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The New Deal In the 1920s the United States economy reached its peak. The stock market took on rapid expansion while prominent businesses flourished. By the late 1920s people were living in tremendous prosperity. The invention of the radio and automobile helped enhance the economy while people could now afford to spend more money than ever before. By 1929 the economy had reached such a climax that it could only stall. In October of 1929 the stock market crashed, leaving thousands of investors financially crippled. What would follow The Roaring 20s would be known as the Great Depression. The Depression would soon bring a massive wave of poverty and unemployment that would be unsurpassed throughout history. With such a dramatic change in the lifestyles of Americans, people needed assistance. They needed a way out of such a painful catastrophe. The people of America need The New Deal. In the 1932 election the American people were in a state of panic. Herbert Hoover was running for a second term with 25% unemployment, and fingers pointing at him for the cause of the Great Depression. On the other side of the political realm Franklin Delano Roosevelt was running for president with the hope of turning the country back around. Many Americans asked the question, What is Roosevelts plan to help America overcome such economic adversity? Roosevelt believed in more of an active government, as well as a balanced budget. He would go on to win the election and emerge as the president of the United States. Shortly following his inauguration, Roosevelt proposed a New Deal. (Lecture 7) President Roosevelt proposed two New Deals. The first New Deal simply laid the ground work for the one to follow. The next New Deal would become permanent, helping push America back on her feet. The New Deal was expanded power of the federal government, but controlled at the local level. Roosevelt believed the American people needed work, not relief. He planned to

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put people to work with a series of programs. Part of the Roosevelts philosophy was when workers of the New Deal programs were given their checks, they would spend them. This cycle would get Americas economy up and running again. (Lecture 8) One of the most famous programs at this time was known as the Works Progress Administration (WPA). Roosevelt required every able-bodied, unemployed person to work. Congress backed this plan with the largest peacetime appropriation in American history (Patterson, p. 221). This governmental program put thousands of people to work. Republicans felt like the WPA was simply the Democrats way of gaining votes for the 1936 election by employing party hacks (Patterson, p.222). While the Republican Party undermined the program, the reality was that the WPA put struggling people to work building parks, schools, infrastructure, and even zoos. This program employed up to 7% of the country in the 1930s. Although the WPA was most known for its work in infrastructure, the program also contributed to the Federal Theatre Project, as well as creative artists in America. The WPA had a direct effect on the nations cultural experience (Patterson, p.223). By 1941 the WPA allowed the economy to absorb more than $11 billion. Another program that became one of the more popular innovations of the New Deal was the Civilian Conservation Corps (CCC). The CCC employed over three million young men to work at the wage of thirty dollars a month. The workers participated in forestry, flood control, and other embellishment projects. This program was one of many that gave the nation federal unemployment relief throughout the Great Depression (Kennedy, p.144-145). The federal government played a significant role in the New Deal. Prior to the Great Depression the United States was the only major country without Unemployment Insurance.

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Unemployment Insurance made it possible for the unemployed to receive a small income when they were out of work. Also, if someone was to lose their job, they could appeal the process. This provided families a small income, to keep them afloat, while they looked for other jobs. Until this point in history, old age pensions were never an issue. People were starting to live well past the age of sixty. At least 8% of the population was 65 years or older. The federal government understood that there was a concern for senior citizens, who had lost everything. President Roosevelt helped promote and pass a bill for a program called Social Security. It is more of a sense of retirement today, but President Roosevelt wanted Social Security to be a reward for the elderly. Anyone over the age of sixty could receive a monthly pay check. It was understood to be an earned right for most. Initially, 9.4 million people were left out of Social Security. These people mainly consisted of farmers and other people of the South. The program would later be revised to fix the flaws. (Lecture 8) It is important to note that farmers struggled mightily in the Great Depression. Many of the farmers were anti-government. Also, they were not fond of the way the country was being run. Another important note to consider is that farmers had a very difficult time being successful during the Depression because they did not have a boom in the 1920s like many other Americans. If farmers lost their farms, they lost their means of providing for a family. The New Deal alleviated the pain for some failed farmers, but it did not end it (Terkel, p. 213-235). Another group that struggled severely was African-Americans. Race relations were intensified during the Great Depression. In the 1930s one out of every three blacks were unemployed. African-Americans were often the last hired and first fired. Unemployment reached higher than 50% in places like Harlem and Philadelphia. Nobody needed the New Deal and job

