worked on national works projects (internal improvements)

– Rural Electrification Administration (REA)– Wagner Act: protects workers’ rights to form unions – Social Security Act: gives workers unemployment

insurance and retirement benefits

Critics of the New Deal

• Supreme Court: most of the 9 justices did not support the New Deal programs. – Felt they were unconstitutional due to the federal government having too much

power/control over the economy – Many New Deal programs were shut down by Supreme Court – FDR tried to “pack the court” with a bill/law that would add 6 justices to the Supreme

Court (that he would choose). – Congress, both Reps and Dems rejected this bill– Eventually, by 1941, due to retirements and deaths of justices, FDR got a more

sympathetic court • Conservatives/Republicans:

– Also argued that New Deal costs too much, running up government deficit– critics argued that the New Deal was basically a form of socialism since government

sponsored businesses were competing with private businesses • Example: Tennessee Valley Authority

Other Critics

• Some complained the New Deal didn’t go far enough:– Huey Long wanted a “Share the Wealth Program”

which would tax the wealthy heavily to give money to the poor

Effects of New Deal

• It put millions of Americans to work=lower unemployment rate • Labor Unions Gain Strength: AFL and CIO• Power of presidency and size of gov’t increased• FDR’s New Deal offered modest opportunities for minorities:

– More women held gov’t positions than ever before (Francis Perkins became first female cabinet member ever)

– Eleanor Roosevelt held regular press conferences for female reporters

– African Americans hired to be a part of an advisory group to president

– BUT FDR failed to support some civil rights bills for AA’s ; and he had many Mexican Americans (some of whom were legal) deported

Lasting Effects of New Deal

• Still a major debate over role and size of federal government between liberals and conservatives

• New Deal Programs remain such as: – FDIC, Social Security, Securities and Exchange

Commission (SEC) monitors stock market today

WWII Pulls USA out of Depression

• War Production Board: coordinates production of military goods during war– By 1945 (end of the war), U.S. Gross National Product

(GNP) increased from 90.5 billion in 1939 to 212 billion. – Factories built 300,000 aircraft and 75,000 ships during

WWII, employing hundreds of thousands of workers– Rationing occurred: families limited to certain amounts

of items: gas, rubber, meat, sugar, shoes, etc..– Gov’t raised income taxes and sold war bonds to pay

for war

Economic Effects of War for Minorities

• Hispanics worked in war industries– More than 300,000 fought in war

• More than 1 million African Americans worked in war industries (many migrated up North where most war industry jobs were)– Many served in armed forces (Tuskegee Airmen, etc..)

• About 40,000 Native Americans worked in war industries – Served in armed forces: Navajo Code Talkers

Women Make Economic Gains

• Demand for female labor increased due to war– Rosie the Riveter – 1940= 14 million women worked and by 1945 up

to 19 million; many worked in war industries– More than 300,000 women served in armed

forces:• As nurses, mechanics, drivers, clerks,