The New Deal

The New Deal

In March 1932, Franklin D. Roosevelt asked Raymond Moley, a professor of public law at Columbia University, "to pull together some intellectuals who might help Roosevelt's bid for the presidency". Moley recruited two of his university colleagues, Rexford G. Tugwell and Adolf Berle. Others who joined the group, later known as the Brains Trust, included Roosevelt's law-partner, Basil O'Connor and his main speech writer, Samuel Rosenman. Others who attended these meetings included Felix Frankfurter, Louis Brandeis (who introduced the group to the ideas of John Maynard Keynes) and Benjamin Cohen. (1)

It has been argued by Patrick Renshaw, the author of Franklin D. Roosevelt (2004): "Politically, Tugwell was on the left with Berle on the right. Moley chaired regular meetings of the brains trust, which Samuel Rosenman and Basil O'Connor also attended. FDR was not an intellectual, but enjoyed their company and was in his element at the free-wheeling discussions which hammered out the New Deal." (2)

However, all the men shared the philosophy advocated by John Dewey that "organized social intelligence should shape society". They were all impressed by the work of women such as Jane Addams, Ellen Starr, Florence Kelley, Alzina Stevens, Julia Lathrop, Mary Kenney, Mary McDowell, Mary Ovington, Alice Hamilton, Belle La Follette, Fanny Garrison Villard, Emily Balch, Jeanette Rankin, Lillian Wald, Edith Abbott, Grace Abbott, Mary Heaton Vorse, Charlotte Perkins Gilman, Crystal Eastman and Sophonisba Breckinridge, that had been so involved in the social reform movement. (3)

Rexford G. Tugwell and Adolf Berle argued the free market of Adam Smith had vanished forever. They concluded that the market no longer performed its classic function of maintaining an equilibrium between supply and that the two thousand men who controlled American economic life, manipulated prices and production. Tugwell wrote: "The cat is out of the bag. There is no invisible hand. There never was... We must now supply a real and visible guiding hand to do the task which that mythical, nonexistent, invisible agency was supposed to perform, but never did." (4)

In a speech jointly written by Franklin D. Roosevelt, Raymond Moley and Samuel Rosenman, he gave a speech on 7th April 1932 where he attacked the administration of President Herbert Hoover for attacking the symptoms of the Great Depression, not the cause. "It has sought temporary relief from the top down rather than permanent relief from the bottom up. These unhappy times call for the building of plans that put their faith once more in the forgotten man at the bottom of the economic pyramid." (5)

Roosevelt was selected as the Democratic Party candidate for the 1932 Presidential Election to fight President Herbert Hoover. In his acceptance speech Roosevelt argued: "Yes, the people of this country want a genuine choice this year, not a choice between two names for the same reactionary doctrine. Ours must be a party of liberal thought, of planned action, of enlightened international outlook, and of the greatest good to the greatest number of our citizens.... Let us all here assembled constitute ourselves prophets of a new order of competence and of courage. This is more than a political campaign; it is a call to arms. Give me your help, not to win votes alone, but to win in this crusade to restore America to its own people." He then added the words: "I pledge you, I pledge myself, to a New Deal for the American people." (6)

In the election Roosevelt received 22,825,016 votes to Hoover's 15,758,397. With a 472-59 margin in the Electoral College, he captured every state south and west of Pennsylvania. Roosevelt carried more counties than a presidential candidate had ever won before, including 282 that had never gone Democratic. Of the forty states in Hoover's victory coalition four years before, the President held but six. Hoover received 6 million fewer votes than he had in 1928. The Democrats gained ninety seats in the House of Representatives to give them a large majority (310-117) and won control of the Senate (60-36). Only one previous Republican candidate, William Howard Taft, had done as badly as Hoover. (7)

Franklin D. Roosevelt was elected on 8th November, 1932, but the inauguration was not until 4th March, 1933. While he waited to take power, the economic situation became worse. Three years of depression had cut national income in half. Five thousand bank failures had wiped out 9 million savings accounts. By the end of 1932, 15 million workers, one out of every three, had lost their jobs. When the Soviet Union's trade office in New York issued a call for 6,000 skilled workers to go to Russia, more than 100,000 applied. (8)

President Franklin D. Roosevelt took office on 4th March, 1933. His first act as president was to deal with the country's banking crisis. Since the beginning of the depression, a fifth of all banks had been forced to close. Already 389 banks had shut their doors since the beginning of the year. As a consequence, around 15% of people's life-savings had been lost. Banking was at the point of collapse. In 47 of the 48 states banks were either closed or working under tight restrictions. To buy time to seek a solution Roosevelt declared a four-day bank holiday. It has been claimed that the term "bank holiday" was used to seem festive and liberating. "The real point - the account holders could not use their money or get credit - was obscured." (9)

Roosevelt's advisers, Louis Brandeis, Felix Frankfurter, and Rexford G. Tugwell agreed with progressives who wanted to use this opportunity to establish a truly national banking system. Heads of great financial institutions opposed this idea. Louis Howe supported conservatives on the Brains Trust such as Raymond Moley and Adolf Berle, who feared such a measure would create very dangerous enemies. Roosevelt was worried that such action "might accentuate the national sense of panic and bewilderment". (10)

Roosevelt summoned Congress into special session and presented it with an emergency banking bill that permitted the government to reopen the banks it ascertained to be sound, and other such banks as rapidly, as possible." The statue passed the House of Representatives by acclamation in a voice vote in forty minutes. In the Senate there was some debate and seven progressives, Robert LaFollette Jr, Huey P. Long, Gerald Nye, Edward Costigan, Henrik Shipstead, Porter Dale and Robert Davis Carey, voted against as they believed that it did not go far enough in asserting federal control. (11)

On 9th March, 1933, Congress passed the Emergency Banking Relief Act. Within three days, 5,000 banks had been given permission to be re-opened. President Roosevelt gave the first of his radio broadcasts (later known as his "fireside chats"). It is estimated that it had an audience of 60 million people: "Some of our bankers have shown themselves either incompetent or dishonest in their handling of the people's funds. They had used money entrusted to them in speculations and unwise loans. This was, of course, not true of the vast majority of our banks, but it was true in enough of them to shock the people for a time into a sense of insecurity. It was the government's job to straighten out this situation and do it as quickly as possible. And the job is being performed. Confidence and courage are the essentials in our plan. We must have faith; you must not be stampeded by rumours. We have provided the machinery to restore our financial system; it is up to you to support and make it work. Together we cannot fail." (12)

Will Rogers welcomed the speech: "Mr. Roosevelt stepped to the microphone last night and knocked another home run. His message was not only a great comfort to the people, but it pointed a lesson to all radio announcers and public speakers what to do with a big vocabulary - leave it at home in the dictionary. Our President took such a dry subject as banking (and when I say dry, I mean dry, for if it had been liquid, he wouldn't have to speak on it at all) and made everybody understand it, even the bankers." (13)

In September 1922, the Fordney-McCumber Act was signed by President Warren Harding. These raised tariffs to levels higher than any previously in American history in an attempt to bolster the post-war economy, protect new war industries, and aid farmers. Over the next eight years it raised the American ad valorem tariff rate to an average of about 38.5% for dutiable imports and an average of 14% overall. It has been claimed that the tariff was defensive, rather than offensive. (14)

Most of American trading partners had raised their own tariffs to counter-act this measure. The Democratic Party that had opposed tariffs argued that it was to blame for the agricultural depression that took place during the 1920s. Senator David Walsh pointed out that farmers were net exporters and so did not need protection. He explained that American farmers depended on foreign markets to sell their surplus. The price of farming machinery also increased. For example, the average cost of a harness rose from $46 in 1918 to $75 in 1926, the 14-inch plow rose from $14 to $28, mowing machines rose from $45 to $95, and farm wagons rose from $85 to $150. Statistics of the Bureau of Research of the American Farm Bureau that showed farmers had lost more than $300 million annually as a result of the tariff. (15)

Although agriculture sector had problems during the 1920s, American industry prospered. The real wages of industrial workers increased by about 10 per cent during this period. However, productivity rose by more than 40%. The farming community did not enjoy the benefits of this growing economy. As Patrick Renshaw has pointed out: "The real problem was that in both agricultural and industrial sectors of the economy America's capacity to produce was tending to outstrip its capacity to consume." (16)

Herbert Hoover and the Republicans believed the Forder-McCumber tariffs had helped the American economy to grow. William Borah, the charismatic senator from Idaho, widely regarded as a true champion of the American farmer, had a meeting with Hoover and offered to give him his full support if he promised to increase tariffs of agricultural products if elected. (17) Hoover agreed with the proposal and during the campaign promised the American electorate that he would increase the tariff. (18)

After his election Hoover asked Congress for an increase of tariff rates for agricultural goods. The Smoot-Hawley Act was passed in the Senate on a vote of 44 to 42, with 39 Republicans and 5 Democrats voting in favor of the bill. Hoover signed the bill on 17th June, 1930. The Economist Magazine argued that the passing of the Smoot–Hawley Tariff Act was "the tragic-comic finale to one of the most amazing chapters in world tariff history… one that Protectionist enthusiasts the world over would do well to study.” (19)

By 1933 agriculture in America was in a terrible state. For example, per capita farm income was one quarter that of non-farmworkers. Farm prices fell by 53 per cent from 1929 to 1932. Net farm income was down by 70 per cent. "A cow that sold for $83 in 1929 now brought $28. Cotton sold for six cents a pound. Corn in Nebraska brought thirty-one cents a bushel, Kansas wheat thirty-eight cents. By early 1933, 45 per cent of all farm mortgages were delinquent and facing foreclosure." (20)

Harry Terrell was brought up on a farm in South Carolina: "320 acres of farm land, fine land, that my uncle owned and cleared, he lost it because they foreclosed the mortgage. Some of the best in the state, and he couldn't borrow a dime. The farmers didn't have anything they could borrow on...Corn was going for eight cents a bushel. One county insisted on burning corn to heat the courthouse because it was cheaper than coal... The county was getting up in arms about taking a man's property away from him. It was his livelihood. When you took a man's horses and his plow away, you denied him food, you just convicted his family to starvation." (21)

Oscar Heline was someone who was forced into bankrupcy by the Great Depression: "First, they'd take your farm, then they took your livestock, then your farm machinery. Even your household goods. And they'd move you off... In South Dakota, the county elevator listed corn as minus three cents. Minus three cents a bushel. If you wanted to sell 'em a bushel of corn, you had to bring in three cents. They couldn't afford to handle it." (22)

Henry A. Wallace was appointed as Secretary of Agriculture. Rexford G. Tugwell, became assistant secretary. Tugwell wrote that "Since my graduate-school days, I have always been able to excite myself more about the wrongs of farmers than those of urban workers." (23) Together they drafted what became known as the Agricultural Adjustment Act. The plan was to raise farm income by reducing agricultural surpluses through a system of domestic allotments. Farmers would be paid directly by the government not to produce crops beyond an allotment set by the secretary of agriculture. The proposal aimed to deal with the crucial problem of depressed prices and mounting surpluses. (24)

Calvin Benham Baldwin was one of those employed by Wallace to help solve these problems. "The Agricultural Adjustment Administration (AAA) came into being shortly after I got to Washington. Its purpose was to increase farm prices, which were pitifully low. All the farmers were in trouble, even the big ones. Hog prices had just gone to hell. They were four, five cents a pound? The farmers were starving to death. It was decided to slaughter piggy sows (a pregnant pig). The AAA decided to pay the farmers to kill them and the little pigs. Lot of them went into fertilizer. You had a similar situation on cotton. Prices were down to four cents a pound and the cost of producing was probably ten. So a program was initiated to plow up cotton. A third of the crop, if I remember. Cotton prices went up to ten cents, maybe eleven." (25)

On 16th March, 1933, President Roosevelt sent the first genuine New Deal measure to Congress. It was a radical departure, suggesting government control of agricultural production, historically the most individualitic segment of the economy. Roosevelt admitted that the Agricultural Adjustment Act was a great departure from previous legislation: "I tell frankly that it is a new and untried path, but I tell you with equal frankness that an unprecedented condition calls for the trial of new means to rescue agriculture." (26)

The House of Representatives passed the Agricultural Adjustment Act without any amendments, but the Senate was not so convinced. The measure shocked conservatives and upset those who had to pay the proposed processing tax. Joseph W. Martin of Massachusetts claimed that it the bill passed it would "put America on the road to Moscow". Frank Freidel, the author of Franklin D. Roosevelt: A Rendezvous with Destiny (1990) pointed out that "others plastered a red label on Roosevelt's agricultural experts, or denounced them as professors who had no knowledge of farm realities." (27)

At the same time, some radicals, such as Burton Wheeler and Lynn Frazier, argued that the farmer deserved nothing less that government guarantee of his "cost of production". Tugwell observed: "For real radicals such as Wheeler, Frazier, etc., it is not enough; for conservatives it is too much; for Jefferson Democrats it is a new control which they distrust. For the economic philosophy which it represents there are no defenders at all. Nevertheless, in spite of everything, it will probably become law." It was passed on 10th May, 1933. (28)

Most farmers were very pleased by the passing of the Agricultural Adjustment Act. Harry Terrell claims: "Henry Wallace and his granary was the man who saved the farmer... They took this corn and paid for it and stored it. They put a price on it that was above the miserable going price." (29) Oscar Heline agrees "It was Wallace who saved us, put us back on our feet. He understood our problems." Heline was in a group of farmers who went to see Henry A. Wallace: "He made it clear to us he didn't want to write the law. He wanted the farmers themselves to write it... He would always give his counsel, but he never directed us. The program came from the farmers themselves." (30)

The Farm Credit Administration was established on 27th March, 1933. It was a merger of government farm loan agencies under the control of Henry Morgenthau. On 16th June, 1933, Congress passed the Farm Credit Act, attempted to deal with the problem of farm mortgages. Over the next eighteen months it would refinance a fifth of all farm mortgages. (31)

Roosevelt later recalled that the establishment of the Farm Credit Administration was a great success as they needed to action to prevent people losing their farms. "We saved farms from foreclosure through the Home Owners' Loan Corporation and the Farm Credit Administration. I suppose some people today would like to repeal all that and go back to the conditions of 1932, when the people out West mobbed a Federal Judge because he was trying to carry out the existing law of the land in foreclosing a farm." (32)

Roosevelt attempted to placate conservatives by appointing George N. Peek as head of the Agricultural Adjustment Administration (AAA). He also appointed Jerome Frank as general council to the AAA. Peek clashed with both Wallace and Frank. John C. Culver and John C. Hyde, the authors of American Dreamer: A Life of Henry A. Wallace (2001) have argued that Peek never liked Jerome Frank and wanted to appoint his own general council: "Crusty and dogmatic, Peek still seethed with resentment over Wallace's appointment as secretary, a position he coveted.. Frank was liberal, brash, and Jewish. Peek loathed everything about him. In addition, Frank surrounded himself with idealistic left-wing lawyers... whom Peek also despised." This group of left-wing idealists included Frederic C. Howe, Adlai Stevenson, Alger Hiss, Lee Pressman, Hope Hale Davis and Gardner Jackson. Peek later wrote that the "place was crawling with... fanatic-like... socialists and internationalists." On another occasion he called the men "Lenin chicks". (33)

