The New Deal
The United States was in the worst of the Great Depression. Banks were in crisis, and nearly a quarter of the workforce was unemployed. Wages and salaries declined significantly, as did production. U.S. President Franklin D. Roosevelt’s New Deal (1933–1939) aimed to provide immediate economic relief and to bring about reforms to stabilize the economy.
In the summer of 1932, the New York governor, Franklin D. Roosevelt, was nominated as the Democratic Party's presidential candidate. Roosevelt addressed the depression problems in his acceptance speech by telling the American people, "I promise you, I pledge myself, to a new deal for the American people." Roosevelt won by a landslide in the election that took place in the fall of 1932.
The New Deal Roosevelt had promised the American people began to take shape immediately after his inauguration in March 1933. The first days of Roosevelt's administration, based on the assumption that the federal government's power was needed to get the country out of depression, saw the passage of banking reform laws, emergency relief programs, work relief programs, and agricultural programs. A second New Deal was later to evolve which included the Social Security Act's union protection programs and programs to assist tenant farmers and migrant workers. Many acts or agencies in the New Deal came to be known by their acronyms. The Works Progress Administration, for example, was known as the WPA whereas the Civilian Conservation Corps was known as the CCC. Many people remarked that the New Deal programs reminded them of alphabet soup.
The Second New Deal
Despite the introduction of several new laws and regulations with the First New Deal, the Great Depression continued and things were not getting any better. President Roosevelt decided in 1935 to try a new round of laws and regulations that would fix the economy. The laws passed between 1935 and 1938 are often referred to as the "Second New Deal."
One of the most important aspects of the Second New Deal was the Social Security Act passed in 1935 to assist elderly people in their retirement, to provide retirement pensions, to care for orphans and the disabled, and to establish a system of unemployment insurance.
The Works Progress Administration (WPA) was formed to aid with high unemployment. The WPA hired jobless workers to build various public projects such as airports, schools, roads, parks, and bridges. Over the next several years the WPA hired around 8 million workers.
In 1935 Congress passed the National Labor Relations Act. It guaranteed certain rights to unions and to workers. It also set up a federal board to help both sides come to salary agreements. In 1938, another labor law was passed which was called the Fair Labor Standards Act. This law protected workers with a maximum working week (44 hours), a minimum wage (25 cents per hour), and prohibited child labor.
One of the last new deal agencies established was the United States Housing Authority of 1937. This agency tore down slums and built new, better housing for the homeless.
By 1939, the New Deal had run its course. In the short term, New Deal programs helped improve the lives of people suffering from the events of the depression. In the long run, New Deal programs set a precedent for the federal government to play a key role in the economic and social affairs of the nation.
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