The New Deal programs empowered the federal government to exercise greater control over the national economy, to assist poor and unemployed persons, to recognize and enforce the right of collective bargaining, and to administer the complex system of Social Security.
The term “New Deal” was first used by Franklin D.
When Roosevelt took office on March 4, 1933, more than five thousand banks had been forced to close, and the entire banking system appeared to be on the brink of collapse. In his inaugural address, Roosevelt asserted his belief that “the only thing we have to fear is fear itself,” and he pledged to “wage war against the emergency” with “direct, vigorous action.” In the next few months, called the Hundred Days, the Roosevelt administration cooperated with Congress to enact an unprecedented amount of legislation.
On March 5, Roosevelt unexpectedly declared a four-day “bank holiday.” He and his advisers hoped to stop the run on the banks and restore public confidence in the banking system. Officials quickly drafted the Emergency Banking Act, proposing that Department of Treasury inspectors examine the banks and then announce which ones were financially sound. Congress approved the legislation on March 9, and within three days almost one thousand banks were operating without fear of panic. To secure lasting confidence in the system, Congress passed the
Additional laws of the Hundred Days further enlarged governmental intervention into the nation’s economy. The
A 1934 political cartoon satirizes the proliferation of New Deal legislation.
In 1934, the first phase of the New Deal came to an end with a flurry of legislation that established new regulatory structures. The
While continuing relief and recovery programs, the second phase of the New Deal put a new emphasis on social and economic reforms designed to help working people, the unemployed, and the elderly. Roosevelt announced this change of direction in his annual address to Congress on January 4, 1935. In large part, Roosevelt was reacting to the left-wing critics of the New Deal, particularly Huey Long, who advocated a massive redistribution of wealth, and Francis Townsend, who proposed an expensive program of benefits for older citizens.
The two most significant legislative reforms of the New Deal’s second phase were the
Other important programs were also started in 1935. The
A number of programs were designed to improve conditions in rural areas. The
In 1937, Roosevelt signed into law the
By 1938, New Deal liberals, increasingly under attack, were forced into a defensive position. A powerful coalition of Republicans and conservative southern Democrats was able to slash appropriations and reduce corporate taxes. Conservatives on the House Committee on Un-American Activities launched a well-publicized investigation of communist influences within New Deal agencies. In the mid-term Democratic primaries, voters reacted negatively to Roosevelt’s attempts to “purge” anti-New Deal Democratic senators, and in the November elections, Republicans made major gains in both the Senate and the House, as well as in state contests. In his state of the union address of January, 1939, Roosevelt expressed the need to “preserve our reforms,” while he proposed no new domestic policies.
With the outbreak of World War II, the growing demand for labor eliminated the need for relief programs such as the Civil Conservation Corps and the Works Progress Administration. In a press conference of 1943, Roosevelt observed that New Deal programs had been enacted during a period in which the United States was “an awfully sick patient,” and he declared that it was now time for “Dr. New Deal” to be replaced by “Dr. Win-the-War.” Although conservatives continued to denounce the New Deal, they made almost no attempts to abrogate its core programs: Social Security, subsidies for farmers, minimum-wage legislation, the banning of child labor, defense of collective bargaining, and banking and securities regulations. These programs had become firmly entrenched as foundations within the new economic and social order produced by the New Deal.
In subsequent years, moreover, many of these programs would be expanded on a piecemeal basis. When the United States entered World War II in December, 1941, Roosevelt would be able further to institutionalize the New Deal’s most important legacy, governmental regulation of the economy. Following the war, the number of New Deal-inspired programs would continue to proliferate in Harry S. Truman’s Fair Deal and even more in Lyndon B. Johnson’s Great Society.
Alter, Jonathan. The Defining Moment: FDR’s Hundred Days and the Triumph of Hope. New York: Simon & Schuster, 2007. Compelling narrative account of how President Roosevelt and his advisers dealt with the banking crisis and cooperated with Congress to enact the many significant laws of early 1933. Kennedy, David M. Freedom from Fear: The American People in Depression and War, 1929-1945. New York: Oxford University Press, 1999. The first half of this Pulitzer Prize-winning book presents an informed account of the New Deal within its historical context. Leuchtenburg, William. Franklin D. Roosevelt and the New Deal, 1932-1940. New York: Harper & Row, 1963. Written by a Roosevelt admirer who lived during the period, this popular book has long been recognized as one of the best syntheses ever written about the New Deal. Rosen, Elliott A. Roosevelt, the Great Depression, and the Economics of Recovery. Charlottesville: University Press of Virginia, 2007. Discussing corporate regulations, social welfare, and monetary and fiscal policies, Rosen takes a critical view of the government’s efforts to regulate the economy. Sitkiff, Harvard. New Deal for Blacks: The Emergence of Civil Rights as a National Issue. New York: Oxford University Press, 1981. Discusses the extent to which the New Deal benefited African Americans, emphasizing the roles of persons like Mary McLeod Bethune and Robert Weaver. Smith, Jason Scott. Building New Deal Liberalism: The Political Economy of Public Works, 1933-1956. New York: Cambridge University Press, 2005. In this historical account of public works programs, Smith argues that the New Deal produced a revolution in economic development and laid the foundations for postwar development. Smith, Jean Edward. FDR. New York: Random House, 2007. Probably the most interesting and well-written biography ever written about Roosevelt, with a good balance between his personal life and public policies.
Farm Credit Administration
Federal Deposit Insurance Corporation
Federal Trade Commission
Food Stamp Plan
National Labor Relations Board
Social Security system
Tennessee Valley Authority
World War II