The conflict between Peek and the young liberals in the AAA continued. Peek's main objective was to raise agricultural prices through cooperation with processors and large agribusinesses. Other members of the Agricultural Department such as Jerome Frank were primarily concerned to promote social justice for small farmers and consumers. On 15th November, 1933, Peek demanded that Wallace should fire Frank for insubordination. Wallace, who agreed more with Frank than Peek, refused. Peek was also hostile to Rexford Tugwell, who believed that Peek was an anti-Semite." (34)

Peek resigned from the AAA on 11th December, 1933. Peek was replaced by Chester R. Davis. He also came into conflict with these young radicals. In February 1935, Davis insisted that Jerome Frank and Alger Hiss should be dismissed. Wallace was unable to protect them: "I had no doubt that Frank and Hiss were animated by the highest motives, but their lack of agricultural background exposed them to the danger of going to absurd lengths... I was convinced that from a legal point of view they had nothing to stand on and that they allowed their social preconceptions to lead them to something which was not only indefensible from a practical, agricultural point of view, but also bad law." (35)

Davis told Frank: "I've had a chance to watch you and I think you are an outright revolutionary, whether you realize it or not". Wallace wrote in his diary: "I indicated that I believed Frank and Hiss had been loyal to me at all times, but it was necessary to clear up an administrative situation and that I agreed with Davis". According to Sidney Baldwin, the author of Poverty and Politics: The Rise and Decline of the Farm Security Administration (1968), Wallace greeted Frank with tears in his eyes: "Jerome, you've been the best fighter I've had for my ideas, but I've had to fire you... The farm people are just too strong." (36)

Rexford Tugwell attempted to protect Frank and Hiss and received support from Louis Howe and Harry Hopkins: "I went and talked to Harry Hopkins who was outraged, to Louis Howe who was sympathetic, to Henry Wallace who was red-faced and ashamed, and to the President. My first impulse was to resign... I made up my mind that Jerome must have justice." (37) Roosevelt refused to let him go and agreed to appoint Frank as a special counsel to the Reconstruction Finance Association. (38)

After he was elected President Franklin D. Roosevelt initially opposed massive public works spending. However, by the spring of 1933, the needs of more than fifteen million unemployed had overwhelmed the resources of local governments. In some areas, as many as 90 per cent of the people were on relief and it was clear something needed to be done. His close advisors and colleagues, Harry Hopkins, Rexford Tugwell, Robert LaFollette Jr. Robert Wagner, Fiorello LaGuardia, George Norris and Edward Costigan eventually won him over. (39)

Frances Perkins explained in her book, The Roosevelt I Knew (1946): In one of my conversations with the President in March 1933, he brought up the idea that became the Civilian Conservation Corps. Roosevelt loved trees and hated to see them cut and not replaced. It was natural for him to wish to put large numbers of the unemployed to repairing such devastation. His enthusiasm for this project, which was really all his own, led him to some exaggeration of what could be accomplished. He saw it big. He thought any man or boy would rejoice to leave the city and work in the woods. It was characteristic of him that he conceived the project, boldly rushed it through, and happily left it to others to worry about the details." (40)

On 21st March, 1933, sent an unemployment relief message to Congress. It took only eight days to create the Civilian Conservation Corps. It authorized half a billion dollars in direct federal grants to the states for relief. The CCC was a program designed to tackle the problem of unemployed young men aged between 18 and 25 years old. By September, 1935, over five hundred thousand young men lived in CCC camps. (41)

The Civilian Conservation Corps camps were set up all over the United States. Blackie Gold told Studs Terkel: "I was at CCC's for six months, I came home for fifteen days, looked around for work, and I couldn't make $30 a month, so I enlisted back in the CCC's and went to Michigan. I spent another six months there planting trees and building forests. And came out. But still no money to be made. So back in the CCC's again. From there I went to Boise, Idaho, and was attached to the forest rangers. Spent four and a half hours fighting forest fires." (42)

The organisation was based on the armed forces with officers in charge of the men. Over 25,000 men were First World War veterans. The pay was $30 dollars a month with $22 dollars of it being sent home to dependents. The men planted three billion trees, built public parks, drained swamps to fight malaria, built a million miles of roads and forest trails, restocked rivers with nearly a billion fish, worked on flood control projects and a range of other work that helped to conserve the environment. Between 1933 and 1941 over 3,000,000 men served in the CCC. (43)

Marriner Eccles, an advocate of the economic ideas of John Maynard Keynes and Lauchlin Currie, worked at the Treasury Department under the treasury secretary Henry Morgenthau. Eccles went before the Senate Finance Committee in 1933. According to Patrick Renshaw, the author of Franklin D. Roosevelt (2004): "Though the young Mormon banker from Utah claimed never to have read Keynes he had nevertheless jolted Senate finance committee hearings in 1933 by urging that the federal government forget about trying to balance budgets during the depression and instead spend heavily on relief, public works, the domestic allotment plan and refinancing farm mortgages, while cancelling what remained of war debt." (43a)

The National Industrial Recovery Act (NIRA) was passed by the Senate on 13th June by a vote of 46 to 37. The National Recovery Administration (NRA) was set up to enforce the NIRA. President Franklin D. Roosevelt named Hugh S. Johnson to head it. Roosevelt found Johnson's energy and enthusiasm irresistible and was impressed with his knowledge of industry and business. William E. Leuchtenburg has commented: "A gruff, pugnacious martinet with the leathery face and order-barking rasp of a former cavalry officer, Johnson had no illusions about the dimensions of the job." (44)

Huey P. Long was totally opposed to the appointment. He argued that Johnson was nothing more than an employee of Bernard Baruch and would permit the most conservative elements in the Democratic Party to do as they pleased with American industry. Guy Tugwell also had his concerns about his relationship with Baruch: "It would have been better if he had been further from Baruch's special influence." He was concerned about other matters: "I think his tendency to be gruff in personal matters will be an handicap and his occasional drunken sprees will not help." However, overall he thought it was a good appointment: "Hugh is sincere, honest, believes in many social changes which seem to me right, and will do a good job." Surprisingly, Baruch himself had warned Frances Perkins against the appointment: "Hugh isn't fit to be head of the NRA. He's been my number-three man for years. I think he's a good number-three man, maybe a number-two man, but he's not a number-one man. He's dangerous and unstable. He gets nervous and sometimes goes away without notice. I'm fond of him, but do tell the President to be careful. Hugh needs a firm hand." (45)

Johnson expected to run the whole of the NRA. However, Roosevelt decided to split it into two and placed the Public Works Administration (PWA) with its 3.3 billion dollar public works programme, under the control of Harold Ickes. When he heard the news Johnson stormed out of the cabinet meeting. Roosevelt sent Frances Perkins after him and she eventually persuaded him not to resign.As David M. Kennedy has pointed out in Freedom from Fear (1999), the NRA and the PWA "were to be like two lungs, each necessary for breathing life into the moribund industrial sector". (46)

Jean Edward Smith, the author of FDR (2007): "No two appointees could have been more dissimilar, and no two less likely to cooperate. For Johnson, an old cavalryman, every undertaking was a hell-for-leather charge into the face of the enemy. Ickes, on the other hand, was pathologically prudent. As he saw it, the problem of the public works program was not to spend money quickly but to spend it wisely. Obsessively tightfisted, personally examining every project in minute detail, Ickes spent a minuscule $110 million of PWA money in 1933." (47)

The National Recovery Act allowed industry to write its own codes of fair competition but at the same time provided special safeguards for labor. Section 7a of NIRA stipulated that workers should have the right to organize and bargain collectively through representatives of their own choosing and that no one should be banned from joining an independent union. The NIRA also stated that employers must comply with maximum hours, minimum pay and other conditions approved by the government. Johnson asked Roosevelt if Donald R. Richberg could be general counsel of the NRA. Roosevelt agreed and on 20th June, 1933, Roosevelt appointed him to the post. Richberg's main task was to implement and defend Section 7(a) of the NIRA. (48)

Employers ratified these codes with the slogan "We Do Our Part", displayed under a Blue Eagle at huge publicity parades across the country, Franklin D. Roosevelt used this propaganda cleverly to sell the New Deal to the public. At a Blue Eagle parade in New York City a quarter of a million people marched down Fifth Avenue. Roosevelt argued that "there is a unity in this country which I have not seen and you have not seen since April, 1917." (49)

Charles Edison told his workers: "President Roosevelt has done his part: now you do something. Buy something - buy anything, anywhere; paint your kitchen, send a telegram, give a party, get a car, pay a bill, rent a flat, fix your roof, get a haircut, see a show, build a house, take a trip, sing a song, get married. It does not matter what you do - but get going and keep going. This old world is starting to move." (49a)

The NRA program was voluntary. However, those businessmen who accepted the codes developed by the various trade associations, could place the NRA blue eagle symbol in their windows and on the packaging of their goods. This virtually made the scheme compulsory as those companies that did not display the NRA symbol were seen as unpatriotic and selfish. (50)

Johnson's first success was with the textile industry. This included bringing an end to child labour. As William E. Leuchtenburg, the author of Franklin D. Roosevelt and the New Deal (1963), has pointed out: "At the dramatic cotton-code hearing, the room burst into cheers when textile magnates announced their intention to abolish child labor in the mills. In addition, the cotton textile code stipulated maximum hours, minimum wages, and collective bargaining." As Johnson pointed out: "The Textile Code had done in a few minutes what neither law nor constitutional amendment had been able to do in forty years." (51)

On 30th June, 1933, Hugh S. Johnson commented: "You men of the textile industry have done a very remarkable thing. Never in economic history have labor, industry, government and consumers' representatives sat together in the presence of the public to work out by mutual agreement a 'law merchant' for an entire industry... The textile industry is to be congratulated on its courage and spirit in being first to assume this patriotic duty and on the generosity of its proposals." However, some trade unionists criticized the agreement to a $11 minimum wage as a "bare subsistence wage" that would provide workers with little more than "an animal existence." (52)

By the end of July 1933 Johnson had half the main ten industries, textiles, shipbuilding, woolens, electricals and the garment industry, signed up. This was followed by the oil industry but he was forced to make a raft of concessions on price policy to persuade the steel industry to join. On 27th August, the automobile manufactures, except for Henry Ford, agreed terms with Johnson. When the coal operators fell in line on 18th September, Johnson had won the last of the big ten industries to the NRA in a period of only three months. (53)

The coal code brought dramatic gains for miners. It included the right of miners to a checkweighman and payment on a net-ton basis and prohibitions against child labour, compulsory scrip wages and the compulsory company store. It also meant higher wages. As a result of the agreement, the United Mine Workers increased union membership from 100,000 to 300,000.

Ford announced he intended to meet the wage and hour provision of the code or even to improve on them. However, he refused to sign up to the code. Johnson reacted by urging the public not to purchase Ford vehicles. He also told the federal government not to purchase vehicles from Ford dealers. Johnson commented: "If we weaken on this, it will greatly harm the Blue Eagle principle and campaign." Johnson's actions resulted in a decline in sales of Ford cars and trucks in 1933. However, it only had a short-term impact and in 1934 the company had increased sales and profits. (54)

John Kennedy Ohl has argued that during the summer of 1933 Johnson was called the "busiest man" in the United States: "Whether sitting at the desk in the Commerce Department or on the platform in the auditorium, Johnson, with his coat off, shirt open at the neck, sleeves rolled up, and perspiration streaming down his cheek... He chain-smoked Old Gold cigarettes, often lighting up one while two others were still burning in a nearby ashtray. Between visitors, sometimes over a hundred a day, and telephone calls, he scanned official documents and hurriedly scribbled his signature on letters brought in by his secretary." (55)

Some critics described Johnson as behaving like a fascist. John T. Flynn argued: "He (Johnson) began with a blanket code which every business man was summoned to sign ­ to pay minimum wages and observe the maximum hours of work, to abolish child labor, abjure price increases and put people to work. Every instrument of human exhortation opened fire on business to comply ­ the press, pulpit, radio, movies. Bands played, men paraded, trucks toured the streets blaring the message through megaphones. Johnson hatched out an amazing bird called the Blue Eagle. Every business concern that signed up got a Blue Eagle, which was the badge of compliance.... The NRA provided that in America each industry should be organized into a federally supervised trade association. It was not called a corporative. It was called a Code Authority. But it was essentially the same thing. These code authorities could regulate production, quantities, qualities, prices, distribution methods, etc., under the supervision of the NRA. This was fascism." (56)

Francis Townsend, a doctor, lost his job during the Great Depression and was forced into retirement. Roosevelt and the New Deal (1963), has argued: "He was sixty-seven years old, and had less than a hundred dollars in savings. Disturbed not only by his own plight but by that of others like him - elderly people from Iowa and Kansas who had gone west in the 1920's and now faced the void of unemployment with slim resources." (57)

In 1933 Townsend proposed a scheme whereby the Federal government would provide every person over 60 a $200 monthly pension (roughly $2,600 in today's money), on condition that he or she retire from all gainful work and spent the money in the United States. Townsend claimed that his Old Age Revolving Pension Plan could be financed by a 2 per cent tax on business transactions. Townsend argued that his plan would help the economy as older people would be compelled to surrender their positions to the younger unemployed and the spending of the pension money would produce a demand for goods and services that would create still more jobs. (58)

Some critics described Townsend's plans as being an example of the ideas of the "crackpot Left". (59) Other observers pointed out that it was far from radical and appealed to Protestant rural America and proclaimed traditional values, and promised to preserve the profit system free from alien collectivism, socialism and communism. In the words of Townsend, the movement embraced people "who believe in the Bible, believe in God, cheer when the flag passes by, the Bible Belt solid Americans." He told his followers: "The movement is yours, my friends... Without you I am powerless but with you I can remake the world for mankind." (60)

Walter Lippmann observed: "If Dr. Townsend's medicine were a good remedy, the more people the country could find to support in idleness the better off it would be." Townsend replied "My plan is too simple to be comprehended by great minds like Mr. Lippmann's." (61) One historian has pointed out that "Townsend meetings featured frequent denunciations of cigarettes, lipstick, necking, and other signs of urban depravity. Townsendites claimed as one of the main virtues of the plan that it would put young people to work and stop them from spending their time in profligate pursuit of sex and liquor." (62)

Townsend plan would have diverted 40 per cent of the national income to 9 per cent of the people. It obtained a great deal of public support and by 1935 his Townsend Club had over 5 million members. Most of them from among otherwise conservative people, that politicians throughout the country had to take these ideas into consideration. The pressure increased when Townsend handed in to President Franklin D. Roosevelt a petition supporting the Old Age Revolving Pension Plan that had been signed by over 20 million people. (63)

