Since its discovery in the Renaissance period America had always been seen as a land of dreams, it was prosperous and its inhabitants were happy, however in 1929 a catastrophic chain of events left it in depression, people starved and the country lost its status as a great super power.
The depression was caused by a number of factors, the main trigger came in the October of 1929, when the Wall Street stock market crashed, millions of dollars were lost and suddenly many faced poverty, however looking back, with the benefit of hindsight it is possible to see that the crash was inevitable. In the years leading to the crash, there had been great prosperity, during the “boom” of the 1920s, the then republican government of America had taken a laissez-faire attitude towards business and had not intervened, hoping that the companies knew what they were doing.
The little cant taken by the republicans when it came to the economy seemed acceptable but when economic collapse began their schemes ended up crippling companies more. In the early 20s tariffs had been introduced on foreign goods, in the hope that American companies would be able to prosper, this meant that when America was desperate to trade to make money, the goods were not bought, because other countries had copied the idea.
Because the government did not take an active role in industry, it was important for companies to look after themselves, to make this easier trusts were created, these were huge corporations that dominated industry, people thought that the trusts would act responsibly and would be able to handle any situation, however when the crash hit, it meant that if one of the ‘captains of industry’ went down the whole sector was taken down as well, the democrats had argued against trusts for years prior to the crash.
In 1933, after a miserable three years without hope, Americans decided that change was needed and the ambitious Franklin D Roosevelt was elected as president. His speeches had caught the attention of the public as he promised to provide a way out of the depression and to solve he problems facing America. Roosevelt promised to take action and overcome fear to help the USA out of the social and economical tangle it found itself in.
Roosevelt made over 70 speeches in the months running up to the election, in them he had promised Americans a ‘New Deal’, this aimed to solve unemployment, provide aid and support for the sick, elderly and unemployed, rebuild American industry and agriculture and to restore the economy, this included restoring faith in investors and savers. Even though his plans were highly ambitious, Americans were desperate for change and in the March of 1933, Roosevelt came to power. Now in power Roosevelt was expected to deliver on his promises and help solve America’s problems.
Opinions in America as to his aims differed greatly, and now nearly seventy years later people are still divided when it comes to the action taken. Did Roosevelt actually deliver and solve all the problems of 1930s America or did he simply rely on propaganda and ‘fluff’ to give the illusion of change, when really he hadn’t addressed the major problems of America? When Roosevelt took over, he was faced with a colossal task; he had inherited a country riddled with both economical and social problems. The wall street crash had crippled companies, production fell and millions were left on much lower wages or unemployed.
Other effects of the crash were the banking crisis and the disappearance of consumer confidence; people were not using banks and were not investing in companies so progress was impossible. Agriculture, which had been facing difficulties during the roaring 20s, was also affected, farmers couldn’t pay their mortgages and production fell by 40%. The effects of the crash created a vicious circle that could not be broken and the country was left in financial depression, the government would have to find a way of generating funds to help rebuild the economy.
The republican approach had meant that corruption was common in American firms, this worsened after the crash as people were desperate to make profit, it reduced confidence further and meant that there was no sense of fair trade in 1930s America. After the crash companies had to downsize, millions found themselves unemployed and facing hefty debts after speculating on the market. People were forced to leave their homes and shanty towns, known as ‘Hovervilles’ were created on the outskirts of the cities, the poor, sick and elderly received no aid fro the government and were left to starve.
However poverty didn’t only exist in urban areas, the countryside had also been left impoverished after agriculture had seen a huge slump, land had become baron and farmers couldn’t produce goods. Poverty, unemployment and ruin created tension in the ‘melting pot’ that was America, everyone was anxious for change and competition soon began to occur, this led to prejudice, particularly against women, black people and native Americans, in many cases discrimination occurred and people were persecuted, this was particularly common in the southern states.
Roosevelt had a lot to do to rebuild America, he realised that he must “act and act quickly”, he immediately set to work, the day after he got into office, he introduced the Emergency Banking Act and the Securities Exchange Commission, all of the banks of America were closed for a four day holiday, they were then investigated and 5000, trust worthy banks were selected by the commission as fir to re-open.
