Friday, March 29, 2013

Chapter 33

The great depression and the new deal
FDR: A Politician in a Wheelchair
1932 was worst year of the Great Depression
an election year.
Hoover ran for reelection saying what he was doing was helping the situation.
The Democrats nominated Franklin Delano Roosevelt, better known as FDR.
He was articulate with his words and conveyed a sense of caring.
His wife, Eleanor Roosevelt, was also active in politics.
She would by far become the most involved First Lady up to that time, maybe of all time.
Presidential Hopefuls of 1932
Hoover used slogans like "The Worst is Past" and "It Might Have Been Worse." Folks just looked around and saw through those words.
FDR won the election in a landslide, 472 to 59 in the electoral vote.
Cynical opponents of FDR said he purposely allowed things to get worse just so he could emerge that much more as the savior.
In essence, FDR was saying, "If we don't panic, we'll be okay. Confidence!"
Congress was controlled by far by the Democrats. Anything FDR wanted passed, was passed.
Roosevelt Manages the Money
In only eight hours, Congress passed the Emergency Banking Relief Act which set up the bank holiday.
To create inflation, FDR ordered the Treasury to buy up gold at increasingly higher prices. $35 per once became the norm for 40 years. This meant more paper money in circulation, which is less valuable than gold, and did cause inflation.
Creating Jobs for the Jobless
FDR was willing to use government money to help those in need. One of his main weapons was to "prime the pump", or use federal money on programs in hopes that it would jump start the economy to run on its own.
In the CCC, young men were hired to work in the national forests. They lived in camps like boy scouts and did things like clearing land, blazing trails, planting trees, draining swamps, etc.
He proudly said they'd spend, tax, and get themselves reelected. Others saw this scheme as simply taking one person's money in taxes and giving it to another person to buy his vote.
Notably, the Great Migration was wrapping up at about this time. It's the massive movement by blacks from the rural South to the cities up North. It roughly went on between 1910 and 1930.
A Day for Every Demagogue
He was first pro-FDR, then very much anti-New Deal. He eventually went overboard and was silenced by higher-up clergy.
One of the more flamboyant critics was Sen. Huey Long of Louisiana. He ranted about a "Share the Wealth" plan and promised "every man a king."
He spoke of giving $5,000 per family to the poor, likely taking it from those who had it. The mathematics of the scheme were silly.
King got passionate responses. Many down-and-out folks loved him. Many despised him and feared he might become some type of dictator. One person assassinated him, in 1935.
Many students were set up with part-time jobs. Work was also drummed up for artists and writers, although it was often boondoggling: John Steinbeck, future Nobel literature prize winner, counted dogs in Salinas county California.
There was some other waste, like controlling crickets and building a monkey pen.
New Visibility for Women
After having the right to vote for over 10 years now, women began taking a more active role in things. Leading the way was Eleanor Roosevelt but there were other ladies too.
Frances Perkins was the first female cabinet member as Sec. of Labor.
Mary McLeod Bethune was in charge of the Office of Minority Affairs. She was the highest ranking black in FDR's administration. She later held found a college in Daytona, FL.
Ruth Benedict, an anthropologist, studied cultures as personalities in Patterns of Cultures.
One of her understudies was Margaret Mead. She wrote the landmark anthropology book Coming of Age in Samoa about adolescence in that culture.
Novelist Pearl S. Buck wrote the timeless The Good Earth about a peasant farm family in China. She won the Nobel prize for literature in 1938.
Helping Industry and Labor
Labor unions were given the right to organize and collectively bargain. Antiunion yellow-dog contracts were forbidden; child-labor was curbed.
Businesses could agree to go along with the NRA's principles. If they did, they displayed the blue NRA eagle and slogan, "We do our part."
There was enthusiasm for the NRA. Philadelphia named their new pro football team the "Eagles." Still, FDR knew the NRA was a gimmick in essence, and temporary, saying, "We can't ballyhoo our way to prosperity."
In the same law as the NRA, Congress had set up the Public Works Administration (PWA). Like the PWA, it sought to build public works and infrastructure.
Early on, FDR and the Democrats passed legislation legalizing beer and wine with alcohol not over 3.2%.
The Twenty-first Amendment (1933) repealed the Eighteenth, thus ending the prohibition of alcohol.
Paying Farmers Not to Farm
The Agricultural Adjustment Act (AAA) tried to help farmers by creating "artificial scarcity." It paid farmers to not farm, thus reducing the supply.
The AAA's start was shaky. Cotton farmers plowed under already planted crops. Pigs were slaughtered and some of the meat turned to fertilizer. The law seemed cruel and wasteful.
Farm incomes did rise, but farmer unemployment rose too.
The Supreme Court ended the AAA when it declared the AAA unconstitutional in 1936.
Congress passed the Soil Conservation and Domestic Allotment Act. It paid farmers to plant crops that preserved and reinvigorated the soil, like soybeans. The Supreme Court went along with this plan.
A Second Agricultural Adjustment Act was passed in 1938. Farmers were encouraged to plant less acreage in exchange for payments. Again, it was simply payment to not farm.
Dust Bowls and Black Blizzards
A long drought hit the lower Plains in 1933. The winds kicked up and started the Dust Bowl. The fertile topsoil of many farms simply blew away, mostly in parts of Oklahoma, Kansas, and Texas.
With the farms not unable to grow crops, many people headed west to California in search of farm-jobs. This inspired John Steinbeck's classic novel The Grapes of Wrath about the "Okies" long,tough trip looking for work.
The Resettlement Administration (1935) tried to resettle farmers onto better soil.
The CCC boys planted 200 million trees trying to grow windbreaks.
The government's relationship with the Indians was changing again.
Battling Bankers and Big Business
The Securities Exchange Commission (SEC) was set up as the stock watchdog.
The TVA Harnesses the Tennessee River
The electricity industry attracted New Dealers. They felt electricity companies of gouging consumers with high rates. They also wanted to expand electricity to rural areas.
The Tennessee Valley Authority (TVA) was set up in 1933 to build a series of dams along the Tennessee River.
This would be a "double-barreled" plan: provide jobs, help with housing via the jobs, provide electricity.
The TVA's area would help improve the lives of some 2.5 million people.
Housing Reform and Social Security
It was a popular program and outlasted FDR and the New Deal.
These laws helped stop the growth of slums.
The Social Security Act (1935) was perhaps the most far-ranging law.
It set up a payment plan for old age, the handicapped, delinquent children, and other dependents.
The payments were funded by taxes placed on workers and employers, then given to the groups above.