Frances Perkins, one of Roosevelt's most senior colleagues, later recalled in her autobiography, The Roosevelt I Knew (1946): "One hardly realizes nowadays how strong was the sentiment in favour of the Townsend Plan and other exotic schemes for giving the aged a weekly income. In some districts the Townsend Plan was the chief political issue, and men supporting it were elected to Congress. The pressure from its advocates was intense." (64)

The measures taken by President Roosevelt did help 2 million people to find jobs by 1934 but unemployment remained high at 11.3%. The nation's GDP registered a 17% increase on 1933 but national income was still little better than half of what it had been in 1929. Roosevelt and the Democrats were worried about the outcome of the mid-term elections in November, 1934. However, they were wrong to be concerned as the government was rewarded for its actions to deal with the country's economic problems. In the House of Representatives the Democratic majority increased from 310 to 322 and in the Senate they now held 69 seats that was more than a two-thirds majority. Never in the history of the Republican Party had its percentage in either House been so low. Arthur Krock wrote in the The New York Times that the New Deal had won "the most overwhelming victory in the history of American politics". (65)

These results gave President Roosevelt to introduce more radical policies. On 17th January, 1935, Roosevelt asked Congress to pass social security legislation. The two men he chose to guide this measure through Congress had both experienced poverty. Robert Wagner (Senate) was an immigrant boy who had sold newspapers on the street and David John Lewis (House of Representatives) had gone to work at nine in a coal mine. (66)

Roosevelt told the American people: "We must begin now to make provision for the future. That is why our social security program is an important part of the complete picture. It proposes, by means of old age pensions, to help those who have reached the age of retirement to give up their jobs and thus give to the younger generation greater opportunities for work and to give to all a feeling of security as they look toward old age. The unemployment insurance part of the legislation will not only help to guard the individual in future periods of lay-off against dependence upon relief, but it will, by sustaining purchasing power, cushion the shock of economic distress. Another helpful feature of unemployment insurance is the incentive it will give to employers to plan more carefully in order that unemployment may be prevented by the stabilizing of employment itself. (67)

The Social Security Act established Old Age and Survivors' Insurance that provided for compulsory savings for wage earners so that benefits may be paid to them on retirement at 65. To finance the scheme, both the employer and employee had to pay a 3% payroll tax. The provisions of the act also encouraged states to deal with social problems. It did this by offering substantial financial help the states provide unemployment benefits, old-age pensions, aid to the disabled, maternity care, public health work and vocational rehabilitation. (68)

In the debate in Congress, Arthur Harry Moore protested that if the legislation was passed: "It would take all the romance out of life. We might as well take a child from the nursery, give him a nurse, and protect him from every experience that life affords." Newspapers were also hostile to these measures. For example, The Jackson Daily News reported: "The average Mississippian can't imagine himself chipping in to pay pensions for able-bodied Negroes to sit around in idleness on front galleries, supporting all their kinfolks on pensions, while cotton and corn crops are crying for workers to get them out of the grass." (69)

After being passed by Congress in April and signed into law by President Roosevelt on 14th August, 1935. Leuchtenburg has argued: "In many respects, the law was an astonishingly inept and conservative piece of legislation. In no other welfare system in the world did the state shirk all responsibility for old-age indigency and insist that funds be taken out of the current earnings of workers. By relying on regressive taxation and withdrawing vast sums to build up reserves, the act did untold economic mischief. The law denied coverage to numerous classes of workers, including those who needed security most: notably farm laborers and domestics. Sickness, in normal times the main cause of joblessness, was disregarded. The act not only failed to set up a national system of unemployment compensation but did not even provide adequate national standard." (70)

Despite its faults the Social Security Act of 1935 was a new landmark in American history. It reversed historic assumptions about the nature of social responsibility, and it established the proposition that the individual had the same social rights as those people living in Europe. Roosevelt defended his decision to make the employee contributions so high: "We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program." (71)

Roosevelt told Anne O'Hare McCormick: "In five years I think we have caught up twenty years. If liberal government continues over another ten years we ought to be contemporary somewhere in the late Nineteen Forties." (72) The British journalist, Henry N. Brailsford, argued that Roosevelt was doing what David Lloyd George had done between 1906 and 1914, but at a quicker tempo. According to William E. Leuchtenburg: "The British reforms, which rested on the conviction that the profit system was compatible with aid to the underdog, had rendered working-class life less precarious and was one of the important reasons that the depression struck Britain less heavily than America." (73)

This reform came under attack from right-wing conservatives. Flynn argued: "Does anyone imagine that $8 a week is security for anyone, particularly since Roosevelt's inflation has cut the value of that in half? But what of the millions of people who through long years of thrift and saving have been providing their own security? What of the millions who have been scratching for years to pay for their life insurance and annuities, putting money in savings banks, commercial banks, buying government and corporation bonds to protect themselves in their old age? What of the millions of teachers, police, firemen, civil employees of states and cities and the government, of the armed services and the army of men and women entitled to retirement funds from private corporations ­ railroads, industrial and commercial? These thrifty people have seen one­half of their retirement benefits wiped out by the Roosevelt inflation that has cut the purchasing power of the dollar in two. Roosevelt struck the most terrible blow at the security of the masses of the people while posing as the generous donor of security for all." (74)

Francis Townsend claimed that Roosevelt's social security legislation was completely inadequate and in 1936 joined with Father Edward Coughlin and Gerald L. K. Smith to form the National Union of Social Justice. They selected William Lepke as their presidential candidate. The 1936 Presidential Election was one of the greatest election victories in American history. Roosevelt won by 27,751,612 votes to 16,681,913 and carried the electoral college 523 to 8. He won every state but Maine and Vermont. Lepke won only 882,479 votes. (75)

The Works Projects Administration (WPA) was established by Franklin D. Roosevelt as part of the New Deal attempt to combat the Depression. This included the The Federal Writers Project to provide employment for historians, teachers, writers, librarians, and other white-collar workers. The project was directed by Henry Alsberg, a former journalist and theatre director. Originally, the purpose of the project was to produce a series of sectional guide books under the name American Guides, focusing on the scenic, historical, cultural, and economic resources of the United States. Over the next couple of years the project was responsible for about a thousand publications, including fifty-one state and territorial guides, thirty city guides, and twenty regional guides. (76)

Writers involved in the project included Richard Wright, Claude McKay, John Steinbeck, Ralph Ellison, Studs Terkel, Zora Neale Hurston, Nelson Algren, Conrad Aiken, William Attaway, Saul Bellow, Max Bodenheim, John Cheever, Vardis Fisher, Fountain Hughes, Weldon Kees, Kenneth Patchen, May Swenson, Jim Thompson, Frank Yerby, Margaret Walker, Dorothy West and Anzia Yezierska.

William E. Leuchtenburg, the author of The FDR Years: On Roosevelt and His Legacy (1995): "Project workers transcribed chain gang blues songs, recovered folklore that would otherwise have been lost... In Chicago WPA workers translated half a century of foreign language newspapers, a project requiring seventy-seven reels of microfilm... When the magazine Story conducted a contest for the best contribution by a Project employee, the prize was won by an unpublished twenty-nine-year-old who had been working on the essay on the Negro for the Illinois project. With the prize money for his tales, subsequently published as Uncle Tom's Children, Richard Wright gained the time to write his remarkable first novel, Native Son." (77)

The outpouring of literature under the sponsorship of the Federal Writers' Project was "one of the most remarkable phenomena of the era of crisis" wrote the critic Alfred Kazin in his book, On Native Grounds: An Interpretation of Modern American Prose Literature (1942): "Whatever form this literature took... it testified to an extraordinary national self-scrutinizing... Never before did a nation seem so hungry for news of itself." (78)

One of the most impressive projects was the Slave Narrative Collection, a set of interviews which led to slave narratives based on the experiences of former slaves, with the work culminating in over 2,300 first-person accounts of slavery and 500 black-and-white photographs of former slaves. This was organised as a state-level branches of the Federal Writers' Projects in seventeen states, working largely separately from each other. (79)

On 26th May, 1938, the United States House of Representatives authorized the formation of the Special House Committee on Un-American Activities. The first chairman of the Un-American Activities Committee (HUAC) was Martin Dies. The original intention of the HUCA was to investigate both left-wing and right wing political groups. However it was soon clear that his main target was New Deal initiatives such as the Federal Writers' Project. John Parnell Thomas, a member of the HUCA, commented that on the basis of "startling evidence" that the project was "a hotbed for Communists". (80)

Dies pointed out in his book, The Trojan Horse in America (1940): "Stalin could not have done better by his American friends and agents. Relief projects swarmed with Communists - Communists who were not only recipients of needed relief but who were entrusted by New Deal officials with high administrative positions in the projects. In one Federal Writers' Project in New York, one third of the writers were members of the Communist Party. This was proven by their own signatures. Many witnesses have testified that it was necessary for W.P.A. workers to join the Workers Alliance - high-pressure lobby run by the Communist Party - in order to get or retain their jobs.... Several hundred Communists held advisory or administrative positions in the W.P.A. projects." (81)

Franklin D. Roosevelt also established Federal Theatre Project (FTP). To direct the project, Harry Hopkins, named Hallie Flanagan, the head of Vassar's Experimental Theatre. Over a thousand theatre productions took place in twenty-two different states. Many of these were given free in schools and community centres. Other outstanding theatre people served as regional directors, including Charles Coburn and Hiram Motherwell. (82)

Although performers were only paid $22.73 a week, the FTP employed some of America's most talented artists. This included Arthur Miller, who was unemployed after graduating from the University of Michigan. He explained in his autobiography, Timebends - A Life (1987): "To join the WPA Theatre Project it was necessary to get on the welfare rolls first, in effect to be homeless and all but penniless... and conniving to get myself a twenty-three-dollar-a-week job." (83)

In 1934 Orson Welles directed Macbeth for the Negro People's Theatre, as part of the Federal Theatre Project. He also worked with John Houseman in the production of The Cradle Will Rock, a musical by Marc Blitzstein. Houseman argued that Blitzstein, described as "a play with music (while others, at various times, called it an opera, a labour opera, a social cartoon, a marching song and a propagandistic tour de force)". He wrote the play in only five weeks. (84)

The original production with Howard da Silva and Will Geer, was banned for political reasons. It eventually was performed at the Mercury Theatre (108 performances). Welles later recalled: "Marc Blitzstein was almost a saint. He was so totally and serenely convinced of the Eden which was waiting for us all the other side of the Revolution that there was no way of talking politics to him.... When he came into the room the lights got brighter. He was a an engine, a rocket, directed in one direction which was his opera - which he almost believed had only to be performed to start the Revolution." (85)

Elmer Rice was placed in charge of the Federal Theatre Project in New York City. In 1936 alone, the FTP employed 5,385 people in the city. Over a three year period over 12 million people attended performances in the city. One of Rice's innovations was the Living Newspaper (plays which were essentially theatrical documentaries). The first of these plays, Ethiopia, which dealt with Italy's invasion of the country, was banned by Harry Hopkins. (86)

One play, It Can't Happen Here, by Sinclair Lewis, in 1936, was produced simultaneously in 22 cities. The Lost Colony (1937) by Paul Green, was an outdoor historical pageant that was performed in a Works Projects Administration built theatre on Roanoake Island. However, several plays were censored as it was believed they were too political. Harold Clurman defended the Federal Theatre Project because he believed it was "the most truly experimental effort ever undertaken in the American theatre." (87)

J. Parnell Thomas, a member of the Un-American Activities Committee (HUAC), described the Federal Theatre Project as being "infested by radicals from top to bottom" and on 26th July, 1938, called for Hallie Flanagan to answer questions before the committee. Flanagan immediately went on the attack arguing that: "Some of the statements reported to have been made by him (Parnell Thomas) are obviously absurd... of course no one need first join or be a member of any organization in order to obtain employment in a theatre project." She also pointed out that only ten per cent of the plays presented by the Federal Theatre dealt with social and political problems. (88)

Sallie Saunders, appeared before the HUAC and condemned the Federal Theatre because it had performed "pro-union plays, plays referring to Negro discrimination, and anti-Fascist plays." Saunders also complained that the project encouraged racial integration and that while working for the FTP she had been "telephoned by a Negro for a date". Hazel Huffman, a former employee of the Works Projects Administration (WPA), claimed that Hallie Flanagan was a person who "was known as far back as 1927 for her communistic sympathy, if not membership" and pointed out that 147 pages of her book, Shifting Scenes of the European Theatre, was devoted to "eulogizing the Russian theater." (89)

Hallie Flanagan eventually appeared before the HUAC. She later recalled: "The room itself, a high-walled chamber with great chandeliers, was lined with exhibits of material from the Federal Theatre and the Writers' Project; but all I could see for a moment were the faces of thousands of Federal Theatre people; clowns in the circus ... telephone girls at the switchboards... actors in grubby rehearsal rooms... acrobats limbering up their routines... costume women busy making cheap stuff look expensive... musicians composing scores to bring out the best in our often oddly assembled orchestras... playwrights working on scripts with the skills of our actors in mind... carpenters, prop men, ushers. These were the people on trial that morning. I was sworn in as a witness by Chairman Dies, a rangy Texan with a cowboy drawl and a big black cigar. I wanted to talk about Federal Theatre, but the Committee apparently did not... Here was a Committee which for months had been actually trying a case against Federal Theatre, trying it behind closed doors, and giving one side only to the press. Out of a project employing thousands of people from coast to coast, the Committee had chosen arbitrarily to hear ten witnesses, all from New York City, and had refused arbitrarily to hear literally hundreds of others, on and off the project, who had asked to testify." (91)

J. Parnell Thomas objected to the radical message in some of these plays. Thomas claimed that: "Practically every play presented under the auspices of the Project is sheer propaganda for Communism or the New Deal." Martin Dies, the chairman of the Un-American Activities Committee, called for the resignations of Harold Ickes, Harry Hopkins and Frances Perkins, as the three had "associates who were Socialists, Communists, and crackpots." (92)

Franklin D. Roosevelt refused to sack these three members of his government but Congress bring the Federal Theatre Project to an end and allowed the other projects to continue only if they found local sponsors who would bear 25 per cent of the cost. During its four years existence the FTP launched or established the careers of such artists as Orson Welles, John Houseman, Will Geer, Arthur Miller, Paul Green, Marc Blitzstein, Canada Lee and Elmer Rice. (93)

Elmer Rice later wrote: "Nationally, the Theatre Project's record was extraordinary. At one time forty-two separate units were in operation in twenty states, with a total of nearly thirteen thousand employees... In its first three years the Theatre Project had produced more than nine hundred different plays, for a total of nearly 55,000 performances, many of them free, none charging more than a dollar. The attendances figures exceeded 26,000,000... In the project's fourth year, Congress killed it... Its demise was perhaps the most tragic occurrence in the cultural history of the United States. Had funds been provided for continuance, upon an artistic basis divorced from unemployment relief, of those units that had clearly demonstrated their worth, the foundation would have been laid for a nationwide theatrical structure that would have brought enlightenment and enjoyment to millions, and stimulation to artistic creation. The cost, compared to the billions expended annually upon weapons of destruction, would have been infinitesimal." (94)

The proposals of our opponents will endanger or destroy our system. I especially emphasize that promise to promote "employment for all surplus labour at all times." At first I could not believe that anyone would be so cruel as to hold out hope so absolutely impossible of realization to these 10,000,000 who are unemployed. And I protest against such frivolous promises being held out to a suffering people.

