NEW DEAL

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FDRS

• NEW DEAL

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Causes of Great Depression that had to be fixed

• Foreign GLOBAL problems
• Europe bankrupted by Dawes Plan, etc
• Tariffs Wars
• Overproduction/Overspeculation
• Unstable Banking policies
• Unstable Labor policies

How we wish it worked
How it really works
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Fix them with

• Relief (get people food and shelter)
• Recovery (get people jobs, so they will spend, so
  that factories will re-open)
• Reform (change some the basic beliefs of
  Laissez-Faire Capitalism. Adam Smith was WRONG.
  This time the boat cant right itself)
• See pages 781 and784. Know them!!!!

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VOTE AGAINST HOOVER
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Hoover tried to help, but he was tied to his
background

• RFC unprecedented government spending, but only
  in the old Trickle-Down ideology.
• Hoover Dam and other projects
• But in the end he was a classical economist
• Went fishing to appear confident
• Mishandled the Bonus Army
• Created the word Depression to replace Panic

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5th cousin to Teddy

• People want the Big Stick used.

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1932 election results

• Republicans run Hoover again and get 40 of the
  popular vote
• Democrats run FDR and get 60 of the popular vote

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• Hoover and FDR 1933 on their way to swearing in
  FDR
• Elected in even years--but you take office in the
  following odd year.
• What is the author saying about the two men?

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The real advocate for the poor. Especially African
American
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The poorest are always hit the hardest
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Eleanor at soup kitchen
When the 2nd Bonus Army marched FDR Did little
more than Hoover, except to Move them
further Away from the Capital and send Eleanor
out to serve Them free food.
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Okies-- "Grapes..."
Sooners Lose again
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FDR Inspired Confidence
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But is confidence enough???
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Was it THAT Great

• 25 unemployment
• 20 under-employment
• No one starved
• Consumerism plummets, and therefore
• But

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After 4 years Of Hoover, and an ineffective
Congress everyone was willing to let FDR lead
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No Real Plan

• Try something
• Keep what works
• Throw out what doesnt
• Try something else
• Etc.
• Etc.
• But usually too much Relief -- not enough Reform
  and not enough spending

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Keynesian Economics

• Govt must SPEND itself out of depressios
• Lower taxes ( saved by people will be spent,
  thus increasing production and jobs, thus)
• Increase govt handouts to the poor ( taken by
  people will be spent, thus increasing production
  and jobs, thus)
• Increase govt projects (jobs received by people
  will create , which will be spent, thus
  increasing production and jobs, thus)

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FDR was NOT (ever) a Keynesian

• Believed in a balanced budget
• Only doubled the budget (when Keynes called for
  10 times as much)
• Cut military spending to get the money for his
  projects
• 1933 Economy Act cut federal spending by 243
  Million, when he asked to cut 500 Million.
• Repealed ALL veterans pensions and benefits (2nd
  Bonus Army goes to D.C.)
• Cut all programs in 1937 when it looked like the
  US was recovering
• Created 2nd Great Depression
• THEN he STARTED to believebut not enough

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• Emergency Banking Relief Act
• Beer Act
• Unemployment Relief Act
• CCC
• Off the gold standard
• FERA
• AAA
• TVA
• HOLC
• NRA, PWA
• Glass-Steagall Act/ FDIC

100 Days Congress
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• Of course this all costs
• Only relieves the pain
• Politically
• Father Coughlin
• Huey Long
• Dr. Townsend
• Forces FDR to accept unacceptable solutions
• He NEVER accepts Keynesian economics
• But he does expand his 3 Rs.
• Constitutional excesses and the Supreme Court

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• Spending has to go up
• Taxes (on the rich) have to go up
• But taxes will not equal spending
• Cant raise tariff
• Deficit has to go up
• According to Keynes--its still not enough

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According to the wealthy -- Its way Toooo much
Look mom, he's writing a dirty word
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ALPHABET SOUP
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Emergency Banking Relief Act FDIC SEC
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Emergency Banking Act

• Temporarily closes all banks until
• They can be inspected, and good-sound banks
  reopened.
• Within days all banks are reopened (Relief)

Glass-Steagall Act or FDIC

• All banks put a of funds into the FDIC fund.
  Then if your bank goes under you get up to 5,000
  back (Reform)

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Managed Currency (reform)

• OFF the Gold-Standard
• Created needed inflation
• 1934, reinstates gold for international payment
  to keep foreigners accepting of US currency

Securities Exchange Commission

• A government agency to investigate stock market
  fraud

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AAA
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The Federal Art Project part of WPA
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Dallas Fairgrounds
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Appeasing Labor

• NIRA Act that created
• NRA (later declared unconstitutional)
• NLRB (Wagner) replaces NRA and gives collective
  bargaining to labor
• CIO for unskilled labor thrives
• Outlawed yellow-dog contracts
• Fair Labor Standards Act--minimum wage

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Supreme Court Fights back

• Declared Unconstitutional
• AAA (illegal tax on food processorsI told you he
  wasnt a Keynesian)
• NRA Too much control over private industry
• 5 other major New Deals
• They believe that Congress has illegally turned
  over the functioning of the Legislative Branch to
  the Executive Branch, thus destroying the
  Constitutional separation of Powers

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FDR fights backbut loses (sort of) for the 1st
time

• Tries to raise the number of justices to perhaps
  15 (court packing)
• Public outcry forces FDR to back down
• BUT, a frightened Supreme Court begins to support
  FDR

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Demagogues

• Father Coughlin (starts as New Dealer, becomes
  vehement anti-semite)
• Dr. Townshend (Give 200 per month to old people
• Huey Long (The Kingfish, Share the Wealth
  Program)
• Because FDR keeps things at least stable
• (no real improvement either) these people
• dont become our Hitler

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TVA

• Creeping socialism????
• Or capitalism reformed?

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1st female cabinet member Secretary of Labor
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But 1st FDR had to create jobs
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CCC
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2nd AAA Soil Conservation Act Domestic allotment
act Resettlement Admin. Frazier-Lemke Act
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WPA to build ??useful?? projects
1935 -- Hopkins
We Provide Alms
11,000,000,000 9,000,000 Jobs
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Dams, Highways, etc.
PWA--Ickes 4,000,000,000 34,000 projects
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FERA camp
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Local Govt also spendingHarlem City Pool
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1926
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1936
1932
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1938
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WWII really ends the

• GREAT DEPRESSION
• Billions for the 3 Rs Trillions for the war

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