A New Deal for Labor
Unskilled workers began to organize. They were usually left out because, being unskilled, they were easily replaced in a strike.
John L. Lewis, head of the United Mine Workers, organized the Committee for Industrial Organization (CIO) which admitted the unskilled.
Some Democrats joined Republicans to form the American Liberty League. It didn't like the "socialist" direction the New Deal was taking America.
But, with FDR's wide popularity, the election was almost a moot point. FDR won 523 to 8 in the electoral vote.
FDR won because he never forgot the "forgotten man."
Nine Old Men on the Bench
Congress was shocked at this little disguised attempt at power-grabbing. Congress didn't want the power see-saw to tip too far toward FDR, and for once, FDR did not get his way. Congress voted no. This was perhaps FDR's first mistake and his first loss.
The Court Changes Course
FDR was widely accused of trying to turn dictator.
Although the "court-packing scheme" was voted down, the Court did begin to sway FDR's way. Formerly conservative Justice Owen j. Roberts started to vote liberal.
For examples, by a 5-to-4 vote, the court upheld minimum wages for women. The court upheld the Wagner Act and the Social Security Act.

Despite the New Deals plethora of spending and programs, the depression did not go away during Roosevelt's first term.
The economy took a second downturn in 1937. The "Roosevelt Recession" was caused the government's policies.
Social Security was cutting into people's take-home pay, and thus, their spending power.

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