If it were possible to give this employment to 10,000,000 people by the Government, it would cost upwards of $9,000,000,000 a year. It would pull down the employment of those who are still at work by the high taxes and the demoralization of credit upon which their employment is dependent. It would mean the growth of a fearful bureaucracy which, once established, could never be dislodged.

We have two problems: first, to meet the immediate distress; second, to build up on a basis of permanent employment.

As to immediate relief, the first principle is that this nation, this national government, if you like, owes a positive duty that no citizen shall be permitted to starve.

In addition to providing emergency relief, the Federal Government should and must provide temporary work wherever that is possible. You and I know that in the national forests, on flood prevention, and on the development of waterway projects that have already been authorized and planned but not yet executed, tens of thousands, and even hundreds of thousands of our unemployed citizens can be given at least temporary employment.

The legislation which has been passed or in the process of enactment can properly be considered as part of a well-grounded plan.

First, we are giving opportunity of employment to one-quarter of a million of the unemployed, especially the young men who have dependents, to go into the forestry and flood prevention work. This is a big task because it means feeding, clothing and caring for nearly twice as many men as we have in the regular army itself. In creating this civilian conservation corps we are killing two birds with one stone. We are clearly enhancing the value of our natural resources and second, we are relieving an appreciable amount of actual distress. This great group of men have entered upon their work on a purely voluntary basis, no military training is involved and we are conserving not only our natural resources but our human resources. One of the great values to this work is the fact that it is direct and requires the intervention of very little machinery. Second, I have requested the Congress and have secured action upon a proposal to put the great properties owned by our Government at Muscle Shoals to work after long years of wasteful inaction, and with this a broad plan for the improvement of a vast area in the Tennessee Valley. It will add to the comfort and happiness of hundreds of thousands of people and the incident benefits will reach the entire nation.

Next, the Congress is about to pass legislation that will greatly ease the mortgage distress among the farmers and the home owners of the nation, by providing for the easing of the burden of debt now bearing so heavily upon millions of our people.

Our next step in seeking immediate relief is a grant of half a billion dollars to help the states, counties and municipalities in their duty to care for those who need direct and Immediate relief.

The Congress also passed legislation authorizing the sale of beer in such states as desired. This has already resulted in considerable reemployment and, incidentally, has provided much needed tax revenue.

We are planning to ask the Congress for legislation to enable the Government to undertake public works, thus stimulating directly and indirectly the employment of many others in well-considered projects.

Further legislation has been taken up which goes much more fundamentally into our economic problems. The Farm Relief Bill seeks by the use of several methods, alone or together, to bring about an increased return to farmers for their major farm products, seeking at the same time to prevent in the days to come disastrous over-production which so often in the past has kept farm commodity prices far below a reasonable return. This measure provides wide powers for emergencies. The extent of its use will depend entirely upon what the future has in store.

Well-considered and conservative measures will likewise be proposed which will attempt to give to the industrial workers of the country a more fair wage return, prevent cut-throat competition and unduly long hours for labor, and at the same time to encourage each industry to prevent over-production.

The first days of the Roosevelt Administration charged the air with the snap and the zigzag of electricity. I felt it. We all felt it. It seemed as it you could hold out your hand and close it over the piece of excitement you had ripped away. It was the return of hope. The mind was elastic and capable of crowding idea into idea. New faces came to Washington - young faces of bright lads who could talk. It was contagious. We started to talk in the cloak rooms; we started to talk in committees. The shining new faces called on us and talked.

In March of 1933 we had witnessed a revolution - a revolution in manner, in mores, in the definition of government. What before had been black or white sprang alive with color. The messages to Congress, the legislation; even the reports on the legislation took on the briskness of authority. I have asked myself often, "Did one man do this? If one did this, what manner of man was he?" I don't know. I think nobody does. Since those days I have read every bit of writing on Roosevelt: Perkins, Sherwood, Churchill, Eleanor Roosevelt, Flynn, Gunther. Out of these cascades of words no definite or sharp outline arises. Whenever I visited Roosevelt on official business, I found a man adroit, voluble, assured, and smiling. I was never quite sure he was interested in the purpose of my visit; we spent so little time on it.

Mostly he talked. He talked with seeming frankness, and when I left, I found that he had committed himself to no point of view. At the end of each visit I realized that I had been hypnotized. His humor was broad, his manner friendly without condescension. Of wit there was little; -of philosophy, none. What did he possess? Intuition, yes. Inspiration, yes. Love of adventure, the curiosity of the experimental. None of these give the answer. None of these give the key. I believe his magic lay in one facet of his personality. He could say and he did say, "Let's try it." He knew how to take the risk. No other man in public life I knew could so readily take the challenge of the new.

The lugubrious Hoover sat and sulked, because his disastrous economic sophistry of allocating money at the top in the belief that it would percolate down to the common people had failed. And amidst all this tragedy he ranted in the election campaign that if Franklin Roosevelt got into office the very foundations of the American system - not an infallible system at that moment - would be imperilled.

However, Franklin D. Roosevelt did get into office, and the country was not imperilled. His 'Forgotten Man' speech lifted American politics out of its cynical drowse and established the most inspiring era in American history. I heard the speech over the radio at Sam Goldwyn's beach-house. "The only thing we have to fear is fear itself" came over the air like a ray of sunlight. But I was sceptical, as were most of us. "Too good to be true," I said.

No sooner had Roosevelt taken office than he began to fit actions to his words, ordering a ten-day bank holiday to stop the banks from collapsing. That was a moment when America was at its best. Shops and stores of all kinds continued to do business on credit, even the cinemas sold tickets on credit, and for ten days, with Roosevelt and his so-called brains trust formulated the New Deal, the people acted magnificently.

Legislation was ordered for every kind of emergency: re-establishing farm credit to stop the wholesale robbery of foreclosures, financing big public projects, establishing the National Recovery Act, raising the minimum wage, spreading out jobs by shortening working hours, and encouraging the organization of labour unions. This was going to far; this was socialism, the opposition shouted. whether it was or not, it saved capitalism from complete collapse. It also inaugurated some of the finest reforms in the history of the United States. It was inspiring to see how quickly the American citizen reacted to constructive government.

The New Deal was an uneasy coalition. Fights developed very early between two factions: one, representing the big farmers, and the other, the little farmers. The Agricultural Adjustment Administration (AAA) came into being shortly after I got to Washington. All the farmers were in trouble, even the big ones.

Hog prices had just gone to hell. Then a great cry went up from the press, particularly the Chicago Tribune, about Henry Wallace slaughtering these little pigs. You'd think they were precious babies.

You had a similar situation on cotton. Cotton prices went up to ten cents, maybe eleven.

In one of my conversations with the President in March 1933, he brought up the idea that became the Civilian Conservation Corps. He thought any man or boy would rejoice to leave the city and work in the woods.

It was characteristic of him that he conceived the project, boldly rushed it through, and happily left it to others to worry about the details. And there were some difficult details. The attitude of the trade unions had to be considered. They were disturbed about this program, which they feared would put all workers under a "dollar a day" regimentation merely because they were unemployed.

Socialism: If you own two cows you give one to your neighbour.

Communism: You give both cows to the government and the government gives you back some of the milk.

Fascism: You keep the cows but give the milk to the government, which sells some of it back to you.

New Dealism: You shoot both cows and milk the government.

Roosevelt did not restore our economic system. He did not construct a new one. He substituted an old one which lives upon permanent crises and an armament economy. And he did this not by a process of orderly architecture and building, but by a succession of blunders, moving one step at a time, in flight from one problem to another, until we are now arrived at that kind of state­supported economic system that will continue to devour a little at a time the private system until it disappears altogether.

He did not restore our political system to its full strength. One may like the shape into which he battered it, but it cannot be called a repair job. He changed our political system with two weapons ­ blank­check congressional appropriations and blank­check congressional legislation. In 1933, Congress abdicated much of its power when it put billions into his hands by a blanket appropriation to be spent at his sweet will and when it passed general laws, leaving it to him, through great government bureaus of his appointment, to fill in the details of legislation.

These two baleful mistakes gave him a power which he used ruthlessly. He used it to break down the power of Congress and concentrate it in the hands of the executive. The end of these two betrayals ­ the smashing of our economic system and the twisting of our political system ­ can only be the Planned Economic State, which, either in the form of Communism or Fascism, dominates the entire continent of Europe today. The capitalist system cannot live under these conditions. The capitalist system cannot survive a Planned Economy. Such an economy can be managed only by a dictatorial government capable of enforcing the directives it issues. The only result of our present system ­ unless we reverse the drift ­ must be the gradual extension of the fascist sector and the gradual disappearance of the system of free enterprise under a free representative government.

There are men who honestly defend this transformation. They at least are honest. They believe in the Planned Economy. They believe in the highly centralized government operated by a powerful executive. They do not say Roosevelt saved our system. They say he has given us a new one. That is logical. But no one can praise Roosevelt for doing this and then insist that he restored our traditional political and economic systems to their former vitality.


The New Deal programs were designed to be economic investments to relieve the suffering and to put people back to work, to calm the mounting fear and to rout the sense of hopelessness, unrest and hardship caused by the Depression. They were unprecedented and they permanently altered the economic, social and governmental landscapes. They included Social Security, Unemployment Insurance, price supports, the building of an interstate highway system and rural electrification through the Tennessee Valley Authority. The programs also instituted government regulation of banking and the stock market to protect bank depositors against bank failures (which occurred frequently after the stock market crash of 1929) and investors from stock market failures, then a common Wall Street nightmare. In addition, the New Deal created the National Housing Act under which the Federal Housing Administration offered home loans and mortgage insurance to benefit mostly low- and middle-income home buyers.

The massive spending stimulated recovery by funneling money into the economy as payments for material, equipment and labor. It thus increased the national purchasing power until the economy could expand and private industry could recover enough to begin hiring again. At the same time, the WPA programs took care of the needs of some of the country's infrastructure, including the construction of public buildings, bridges, roadways and airports, as well as conservation work in the national parks and forests. It also conducted an education program through the National Youth Administration, training young people and helping them find work. More critically, the New Deal Farm Security Administration provided emergency loans to farmers to rescue them from impending bankruptcy.

Not least among the programs was the Federal Arts Project; it gave dignified and creative work to scores of unemployed theater people, artists, writers, teachers and musicians and it brought the arts to millions of Americans.

For example, the Music Project's many symphony orchestras gave about four thousand performances a month before 150 million people, more than half of whom had never heard a live orchestra before. Thousands more learned to play or sing at its many teaching centers.

The Theater Project's companies played to over 25 million people, most of whom had never seen a stage play before. Some of their productions were highly innovative. Among those who got their start here were Orson Welles, John Houseman, John Huston and Norman Lloyd.

The Art Project's artists produced nearly a million works of visual art which were exhibited and used by schools, courthouses, hospitals, libraries, post offices and other public buildings. And each month 60,000 people came to the free art classes offered by the Art Project. Some of the artists and photographers who emerged from this program included Franz Kline, Willem de Kooning, BenShahn, Hugo Gellert, Miguel Coverrubias, Al Hirschfield, Gordon Parks, Dorothea Lange and Arthur Rothstein. Much of the art produced under the aegis of the Art Project provided a vivid record, otherwise unobtainable, of life during the Depression.

The Writers' Project employed workers of literary competence and included many teachers who could not find teaching jobs. Some of these writers trekked the countryside, discovering untapped fountains of folklore and history, wrote about them and provided invaluable data for later researchers of Americana. Writers who came out of this program included Conrad Aiken, Saul Bellow, Studs Terkel, Richard Wright, Nelson Algren, Ralph Ellison, John Cheever and Malcolm Cowley.

The Federal Arts Projects collectively became one of the most culturally productive and creative periods in American history. Nevertheless, it faced considerable opposition in Congress almost from the first days of its creation. The opposition had two roots: the idea that work relief was not something the government should be involved in and the accusation that the WPA projects constituted a network for militant trade unionists and communists. The House Investigative Committee in 1939 began a campaign of intimidation by questioning Federal Arts Project employees regarding their union and political activities, hoping to rouse support for eliminating the programs. The Senate joined in the harassment. As a result, in 1939 the WPA appropriations were cut and the Federal Arts Project died. The WPA itself went out of business officially in 1943.

The New Deal was, in almost every aspect, revolutionary in scope and it was fought bitterly by America's right wing. (What remains of it today is still under attack: witness the recent drive to scuttle Social Security - as well as Medicare passed in the Johnson era.)

Economic Prosperity in the United States: 1919-1929 (Answer Commentary)

Women in the United States in the 1920s (Answer Commentary)

Volstead Act and Prohibition (Answer Commentary)

The Ku Klux Klan (Answer Commentary)

Classroom Activities by Subject

(1) Joseph P. Lash, Dealers and Dreamers (1988) pages 76-88

(2) Patrick Renshaw, Franklin D. Roosevelt (2004) page 71

(3) William E. Leuchtenburg, Franklin D. Roosevelt and the New Deal (1963) page 33

(4) Rexford Tugwell, The Battle for Democracy (1935) page 213

(5) Franklin D. Roosevelt, speech on NBC's Lucky Strike Hour radio programme (7th April, 1932)

(6) Franklin D. Roosevelt, nomination address (2nd July, 1932)

(7) William E. Roosevelt and the New Deal (1963) page 17

(8) Jean Edward Smith, FDR (2007) page 289

(9) Patrick Renshaw, Franklin D. Roosevelt (2004) page 85

(10) Joseph P. Lash, Dealers and Dreamers (1988) page 107

(11) Jean Edward Smith, FDR (2007) page 312

(12) Franklin D. Roosevelt, radio broadcast (12th March, 1933)

(13) Will Rogers, speech (13th March, 1933)

(14) John Rothgeb, U.S. Trade Policy (2001) pages 32-33

(15) Edward E. Kaplan, American Trade Policy, 1923–1995 (1996) pages 8-10

(16) Patrick Renshaw, Franklin D. Roosevelt (2004) page 64

(17) Charles Rappleye, Herbert Hoover in the White House: The Ordeal of the Presidency(2017) page 88

(18) The Economist Magazine (18th December, 2008)

(19) The Economist Magazine (20th June, 1930)

(20) Jean Edward Smith, FDR (2007) page 241

(21) Harry Terrell, interviewed by Studs Terkel, in Hard Times: An Oral History of the Great Depression (1970) page 248

(22) Oscar Heline, interviewed by Studs Terkel, in Hard Times: An Oral History of the Great Depression (1970) page 252

(23) Rexford G. Tugwell, diary entry (31st December, 1932)

(24) Rexford Tugwell, The Battle for Democracy (1935) page 109

(25) Calvin Benham Baldwin, interviewed by Studs Terkel, in Hard Times: An Oral History of the Great Depression (1970) page 294