This would restore consumer confidence and would mean that investment could begin again. In the first few days the radical changes in America seemed a lot to take in, all people knew was that “something was happening, something good for them”, the government realised how important it was to keep the support of the public and constantly reassured them that the situation was improving.
In his inauguration speech, Roosevelt had highlighted how important it was to “put people back to work”, he immediately set about making this a reality and created the Civilian Conservation Corps and the Public Works Administration, these schemes were meant to get people, particularly men to work, it was hoped that the money would go to help families out of poverty and the laboring done would create a healthy infrastructure for the America of the future.
However Roosevelt realised that it would take time for men to raise enough money to help their families so the Federal Emergency Relief Administration was established, this provided $500 million to help the poor and sick, food could be purchased and schools were created, along with employment schemes so people didn’t have to rely on charity forever. The Social Security Act was also created, defied convention in America as it meant that for the first time in history aid would be provided for the sick, elderly and unemployed, in the years before, people had been expected to deal on their own.
Next on the agenda was the countryside, to address the issue of agriculture the Agricultural adjustment Agency was created, this was meant to stop overproduction amongst farmers, the Farm Credit Administration meant that a fifth of Americas farmers were able to pay off their mortgage, other schemes for agriculture included The Resettlement Administration and the Farm Security Administration, these schemes stabilized farming and allowed prosperity back into the country.
However the most important scheme for the countryside was the Tennessee Valley Authority, this area had become a huge ‘dust-bowl’ the land could be used and many of the inhabitants lived in poverty without electricity or any form of regular income. The Authority saw that numerous dams were built, these would irrigate the land, provide jobs and also give a source of electrify, this scheme was the most ambitious and many questioned whether it would be a success or failure.
The last act to be passed during the hundred days was the National Industrial Recovery Act, this revolutionized American industry, in the years of the depression, America’s Gross National Product had reached an all time low and there had been a huge rise in the number of business and back failures, it was hoped that the NIRA would stimulate the economy, improve morale and help industry get back on its feet. By the June of 1933, it seemed that America’s problems had been solved and that prosperity was just around the corner, however people criticized and said that not enough was being done to help America’s society and economy.
Such critics were Huey Long, Francis Townsend and Father Coughlin, all agreed that the New Deal was not doing enough to help black people and wasn’t providing enough security to those who need it, such as the elderly. Roosevelt’s schemes had helped 200,000 black Americans; they were employed and were able to leave the slums, however for many, life did not change at all as they were still viewed as second-class citizens.
Despite pressure, Roosevelt didn’t pass any civil rights laws, this meant that in the south the Ku Klux Klan were still able to lynch innocent black people and created a sense of fear amongst minority groups. Many were angered when Roosevelt failed to address the issue of racism in America, however their criticisms were somewhat pacified when aims to help Native Americans were announced, throughout the 20s they had been referred to as the “vanishing Americans”, however the New Deal meant that they could afford to keep their land and traditions.
Though this action was welcomed, many saw it as a token gesture and questioned its impact as Native Americans still remained on the outskirts of society and had no real voice in America. Another group who questioned the new deal were women, during the boom of the 20s, woman had started to question and break out of their limitations, however when the depression hit, the movement was set back and once again women were expected to assume their old positions as mothers an loyal wives.
Only about 8000 woman were actively helped to find employment by the New Deal and wages were half of the average man, some women did see positive change as a few were able to work in offices and the social security act meant that women could receive aid to help them support their children, however local governments imposed rules on this, so many were refused benefits.
Roosevelt found a way of projecting a positive image throughout America, even if problems still existed, for example affirmative action was taken was taken within government, woman and black people were employed to runt eh new schemes, this helped unemployment as well as helping the governments image, it is an example of the productive propaganda Roosevelt used.
