Communism and the

Russian Revolution.
Communism in Russia (1900-
1940)

1
What is Communism?
• Communism: is a classless society where wealth and property
are owned and shared by the community/communal.
• Socialism: is a transitional social state between the overthrow
of capitalism and the realisation of Communism.
• The theory of communism is actually based on the writings of
Karl Marx and Friedrich Engels: (Marxism theory in The
Communist Manifesto and Das Kapital, 1848)
• It was adapted by Lenin (Marxism-Leninism) to the conditions
in Russia after the 1905 Revolution and implemented after the
Bolsheviks Revolution of 1917.
• When Stalin came to power in 1928, he introduced
his own interpretation of Marxism-Leninism. 2
3
Key features of the theory of communism.
• Resources are owned by the state on behalf of the people.
• Greater equality; no class divisions caused by an unequal
spread of wealth.
• Government control of the economy; all decisions to be
centrally planned.
• Housing, medical services, the education system, and all social
services provided free by the state.
• Equality and the common good are valued more than individual
freedom. Moremi SK

KgaugeloM@athlonegirlshigh.co.za
4
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5
 How was communism
applied in Russia under
Lenin and Stalin?
Russian Revolution.

6
What was Russia like before the Revolution of 1917?

7
What was Russia like before the Revolution of 1917?

8
What was Russia like before the Revolution of 1917?

9
 1917 Russian
Revolutions.
February and November Revolutions

10
Revolution.

▪A revolution is a successful attempt

by a large group of people to change
the political and social system of
their country by force.
▪Revolution thus brings a
fundamental/radical change in the
political and social (socio-economic)
organisation of a country.
Moremi SK

KgaugeloM@athlonegirlshigh.co.za
11
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The 1905 Russian Revolution.
Some of the demands;
(i) An 8-hour day and freedom to organize trade unions.
(ii) Improved working conditions, free medical aid, higher
wages for women workers.
(iii) Elections to be held for a constituent assembly by universal,
equal and secret suffrage.
(iv) Freedom of speech, press, association
and religion.
(v) An end to the war with Japan.
12
The results of the 1905 Revolution
• Social democrats were divided into two groups:
➢the Mensheviks and;
Led by Julius Martov
Believed in building the organization slowly and believed they would
take power once they had mass support.
➢the Bolsheviks.
Led by Vladimir Lenin
Were more radical and wanted a direct and immediate revolution to
overthrow the Tsarist government.

13
• Constant protesting and striking by the soviets caused the Tsar
to declare and sign the October Manifesto.
= In it, he agreed to a new constitution and pledged a
nationally elected parliament, which was called The Duma.
• The 1905 revolution brought (little) no real change to the
social, economic, and political landscape of Russia, but it set
the stage for the revolutions of 1917.

14
What transpired during the February/March Revolution?
• The tsar was persuaded to abdicate by his ministers and
generals on March 15, 1917.
• The Duma appointed a Liberal Provisional Government from
its own members, to rule Russia until elections could be held.
• The Liberal Provisional Government, led by Kerensky, was
indecisive and ineffective.
• Lenin’s slogans, from his April Thesis, ‘Peace, Bread, Land and
all power to the Soviets’ won wide support for the Bolsheviks.
• The Provisional Government blamed the Bolsheviks for causing
protests and riots, they then arrested their leaders.
15
= Lenin fled across the border into Finland to escape arrest.
What was the April Thesis?
• Peace:
= The Bolsheviks declared that they would
make peace with the Germans.
• Land:
= by offering the peasants land, Lenin
wanted to ensure that the peasants stayed
neutral when the Bolsheviks made their
bid for power.
• Bread:
= Lenin wanted to confiscate large areas of land from the
estates of the tsar, the church, and, the nobles and give it to
the peasants to produce food.
16
The October/November (Bolsheviks) Revolution
What were the events (and the causes) leading to the
October/November 1917 Revolution?
• Lenin returned from Finland and, together with Trotsky, made
plans to seize power.
= they were supported by the Kronstadt sailors.
• The Bolsheviks carried out a successful coup d’état on 25
October 1917.
= stormed the Winter Palace in St Petersburg and arrested
members of the Provisional Government on the 26th October.
• Under Lenin’s leadership and All-Russian Congress of Soviets,
the Bolsheviks took control of Russia on 7 November 1917.
17
How did Lenin base his regime on terror and
suppression of the opposition?
• Establishing the CHEKA in December 1917.
• Shutting down oppositional press and parties.

