Thursday, January 23, 2020
New Deal America :: American America History
New Deal America The stock market crash of 1929 helped launch the United States and many other nations into the worst economic depression in history. The severity of the Great Depression called for federal government programs to protect the general welfare of citizens. The New Deal programs created by Franklin D. Roosevelt provided the framework for the welfare state that still serves as a basis for American public policy. All aspects of American society suffered during the Great Depression. By 1932, there were thirteen million people unemployed. There was no security for the millions who lost all of their savings in the bank failure or stock market crash. Volunteer organizations attempted to help the needy, but their resources were simply not adequate (Madaras and SoRelle 218). Hope seemed non-existent. Americans had never seen such a severe depression. They could not look to history for guidance. The New Deal was Roosevelt's attempt to restore the economy. His willingness to act decisively and experiment with new policies set him apart from previous presidents. He often said, "I have no expectation of making a hit every time I come to bat. What I seek is the highest possible batting average"(Tindall and Shi 1238). In the first years of Roosevelt's term he worked hard to empower the federal branch. The New Deal set the precedent for 20th century liberalism. The first order of business for the Roosevelt administration was financial reform. Banking is a crucial aspect of capitalism and Roosevelt was very aware of this fact. On his second day in office, Roosevelt called Congress to meet in a special session. The outcome was the Emergency Banking Relief Act, which permitted stable banks to reopen and provided managers to those who remained in trouble. The Glass-Steagall Act separated commercial and investment banking and created the Federal Deposit Insurance Corporation. These actions all helped restore banking confidence within American people. Roosevelt ensured that it was safer to "keep your money in a reopened bank than under the mattress"(Tindall and Shi 1238). After accomplishing this task, the new administration was ready to solve other problems. Other financial programs included the Securities and Exchange Commission (SEC), National Industrial Recovery Act (NIRA), and the Agriculture Adjustment Administration (AAA). The SEC functioned in regulating the stock and bond markets. The NIRA and AAA were aimed at recovery through regulation. The NIRA played a big role in restoring faith and confidence in the system and helped to increase demand and wages, but realistically it was impractical; it abandoned the American market system.
Posted by Emory Gustafson at 8:27 AM