(26) Franklin D. Roosevelt, speech to Congress (16th March, 1933)

(27) Frank Freidel, Franklin D. Roosevelt: A Rendezvous with Destiny (1990) page 103

(28) Rexford Tugwell, diary entry (31st March, 1933)

(29) Harry Terrell, interviewed by Studs Terkel, in Hard Times: An Oral History of the Great Depression (1970) page 250

(30) Oscar Heline, interviewed by Studs Terkel, in Hard Times: An Oral History of the Great Depression (1970) page 254

(31) Arthur M. Schlesinger, The Coming of the New Deal (1958) pages 44-45

(32) John Gunther, Roosevelt in Retrospect (1950) page 316

(33) John C. Hyde, American Dreamer: A Life of Henry A. Wallace (2001) page 123

(34) Joseph P. Lash, Dealers and Dreamers (1988) page 219

(35) John C. Wallace (2001) page 154

(36) Sidney Baldwin, Poverty and Politics: The Rise and Decline of the Farm Security Administration (1968) page 82

(37) Rexford Tugwell, diary entry (10th February, 1935)

(38) Rexford Tugwell, diary entry (27th February, 1935)

(39) Arthur M. Schlesinger, The Coming of the New Deal (1958) pages 44-45

(40) Frances Perkins, The Roosevelt I Knew (1946) page 177

(41) William E. Roosevelt and the New Deal (1963) page 174

(42) Blackie Gold, interviewed by Studs Terkel, in Hard Times: An Oral History of the Great Depression (1970) pages 76-77

(43) William E. Leuchtenburg, The FDR Years (1995) page 268

(43a) Patrick Renshaw, Franklin D. Roosevelt (2004) page 112

(44) William E. Roosevelt and the New Deal (1963) page 64

(45) Frances Perkins, The Roosevelt I Knew (1946) page 200

(46) David M. Kennedy, Freedom from Fear (1999) page 178

(47) Jean Edward Smith, FDR (2007) page 344

(48) Frances Perkins, The Roosevelt I Knew (1946) page 241

(49) William E. Roosevelt and the New Deal (1963) page 66

(49a) Time Magazine (3rd April 1933)

(50) Hugh S. Johnson, The Blue Eagle from Egg to Earth (1935) page 208

(51) William E. Roosevelt and the New Deal (1963) page 65

(52) Hugh S. Johnson, speech (30th June, 1933)

(53) Arthur M. Schlesinger, The Coming of the New Deal (1958) pages 116-118

(54) John Kennedy Ohl, Hugh S. Johnson and the New Deal (1985) page 146

(55) Frances Perkins, The Roosevelt I Knew (1946) page 241

(56) John T. Flynn, The Roosevelt Myth (1944) page 43

(57) William E. Roosevelt and the New Deal (1963) page 103

(58) Jean Edward Smith, FDR (2007) page 349

(59) John Gunther, Roosevelt in Retrospect (1950) page 313

(60) Hadley Cantril, The Psychology of Social Movements (2001) page 186

(61) New York Herald-Tribune (4th January, 1935)

(62) William E. Roosevelt and the New Deal (1963) page 105

(63) Frank Freidel, Franklin D. Roosevelt: A Rendezvous with Destiny (1990) page 145

(64) Frances Perkins, The Roosevelt I Knew (1946) pages 278-279

(65) Arthur Krock, The New York Times (11th November, 1934)

(66) William E. Roosevelt and the New Deal (1963) pages 131-132

(67) Franklin D. Roosevelt, radio broadcast (28th April, 1935)

(68) Frances Perkins, The Roosevelt I Knew (1946) pages 278-300

(69) The Jackson Daily News (20th June, 1935)

(70) William E. Roosevelt and the New Deal (1963) page 132

(71) Arthur M. Schlesinger, The Coming of the New Deal (1958) pages 308-309

(72) Anne O'Hare McCormick, New York Times (16th October, 1938)

(73) William E. Roosevelt and the New Deal (1963) page 166

(74) John T. Flynn, The Roosevelt Myth (1944) page 416

(75) Frank Freidel, Franklin D. Roosevelt: A Rendezvous with Destiny (1990) page 207

(76) William E. Roosevelt and the New Deal (1963) page 127

(77) William E. Leuchtenburg, The FDR Years (1995) pages 262-263

(78) Alfred Kazin, On Native Grounds: An Interpretation of Modern American Prose Literature (1942) pages 378-379

(79) Norman R. Yetman, The Background of the Slave Narrative Collection (1967) pages 534-553

(80) Walter Goodman, The Committee (1964) page 25

(81) Martin Dies, The Trojan Horse in America (1940) page 298

(82) William E. Roosevelt and the New Deal (1963) page 126

(83) Arthur Miller, Timebends - A Life (1987) page 246

(84) John Houseman, Unfinished Business (1996) page 127

(85) Orson Welles, interview with Barbara Leaming (30th June, 1984)

(86) Susan Quinn, Furious Improvisation: How the WPA and a Cast of Thousands Made High Art Out of Desperate Times (2008)

(87) Yvonne Shafer, Eugene O'Neill and American Society (2011) page 154

(88) Walter Goodman, The Committee (1964) page 44

(89) Hazel Huffman, testimony before the Un-American Activities Committee (19th August, 1938)

(90) Hallie Flanagan, Arena: The History of the Federal Theatre (1940) page 344

(91) Frances Perkins, The Roosevelt I Knew (1946) pages 318-319

(92) William E. Roosevelt and the New Deal (1963) pages 126-127

(93) Elmer Rice, Minority Report: An Autobiography (1963) page 358


History of the Living New Deal

The Living New Deal has its roots in a book project by Dr. Gray Brechin on the WPA in California, but soon outgrew the original intent as the vast extent of New Deal public works projects became clear. In 2005, the project became a team effort to inventory, map, and interpret how the New Deal radically modernized California. After two years as a small volunteer operation, the California Living New Deal Project was officially launched in 2007 at the University of California, Berkeley, under the direction of Professor Richard Walker. This was done in partnership with the California Historical Society (CHS), which helped provide visibility around the state, and the Institute for Research on Labor and Employment (IRLE) at UC Berkeley, where the technical side of the project was developed. Financial support came from grants by the Columbia Foundation and IRLE.

The first order of business was to construct an interactive website that could accommodate a range of data on New Deal public works – photographs, site information, historic documents, personal accounts, etc. – and allow users to access that data through Google maps. A suitable website was constructed by Elizabeth Camacho and Heather Lynch at the IRLE. An outreach director, Lisa Ericksen, was hired in 2008-09 to organize workshops to recruit volunteers from historical societies around the state. Graduate research assistants Lindsey Dillon and Shaina Potts entered data and we passed our first landmark of 1000 New Deal sites across California by early 2010. When the partnerships with CHS and IRLE ended, the project moved to UC Berkeley’s Department of Geography.

By the end of 2010, we decided to go national thenceforth, the Living New Deal would cover the entire country – 50 states and several territories. This bold step required a rapid scaling up of the project, its web presence, project team and financing. First, the website was completely reconstructed in 2011 by Ben Hass with a more elaborate design using Wordpress. In 2012, Ben radically overhauled the database and made the map searchable to improve user access to our data. In 2013 he redesigned the home page and data storage.

At the same time, the project team grew to include a communications expert, Susan Ives, a fundraising consultant, Adam Kinsey, oral historian and book review editor, Sam Redman, and president of the National New Deal Preservation Association, Harvey Smith. Meanwhile, Research Assistants Shaina Potts and John Elrick were adding hundreds of new sites to the database and map, mostly from published documents, ramping up the total to over 2000 by Summer 2012. Thereafter, significant new donations and grants allowed the Living New Deal to greatly expand its organizational and research capacity.

Fall 2012 marked the arrival of our first Project Manager, Rachel Brahinsky, a postdoctoral fellow at UC Berkeley (funded by a bequest of Ann Baumann of New Mexico). She made a concerted effort to locate researchers around the country who could assist us in documenting New Deal sites, and this bore fruit with new regional associates in Maryland, Virginia, Wisconsin, Southern California and Mississippi. By late 2013, the project had a dozen national associates around the country, and that number passed 30 in mid-2014 and hit 40 by early 2015. In that year we create a second arm of the Living New Deal as a non-profit, incorporated in California, and received our official non-profit status from the IRS.

By late 2013, the number of documented sites in the database had risen to 5000 and by the end of 2015 it had doubled to 10,000. (You can track the expansion of our map at ‘Project Growth’). More people were finding the Living New Deal on the web and through Facebook and Twitter. Our website was named one of the top 10 sites of 2015 by Salon.com. Web traffic was already rising smartly, but that recognition bumped us up to almost 500,000 Google visits for the year.

By end of 2013, the Living New Deal team had a number of new faces. Rachel Brahinsky moved on to the faculty of the University of San Francisco, Sam Redman joined the history faculty at University of Massachusetts-Amherst and Ben Hass moved on to a full-time IT job. Alex Tarr of the Berkeley Geography Department took over as Project Manager, Susan Ives became our development advisor, and Lisa Thompson came on board as webmaster. John Stehlin of UC Berkeley became our chief RA and was later joined by Glenna Anton of the Geography Department and the returning Shaina Potts.

A Growing Staff, A Rising Star

When Alex Tarr moved to Rice University in Fall 2014, Gabriel Milner took the job of Project Manager. In 2015, we engaged Brent McKee of West Virginia to carry out research on New Deal history, Evan Kalish of New York to standardize our site submissions and database, and Chris Carlsson of San Francisco to create a film archive. With the able sleuthing of McKee, Kalish and many Research Associates, the database continue to bulge, reaching 12,000 by the end of 2016 and 14,000 a year later.

McKee added a major new resource to the website in 2015-16: brief introductions to over 60 New Deal programs and 40 New Dealers. Kalish wrote up detailed formats for project submissions, McKee et al. added advice for researchers, and Milner & Potts created a page on New Deal oral histories. Carlsson & Milner produced a New Deal film and video page.

More new features went up on our website, such as New Deal Smiles (2016), Working Together (2017) and New Deal Ancestry (2017). All these required the design and coding talents of Lisa Thompson, our webmaster.

A new outreach project launched in 2014: a series of hard-copy, printed maps showing the impact of the New Deal on major cities around the country. It began with the publication of a pocket map and guide to New Deal San Francisco late that year, an effort led by Susan Ives, designer Linda Herman and cartographer Garrett Bradford.

In late 2015, we launched a more ambitious project for a pocket map and guide to New Deal New York City, which appeared in Spring 2017. That map covers hundreds of sites across the five boroughs and features 50 key buildings, parks and murals. It was launched with two major events at the Roosevelt House at Hunter College and the Museum of the City of New York in May and it received rave reviews from people and organizations around the city.

In 2017 Erin Reding became our Project Manager when Gabe Milner left for a teaching job in Los Angeles. Elena Ion came on board as Research Manager that year, too, as John Stehlin and Shaina Potts took academic positions elsewhere. When Erin became too busy to continue in 2018, Elena took on the Project Coordinator job, as well.

Keynoter Robert Reich and audience
at Women and the New Deal conference

The highlight of 2018 was our “Women & the Spirit of the New Deal” conference held at UC Berkeley. The weekend-long gathering of almost 200 people was a roaring success. Videos of the speakers can be found on our “New Deal Speaks” page. An important development in 2018 the formation of a New York Living New Deal branch led by Peggy Crane, who assembled a large working group of New York historians and writers.

Important new content was added to our website in 2018. A New Deal Inclusion section was created to counter shallow criticisms of the New Deal by showing the many good results of New Deal programs for Americans of color, despite well-known shortcomings in some others. Another advance was to develop our own Living New Deal YouTube video channel to include our many videos/films/recordings about the New Deal, including those from our events, lectures and interviews.

In 2019, we responded to a changing political landscape by adding a Green New Deal section to the website to follow legislative developments and debates, as well as to add our input about the lessons of the New Deal for today and to emphasize how ‘green’ the original New Deal was. That led to an op-ed in the Washington Post. Visits to our website shot up as young people sought information about the Green New Deal.

We added two important members to our core team in 2019. Elliott Medrich, a volunteer, took on the job of coordinating the network of National Associates. Kurt Feichtmeir was hired as Development Director, thanks to a generous grant from one of our board members. Other team members continued to give talks and tours on the New Deal, past and present. To further improve outreach, we added a “New Deal Speaks” page to feature audios and videos of LND team members, speeches from the 1930s, and more.

Also in 2019, we became involved in New Deal preservation for the first time with the rescue and exhibition of a ‘lost’ WPA model of San Francisco by Gray Brechin and the SF MOMA and the fight against efforts to destroy the magnificent murals at George Washington HS in the city.

2020 was a trying year for everyone, but despite the challenges of the pandemic, we managed to accomplish a remarkable amount. We had expected to launch our pocket map and guide to New Deal Washington DC, the third of our city maps, but our big events at the Department of the Interior and Greenbelt MD had to be postponed in the face of the Covid-19 epidemic. This proved to allow valuable time to upgrade the map to over 500 sites in the District of Columbia to improve the final version in many small ways for 2021.

The pandemic had a beneficial effect of forcing us to focus on organization and finances. Kurt led a rethinking of donor relations and record keeping, which led to adoption of the online system NEON and more personal dealings with funders. Kurt also led a drive to expand our funding base through donors and foundations, which required better strategic planning to target specific projects and creation of a handful of concise funding proposals.

We further upgraded the organization by launching a new monthly newsletter, The Fireside, with an elegant new design (and redesigning our periodic activity report, The Lowdown). We deepened personal relationships with our Advisory Boards and National Associates, who have given us some excellent feedback on our projects. The Living New Deal-New York City branch continued to be very active, winning approval from the Parks and Recreation Department for marking WPA sites with special medallions and initiating a new webinar series with a program on the Green New Deal.

Meanwhile, our online national map of New Deal public works and art sites continued to expand to over 16,500, our website content continued to grow, and our number of online visitors rose to around 1 million per year. All this was achieved in spite of a serious hack that took out thousands of photographs from our archive and required major repair work, a change of server hosts and a new security system – all of which was aided by a major gift from a donor in the tech world.

In the long run, we have ambitious plans for a Living New Deal Center to serve as a national research institute, museum and educational center on the New Deal.

For a more detailed information, view our annual reports :


New Deal

James C. Cobb, "Georgia Odyssey," in The New Georgia Guide (Athens: University of Georgia Press, 1996).

Florence Fleming Corley, "The National Youth Administration in Georgia: A New Deal for Young Blacks and Women," Georgia Historical Quarterly 77 (winter 1993).

Frank Freidel, FDR and the South (Baton Rouge: Louisiana State University Press, 1965).

J. William Harris, Deep Souths: Delta, Piedmont, and Sea Island Society in the Age of Segregation (Baltimore: Johns Hopkins University Press, 2003).

Lawrence R. Hepburn, The Georgia History Book (Athens: Carl Vinson Institute of Government, University of Georgia, 1982).