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KgaugeloM@athlonegirlshigh.co.za

copyright © all rights reserved. 18

War Communism
and the Civil War.
1918-1921

19
The Russian Civil War 1918-1920
What caused the Russian Civil War of 1918-1920?
• After the Bolsheviks withdrew from the WWI, Russia’s former
friends and allies became enemies and attacked Russia at once.
• The Bolsheviks adopted a Red Flag as their symbol and were
known as the Reds/ Red army.
• Those who opposed the Bolsheviks called themselves the
Whites.
• The Whites included monarchs, liberals,
the Mensheviks, Social Revolutionaries
and other right-wing groups.
• The Whites were supported by the Allies. 20
Why did the Red Army win the War?
• Trotsky led the Red army skilfully, he visited various parts of the
front using an armoured train to direct battle personally.
• The Reds were fighting foreigners, and this gave them a
propaganda advantage.
• The workers and peasants fighting for Lenin and Trotsky were
often highly motivated.
• On 17 July 1918 the Tsar and his family were
assassinated at Ekaterinburg.

21
Why did the White Army lose the War?
• They had different commanders; General Kornilov, Wrangal,
Denikin, Admiral Kolchak and Yudenich.
• The whites had difficulty communicating across a wide area
and spoke different languages.
• When the WWI ended in November 1918, the French troops
were tired of the war and wanted to go home.
• American forces and the British forces also
withdrew from in the early fall of 1919.

22
What was the War Communism policy (1918-1921)?
• The Soviet state had pursued a policy of 'War Communism'
during the Civil War in order to keep the Red Army well
provisioned with food and weapons.
• During this period, the government took control of the
economy and used nationalisation and central planning.
• Grain/crops and other food supplies were requisitioned from
the peasants at prices set by the government.
• Poorer peasants were mobilized against the kulaks (wealthy
peasants).
• Labour (or fighting for the Red Army) was compulsory and
strikes were outlawed.
23
• The state organized a barter system which replaced the free
market/private trade.
• The Bolsheviks were convinced that a world revolution was
about to begin, led by the Bolsheviks to speed up the
construction of a socialist state in Russia.

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KgaugeloM@athlonegirlshigh.co.za

copyright © all rights reserved. 24

The effects/results of the Policy of War Communism.
• Production in factories, farms and industries virtually declined.
• Peasants resisted the requisition squads and refused to hand
over their surplus.
• Poor harvest and bad weather in 1920-1921 led to widespread
famine and as a result, 7 million people died from hunger.
= Reports of cannibalism.
• Buildings lay in ruins and people had nowhere to live.

25
A Russian couple sell human body parts on a market. People
of Russia began to eat and sell human limbs due to the food
struggle during the Russian famine of 1921.

