A New Deal for Americans

(adapted from Challenge of Freedom, Glencoe: 1990)


Overview  When he entered office, President Roosevelt told the nation to remain confident in the country's future. He said, "The only thing we have to fear is fear itself." President Roosevelt worked with the Congress on a wide range of measures aimed at providing all Americans with a "new deal."

Objectives :  After reading this section, you should be able to:

A Bold Leader. Franklin Delano Roosevelt was known as a bold leader even before he entered the White House. Roosevelt-or FDR as he was called-had been the governor of New York since 1928. As governor, he had backed state aid for the jobless. He also led the state government in undertaking a number of reforms. In additional, FDR worked for laws that would protect natural resources.

In his personal life, FDR had shown that he would work hard to overcome problems. In 1921 he had become very ill with polio - a disease that left him partially paralyzed. Although he never regained full use of his legs, he did not let this interfere with his activities.

Many voters had backed Roosevelt for President because he seemed to be open­minded and hopeful about our country's future. During the campaign, he promised a "new deal" to lead the nation out of the depression. In his inaugural address on March 4, 1933, President Roosevelt told the nation to remain confident in the country's future. He promised to undertake bold, new actions against the country's problems. His pledge for action helped Americans to believe that the United States could overcome the depression.


Think about it...What public office did FDR hold before becoming President?


Beginning the New Deal. President Roosevelt kept his promise to take immediate action against the country's problems. To do this, he called Congress to meet in a special session. He then asked the lawmakers to pass laws aimed at three goals. First, relief laws were necessary to meet the needs of those Ameri­cans who were without food, housing, and other basic needs. Second, recovery laws were needed to help business and agriculture start up again. Third, reform laws were needed to solve the country's economic problems. President Roosevelt's plans for these three goals became known as the New Deal

During President Roosevelt's first week in office he worked out a way to end the banking crisis. The President closed every bank in the country by declaring a "bank holiday." Government inspectors were put in charge of deciding which banks were sound.

The President then held a radio broadcast called a fireside chat to explain these actions. He told the nation that only sound banks would be allowed to reopen. The President was successful in ending the banking crisis. He convinced Americans once again to trust banks with their savings.

More importantly, President Roosevelt had shown many Americans that the government would act quickly to strengthen our economy. His later fireside chats convinced many Ameri­cans that the President would keep in touch with the citizens.

The special session of Congress continued until June 16, 1933. This lawmaking session is often called the Hundred Days. During this period, the Congress passed 15 major New Deal laws. During the Hundred Days, President Roosevelt and his advisers worked with the Congress to find ways to aid the millions of suffering Americans.

Think about it...What were the three goals of the New Deal?


Providing Relief. President Roosevelt believed that the federal government had to act to provide food for the hungry and jobs for the unemployed. The Congress agreed that this relief was needed. As a result, the law­makers passed laws that set up a number of aid programs.

President Roosevelt and Congress worked together to set up the Federal Emergency Relief Administration in May of 1933. This office was given a budget of $500 million. The money was given out to the states to use for their aid programs.

President Roosevelt and his advisers favored relief programs that gave jobs to the unemployed. They felt that American workers would feel better about themselves if these workers were doing a job rather than just taking money from the government.

One of the most popular work relief programs of the New Deal was the Civilian Conservation Corps (CCC). It was aimed at helping young men from poor families. The CCC set up work camps in rural parts of the country. Young men who joined the CCC lived in these camps and worked to protect and restore our natural resources.

The CCC was in operation between 1933 and 1940. During those years, about 2.5 million youths earned money and gained job skills through the CCC.


The New Deal included other job programs. Through the Civil Works Administration (CWA), for example, about 4 million Americans found jobs during the winter of 1933-1934. The CWA offered many different jobs. It also left the country with many long-lasting improvements. Roads, schools, and airports were built and repaired by CWA workers. The CWA also provided jobs for writers and for artists.

The CWA was followed by other work relief programs. These programs, however, were seen only as emergency measures. The President's goal was for business to recover and to begin hiring more workers.

The New Deal also provided relief for property owners who could not pay their regular mortgage payments. Thousands of Americans kept their homes and their farms because of these programs. At the same time, the government tried new ways to bring economic recovery to American farmers.


Think about it...What is a work relief program?


Plans for Farm Recovery. American farmers were among those hardest hit by the depres­sion. Crop prices had fallen greatly after World War I. Corn, for example, had sold for about $1.23 a bushel during World War I. By the early 1930's, corn was selling for about $0.50 a bushel. Overproduction was the major cause of low crop prices.

One of the goals of the New Deal, therefore, was to raise crop prices by ending overproduction. To do this, Congress passed the Agricul­tural Adjustment Act (AAA) in May 1933. This law gave the Secretary of Agriculture the power to pay farmers to lower their crop output. In some cases, farmers were paid to destroy crops.

The AAA had several shortcomings. For example, many persons thought it was wrong for food to be wasted while many Americans were hungry. However, the President knew that farmers would continue to face hard times until crop prices were raised.

Another problem with the AAA was that it aided only farm owners. Many other persons who made their living from farming were hurt by the program.
Sharecroppers and hired farm workers, for example, often lost their means of earning a living when farm owners cut their crop output. Large numbers of blacks in the South and Mexican Americans in the Southwest faced this problem.

Like many parts of the New Deal, the AAA was an experiment. Although it caused some problems, the policy of limiting output did raise crop prices.


Think about it...How did the New Deal try to end the overproduction of farm crops?


Recovery for Industry. In 1930, far more Americans were earning their living through industry than through farming. Thus, industry had to recover if the depression was to be ended. To get business going again, Congress passed the National Industrial Recovery Act in June of 1933. With this law, Congress gave the President great powers over business.

The law set up the National Recovery Administration (NRA). The NRA was in charge of approving codes - rules - for each industry. The codes were to be written by business leaders from each industry. One aim of the NRA was to end unfair competition. To do this, the codes set the amount of goods that each business would be allowed to make. Also, the codes set minimum prices for goods.

The NRA codes were also aimed at helping industrial workers. For example, the codes set the maximum hours to be worked each week. In addition, each industry had to agree on minimum wages - the lowest pay that would be given to workers. Workers were also promised the right to bargain collectively.


During the summer of 1933, the Blue Eagle - the emblem for the NRA - became a well-known sight. Many Americans backed this New Deal experiment. Union leaders believed the NRA would help unions to become stronger. The NRA rules were also helping to end child labor. Many business owners also backed the NRA as a way to end the depres­sion. This hopeful outlook, however, did not last long.

Within a year, it became clear that the NRA had many weaknesses. Small businesses, for example, charged that big businesses had too much power in writing the codes. Because of this, small businesses were not being treated fairly. Consumers also charged that big businesses were given too much power under the NRA. Also, it became impossible to see that codes were carried out. Thus, President Roosevelt and the Congress had to work out other ways to meet the goals of the NRA.

Think about it...n what three ways did the NRA codes aid industrial workers?