William F. Holmes, "The 1920s and the New Deal," in A History of Georgia, ed. Kenneth Coleman, 2d ed. (Athens: University of Georgia Press, 1991).


Two New Deals

According to historians, the “New Deal” can be divided into two periods. The “First New Deal” took place between 1933 and 34, during which there was a great focus on helping a variety of groups and institutions, from industry, railroads and banking to farming to survive financially in order to boost the economy. The “Second New Deal,” which took place between 1935 and 1938 focussed more on helping the average American through the Wagner Act, the WPA relief program, the Social Security act, Fair Labor Standards Act and many more.


New Deal

The New Deal , Painting/Mural by Conrad A. Albrizio. Dedicated to President Roosevelt. Placed in the auditorium of the Leonardo Da Vinci Art School, 149 East 34th Street, New York, New York,& ca. 1934 (FDR Presidential Library NLR-PHOCO-A-59333)

"Archival Vintages for The Grapes of Wrath"
Daniel Nealand's Prologue article shows how John Steinbeck used WPA documentary source material provided by Thomas E. Collins when writing The Grapes of Wrath.

"Black Domestics During the Depression: Workers, Organizers, Social Commentators"
In this Prologue article, Phyllis Palmer describes how records of New Deal agencies bring women's lives, livelihoods, and struggles to light.

FDR, the WPA, and the New Deal Arts Programs
The story of President Franklin Roosevelt, the Works Progress Administration, and New Deal Arts Programs told with photographs and images of artworks.

Interactive Periodic Table of the New Deal
The Franklin D. Roosevelt Presidential Library has devised this interactive chart based on the periodic table of elements. "The table presents major programs, players and events surrounding the New Deal and includes brief definitions or descriptions."

"Into the Woods: The First Year of the Civilian Conservation Corps"
Joseph M. Speakman's Prologue article about the first of Franklin D. Roosevelt's major New Deal programs.

A New Deal for the Arts
"This online exhibit is adapted from A New Deal for the Arts, an exhibit that was on display from March 28, 1997 through January 11, 1998, in the Rotunda of the National Archives Building in Washington, DC."

The New Deal in Action
The Franklin D. Roosevelt Presidential Library provides this list of projects built by New Deal agencies. The list, which is not comprehensive, can be searched or browsed. "The purpose of this list is to demonstrate how the New Deal helped to shape this country by providing specific examples of infrastructure and cultural projects created by the Alphabet Agencies in communities across the nation." The public is invited to submit projects to the list.

"The WPA Census Soundexing Projects"
In this Prologue article, Claire Prechtel-Kluskens describes the WPA's projects to create indexes to census schedules, which became a tremendous help to genealogists.

Other Resources

The 1930s
This collection from the PBS series American Experience includes several films that can be viewed online, articles, photographs, and a teacher’s guide.

Address on Agricultural Adjustment Act, 1935
PBS presents a transcript of President Roosevelt's address to the nation describing the ways in which conditions had improved for farmers.

Agricultural Adjustment Act
A discussion about the effects of the Agricultural Adjustment Act on farmers in Arkansas. Includes a bibliography.

The American Guide Series
The U.S. Senate provides an annotated listing of the 48 travel guides produced by the Federal Writers Project.

American Life Histories: Manuscripts from the Federal Writers’ Project
The Library of Congress offers a collection of manuscripts representing the work of over 300 writers. Interviews with people in 24 states are presented in various formats such as narrative, dialogue, and case history. The project resulted in about 2900 documents describing life in America during the Depression.

Born in Slavery: Slave Narratives from the Federal Writers' Project, 1936-1938
This Library of Congress website "contains more than 2,300 first-person accounts of slavery and 500 black-and-white photographs of former slaves" originally compiled by the Federal Writers' Project of the Works Progress Administration (WPA).

CCC: A New Deal to Rebuild a Nation
A five part lesson plan from the National Park Service.

Census of Old Buildings in Connecticut
"Often called 'The WPA House Survey', the Census of Old Buildings in Connecticut, 1934-1937 was a Works Progress Administration (W.P.A.) project. Survey forms provide descriptions of nearly 5,000 buildings." Photographs of the old buildings are available on this site, arranged by town and type of building.

Civilian Conservation Corps
A collection of CCC photos from the Oregon State University Special Collections & Archives

Civilian Conservation Corps Legacy
Provides information about the history of the CCC as well as aids for researchers, including a bibliography of materials related to the CCC and a list of CCC camps. This organization represents CCC alumni.

The Civilian Conservation Corps, What It Is and What It Does
Digitized version of the 1940 booklet from the Broward County Library's Digital Collections.

Farm Security Administration/Office of War Information Black-and-White Negatives
"The photographs in the Farm Security Administration - Office of War Information Photograph Collection form an extensive pictorial record of American life between 1935 and 1944." This collection from the Library of Congress contains images from such photographers as Dorothea Lange, Walker Evans, Ben Shahn, and more.

Federal Theatre Project
George Mason University Libraries present this collection of "nearly one thousand different 35mm slides taken from original posters." In addition to the gallery of digitized images, the site includes a map, a timeline, and an alphabetical list of posters.

Index of American Design
"The Index of American Design is a compilation of nearly 18,000 watercolor renderings that depict traditional American arts and crafts made before about 1890. The renderings were created under the auspices of the Index of American Design project, one of several Fine Arts Divisions in the Federal Art Project (FAP) of the Works Progress Administration (WPA), which operated from 1935 to 1942."

Indiana Farm Security Administration Photographs
The Indiana University-Purdue University Indianapolis Library offers this website which includes FSA photographs, background information, and IFSAP Study Guide and Curriculum Materials.

James F Justin Civilian Conservation Corps Museum
This online museum contains photographs, documents, anecdotes, and more.

National New Deal Preservation Association
A non-profit organization whose goal is to raise awareness about the legacy of New Deal programs and encourage the preservation of materials related to these projects. The association maintains a web site with information about the organization, its activities, and various New Deal topics, as well as links to other web resources.

The New Deal
This chapter from Federal Rural Development Policy in the Twentieth Century describes the effects of New Deal policies and programs on agriculture.

New Deal Achievements
The Franklin D. Roosevelt American Heritage Center presents a list of President Roosevelt's New Deal initiatives along with descriptions and outcomes.

New Deal Artwork: GSA's Inventory Project
A description of the General Services Administration effort to catalog "movable New Deal artworks housed in non-federal repositories. In collaboration with repositories, GSA aims to provide a centralized resource of information about New Deal artwork that is readily available to museum professionals, the academic community, art conservators and the public at large."

New Deal Collections
Materials available on this website from the Archives of American Art include finding aids and oral histories of New Deal artists.

New Deal Era and Its Origins
This web site, sponsored by H-Net Humanities and Social Sciences OnLine, provides a forum for research and teaching the history of the United States from 1918 to 1945.

New Deal Legislation
A list of statutes that established New Deal programs, compiled by the Gilder Lehrman Institute of American History.

New Deal Network
Features lesson plans and education tools related to the New Deal, on-line photographs and documents, and more in-depth information on a variety of featured topics.

New Deal Programs: Selected Library of Congress Resources
This site "was created to serve as a starting point for research using Library of Congress collections of New Deal program materials."

WPA Land use survey maps for the City of Los Angeles, 1933-1939
These 345 hand-colored land use survey maps are the result of a WPA survey from December 18, 1933 to May 8, 1939 for the city of Los Angeles, Department of City Planning. Provided by the USC Digital Library.

WPA Murals
This website provides listings by state of murals created by artists of the Works Progress Administration. Information for each mural includes the location, the artist, title, date, and medium. Some listings include an image of the mural.

WPA Posters
A Library of Congress collection consisting of 907 original posters produced from 1936-1943 by various agencies of the WPA.

WPA/TVA Archaeological Photographs
The University of Tennessee Frank H. McClung Museum and the Libraries provide this database of "information describing photographs taken by Works Progress Administration (WPA) workers of archaeological projects conducted in preparation for Tennessee Valley Authority (TVA) dam construction in the 1930s." The database can be either searched or browsed.

This page was last reviewed on August 15, 2016.
Contact us with questions or comments.


Why the New Deal Matters

March 20, 2008

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When my mother died last year, at 93, her loss wasn’t just personal in the way a parent’s death always is. After my aunts and uncles and then my father died, she’d been, for the past fifteen years, my last direct family link to Franklin Roosevelt and the New Deal. For me–a cradle Democrat–losing that connection meant a rite of passage all its own.

Mother never met Roosevelt, but to her his achievements defined Democratic politics–American politics, really–for almost half a century. Like Bill Clinton and George W. Bush, I was born in 1946, the year after FDR died, and though my generation has acquired its own (mixed) reputation, all of us know how much we’re the progeny of his generation and his legacy. Our 1960s Presidents, JFK and LBJ, mimicked his triple-initial moniker and were always being measured against him–Kennedy most often for his elegance and eloquence, Johnson for his programs. And when 󈨀s students began calling themselves the New Left, it may have distinguished them from the Old Left–but perhaps it also evoked the keystone of all postwar American politics, the New Deal.

The power of FDR has always been such that even conservative counterrevolutionaries had to be careful how they disavowed him and his programs. By the 1980s, Ronald Reagan–who’d voted for Roosevelt four times–knew exactly whose jaunty, upbeat style to mimic, even as he played Brutus to Roosevelt’s legacy. After GOP Jacobins captured control of Congress in 1994, their doughy Robespierre, Newt Gingrich, claims he consciously modeled his agenda on FDR’s Hundred Days–and in recent years he unabashedly declared Roosevelt “the greatest President of the twentieth century.”

Under the Bush-Cheney presidency, the Republican revolution’s remaining brightness dimmed significantly for most Americans. One might think these past several months, filled as they have been with heated debates over hope and experience, where Democrats come from and where they’re going, would have yielded more talk and reflection about the New Deal and FDR.

Poll after poll, after all, shows that Americans are ready for more government of the kind the New Deal represents–more caring, more equitable, more willing to counterbalance the private power of corporations and concentrated wealth–and they are, frankly, tired of GOP pieties (and invective) about high taxes, big government and endless deficits. (Quick quiz for your conservative relative: who was the last Republican President to actually balance the budget? Answer: Eisenhower.) By twenty-point margins or more, voters are telling pollsters they trust Democrats over Republicans to tackle the big issues of our time.

This tectonic shift in public opinion today isn’t the only good reason for celebrating what Roosevelt did. Most historians, after all, rank him as the greatest of our modern Presidents. And for Democrats, constantly fretting about “electability,” he is the only President to have been elected four times. So he must have done something right–something we can learn from and use in this new century.

Yet strangely–apart from Bill Clinton’s brief-lived comparison of Hillary to FDR (and of himself to Teddy Roosevelt) late last year–there has been almost no serious reference to, let alone examination of, this most extraordinary of American Presidents, either by the candidates, the mainstream press or the upper reaches of the commentariat. Even the fractious blogging world–never at a loss for words–has largely ignored him and the lessons his victories (and defeats) might teach us.

One simple reason for the silence is age: all the major candidates in this election season (save John McCain) were born–like nearly three out of four voters–after FDR died. (More telling, most major bloggers are post-Nixon babies, with a few prodigies even post-Reagan.)

But age is not the only reason. Andy Stern, the very bright, vocal (and brash) head of the Service Employees International Union, America’s fastest-growing and second-largest public services union, has proposed a second, more powerful one: that the New Deal is no longer relevant. “Anyone who might long wistfully for a return to the New Deal,” he remarked bluntly not long ago, “should consider that America today is as far from the time of FDR as the New Deal was from Abe Lincoln and the Civil War.” As far as Stern is concerned, it’s time for us to move on.

I’m just glad my mother never read that.

Matt Bai, a thirtysomething New York Times Magazine writer and author of The Argument, a tough, controversial look at the Democratic Party and the billionaires, bloggers and other insurgents on the left who want to change it, has pronounced the same conclusion. Until the Democrats–and liberals and progressives generally–figure out a new governing vision “more contemporary than defending the programs of the New Deal,” he concludes, they will remain nothing more than “a slightly dated alternative to the mess that is modern conservatism.”

I’m glad my mother never read that either.

It’s not that she’d have been shocked she’d heard her share of Roosevelt’s many opponents declaring him and the New Deal seditious, irrelevant, dead (or worse) ever since 1932. Lest we forget, that first election year The Nation–like much of the “sophisticated” left–backed Norman Thomas, while the Communists were unsparing in their disdain for “capitalism’s savior” until Moscow declared a timeout in the mid-1930s for the antifascist Popular Front.

Right-wingers never called a timeout. They attacked Roosevelt far more relentlessly than the left during his lifetime–and have done so ever since. In this, Reagan and Gingrich were exceptions, but in their speeches to bipartisan audiences, not their behavior. Amity Shlaes’s recent history of the Depression, The Forgotten Man–billed by Shlaes as a “fresh look” at FDR–assaults his character and policies so unremittingly that a newcomer to this history might honestly wonder how such an ogre ever won public office [see Kim Phillips-Fein’s review on p. 34]. And in the just-published Liberal Fascism, conservative columnist Jonah Goldberg underscores Roosevelt’s indisputable awfulness by telling us that Hitler and Mussolini once spoke well of him and likened their own programs to the New Deal!

(My mother, a kind and refined woman, taught my brothers and me how FDR had firmly but deftly dealt with such critics. “A conservative,” the crippled President declared, his trademark grin spread across his face, “is a man with two perfectly good legs, who, however, has never learned to walk forward.” She felt that to be comprehensively dispositive.)

But what is it about the New Deal and about Roosevelt that makes the man and the era relevant today?

One frequent shorthand answer I still hear from New Deal supporters rests on policy achievements: Social Security, bank and stock market regulation, government-backed home mortgages, a progressive income tax, a federal minimum wage, guaranteed workers’ rights, aid to higher education, private pensions and healthcare plans and a vast array of public works projects still used today–from giant Western dams and the Tennessee Valley Authority to thousands of bridges, tunnels, roads, sewers, water systems, post offices and airports.

A second legacy is still vitally important, but I hear about it less often–perhaps because it’s become so commonplace or because its importance has been so steadily derided and confused, thanks to the right’s attacks over the past sixty years: the systematic public macromanagement of the economy, through active fiscal, monetary and regulatory policy as well as the steadying effects of government’s one-third share in the GDP.

Republicans, for all their “small government,” have never rolled back that share and indeed have been significant handmaidens in its increase: government’s share of GDP reached its highest post-World War II level under Reagan and is today under Bush larger than it ever was under Clinton–or, for that matter, Truman, JFK, LBJ or Carter (or the New Deal itself). Conservatives may love to hate Keynesian fiscal management, but Alan Greenspan played the part of a monetary Keynesian to their unending delight.

The difference between Democrats and Republicans has been not about government’s size but about spending priorities–defense versus domestic programs, in the most naked terms–and about revenue choices (and their consequences), especially the post-1980 GOP’s willingness to accept swelling deficits and public debt as the price for tax cuts asymmetrically favoring the few over the many. From Truman through Carter, public debt fell dramatically as a fraction of GDP since 1981, save during Clinton’s second term, it has risen–and now is more than double its 1981 low level, with interest payments on that debt alone costing us far more than all the conservatives’ favorite bêtes noires combined–welfare, foreign aid, funding for the arts, etc.