26
The New Economic
Policy (NEP) of
1921.
State capitalism.

27
 Why did
Lenin
introduce
the New
Economic
Policy?

28
Why did Lenin introduce the New Economic Policy?
• Peasants were against the introduction of War Communism
and attacked the Reds and the Whites throughout Ukraine.
= Reds emerged victorious, peasants embarked on armed
struggle, the black market, reduced sowings/planting, and
concealment.
• Peasants went further to burning crops and they, together with
unhappy civilians, blew up bridges.
• The burning of crops and the harvest failures of 1920-1921 due
to drought/ice-age left the nation short of crops and food.
= this led to famine which resulted in millions of deaths.
• At Kronstadt Naval Base, sailors also protested against the lack
of progress, famine and terror. 29
Features/Reforms/Changes brought by the NEP
• Ended grain requisitions and replaced it with Tax in Kind policy
which made peasants pay tax rather than handing over their
produce to the state.
• Farmers now produced more food as they
had the option to sell some of their produce,
rather than it being seized by the state
without compensation.
• It involved a more capitalist-oriented
economic policy (including a 'free market’),
and the return of private enterprise. “The Russia of
= small (private) businesses were allowed to NEP will become
operate again as long as they employed less a Socialist Russia”
than 20 workers. (Lenin)
30
• Lifted the ban on private trade introduced
under War Communism.
• Workers were paid incentives and bonuses.
• The government made trade agreements with
Capitalist Western countries.

“The Russia of
Moremi SK NEP will become
KgaugeloM@athlonegirlshigh.co.za
a Socialist Russia”
copyright © all rights reserved. (Lenin) 31
What were the effects of the NEP?
Successes of the NEP
• Concessions to capitalism helped Russia
to recover economically and gave the
government time to consolidate its
control.
• A new capitalist class of entrepreneurs called Nepmen
who ran large shops and stores in the urban areas
emerged.
• Grain harvest yields increased from 37,6 million tons in
1921 to 50,3 million tons in 1922. 32
• A new wealthy class of peasants/farmers called Kulaks
emerged.
• Factory production doubled in just two years and exports grew
by 350% in three years.
• Cotton cloth production trebled in a single year between 1921
and 1922.
• Electricity generation increased rapidly.

33
Shortcomings of the NEP
• Many communists were unhappy about the compromise with
capitalism and the social inequalities it created.
• The aspects of the NEP went against the Marxist belief in
classless society, and as a result, poorer people resented the
success of the Kulaks and Nepmen.
• Many workers lost their jobs since the factory managers cut
back on their workforce to increase their profits, and wages
remained low.
• Food prices fell as agricultural produce flooded the markets.
34
• Industrial goods climbed as imports of machinery, training and
skilled technicians’ costs drove up the prices.
• Unemployed workers and those who were underpaid called the
NEP the New Exploitation Policy of the Workers.

35
How did the death of Lenin create a power
struggle?
Trotsky VS Stalin.
36
Events leading to the death of Lenin
• The assassination attempt by Fanny Kaplan in 1918 weakened
Lenin and the stresses of leadership during the Russian Civil
War also took their toll.
• Lenin suffered a stroke in 26 May 1922, he recovered but had a
second stroke in 15 December 1922.
• While in isolation, Lenin composed a letter to the Party
congress to be read out after his death.
• According to Lenin’s “Last Testament”, Lenin
thought Stalin was a rude, arrogant
paper-pusher, untrustworthy, and did not
play well with others, specifically Leon Trotsky. 37
• Furthermore, Lenin felt that Stalin had more power than he
could handle and must be removed from his position as
General Secretary of the Russian Communist Party’s
Central Committee as he might be dangerous if he was his
successor
=he stated that Trotsky was the most capable man in the
present to succeed him.
• Lenin then had a devastating stroke in March 1923, which left
him without the power of speech:
• Sadly, a fourth stroke killed him on 21 January 1924 at the age
of 53.
Moremi SK

KgaugeloM@athlonegirlshigh.co.za

38
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39
 ☭ The formation of USSR ☭
• In 1922, Stalin, proposed the new Union of Soviet Socialist
Republics as a substitute for the existing federation of republics
via the Declaration of Union and Treaty of Union, December 30,
1922.
• In 1923, the country officially became known as the
USSR/Soviet Union.

