Roosevelt and his “NEW DEAL”.

Just before Roosevelt entered office on March 4, 1933, a bank panic swept the country. Thousands of banks failed, people lost their money. They rushed to the banks to get their money out. It became difficult because everyone wanted to do it and completely no one had time to do it. Banks crashed before people had to get their money. Thousands of unsound banks crashed. Millions of dollars disappeared. People were very dissatisfied. Their dissatisfaction influenced the government policy. Roosevelt made a really wise step. He understood that it was difficult even for sound banks to meet the demands. He decided to close all banks for a special bank holiday. When it was time for them to open, he allowed opening only sound banks. This crisis was very difficult and hard but Roosevelt found the way to overcome the problem. Some banks loaned money from government or bank which had better situation and most of them reopened for business. This action and a series of “fireside chats” gave the people new confidence. The first months of Roosevelt’s administration were very busy. During a period of about one hundred days Congress passed many new laws to provide relief and to promote recovery.

1. Gold ceased to circulate as money, and paper dollars were issued. People could repay debts more easily with the new paper money.

2. The Securities Act of 1933 provided for government supervision of the issuance of new stock. An act passed in 1934 created the Securities and Exchange Commission, which regulates the sale of the stock.

3. A new farm program was created by the Agricultural Adjustment Act (AAA). The AAA raised prices for farm produce to pre – World War I levels. In return for price supports farmers had to agree to reduce production.

4. The Tennessee Valley Authority (TVA) began constructing dams on the Tennessee River electrical power. The TVA sponsored many programs for improving life in a large area of the South.

5. The National Industrial Recovery Act (NIRA) set up the National Recovery Administration (NRA) to aid industry and labor. The program tried to help get higher prices for industry and higher wages for labor. The American people were encouraged to buy from stores that displayed the Blue Edge, a sign which indicated participation in NRA programs. The Public Works Administration (PWA), created by the same act as the NRA, provided jobs by financing the construction of roads and other public works.

6. The Civilian Conversion Corps (CCC) provided government jobs for unemployed youths. Much of their work was devoted to planting trees, protecting, and building parks.

7. The federal Emergency Relief Administration (FERA) provided direct aid to the unemployed.

In 1935 the New Deal was concentrated more on reform than on recovery. Roosevelt wanted to deal with the causes of the Great Depression. He wanted American wealth to be distributed more equally. This required the passage of several new laws. The Revenue Act of 1935| provided a national pension system, unemployment insurance, and benefits to the wives and families of deceased workers. The National Labor Relations Board (NLRB) gave labor unions the opportunity to win better wages.

In July 1935 Congress passed Labor Relations Act. Known as the Wagner Act – after senator Robert E. Wagner, who introduced it – it strengthened the power of the labor unions.

The Wagner Act helped workers by outlawing unfair practices. Employers could no longer refuse no bargain with union representatives or prevent workers from joining unions. The act set up National Labor Relations Board (NLRB) which gave labor unions the opportunity to win better wages.

Probably the hardest battle of the New Deal was fought over the Social Security Act. Many people opposed such a plan because of its costs to businesses.

Roosevelt wanted everyone to be included, however. Frances Perkins, Secretary of Labor and the first woman ever appointed to a President’s cabinet knew that many people were against such a sweeping bill. In 1935 she drew up the first Social Security Act. The plan was a form of insurance. Employers and workers would pay taxes to create funds to cover unemployment benefits, old-age pensions, programs for children or insured workers who died. The bill covered only about half the work force. Farm and domestic workers were left out. Despite these limits, however, it gave millions of workers a sense of security.

The New Deal succeeded in putting many people back to work It gave recovery to the farmers and to businesses. But recovery was slow and painful.

3. Government’s efforts to reduce immigration to the USA.

Efforts to limit immigration had begun early in the decade. In 1921 Congress passed an act limiting the number of immigrants from eastern and southern Europe – the Europeans most anxious to come to the United States.

In 1924 and 1929 Congress imposed even more restrictions on immigrants. Thus, the nation’s history of nearly unlimited European immigration came to an end. Meanwhile, most Asian immigration was still banned.

Anti-immigration laws, however, did not apply to people from Americas. Nearly 500.000 people immigrated from Mexico in the 1920s, and 950.000 from Canada. Most Mexicans migrated to the Southwest, where their labors played a vital role in the growth of farmlands, railroads, and mines.

As the anti-immigrant mood gripped the nation, an old organization took on new life. Leaders of the Ku Klux Klan, which had terrorized black southerners during Reconstruction, saw a chance to expand the Klan’s strength beyond its base in South.