There’s a third facet to Roosevelt that is vital for Democrats to celebrate today: he was the last Democratic President truly committed to multilateralism and to a nonmilitarized American presence in the world. It was FDR who pushed through–in the form of the United Nations, the IMF and the World Bank–the architecture of internationalism that Woodrow Wilson had dreamed of but failed to achieve. And we know from his wartime politics and diplomacy that he was fully committed, on the one hand, to the decolonization of the world and, on the other, to finding means to engage Moscow after the war, a policy that might have headed off the cold war, or at least its worst excesses.

Yet as I write these words, I also know why people like Stern and Bai can talk about the New Deal as seeming far away and somehow irrelevant.

Young people don’t think Social Security will last another generation–at least in a form that will secure their retirement. Bank and stock market regulation? Aren’t we in the midst of a meltdown that started with subprime mortgages but whose real scope and scale is still scarily unknown? Why do these sorts of financial crises keep recurring? Didn’t a gargantuan stock bubble burst at the start of the century? Wasn’t there an Asian–and then Russian and Latin American–financial collapse in the 1990s? Why is it that, from way back in the Reagan years, the words “savings and loan,” “Rust Belt,” “October 󈨛,” “downsizing” and “Japan Inc.” recall unhappy memories? The progressive income tax is now much less progressive, the minimum wage in our “world is flat” era looks almost comically ineffectual and neither seems to be doing much about closing the American income and wealth gap.

You see my point. Most of the “New Deal legacy” that people like my mother loved, celebrated and trusted seems to have become fragile, crippled, emaciated, distant–you choose the adjective.

But here’s another important point my mother understood: the appearance of fragility and distance has resulted not from the New Deal’s failures, she and I agreed, but from policies advocated by those so-called New Democrats who emerged thirty years ago, when white Southerners fled the Democratic Party. At first desperate to woo them back, and then, when that failed, at least to woo non-Southern independents and moderate Republicans to their cause, the New Dems became Rockefeller Republicans in Democratic drag.

Jimmy Carter’s early-stage deregulation of the airlines, telecoms, rail, trucking, energy, banking and Wall Street set the stage for Reagan–and, in certain areas, surpassed him. Mike Dukakis and Walter Mondale both championed technocratic efficiency, but that platform lacked the larger vision or community that FDR Democrats had championed for decades. Bill Clinton, confident that “the era of big government is over,” pushed NAFTA and the WTO on his resistant party as models of trade deregulation accelerated telecom, energy, and food and drug deregulation and, under Robert Rubin’s tutelage, rolled back the enormously successful financial market firewalls that Roosevelt had put in place.

What are the achievements of these deregulated markets and government reinventions? Airlines? Cable TV? Banks? Savings and loans? Electricity (remember Enron and California)? Wall Street (take your pick: LBOs in the 1980s, with Boesky and Milken then in the 1990s the tech-stock bubble, AOL/Time-Warner, analysts-as-stock touts the Asian, Russian and Latin American crises the housing bubble-subprime-CDO fiasco today–which is or isn’t over)?

How about the decreasing oversight of food and drug safety? Toys from China, anyone? Cooked books at Fannie Mae? The government student loan mess? Blackwater as the model of a deregulated, outsourced military in Iraq? The growth rate of the American economy? The distribution of income and wealth? You get the point.

In 2008 the sudden surging support for Barack Obama’s “audacity of hope” politics–especially among the young–seems to arise from the same impulses that set the political stage in 1932, 1960 and 1980: a profound sense of the need to end what has gone before and to try something new.

My mother never much described her then similarly young generation (she was 19 when FDR took office) as committed to any explicit “Rooseveltian” agenda in 1932 or thereafter. What they were committed to was their belief that Roosevelt cared about them and their future–and the nation’s future as a just and equitable society. They didn’t know the language of economists or of technocrats (Hoover had spoken that dialect) they knew instead the terms of family and neighborhood and community, and Roosevelt used those terms and talked to them in their language. They didn’t much care where FDR got his ideas but rather whether they worked and seemed somehow fair and gave people a sense of their worth and dignity.

Few historians today think FDR had a finely tuned policy agenda in the back of his mind at any point during his twelve years in the White House. What he did have, though, was worth far more. Eliot Janeway, looking at FDR’s oft-criticized record in preparing the nation for war–and for what became the swiftest, most enormous and most complex expansion of the economy and the government in America’s history–named what was essential.

Roosevelt’s critics have said–and say–he organized Washington into…a comptroller’s hell, into a jungle of confusion…. They are right. He did. And yet this irresponsibility–so disastrous on the face of it–did not result in disaster…. To Roosevelt, the important question was the participation of the nation in its own defense, not the administrative planning for this participation…. So long as the home front was big at the base, Roosevelt was willing to bet he could let it be confused at the top–and he and he alone had the power, the genius, the dramatic instinct, and above all the daring to make it as big outside Washington and as amorphous inside Washington as he pleased.

It’s those qualities–his ability to project a sense of trust in people’s ability to rise to common needs and dreams, plus his capacity as democratic leader to help them find the means needed to triumph–that defined Roosevelt’s genius. And it’s crucial for us to recognize why his style of “democratic leadership” was and is more challenging than “leadership of a democracy” or of business leadership or military leadership or most kinds of political leadership touted as “what we need today.” Crucial among the gifts of a true democratic leader, as FDR clearly was, is the ability to share not so much policies but stories, parables that incorporate moral and ethical vision, narratives of who we are and where we came from, and why we are together and where we can go, and what we can achieve if we work together.

March 4 marked the seventy-fifth anniversary of FDR’s inauguration as President–and more than likely, you heard his famous line about “nothing to fear but fear itself” trotted out for beneficent, bipartisan approval. It deserves to be quoted–but take a moment and go online to read the whole speech (like the Gettysburg Address or JFK’s inaugural, it is not long) and read down until you come to his description of how America will recover and grow once more. This is what he said about the reasons we’d been made afraid:

Our distress comes from no failure of substance…. Compared with the perils which our forefathers conquered because they believed and were not afraid, we have still much to be thankful for. Nature still offers her bounty and human efforts have multiplied it. Plenty is at our doorstep, but a generous use of it languishes in the very sight of the supply.

Primarily this is because the rulers of the exchange of mankind’s goods have failed through their own stubbornness and their own incompetence, have admitted their failures and abdicated.

Faced by failure of credit, they have proposed only the lending of more money. Stripped of the lure of profit…they have resorted to exhortations, pleading tearfully for restored conditions. They know only the rules of a generation of self-seekers.

The money changers have fled their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of the restoration lies in the extent to which we apply social values more noble than mere monetary profit.

Happiness lies not in the mere possession of money it lies in the joy of achievement, in the thrill of creative effort. These dark days will be worth all they cost us if they teach us that our true destiny is not to be ministered unto but to minister to ourselves and to our fellow-men.

In the roughly ninety seconds it took FDR to deliver those words on a bleak and unpromising day in Washington at the tail end of winter seventy-five years ago, he described a politics, an economics and a morality at once–and thereby told Americans how they could and should make change, that he would lead them in doing so and who would oppose them.

He didn’t cut to the middle or appeal to an interest group he didn’t divide the country into friends and enemies (though he named those he intended to struggle against) and he held out the promise that all could work together, though he knew in truth they never would.

And then together, the Americans who knew his story–and knew it was their own–set about the work ahead of them.

Richard Parker Richard Parker, a Nation editorial board member, teaches at Harvard University’s Kennedy School of Government and cofounded Mother Jones. He is the biographer of John Kenneth Galbraith.


New Deal Programs

With unemployment the highest it had ever been in the nation's history, the most pressing problem facing Roosevelt when he took office was to get people back to work. His first request to Congress was for the Unemployment Relief Act, which created the Civilian Conservation Corps (CCC). Over the course of its existence, the CCC employed some three million young men on conservation projects such as flood control, draining swamps, and planting trees. The CCC did more than just provide jobs—it kept many young men off the streets and gave them hope and dignity. CCC employees were not only able to earn money for themselves, but part of their pay was sent to their parents, so the benefit was spread to their families and ultimately to the economy. CCC workers were given uniforms, housed in barracks, and fed regular meals. Critics complained about the militarization of America's youth, but many CCC workers would have gone without the basic necessities of food, shelter, and clothing without this program.

To assist families and adult unemployed workers, Congress passed the Federal Emergency Relief Act (FERA), which gave $3 billion to states to be used as welfare and to supplement work projects. Harry L. Hopkins, a New York social worker, was put in charge of the agency. Roosevelt also ordered the Civil Works Administration (CWA) as a sub-agency of FERA. The CWA provided strictly temporary jobs, many of them inconsequential in nature, in order to help people through the winter of 1933 to 1934. While the CCC and FERA had both relief and recovery aims, the CWA was designed solely for relief.

Farmers and homeowners were also in desperate need of assistance. The Agricultural Adjustment Act (AAA) and the Home Owners' Loan Corporation (HOLC) provided millions of dollars in mortgage assistance so families could keep their homes and farms. Secondarily, mortgage-holding banks were saved from huge losses and in some cases even collapse with mortgage holders once again being able to make their payments. As with the CCC and FERA, these mortgage assistance agencies were for both immediate relief and longer-term recovery.

In addition, the Agricultural Adjustment Administration was created to maintain farm income. The agency's strategy was to reduce the supply in the market by paying farmers to decrease their acreage under production. The government also bought surpluses and destroyed them, to the chagrin of people who could not afford food. The scheme was to be paid for by taxes on food processors such as grain mills and slaughterhouses, who would pass on the increases to the public.

In Butler v. U.S. in 1935, the Supreme Court ruled the government's method of taxation unconstitutional and the AAA program was scrapped. In its place, the government created the Soil Conservation and Domestic Allotment Act of 1936 where the government paid farmers to allow some of their land to lie fallow or to plant part of their acreage in soil-conserving crops such as beans or buckwheat. In 1938, it followed up with the Second Agricultural Adjustment Act with the goal to support farm prices and restore farm income to be on a par with the incomes of other segments of society.

As if nature had joined in a conspiracy against the American economy, the 1930s witnessed a devastating drought in the region drained by the Mississippi River. Conditions were so dry that the especially hard-hit areas of eastern Colorado and western Texas, Oklahoma, Kansas, and Nebraska were called the Dust Bowl. Farming there became virtually impossible as the land turned to desert. Most of the region's farming population headed west in the great migration memorialized by John Steinbeck in his 1939 classic, Grapes of Wrath.

The Roosevelt administration endeavored to deal with in the problems caused by the Dust Bowl by sending to Congress the Frazier-Lemke Farm Bankruptcy Act of 1934, which mandated a suspension of mortgage foreclosures for five years. The Supreme Court struck down the Frazier-Lemke Act, but Congress passed an amended act that forestalled foreclosures for three years. In 1935, the government created the Resettlement Administration to assist Dust Bowl farmers with relocating to better land. Meanwhile, CCC workers planted 200 million seedling trees in the Dust Bowl region as windbreaks. The rains began to fall again by the 1940s, but after the 50-year experiment in farming this fragile area, much of it was returned to grazing because the tough prairie grasses hold the soil during the cyclical droughts that plague the region.

Along with banking and unemployment, the Roosevelt administration was committed to repealing prohibition. In practical terms, prohibiting alcohol had simply not been successful. Those who wanted a drink were seldom prevented from getting one. In fact, alcohol consumption had increased in the 1920s. From a sociological standpoint, prohibition was a disaster because the illicit market for alcohol was so lucrative that it fostered the growth of criminal organizations such as that of Al Capone in Chicago. When alcohol became legal, these organizations did not disappear but turned to making a profit in other criminal arenas, notably drugs and prostitution.

On March 22, 1933, just 18 days after Roosevelt took office, Congress legalized light (3.2% alcohol) beer and wine. This did more than end prohibition it spurred employment in a domestic industry that had been suppressed for a decade. Even more important, perhaps, a tax of $5 was levied on each barrel of wine and beer, which provided needed revenue to the Treasury. Later in 1933, prohibition was abolished altogether with the Twenty-first Amendment.

Another institution in desperate need of reform was the stock market. Small margin requirements and insider trading had allowed swindlers to manipulate the market and make fortunes at the expense of investors. During the first hundred days of the emergency session, Congress passed the Truth in Securities Act that called for complete disclosure concerning a stock before it was sold. In 1934, Congress solidified its fair trading policy by creating the Securities and Exchange Commission (SEC). This agency set rules and regulations concerning trading that put all investors on a level playing field.

In 1935, Congress passed the Public Utility Holding Company Act to address the huge utility conglomerates that had swallowed up hundreds of local utility companies under the umbrella of a holding company that was held by a parent holding company, and so on. As an example of the dangers of this pyramiding, Samuel Insull's utility behemoth had failed in 1932 sending shocks throughout the business world and creating distress for the company's tens of thousands of customers. The Insull failure had an immediate response from the first emergency Congress. Roosevelt's New Deal cabinet and Congress wanted to counter the monopolistic utility companies, especially the electric power companies, with a model government program that could be used as a gauge for fair prices and practices. Senator George W. Norris of Nebraska was a particular champion of this idea.

The Tennessee River valley, which was badly eroded from incessant flooding and whose population had been especially hard hit by the depression, was the ideal location for a pilot project of impressive proportions. The president promoted and Congress passed the Tennessee Valley Authority (TVA) legislation that mandated the project. More than 20 dams on the river and its tributaries were constructed to prevent flooding and provide power to generate electricity for the entire region. Building this flood control and power generating system employed thousands of workers, which helped bring needed dollars to the local populace. Erosion was all but eliminated, and CCC workers restored much of the land to forest.

The TVA was a notable success, in spite of efforts by privately owned utility companies to discredit the achievement. Initiating similar large-scale projects on other river systems met with resistance, however, as conservatives and even moderate Democrats became concerned over the dangers of slipping into a socialistic, managed economy. But smaller projects and individual dams built to provide both water and power in the driest areas of the West proved great boons to those areas in the years to come.

Housing was another critical area addressed by the New Deal. In 1934, Roosevelt inaugurated the Federal Housing Administration (FHA) to make small loans to homeowners for home improvements or completing construction on a home. The project was extremely well received, and in 1937 Roosevelt supplemented it with the United States Housing Authority (USHA) aimed at sponsoring new home construction. Housing funds were allocated for over a half million low income families, but the initiative was obstructed by entrenched interests in real estate and construction who felt that government-sponsored, low-income housing would interfere with their livelihood. Enough housing was built to get many families out of the worst of the urban slums, however, and housing assistance through the FHA continues to this day.

A far-reaching program called the National Recovery Administration (NRA) attempted in 1933 to coordinate business and labor and to address unemployment both for the short and long term. The NRA called for self-restraint on the parts of both business and labor. Businesses were to abide by codes of fair competition. Minimum wages and maximum work hours were established for workers in order to employ a greater number of people. Labor was encouraged to use collective bargaining.