Despite the numerous schemes created to help the economy, some still maintained that more change was needed, people were concerned by the types of employment provided, the wages were poor and jobs were only based on short term contracts, people wanted to see more stability. When in 1937, Roosevelt gained a second term in office, changes were made, it was not possible for the government to continue to pour money into schemes, this development caused huge stirs within the US economy, 1938 saw unemployment reach a 2-year high and the country’s GNP was significantly down, banks and businesses once again saw a rise in failures.
Consumer confidence was still low in America, though more people were investing; overall people invested 75% less than they had in the years prior to the crash. When America joined the war in 1941, it came as a relief as it provided America with trade and employment and took the pressure off Roosevelt as some of the problems facing the US were solved.
The other school of thought believed that the New Deal was doing too much and was complicating progress, these opponents were a mixture members of the public as well as industrialists, Many Americans worried about the power Roosevelt had, in the first hundred days he had effectively ruled as a dictator and faced to opposition when he went to congress, they also spotted the similarity between Roosevelt’s New Deal and Stalin’s Five year Plans, this worried many as the red scare still existed in America and they didn’t want their free democratic country to be compared to a Communist dictatorship.
Workers felt betrayed by the government and many criticized the new social security, they felt that if they worked hard, they would only be forced to pay huge taxes that would help those doing meaningless jobs, or those who were ‘signing on’. Industrialists felt that unions had been given too much power, schemes were too complex and some felt that the new schemes such as the TVA created unfair competition amongst private companies.
The government took these criticisms seriously, as they thought it was important to listen to the public, however the complaints lost credibility when a smear campaign, headed by the Republicans began. The arguments also seemed petty when cases such as The Schechter Poultry Corporation came onto the public scene; this rather trivial case sent ripples through the American law system and ended up giving Roosevelt more power.
The main reason for these criticisms was purely down to the fact that the Republican and Democrat ideals were very different, although in 1937 Roosevelt once again managed to win in the elections, by a landslide, it seemed clear whose ideas the general public supported. Today, people are still widely divided when it comes to the issue of Roosevelt and his New Deal. There is no doubt that the New Deal did help America out of the depression, but did it actually solve the problems of America in the 30s?
After all blacks were still living in fear, women had not gained any voice on the public stage and America had been the slowest country to recover after the depression, while the European countries had begun to prosper. When looking back with the benefit of hindsight it is possible to see the changes the New Deal did bring, after the dark years of the depression and the Republican government, Roosevelt and his radical schemes were welcomed by the American people, this positive attitude helped America and meant that confidence was restored in both the economy and the government.
When shown the statistics on American economy it is obvious that the New Deal did help, however the only true progress came after 1941, it seems that war was the only action that helped stabilize the US economy permanently. this questions the strength of the New Deal as it shows how variable its success was. When, in 1937, cuts to the budget of the New Deal were announced people met the news with mixed feelings, some such as Newspaper editors were relived, as they felt that millions of money was being wasted, however others felt uneasy and confidence saw a huge drop during 1937-1938.
This recession was not nearly as serious as the crash however it was enough to shake investors and undermined the New Deal as people saw how close financial ruin was. It is true to say that in the years of the New Deal consumer confidence increased, however when comparing the figures to that of pre-1929, it is clear that confidence had not been fully restored, this showed that though people were glad to see change they had qualms and were still nervous about the USA, this means that one of the major problems facing Roosevelt had not been solved.
When trying to analyse the success of Roosevelt and the New Deal it is important to be objective and to think both comparatively and relatively, at this one can see that the successes of the New Deal were hugely variable, some aspects such as the TVA were a great success, however the major issues of American society such as race and poverty had not been addressed or eased.
However Franklin D Roosevelt is still know today as one of the greatest presidents of all time, because he created hope in a time of depression and his actions meant that in future years radical changes could be made and excepted by Americans because confidence was slowly rising and people had seen change. So in conclusion, Roosevelt was not wholly successful in solving the all of the problems of the US in the 1930s, but he had the support of the people and his dramatic actions created so much hype and momentum that in the end the American people were able to find a way out of their own personal depression.