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Franklin Roosevelt’s First New Deal

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What were the goals of President Franklin D. Roosevelt’s First New Deal? “The only thing we have to fear is fear itself”. President Franklin D. Roosevelt uttered those words to reassure the American people when assuming the Presidency at the darkest hour of the Great Depression. Born into a wealthy New York family, FDR attended Harvard University and Columbia Law School. Inspired by his fifth cousin, Theodore Roosevelt, FDR entered politics early in his life becoming senator at the age of 28, then the governor of New York before finally becoming President in 1932.

He was the 32nd President of the US.

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FDR worked determinedly and tirelessly to get the US out of depression and bring back hope into the lives of the American people. He attempted this by a series of programs and acts known as his ‘First New Deal’. FDR’s New Deal was an attempt to deliver relief, recovery, and reform. Relief meaning the initial action taken to halt the financial deterioration, recovery meaning provisional programs that would go towards recovering from the Great Depression, and reform meaning stable programs designed to avoid another depression.

This essay will look at two things; some of the programs/acts etc. that Franklin D. Roosevelt created as part of his New Deal and whether they were successful in accomplishing his overall goal of obtaining the three R’s-Relief, Recovery and Reform in the United States. Before FDR exceeded Herbert Hoover as President of the US, the people of America were in general extremely disappointed with the crumbling economy, mass unemployment, diminishing wages, and Hoover’s policies, especially the Revenue Act of 1932 which raised US tax rates. FDR entered office with a lot of pressure which required immediate positive action. Roosevelt responded swiftly with a series of programs within his first 100 days in office.

He met frequently with Congress trying to help America get out of the depression, avoid the same mistakes in the future, and grow stronger economically and as a nation. Roosevelt addressed the American public and explained his goals and what he hoped to achieve while in office. Before FDR could start recovery plans for the US he had to put a stop to the declining economy. Depositing money in a savings account carried a great deal of risk in the past. When a bank had made bad investments and was forced to close, people who didn’t withdraw their money quickly enough were unlucky and lost it.

When depositors feared a bank was unstable, news spread quickly across the country and they began removing their money. This is was the main reason for the collapse of the banks during the Great Depression. In 1929 alone, 659 banks closed and by 1932 an additional 5,102 banks went out of business. Life-savings were lost over night. Bank failures continued in 1933 however FDR knew that fixing the bank failures was the number one priority after being inaugurated and began strategizing to fix the problem. FDR acted quickly by declaring a ‘Bank Holiday’.

This meant that banking transactions were suspended across the nation. During this time Congress passed Roosevelt’s Emergency Banking Act which gave the President power through the Treasury Department to reopen banks that were solvent and assist those that were not. Banks were divided into four categories. Amazingly, just over half of the banks were in the first category and were sufficient to reopen. The second category were reopened but were only permitted to give out a percentage of its deposits. The third category were on the verge of collapse so were only permitted to accept deposits and not withdrawals.

Five percent of banks were in the final category and were deemed unfit to continue. Before the banks were allowed to reopen, FDR addressed the nation in his first fireside chat and assured sixty million radio listeners that the crisis was over and that the banks were secure. On the first day back, deposits were greater than withdrawals. The bank crisis had finished. On top of this, on June 16th 1933, FDR signed the ‘Glass-Steagall Banking Reform Act’ which meant that if the banks did collapse again, the Federal Government would refund their losses.

President Franklin D. Roosevelt’s next step was to improve the rate of unemployment. In 1933, FDR created the CCC (Civilian Conservation Corps) to help decrease unemployment in the US. The work was only temporary but it gave jobs to unskilled single adults who struggled to find work. The work was manual and was linked to the conservation and development of landscapes and natural resources in rural lands owned by federal state and local governments. The employees of the CCC also had to help out in disaster type situations. The employees lived in barracks.

Although the work was only provisional, it was a stepping stone to recovery and at the same time instigating natural resource programs. On top of establishing the CCC, Franklin Roosevelt also formed the CWA (Civil Works Administration) to help provide employment for the American economy in 1933. The focus of the CWA was mainly constructional jobs; improving or constructing roads, bridges and buildings. Unfortunately like the CCC it was only temporary but this was mainly due to the fact that it was too great of an expense for the Federal Government and it ended in 1934 .

As part of FDR’s New Deal, the FHA (Federal Housing Administration) was founded in 1934 to fight against the housing crisis and help the civilian of America get back on their feet. FDR’s goal for the FHA was to provide a stable mortgage market for American families and also to provide the funds needed to construct low income housing which was badly needed. To help the citizens of America refinance their homes, Franklin D. Roosevelt fashioned the HOLC (Home Owner’s Loan Corporation). The housing crisis in America as a result of the Great Depression led to a great deal of foreclosures.

