Roosevelts New Deal Essay Example

The advent of Franklin D. Roosevelt's presidency during the Great Depression marked economic and social unrest comparable only to the likes of Lincoln. During the beginning of his presidency, Roosevelt's proposed "New Deal" emerged to repair the shattered economy by providing social welfare programs to support those economically ravaged by the depression. This program provided a precedent that increased the executive branch and the federal government's effective power. In addition, it sought to reduce the likelihood of another financial collapse through progressive reforms such as the Glass-Steagall Banking Reform Act and the establishment of economically protective federal bodies such as the SEC and FDIC. Furthermore, the establishment of the Wagner Labor Relations Act and the Fair Labor Standards Act, coupled with the laboring opportunities offered by The Civilian Conservation Corps, characterized the New Deal as a protective measure against later economic depressions. However, the New Deal was too economically centric to influence significant social change.

October 29th, 1929, is widely understood as one of the worst intraday trading sessions, as it later became known as "Black Tuesday." However, this terrible trading day alone was not the sole cause of the depression; the later developments in the failing of over nine hundred banks signaled the Depression Era. With the roaring economic boom of the 1920s, consumerist culture emerged at an unsustainable rate. Once consumer spending began to stagnate, the economic prosperity that led many to believe buying stock on margin was foolproof dwindled and led to a mass margin call. There was also a significant reduction in government spending and trade due to the protectionist Smoot-Hawley tariff, America's trading policy with Europe due to the lack of government initiative. Expectedly, unemployment rates rose in reverse to the US GDP, averaging 18 percent during Roosevelt's first eight years in office. Through the 1930s, U.S. industrial production and national income fell by about almost one-third. Still, even eight years after the passing of the New Deal, unemployment averaged a dreadful 14 percent. Between 1929 and 1933, U.S. GDP fell by 30%, with the total market losing 90% of its total value, and the income of the average American family was reduced by 40%. Nine million savings accounts evaporated between 1930 and 1933, and the nation was despondent ever to reach a fraction of its former wealth. Out of this hopelessness, the new deal's social welfare and protective programs emerged to stimulate a reversal.

The unjust labor practices that employers indulged in significantly exacerbated the already dispirited American workers. In Document G, John Lewis reaffirms this notion by claiming employers' reluctance to compromise with their laborers helped spark economic disaster. Lewis was an avid supporter of FDR because of his role in using the federal government to help regulate and support labor unions, which likely serves as his motive for broadcasting content related to pro-New Deal propaganda. With the need to support the American working class, the development of the National Recovery Administration formed to set laboring policies such as minimum wage requirements and the limit to the number of workdays and hours that would then qualify for overtime pay. Not only did this progressive administration help in harmonizing employees and unions, but the Roosevelt administration also created directives to relieve all facets of economic pressure. For example, FDR passed the Bank Holiday to relieve the pressure on banks and allow them to collect their engagements to remain solvent. This holiday led banks to close for approximately four days, allowing the government to audit and ensure they remained financially sound. Furthermore, with quantitative easing through the abolition of the gold standard, the federal government proved pivotal in rebuilding the financial system to reduce the economic collapse. However, this intervention substantially expanded the federal government's authority, for it set the 20th century precedent of a gross expansion in the necessary and proper clause. Nevertheless, the extent of this power, while vast, was limited to federal standards, as seen in the majority opinion stated in Document F. Since the case refers to workers who are not employed in interstate commerce, the Court likely invalidated the National Industrial Recovery Act because it gave the federal government powers of economic regulation that could not be justified under the interstate commerce clause. Therefore, federal power remained limited outside of the economic precedents previously set.

With the most significant longevity of any New Deal policy, the Social Security Act of 1935 created a federal insurance program based on the automatic collection of taxes from employees and employers throughout individuals' working careers. As seen in document E, upon reaching 65, this stipend is redistributed through a monthly pension. The poster's portrayal of the social security system appears as if it is "free" money instead of addressing the underlying necessity. This program is the epitome of the effectiveness of New Deal programs because it was exclusively economical and had a limited pool of beneficiaries. In addition, the Works Progress Administration aided in reversing the unemployment rate by offering government jobs to thousands of unemployed men. These contracts ranged from conservationist assignments to developmental construction projects throughout the U.S. However, they were only a temporary solution to unemployment, as they were low-paying and had limited positions. The finite positions that the federal government could delegate are exemplified in Document J's unemployment chart. The 1937-1938 "Roosevelt Recession"  decrease in government spending reduced the availability of working opportunities. Furthermore, the artificial creation of jobs proved to be wholly ineffective compared to the development of homefront opportune in WWII, where unemployment ultimately returned to modest levels. This economic success was the extent to which the New Deal engendered positive change during the Great Depression. The social reform led by Roosevelt, such as assimilating African-Americans into the workforce, was a hopeful endeavor at best. Document I states that the federal government persisted in upholding segregation, although they increased employment opportunities. This African-American support was likely led by Roosevelt's desire to garner the support of African-Americans rather than genuine hospitality, which would explain its limited effectiveness. Furthermore, the lack of Federal attention to New Deal programs such as those stated in the Roosevelt Record is illustrated by the Evening Star in Document C. The cartoonist portrays the New Deal as part of a natural progression as a rebuttal to New Deal critics as a likely supporter, but this counterargument is not cogent. Since Roosevelt's attempt to appease every party by creating a myriad of programs stretched the federal government too thin, few policies remained significant. Therefore, the significance of the New Deal does not lie in what little it sought to accomplish but in the precedent it set for future federal governments during recessions. The use of Keynesian economics during the Great Depression was most recently adopted during the Great Recession and has since become the foundation for American fiscal policy.