40
How did Stalin rise to power in 1928?
• Stalin presented himself as the chief mourner and tricked
Trotsky so he does not attend Lenin’s funeral.
• While Lenin was ill, Stalin forged an anti-Trotsky alliance with
Kamenev and Zinoviev, the three members
then ruled as a triumvirate.
• He gained vast power as the Secretary-General
of the Communist Party because he had
appointed his supporters to powerful positions
and they owed him favours.
• Stalin weakened Trotsky sufficiently to have him removed from
his power base in the armed forces as Commissar of Military
Affairs in January 1925. 41
• Trotsky then lost his Politburo seat in December 1925, Zinoviev
was removed as Leningrad Soviet Chairman in January 1926
and expelled from the Politburo in July.
• Kamenev also lost his Politburo seat in July 1926 and all three
men were expelled from the Communist Party.
• Trotsky was exiled to Siberia, then to Turkey and finally ended
up in Mexico.
• Once in power, Stalin introduced his economic policy; Socialism
in one country – a combination of collectivisation of
agriculture, nationalism, industrialisation through the five-year
plans, = an authoritarian government and a cult of personality.
42
• Stalin was now a dictator, he unleashed a reign of terror
characterized by a wave of executions of presumed enemies of
the state/opposition.

43
Collectivisation and industrialisation
What was collectivisation?
• Collectivisation: was a policy of forced consolidation of
individual peasant households into collective farms which were
owned and managed by the government.
• Industrialisation: was a
process of accelerated
building-up of the industrial
potential of the Soviet Union
to reduce the economy's lag
behind the developed
capitalist states. 44
45
What were the reasons behind collectivisation of
agriculture?
• It was vital to increase food supplies
to workers in the cities and towns.
• Individual land ownership had to be
ended and the power of the wealthy peasants or Kulaks
had to be eliminated.
• Many small peasant farms were merged into huge
government controlled collective farms which were
mechanised.
46
• Grain would also be exported to foreign countries for hard
currency that could be used to buy machinery and spare parts
for Stalin’s factories.
• Stalin’s industrial policy was governed by the Five-year plans,
the State of Planning Commission (Gosplan) would set
ambitious targets for the workers to be achieved over a five-
year period.

47
The five-year plans
48
1. First five-year plan, 1928-1933
• The state concentrated on heavy industry such as coal, iron,
steel, railways, electricity, machinery.
• These industries were given targets to increase their
production.
• The first Five-Year Plan did not get off to a successful start in all
sectors, actual production figures were lower (production of
pig iron and steel) than the targets but remarkable growth in
output was achieved.
• The focus was on quantity and not quality and as a result,
workers cheated to meet unrealistic goals.
• Factories were built beyond the Ural Mountains, beyond reach
of any western power.
• Overall, number of industrial workers doubled.
49
2. Second five-year plan, 1933-1937
Aims
• To build on and rectify the faults of the First five-year plan.
• Increase consumer goods.
• Improve productivity.
Methods
• New oil and coal fields were opened.
• Industry decentralised by building factories nearer supplies of
raw materials.

50
Achievements.
• Quality of consumer goods improved.
• Standard of living raised by building houses.
• Money spent on armaments because of threat of Nazi
Germany.
• The Second five-year plan was highly successful in expanding
USSR’s productive capacity.