FDR believed that the American citizens would get support with their mortgages with the formation of the HOLC and that it would reduce the amount of foreclosures. The HOLC gave out loans to home owners to pay for mortgages which would prevent them from going homeless and banks going under. Between 1933 and 1935, around one million Americans received long term longs through the HOLC that rescued them from going homeless. Created as part of Franklin D. Roosevelt’s National Recovery Act in 1933, the PWA (Public Works Administration) was formed in order to provide economic stimulus and jobs.

The PWA had budgeted around 7 billion dollars. The objectives of the PWA was to spend the money on providing employment, steadying purchasing power, improving public welfare and of course contributing to the overall recovery of the American industry. Basically it was designed to spend “Big bucks on big projects” as Chris Brick put it. From 1933 onwards, the PWA funded the construction of more than 34,000 projects across America including seventy percent of the new schools, one third of the hospitals, as well as airports and dams, and also it got the Pennsylvania Railroad between New York and Washington going.

Franklin D. Roosevelt designed the SSA (Social Security Act) in order to provide and look after the older generation of society; so that they would have enough money to survive. The SSA ensured that the government would provide income to retired wage earners. The money that the senior citizens received would have been generated by current wage earners and their employees. It was an Act that was seen as very popular. In 1933, FDR established the TVA (Tennessee Valley Authority) to help recover, maintain and develop the economy in the Tennessee Valley area which had been hit hard by the Great Depression.

The TVA is a federal owned establishment. The TVA helped created dams which provided the area with more stable irrigation and cheap hydro-electric power. From 1933 onwards, the TVA has proved to be very successful program by FDR as it is one of the largest public providers of electricity in the United States. After explaining some of the programs of President Franklin D. Roosevelt’s First New Deal, was he successful in achieving his goals-Relief, Recovery and Reform. In terms of relief, the New Deal proved to be extremely positive and effective.

Because of the Great Depression millions of Americans were unable to find work and provide an income for either themselves or their families. I believe that the citizens of America would have literally starved to death if Roosevelt’s Government didn’t come into power and intervene. Roosevelt provided a source of income for the American people with organizations like the CCC (Civilian Conservation Corps). In the field of recovery, although successful in parts, I do not think it excelled. The First New Deal failed to end the brutally high unemployment rate as the jobs it created were only temporary.

The country also had to deal with WW2 so that did not help matters in trying to recover as a nation. With reform, Roosevelt’s New Deal legacy, I strongly believe altered the relationship between the economic market, the people and their government. For the first time in America’s history we see a country devoted to helping out the individual against the unpredictable turns in the market. There is no doubt that FDR’s presidency drastically changed the US in a positive way. In conclusion I would have to say that President Franklin D. Roosevelt did achieve his goals in his First New Deal.

Bibliography

Anonymous, Civilian Conservation Corps < http://www. u-s-history. com/pages/h1586. html> (20/10/2012) * Amos Kiewe, FDR’s First Fireside Chat: Public Confidence and the Banking Crisis (Texas: A&M University Press, 2007) * Brenda Hougen, Franklin Roosevelt: The New Deal President, (Minneapolis: Compas Point Books 2006) 67-73 * Campaign Advisory Corp. , New Deal Achievements<http://www. fdrheritage. org/new_deal. html> (19/10/2012)

* Edmund Lindop et. , Margaret J. Goldstein, America in the 1930s (USA: Lerner Publishing Groups, 2010) * Franklin D. Roosevelt, Inaugural Address, March 4 1933, as published in Samuel Rosenman, ed, The Public Papers of Franklin D. Roosevelt, Volume Two: The Year of Crisis, 1933 (New York: Random House, 1938) * John G. Geer, Wendy J Schiller, Jeffery A. Segal, Gateways to Democracy: An Introduction to American Government. (USA: Cengage Learning, 2011) 469 * Otis L. Graham and Meghan Robinson Wander eds. Franklin D. Roosevelt, His Life and Time. (New York: Da Capo Press, 1985 * Patricia Bernard Ezzell, From a New Deal to a New Century <http://www. tva. com/abouttva/history. html> (22/10/2012) * Patrick J. Maney, The Roosevelt Presence: The Life and Legacy of FDR (USA: University of California Press 1998)

* Patrick Renshaw, Franklin D. Roosevelt: Profiles in Power (Great Britain: Pearson Education Limited, 2004) * Richard D. Polenberg, The Era of Franklin D. Roosevelt 1933-1945: A Brief History with Documents (USA: Palgrave Macmillian 2000) * The White House, President Franklin Roosevelt, <http://www. whitehouse. gov/about/presidents/franklindroosevelt> (20/10/2012) * William D. Pederson, A Companion to Franklin D. Roosevelt, (UK: Blackwell Publishing Ltd, 2011) Social Security * William E. Leuchtenburg, Franklin D. Roosevelt and the New Deal. (New York: Harper & Row)

Cite this Franklin Roosevelt’s First New Deal

Franklin Roosevelt’s First New Deal. (2017, Jan 04). Retrieved from https://graduateway.com/franklin-roosevelts-first-new-deal/

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