In 1920 the Klan hired two sales agents to help achieve its goal. In a public campaign boosting “100 percent pure Americanism,” they directed hatred against anyone who was not white or Protestant. White – hooded Klansmen and their wives now terrorized Catholics, Jews, Asians, and immigrants as well as African Americans.

By 1925 the Klan had as many as 5 million members. They helped elect five United States senators and four state governors – in northern as well as southern states.

However, the Klan’s increasing violence began to weaken its appeal. When a Klan leader was convicted of murder in 1925, membership began to drop. By 1930 the Klan had only 50.000 members.

 

4. Opposition to the New Deal.

There were some people that were unsatisfied with the politics of the new

government. Some of them thought that government was not doing enough. Senator Huey P. Long of Louisiana proposed a Share Our wealth plan which would redistribute the country’s wealth. Dr. Francis Townsend of California wanted the government to give everyone over sixty years of age a pension of two hundred dollars per month. Both men had many supporters. Such demands had a great deal of influence of the establishment of the Social Security system.

Criticism of the New Deal also came from those who felt that government was doing too much. The United States Supreme Court decided that some of the new laws, including the AAA and the NIRA, were unconstitutional. Roosevelt thought otherwise. He tried to increase the number of justices on the Supreme Court. He asked Congress to pass a law allowing him to do this. He hoped to appoint enough new justices to the Court to swing its decisions in favor of the New Deal. Roosevelt’s plan failed. But because of vacancies which Roosevelt filled, and changing opinions among the justices, the Court soon came to accept the new programs.

There were many objections to the New Deal. Many business operators resented government interference. Some of them disliked Roosevelt so much that they would not speak his name, referring him profanely as “that man” in the White House. The huge emergency programs which made work for people to do were criticized for being wasteful. The Works Progress Administration (WPA), which spent $11 billion in some four years giving people work, was called by its critics the “we piddle around” agency.

5. The role of the New Deal in coping with the Depression.

As a whole, the New Deal was only partly successful. By 1938, problems still remained high. Unemployment remained high. As the number of jobs declined, women, blacks, and other minorities were most often the last hired and the and the first fired. They found themselves excluded from jobs by employers, unions, and even by government policies. Only the increased demand for goods and workers caused by the World War II brought full recovery. But the New Deal did accomplish something. It held the American people together. Dictators arose in many countries. However, the United States dealt with the depression without giving up its ideals of government. The New Deal did, however, bring a new era if not a revolution in American life. Since the 1930s government has had the responsibility of providing a sound, healthy economy. The government is called upon to reduce unemployment compensation to those who cannot find work, give aid to the elderly, support the price of farm produce, help individuals obtain better housing, and promote quality education. The role of the government changed under the New Deal from noninvolvement to total involvement. The New Deal pointed the nation in the direction it is following today.

 

Conclusions

While investigating this theme, I have come to the following conclusions:

 

1. Life had greatly changed in America after the Civil War of 1861- 1865. By the  

end of the XIX-th century, the American economy was blooming and prosperity was spreading. The centre of social life moved from farms to cities. Big factories were constructed, big business rose. America was becoming a more powerful industrial power. The reform movement was taking place in all spheres of the USA, and the people who were involved in these reforms were called the Progressives. Progressivism was founded upon the belief that all social problems could be solved through science and enlightened government actions. The role of the government changed: it became more interested in the life of each individual, and working people began to get support from their government. The political system, foreign, social and immigration policies changed in the country.

 

2. The new inventions, made in the end of the 19-th and the beginning of the 20-th centuries, had greatly changed the life of the United States. The life in the country became more comfortable and convenient and Americans got in the know of the latest use in the country and abroad with the telephone, the radio, electricity, automobiles, the telegraph, the gramophone, new appliances for the home, the conveyor line, clothes and footwear producing equipment, etc. Besides, labor productivity had increased to a considerable extent due to the new machines and modern technology introduced into the process of producing goods.

 

3. During the first two decades of the XX century the rise of economy had achieved a very high level. The railroads played a very important role in it. They were covering the whole country that stimulated the industrial rise of the country and intensive use of natural resources. Whatever the industrial revolution needed, the railroads could now deliver it to any place of the country.

People started to pioneer in different fields of business, such as oil refining, steel industry, electric power stations, etc. Efficient using of natural resources, fast exploring of new technologies, professionalism of people working in American industry soon made the United States the world’s economic leader.