The National Recovery Administration program was expensive for industries, and workers who already had a job found their net pay reduced because they were restricted in the number of hours they could work. In addition, labor felt its bargaining impact blunted in not being able to threaten a strike. After a warm reception, the plan began to founder as each group felt it was being asked to sacrifice too much. The NRA's semi-voluntary nature made it easy for individuals to cheat on the rules when they felt unfairly burdened. Finally, in the Schechter case, the Supreme Court ruled that not only had Congress overstepped its bounds by delegating its legislative authority to the executive branch, but also that the federal government did not have jurisdiction for regulating local businesses that were not engaged in interstate activity.

A companion to the ill-fated NRA was the Public Works Administration (PWA) that was also aimed at unemployment relief and economic recovery. Headed by Secretary of the Interior Harold L. Ickes, the PWA pursued tens of thousands of public works projects, including the Grand Coulee Dam on the Columbia River, which provided water for irrigation and hydroelectric power for the region. The success of the PWA and later the Works Progress Administration (WPA) lay in the fact that government was much more successful as a contractor for work than as a mediator between business and labor, as it tried to be with the NRA.

The reforms of the New Deal placed a value on heritage as well as progress. Concerned that Indians under the Dawes Act, which had called for assimilation, were losing their native identity, the Roosevelt administration sponsored the Indian Reorganization Act of 1934, which provided for tribal self-government and the means to preserve native traditions. Of nearly 300 tribes, 200 participated in the reorganization. The remainder balked due to concerns that reviving Indian culture could lead to further marginalization of Native Americans in the predominantly white American culture.

In spite of pump priming, jobs programs, and outright welfare, unemployment was still high in 1935, and many people had exhausted every resource. The mood of the country was desperate. Roosevelt decided that all of the previous programs had not gone far enough to keep people employed, and he began another round of reforms sometimes called the Second New Deal. At his request, Congress created the Works Progress Administration (WPA) as a large-scale remedy. Harry Hopkins headed the WPA, which over time spent approximately $11 billion on public works projects, education, and the arts.

WPA workers constructed bridges, paved roads, and built public buildings. Many of the brick roads laid down by WPA workers are still in use today. Workers also assisted all levels of education as graders and teaching assistants. They wrote histories and produced art for government buildings. Wages were $.25 to $.35 an hour, but people who had been earning nothing were thrilled to get any sort of pay, and WPA jobs helped people keep their self-respect.

In an effort to help organized labor after the demise of the NRA, in 1935 Congress wrote the National Labor Relations Act, sometimes known as the Wagner Act, which created the National Labor Relations Board. This agency fostered the organization of unions and protected their right to bargain collectively.

Perhaps the most revolutionary New Deal reform for America was the Social Security Act of 1935. This law provided government-sponsored insurance for the unemployed, dependent children, retirees, and the handicapped. The plan was funded by mandated contributions from both workers and employers. Social Security payments were from $10 to $85 a month, but have regularly increased to keep pace with inflation. Originally the plan did not cover self-employed persons, though that provision soon changed.

Conservatives bitterly opposed Social Security as pernicious socialism that celebrated leisure and denigrated work. They also charged that the plan was a "ponzi scheme," an illegal form of investment where the incoming funds of people investing in the scheme are used to pay off those collecting their returns, but no principal is actually generating a dividend income. Mathematically, ponzi schemes always fail because at some point those who are receiving exceed in number those who are paying in.

Liberal theorists have maintained that if there should be shortfalls in the Social Security System, the federal government is large enough to absorb them. With the Baby Boom bulge in the population now approaching retirement, politicians and economists are scrambling to plan ways to keep Social Security afloat while shielding the working generation from a crushing tax burden. Time will tell how the story of Social Security plays out, but for the 70-some years of its existence it has provided necessary and humane retirement support for millions of Americans at a reasonable cost to those in the workforce.


Fiscal Stimulus

While the economy did experience a strong recovery during the 1940s, a different school of thought would argue this strength was due to the massive fiscal stimulus brought about by an increase in government spending for the war effort. This more Keynesian perspective would argue the policies implemented by Roosevelt were far too small to enact a fiscal-stimulus-led economic recovery.

It is a misconception to think that the New Deal was a time of great expansionary fiscal policy. Many of the New Dealers were quite fiscally conservative, which is why the social programs they instituted were coupled with significant tax increases. They believed that debt-financed spending, the likes of what the British economist John Maynard Keynes was proposing, posed more of a threat than a stimulus to the economy.

Philip Harvey argues Roosevelt was more interested in addressing social welfare concerns than creating a Keynesian-style macroeconomic stimulus package.   In 1932, Roosevelt deemed the task he faced was, “not discovery or exploitation of natural resources, or necessarily producing more goods,” but “the soberer, less dramatic business of administering resources and plants already in hand…of distributing wealth and products more equitably.”  

The primary concern was not increased production and economic activity, which coupled with fiscal conservatism, guaranteed any increase in social spending would be far too small to kick-start a reeling economy. With this view, it would take the increased spending from the war effort to give the economy the boost it badly needed.


New Deal

Governor John Ehringhaus, fearful of excessive spending, opposed Social Security at the start of the Depression. Image courtesy of the North Carolina Office of Archives and History, Raleigh, NC. African Americans received inadequate federal relief during the Depression. This picture was taken between 1934 and 1936. Image courtesy of the North Carolina Office of Archives and History, Raleigh, NC. Annie Land O'Berry headed major relief bureaucracies in the Tar Heel state during the Great Depression. Image courtesy of the North Carolina Office of Archives and History, Raleigh, NC. A Civilian Conservation Corps (CCC) camp at Laurel Springs, in western North Carolina. Image courtesy of the North Carolina Office of Archives and History, Raleigh, NC. The CCC provided employment for young men and received statewide support. Photograph taken in Globe, North Carolina, June 1934. Image courtesy of the North Carolina Office of Archives and History, Raleigh, NC.

Josiah Bailey, U.S. Senator and author of the "Conservative Manifesto," opposed New Deal programs. Image courtesy of the North Carolina Office of Archives and History, Raleigh, NC.

Federal programs to fight the Great Depression brought almost $440 million by 1938 to North Carolina. Conservative Democrats who had fought the reforms in the state, nonetheless, eagerly accepted the largesse from Washington, D.C. The most important New Deal program in the state was the Agricultural Adjustment Administration (AAA), which essentially paid farmers a modest amount to grow less tobacco, the state’s largest crop, as well as controlling other crops. Consequently, tobacco prices and farm income rose. Overall, the tobacco control program was one of the most successful in the South and in the nation for the AAA. Cotton, due to competition overseas and from synthetics, did not perform as well. Tar Heel farmers embraced crop controls, not out of enthusiasm for big government, but in their self-interest, for the AAA&rsquos regulation had improved prices. Furthermore, the government let farmers vote for controls through referenda.

New Deal agricultural success, however, came with a price. Reduced production meant that fewer tenant farmers and sharecroppers were needed their ironic displacement by the AAA increased the economic problems of the 1930s. Driven from their land, farmers moved to cities, and there many survived on government relief. African Americans, a large number of sharecroppers, were especially vulnerable to displacement. The benefits for crop controls disproportionately benefited landowners over tenants.

The National Recovery Administration (NRA), Roosevelt’s agency for reviving business and industry, had a significant impact as well on North Carolina. Like the AAA, the NRA attracted support because it offered short-term economic benefits, but problems eventually generated opposition in the state. North Carolina, the most industrialized southern state at that time, needed assistance during the 1930s. Overproduction and competition meant low prices for textile products therefore, textile executives eagerly formalized in NRA codes some trade association practices in place since the 1920s. These practices had brought some discipline to the industry, in areas like wages and production. Initially with NRA regulation, profits and wages rose. After a couple of years, enthusiasm waned, as economic lifestyles declined and businessmen realized the NRA meant bureaucratic red tape and higher wages and unions&mdashor at least the threat of unions. Tobacco companies, doing well in the 1930s, needed little help and only agreed to an NRA code shortly before the Supreme Court in 1935 declared the NRA unconstitutional.

North Carolina ranked low in per capita in the receipt of relief funds from Washington, D.C. Farmers and businessmen considered relief a threat to cheap labor. Governors Ehringhaus and Hoey balked at providing state matching funds for relief. Fearful of excessive spending, Ehringhaus delayed approximately two years before calling a special session of the legislature to comply with Social Security. Eventually, participation with some of the Social Security programs transformed the state welfare department into a major agency. New Deal public works projects left an impressive record of physical improvements.

The New Deal in the state had an ironic effect on African Americans. They were a higher percentage of the poor therefore, they benefited from relief, but federal assistance was inadequate. Other federal programs affected them adversely. With higher wages from the NRA, whites often displaced them in the workplace, and crop controls reduced the need for sharecroppers, driving many from the farms. New Deal goals were economic civil rights were not a priority for white liberals in the state or in the White House. The New Deal affected women, too. A significant portion of textile workers, women gained from NRA wage increases. They participated in relief programs like the Works Progress Administration (WPA) sewing rooms and, like others in the 1930s, complained about discrimination, low wages, and cuts in programs. Two Tar Heel women held prominent positions in the New Deal era: Annie Land O’Berry, a social service professional, headed major relief bureaucracies in competent fashion, and Annie Kizer Bost, state welfare director, enhanced her agency by handling some Social Security programs.

As election results proved, the New Deal received broad support in the state. North Carolinians credited Roosevelt for economic recovery and reform measures and sometimes blamed local and state bureaucrats for problems. Sharecroppers complained that the AAA mishandled government payments, and small landowners argued that production controls particularly hurt them. Large landowners supported the AAA more enthusiastically. The Civilian Conservation Corps (CCC), which provided employment to young men, enjoyed the greatest public support in the state.

The state’s congressional delegation played key roles in the creation of New Deal legislation. Typical for the solidly Democratic South, the Tar Heel congressmen supported Roosevelt strongly, at least until 1937. Although most of these men were conservative, party loyalty, situational urgency, patronage concerns, and electoral pressure compelled them to advocate New Deal programs. Congressmen John H. Kerr, Lindsay Warren, Harold D. Cooley, and Frank Hancock, all from tobacco-growing districts, played key roles in developing tobacco-control legislation. Robert L. Doughton served as chair of the House Ways and Means Committee during the New Deal era and consistently pushed critical legislation, such as the NRA, Social Security, and revenue bills, through the House. Party loyalty, fondness for Roosevelt, and patronage, not ideology, generally motivated Doughton. He was the state’s most important New Deal supporter in Congress.

Although he selectively opposed reform legislation, United States Senator Josiah W. Bailey emerged as the most important anti-New Deal member of the congressional delegation. In 1933, he voted against AAA legislation, and after voting for the NRA he attacked it beginning in 1934. By 1937, he had become a prominent opponent of Roosevelt nationally. The recession of the late 1930s, and the president’s attempt to “pack the court,” fueled his attacks. In December 1937, he and other conservative senators, Democratic and Republican, issued the “Conservative Manifesto,” a pro-business and anti-New Deal document. Bailey&rsquos political skill enabled him to remain a force in a state, where Roosevelt enjoyed enormous popularity the Senator managed to oppose the New Deal but also support it and the president when necessary.

In the late 1930s, others in the North Carolina congressional delegation joined Bailey in opposing the New Deal. Graham Barden on the House Labor Committee and J. Bayard Clark on the House Rules Committee fought wage and hour legislation, which he and others in the state believed threatened low-wage southern industry. Three House members in the state’s delegation voted against the 1938 Fair Labor Standards Act and three abstained.

While conservatives gradually increased their resistance to the New Deal, the popularity of Roosevelt and his programs in the state forced them to accommodate certain New Deal programs, if for no other reason than to ensure that federal money made its way to the Tar Heel state. But in the end, dependence on state and local governments, often controlled by pro-business conservatives, limited the impact of the New Deal in the state. In per capita allocation of New Deal expenditures from 1933 to 1939, North Carolina ranked last in the country. North Carolina, a rural state, did not have a significant urban base to press for more vigorous support for the New Deal, and liberal candidates offered little alternative than just opposition to the sales tax or the conservatives. Roosevelt’s reforms, however, mobilized forces that energized liberals in the post-World War II era. Tar Heel workers, farmers, and African Americans aided by government programs, soon empowered the liberal wing of the state Democratic Party.

By 1940, the combination of the financial stimulus from the New Deal and the pro-business policies of the governors produced a relatively strong economy. Those seeking work or on work relief had dropped to 8.8 percent, best in the nation. While nine southern states had declined industrially, North Carolina remained in first place in the region. State government ended the decade with an $8 million surplus.

Sources

Douglas Carl Abrams, Conservative Constraints: North Carolina and the New Deal (Jackson, 1992) and Anthony J. Badger, Prosperity Road: The New Deal, Tobacco, and North Carolina (Chapel Hill, 1980).


Four Ways the New Deal Affects You Today

Many of the New Deal's programs are still safeguarding your finances today. The four most significant are Social Security, the minimum wage, the Securities and Exchange Commission, and the FDIC.

Social Security

The Social Security program provides a guaranteed income for workers who have paid into the system. Most people are familiar with the retirement benefits which can also be extended to the retiree's spouse.    

Social Security also pays disability benefits to eligible beneficiaries who become disabled before reaching retirement age. It pays children, surviving spouses, and dependent parents of eligible beneficiaries who die or become disabled.     In some cases, it will even pay benefits to divorced spouses.  

There is also a Supplemental Security Income program that pays benefits to disabled children and adults with limited income.   There's also a Special Benefits program for qualified World War II veterans.  

Minimum Wage

The minimum wage is the lowest legal wage companies can pay workers. As of 2019, the U.S. current national minimum wage is $7.25 per hour. The purpose of minimum wage laws is to stop employers from exploiting desperate workers.

The minimum wage should provide enough income to afford a living wage. That is the amount needed to provide enough food, clothing, and shelter.

Unfortunately, Congress hasn't raised the minimum wage enough to pace with inflation.

In fact, at 40 hours per week for 52 weeks, the minimum wage translates to $15,080 a year. That is more than the federal poverty level for a single person but is lower than the poverty level for a couple.   In other words, if someone were trying to support a family by making minimum wage, they would qualify for federal poverty assistance.

The SEC regulates stocks, bonds, and mutual funds, making investing safer. The SEC also provides information to help you invest through Investor.gov.   It provides basic education, such as how the markets work, asset allocation, and a review of the different retirement plans. It has a section on How to Select a Broker.   It provides financial planning tools, such as how much you need to retire.  

The FDIC insures savings, checking, and other deposit accounts up to $250,000 per account at each bank. For some joint accounts, the FDIC insures $250,000 per owner.   The FDIC also examines and supervises about 5,250 banks, more than half of the total system.

When a bank fails, the FDIC steps in. It sells the bank to another one and transfers the depositors to the purchasing bank. The transition is seamless from the customer's point of view.


Watch the video: The Great Depression 3 - New Deal, New York