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programs more than African-Americans. Blacks made up 20% of the entire countrys unemployment. As stated before, although the New Deal was an expansion of power of the federal government, it was controlled at the local level. This allowed local officials to be racial, giving whites more benefits. Whites in Atlanta received relief checks of thirty-three dollars while blacks only received nineteen dollars. Eventually, the New Deal improved the lives of AfricanAmericans. Programs like the Congress of Industrial Organization (CIO) organized black workers into unions. As the nation improved so did the life of blacks. Life expectancy for African-Americans increased, and infant mortality decreased. By the 1940s salaries of black teachers went from one-third of the white average to 44%. Due to the economic opportunities provided by the Democratic Party, blacks switched from the Republican Party to the Democratic Party in the election of 1936. Franklin D. Roosevelt would go on to win the 1936 election with 76% of African-American vote. This election was the first election in which both parties competed for black votes. (Lecture 9) In a period when social scientists had a legitimate say on superior and inferior races, political parties began to push for the support of African-American causes. The emergence of the Communist party in the 1930s had an impact on the advancement of the African-American race. Both Democratic and Republican Parties had to compete against the Communist Party for black support. The Communist Party received reasonable support, at the time, because no one had ever seen it fail. It was a new idea for a population that was not certain if capitalism was the best way to run the country. Events such as the Scottsboro Case and the attempted signing of the AntiLynching Bill had a profound impact on the African-American race in America. Roosevelt was not a strong advocate for black rights because he had such a good connection with the southern Democrats. When lynching became an issue in the South, Roosevelt was hesitant to eliminate the

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problem. He did not want to alienate the southern Democrat. Also, in order for his New Deal Bill to be successful, Roosevelt needed the support of the Southern Committee Chairman. (Lecture 9) One of the major changes that the New Deal made was the formation of unions. Workers that were privileged enough to be employed were often mistreated. In 1933 three million workers had joined unions, and by 1940 eight million workers belonged to unions. (Lecture 8) The New Deal enabled the National Industrial Recovery Act (NIRA) to allow industrial workers to form unions. The Nation Recovery Administration put limits on maximum hour work days, as well as minimum wages. Child labor was also abolished in this program. This section of the New Deal really transformed the work place into what we know today (Kennedy, p.151). Other changes that Roosevelts New Deal made were done through currency. Upon taking office, Roosevelt took the United State off the gold standard by devaluing the American dollar. He did this in an attempt to give debtors and exporters relief (Patterson, p.215). Although, the New Deal took on some criticism, it halted the catastrophic free fall of the first two years of the Depression. Banks across the country were able to reopen, and farm prices went up. Unions ensured that workers received fair pay as well as fair working conditions. In conclusion, the New Deal helped lift the country back up again. It stabilized the American economy by putting people to work in programs like the WPA and CCC. The New Deal is responsible for the breakthrough of Social Security and Unemployment Insurance, which gave people an opportunity to receive money after reaching the age of retirement. The work place was also transformed. Unions across the country were able to get regulations set on minimum wage and maximum hour work days. African-Americans struggled the most at this time in history. The New Deal, not only, improved their lives but increased their economic

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opportunities. While the New Deal helped the United States make strides to escape the Great Depression, it did not end it. It only mitigated it. It took over eight years for the New Deal to bring the Depression to a halt. Race relations were intensified, and lynching was a continuing issue. It did not give federal aid to civil rights legislations or education. Although the New Deal did not affect or change some things, it was able to bring the country to a manageable state. Franklin D. Roosevelts plan to rescue the economy by putting the country to work was successful. As stated before, the New Deal did not end the Great Depression. The end of the Depression did not come until the emergence of World War II. This event undoubtedly stabilized the American economy for good.

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Reference Page Patterson, James T. America in the Twentieth Century. Belmont: Wadsworth Publishing, 1999. p. 215, 221-223. Kennedy, David M. Freedom from Fear. New York, Oxford: Oxford University Press, 1999. p. 144-145, 151. Terkel, Studs. Hard Times. New York: Pantheon Books. p. 213-235. Lecture 7-9.