 

 4. As the USA was being industrialized and broadened its trade links, a group of men emerged who would dominate the economic future of the country. These were the industrial giants. They had a sense of vision to see opportunities for production and marketing where others had not. And they had the willingness to take risks. The industrial giants were able to use new inventions and corporate systems to make production costs lower and provide products and services to growing numbers of consumers. They were Andrew Carnegie, John D. Rockefeller, J. P. Morgan, Henry Ford, etc.

5. World War I had greatly influenced the life of the USA. It became the reason of several serious problems in the society. They appeared well before the severe recession but in the course of time they finally led the country to the collapse-the Great Depression of 1929-1939.

First of all, half of the industrial workers lived in poverty and their dissatisfaction with their life was constantly growing.

The racial climate had become very intensive. Racial violence and hatred were growing. Racial discrimination became the reason of high level of unemployment among minorities. The anti-immigration laws made by the government in order to reduce the number of immigrants in country inspired the immigrants’ dissatisfaction and activated the Unions’. All this resulted in strikes and riots against the government politics.

The economy was unstable: the gross national product declined, some businesses went bankrupt, thousands of farmers lost their land and millions of American workers lost their jobs. As a result, there was a dramatic increase of labor unrest.

 

 

 6. But during the 1920s it still seemed as if prosperity would go on forever. It was the decade of significant, even dramatic social, economic and political change.

The American economy began to grow again and it developed new forms of organization. The American government experimented with new approaches to public policy. The stock market performed remarkably well.

 Salaries rose, and working hours decreased. Americans had the resources and the leisure time to pursue new forms of entertainment: going to movies and sporting events, visiting restaurants and bars, dancing to jazz music and doing the shopping, gambling, etc. Though alcohol was prohibited, it was smuggled across state borders. This period of time is called “the Roaring Twenties” or the “New Era”. It was the time in which American culture reshaped itself to reflect all the changes in the society. It was also an age in which America was becoming a modern nation.

 

7. The autumn of 1929 began with alarming declines in stock prices and the stock market crash that followed. It was the beginning of the Great Depression.

The causes of this severe crisis were:

- the US prosperity depended on a few basic industries, mostly construction and automobile but newer industries hadn’t yet developed enough;

- most families were too poor to buy the goods of the industrial economy;

- the credit structure of the economy was in trouble: farmers were deeply in debt but crop prices were too low to allow them pay off what they owed; when the market crashed, some of the nation’s biggest banks failed;

- late in the 1920s America’s position in international trade was bad-European                  demand for American goods began to decline as European economy was destabilized after World War I;

- after WWI all allied with the USA nations owed large sums of money to American banks but they were not able to pay their debts because of economic troubles in their countries.

8. The government began working to see how it could end the Great Depression. President Franklin D. Roosevelt had written a plan called the “New Deal”. The main aim was to create jobs through projects such as building highways, dams, bridges, planting parks, etc. The men who worked on these projects were paid by the government. But the government was just as poor as someone else. In a risky move, it began to spend more money than it had. Printing so much money was causing the inflation, going of the value of the dollar. This has troubled the American economy ever since. Though the government helped people temporarily during the Depression, some of the policies set up than have caused serious problems that are still with Americans today. Sometimes it seemed as though the Great Depression would never end, although by the late 1930s things were improving a little. Men found jobs again and earned money to buy food, clothes and other products. But only in America went to World War II, did the last traces of the Great Depression disappear.

 

Appendix

1. Glossary

1. Depression – депрессия  

2. Inflation – инфляция

3. Stagnation – стагнация  

4. Amendment – поправка  

5. Unemployment – безработица

6. Employer – работодатель  

7. Railroad – железная дорога  

8. Trade Unions – организация рабочих , профсоюзы

9. Racial Unrests – бунты на почве национальной розни  

10. Economy – экономия  

11. Conditions – условия

12. To sustain – продолжать

13. Policy – политика

14. Predictable- предсказуемое

15. Phenomenon – явление

16. Adequate – адекватный

17. Development – развитие

18. Tendencies - тенденции

19. Immigrant – иммигрант

20. Influence - влияние

21. Supervision – управление

22. Government – правительство

23. Significant – существенный

24. Entertainment – развлекательный

25. Approaches – подходы

26. Sound – нормальные

27. To decrease – уменьшаться

28. To increase – увеличиваться

29. To reflect – размышлять

 

2. References

1. Bernstein V. America’s story. – Steck-Vaughn Company.: 1995

2. H C. Dethloff & A E. Begnaud. – Steck-Vaughn Company.: 1986

3. Herman J. Viola. Why we remember. Addison – Wesley Publishing Company.: 1998

4. American History. - Beka Book Publications.: 1990