51
3. Third five-year plan, 1937-1941
• Emphasised on the production of textiles and consumer goods.
• First two years disappointing.
= Goals not met.
• It was cut short by onset of the WWII and invasion by Germany
in 1941.
• Focus shifted to military goods/equipment
• Railways extended
= Special attention to transportation of weapons.
• Many gains made in the 1st, 2nd and 3rd year plans were
destroyed by the outbreak of WWII.
52
Consequences of collectivisation and industrialisation
Positive effects of Stalin’s policies
• USSR transformed into a modern state.
• Heavy industrial sectors grew rapidly.
• Vast dams and canals were built.
• Entire cities, such as Magnitogorsk,
were constructed from scratch.
• Every Russian had a job and could expect to be employed all
their lives.
• Pensions and paid holidays/leaves were provided to workers.
• Living standard improved for some farmers.
• Improvement in education, healthcare and the role of women
in society. 53
Negative effects of Stalin’s policies
• Stalin did not create a classless state, workers were still
exploited.
• Vast natural resources were being utilised and exploited.
• Some workers were accused of sabotage and sent to labour
camps to be tortured and even executed.
• The Kulaks openly resisted the collectivisation drive and
preferred to burn down their farmhouses, crops and destroy
their livestock.
• Stalin’s response was to wage war against the Kulaks and 5-10
million were killed or sent to labour camps in Siberia.
54
• Consequently, famine broke out in 1930-1932 killing million
more peasants, there were many reports of cannibalism.
• Stalin used famine to force peasants to submit to government
control by refusing to give aid to areas which opposed
government policies.

55
Political terror
Purges and Show Trials of the 1930s
Stalin was ruthless in destroying opposition to his ideas,
he feared that others wanted to overthrow him, thus
he was determined to get rid of his rivals;
• Stalin used the OGPU, show trials and the gulags as his
instruments of terror.
• The OGPU was introduced to punished workers as wreckers
and saboteurs if they failed to meet the goals of Stalin’s
ambitious five-year plans.
• Hundreds of thousands of workers were arrested and
imprisoned in labour camps (gulags).
• By 1938, there were 8 million people in the labour camps.
• Those who were charged were tortured by being denied sleep
or food for days on end. 56
• These were known as show trials because the decisions for the
guilt of those charged and their sentences (usually death) were
taken beforehand.
• Stalin then launched a massive and rapid purge of anyone who
threatened his absolute control.
• Zinoviev and Kamenev and fourteen other Party leaders were
brought before judges on made-up charges in show trials in
August 1936.
• Nikolai Bukharin was also arrested
in February 1937 and charged with
conspiring to overthrow the Soviet
state.
57
• The Great Purges resulted in the deaths of over 20% of
Communist Party members by 1938.
• By 1939, 3 out 5 (60%) Red Army Marshalls, all the
admirals and roughly half of the officers had been executed.

58
59
Stalin the Dictator
• Stalin controlled all the information and censored the media.
• Propaganda flooded Newspapers, cinemas, TVs, and radios
about the heroic workers’ struggle and the great leadership of
Stalin.
• Artists and writers had to follow Soviet Party line.
• Criticism, especially of Stalin, and freedom of
speech was banned.
• There was no freedom of assembly and freedom of
religion.
60
• Photographs were doctored to give an impression that Stalin
was Lenin’s chosen successor and was loved by all the people.
• Stalin’s government introduced a police state that not only
punished workers as wreckers and saboteurs
but also silenced and executed those who
opposed or defied Stalin.
• Stalin produced a climate of fear throughout
USSR.

Moremi SK

KgaugeloM@athlonegirlshigh.co.za

copyright © all rights reserved. 61

Capitalism and
the Great
Depression
(1900-1940).
Capitalism in the USA in the 1920s.

62
What is Capitalism?
• An economic and political system in which a country's trade
and industry are controlled by private owners for profit, rather
than by the state.
• Characteristics central to capitalism include private
property, capital accumulation, wage labour,
voluntary exchange, a price system, and
competitive markets.
• Capitalism was based on the ideas of Scottish philosopher,
Adam Smith (1723-90), of free market/enterprise which
encouraged competition between individuals and companies
without interference
from the government.
63
What was the nature of capitalism in the
USA?

64
Aspects of Capitalism in the USA
• Individuals were free to exercise entrepreneurial skill and invest
capital as they saw fit.
• Companies were free to compete in open markets where goods
were sold for a profit.
• With ‘rugged individualism’ any individual could succeed if
they worked hard enough.
• Policy of laissez-faire.
• The American Dream.

65
Why did American
economy boom
and collapse in
the 1920s?

66
The capitalist boom of the 1920s
Strengths in the USA Economy
• Rapid growth as a result of the WWI.
• Natural resources such as oil, iron ore and coal.
• The growth of new technology and innovation – mass
production.
=Ford Motor Company by Henry Ford.
• Government policies (protective tariff) and The Republicans
(Warren G Harding, Herbert Hoover & Calvin Coolidge).
• Growth in advertising.
• Weak unions.
• Shares. 67
Weaknesses in the USA economy
• Unequal distribution of wealth and exploitation.
• Agriculture did not share the growing prosperity.
• Unsound business practices.
• Decline in older industries.
• Problems with trade.
• Too much optimistic speculation on the stock market.

Moremi SK

KgaugeloM@athlonegirlshigh.co.za
68
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The Wall Street crash in 1929

The Great Depression.

69
Events leading to the Wall Street Crash
• Industrial recession, July 1929.
= Investment in home construction fell.
= Many factories that produced goods related to home building
close down.
• Black Thursday, 24 October 1929.
= Investors began to question whether the shares were
really worth the prices being asked.
= Some no longer felt their money was safe and started to
sell their shares in large numbers to try to get their money
back.
= The prices of shares then fell rapidly with each passing hour.
70
• A record of 13 million shares were sold in a
single day, this caused panic as people believed
their shares would soon be worthless.
= People realised their shares were rapidly losing
value and more and more tried to sell their shares
causing the value of shares to drop by $8000 million.
= Those who had not sold their shares now owned shared with
almost no value.
• 29 October 1929, crazed rush to sell shares continued.
= 16 million shares exchanged hands and 11 million more
were sold the following day.
= People lost confidence and would not invest money in
shares anymore or leave it in banks. 71
= No one wanted shares and shares were then
valueless and worthless.
= Investors who already owned shares were
unable to repay loans to the banks.
= Banks began to fail and those who had their
savings in banks lost them.
= As people lost their money, they could not afford to buy goods,
the demand of goods then dropped, factories began to close,
businesses went bankrupt and workers lost their jobs.
• The Stock market collapsed and led to the complete economic
collapse known as The Great Depression.

72
 How was the Wall
Street Crash
responsible for the
Great Depression?
Disastrous consequences.

73
What was the economic impact of the Wall Street
Crash of 1929?
• When factories went bankrupt and closed down, millions of
workers lost their jobs.
• People spent less since they were unemployed and this meant
goods piled up in the warehouse and remained unsold.
• There was underconsumption as cuts in prices and even steep
discounts did not attract buyers.
• People withdrew their money from banks and the banks in turn
collapsed.
• By 1933, 11000 banks had failed and closed down and 10
million people had lost their savings. 74
• The faltering banks called in their loans
and demanded full payment, which
caused many businesses to fail.

Moremi SK

KgaugeloM@athlonegirlshigh.co.za

75
copyright © all rights reserved.
What was the social impact of the Wall Street Crash of
1929?
• People could not afford to pay rent and home loans
(mortgages) and as a result they were homeless without food,
children suffered from malnutrition, and others queued at soup
kitchens for Hoover stews.
• Many slept rough out in the open with only a Hoover blanket
(newspaper) over them.
• Shanty towns sprang out on the outskirts of the cities called
Hoovervilles.

76
77
78
• Poor farming methods and drought in 1930-31 worsened
conditions for farmers as it turned vast areas of the
country into a desert.
= By 1934, strong winds blew away the topsoil causing huge
dust storms / Dust Bowl.

79
• Ruined farms were abandoned as entire families migrated
westward to look for employment in California.

80
How did the American government deal with the
impact of the Great Depression?
President Herbert Hoover (1929-1933) closed the New York
Stock Exchange at noon on Thursday 31st October until the
following Monday to:
• Stabilise Wall Street.
• Give the exhausted stockbrokers time to rest
and recover.
• Reassure the public that the worst was over
and there was nothing fundamentally wrong
for the US economy.
81
82
Hoover’s policies to curb the impact of the Great
Depression
• He introduced the RFC (The
Reconstruction Finance Commission)
to lend money to banks and
businesses in trouble.
• He passed the Agricultural
Marketing Act which gave farmers
$500 million in assistance.
• He passed the Emergency
Relief/Banking Act and Construction
Act which provided credit of up to
$2,3 billion to the unemployed. 83
• He tried to provide employment by starting public works
programmes such as the San Francisco Bridge, the Los Angeles
Aqueduct, and the Hoover Dam
but he refused to introduce
employment benefits and this
resulted in destitute people and
more Hoovervilles/shanty towns.
• He introduced the Smoot-Hawley
Act in 1930 that imposed high
tariffs on imported goods, this
deepened the economic problems
in USA.
84
Roosevelt
and the
New Deal

85
Why was Roosevelt elected?
• By 1932, the Americans had lost confidence in
President Herbert Hoover and his Republican
government.
• Franklin Delano Roosevelt became the leading
critic of President Hoover after the Wall Street Crash in 1929,
he blamed Hoover for causing the crash, he accused Hoover
for doing nothing to help the economy to recover and he
emphasised Hoover’s failure to bring down unemployment
rates which remained stubbornly high.
• FDR promised to take action to help the poor and unemployed,
and to give more protection to workers. 86
• Because he was sympathetic towards people and travelled
tirelessly to meet workers, ordinary people felt that Roosevelt
understood their struggles despite his privileged background,
unlike Hoover who felt it was the individual’s own fault if he
was poor/unemployed.
❖Roosevelt was a Democrat, he was
voted US President 4 times from
November 1932 till his death in
1945, succeeded by Harry Truman
who was then his deputy.
Moremi SK

KgaugeloM@athlonegirlshigh.co.za

87
copyright © all rights reserved.
88
89
Offering the
New Deal

90
What was the New Deal?
• It was a wide-ranging economic policy that gave the
government exceptional power to intervene in the economy.

This cartoon was published in the Phia Record on 3 March 1933

with the caption “Finis” which means “Finished” or “The end”.
It shows President Roosevelt throwing out the policies91of the
previous government.
The First New Deal (1933-1935)
• FDR aimed to provide;
1. Relief
• Emergency food and housing provided
for the unemployed.
• State employment provided.
• Grants given to people to help pay back mortgages.
• Concentrated on relief projects providing jobs.

92
2. Recovery.
• State had to pour money into the economy.
• Industry was regulated so all businesses worked smoothly
together.
• Limited production in industry and agriculture to facilitate rise
in prices.
• Introduced the Emergency Banking Act of 1933 which allowed
the government to close down poorly managed banks.
=He then reopened them and guaranteed to safeguard the
shareholders and depositors, this restored faith of ordinary
people in banks and they then began depositing their money in
banks. 93
• Subsidies to farmers to help rebuild their businesses.
• Aimed to stop cut-price competition to help the economy
recover.

94
Alphabet Agencies
Act Aimed at
AAA (Agricultural Adjustment - Provided cheap credit.
Act) - Controlled and guaranteed
minimum food prices by
paying farmers to stop
producing so much food.
- Addressed the dust bowls by
providing subsidies for crops
such as clover and peas that
helped to bind the soil. 95
FERA (Federal Emergency Relief - Provided $500 million for
Act) emergency food and housing
for the unemployed.

96
NIRA (National - Launched a massive public works
Industrial
• dd Recovery programme.
Act of 1933) - The unemployed were put to work to
help to build roads and bridges.
- Established minimum wage rates and
maximum working hours for workers.
- Factory owners needed to draw up
price schedules and production
guidelines which National Recovery
Administration (NRA) would pass into
law. 97
CCC (Civilian Conservation - Built reservoirs and reforested
Corps Act) national parks.
- Employed between 250000
and 500000 people at any
given time between 1933-
1941.

98
TVA (Tennessee Valley Act)
• dd
- Controlled flooding on the
Tennessee River by building a
series of dams, which could
also be used to generate
hydro-electricity.

HOLC (Home Owners Loan - Provided funds for home

Corporation Act of 1933) owners to refinance their
mortgages.

99
100
The Second New Deal (1935-1939)
• FDR aimed to provide;
3. Reform.
- Changes were made to ensure that the Great Depression would
not happen again.
- National Labour Relations Act passed to settle disputes
between managers and workers.
- Recognised, negotiated with and reformed the trade unions.
- Helped to enforce labour legislations and protect workers.

101
Act
Alphabet Agencies. Cont…
Social Security Act of 1935
Aimed at
- Establishing a nationwide
system of unemployment
insurance fund to help
workers who lost their jobs.
- Established old-age pensions
at a rate of $15 a month for
needy Americans over 65
years.
- Provided federal funding for
variety of social services and
public health programmes.102
Act
Alphabet Agencies. Cont…
Works Progress/Projects
Administration Act of 1935
(WPA)
Moremi SK
KgaugeloM@athlonegirlshigh.co.za
copyright © all rights reserved.
Aimed at
- It set up construction and
conservation projects and
gave work to 8,5 million
unemployed writers, artists,
musicians, actors and
teachers in cultural and arts
projects.
103
104
What opposition was there to the New Deal?
• Many US businessmen felt that FDR’s policies were too
revolutionary and that he was taking the country
towards socialism.
• Wealthy Americans hated having to pay higher taxes for
the New Deal.
• Growing government interference in the economy and
undermining self-reliance.
• Many businessmen found it difficult to retrench
inefficient workers since Roosevelt’s laws gave protection
to workers. 105
• Many businessmen felt the Alphabet Agencies were inefficient
and caused massive waste.
• The Supreme Court declared many New Deal acts to be
unconstitutional, this includes;
• AAA, which the Supreme Court ruled that it threatened the
powers of individual states.
• NRA was said to be interfering in business practice and went
against the capitalist system in the USA.
• Chief Justice Charles E Hughes also declared the NIRA and the
Railroad Retirement Act of 1937 unconstitutional.

106
FDR’s reaction to the
opposition and criticism
• This angered FDR and when he was
elected again in 1936 he wanted to
appoint more progressive judges
who were his supporters to the
Supreme Court.
• Roosevelt then proposed a new
legislation/bill which meant that
6 new judges would be appointed to
the Supreme Court.
107
• Roosevelt’s critics called this a court
packing plan and accused him of
undermining the constitution.
• Many people also thought that FDR
was trying to gain more power and
was behaving like a dictator.
• Roosevelt’s new legislation/bill was
defeated, and it damaged his reputation.
• Four of the old conservative judges either retired or died
between 1937-1938.
Moremi SK

KgaugeloM@athlonegirlshigh.co.za

108
copyright © all rights reserved.
109
To what extent did the New Deal weaken or
strengthen USA capitalism?

110
Achievements of the New Deal.
• Unemployment rate was reduced as millions of jobs were
created.
• Worker’s rights and working conditions were improved: and
this in turn increased Trade Union membership as workers had
collective bargaining power.
• Recovery of the economy.
• Psychological effect on public important as it gave people hope
and a sense of optimism, it also boosted people’s morale and
confidence.

111
Weaknesses/Failures of the New Deal
• Did not entirely solve unemployment or exploitation of
workers.
• Roosevelt's New Deal protected trade unions and guaranteed
the right to strike.
• It ended laissez-faire and rugged individualism as government
interfered with business
• The results were a slow economic recovery and second
“Roosevelt” depression in 1938.
= Vast government spending, high taxes and massive
intervention in the economy may have delayed the USA’s
economic recovery. 112