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THE NEW DEAL

LISERO O. MUGULA

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POLS 1101

AMERICAN GOVERNMENT

1/27/2018

DR. ANDREA M. PETERSON

 

 

 

 

 

 

 

 

 

 

 

 

Franklin D. Roosevelt and The New Deal

The New Deal was a series of government programs and projects meant to help recover from the effects the Great Depression of 1929 had in the United States of America. Some of these effects included critically low levels of unemployment in many states. The New Deal was introduced in 1933 by President Franklin Delano Roosevelt. President Franklin D. Roosevelt was the type of president that instilled hope in people which made the impossibility of change possible to numerous American minds. He believed that “the only thing we have to fear is fear itself.” (History.com Staff, 2009). This made the American populace feel they elected the right person.

 

Relief, Recovery & Reform

            The new deal was developed on the basis of three major objectives: Relief, Recovery, and Reform. One in four Americans were unemployed by 1933 (“The New Deal,” n.d.). Numerous programs meant to put the American people back in employment were introduced. For example, the Civilian Conservation Corps assisted young men in achieving employment, the Civil Works Administration and the Public Works Administration gave jobs to other unemployed Americans, the Wagner Act made the existence of unions possible and the Home Owners Loan Corporation helped Americans pay their own mortgages etc.

            The second goal of The New Deal was economic recovery. A lot of money was put into numerous public works programs. These programs increased employment which allowed the American people to generate income which could be used to purchase various items. The Tennessee Valley Authority helped initiate the industrialization of the South by providing them with electricity. They did this by constructing dams which utilized the force of water.

            The final goal of The New Deal was Reform. The great depression was devastating to the American people. Clearly, changes had to be made to prevent this from ever happening again. The Security and Exchange Commission supervised the stock market to guarantee no fraudulent activity was taking place, the National Industrial Recovery Act was an association of businesses that worked together to reduce the effects of the Great Depression and the Soil Conservation Act were laws put into effect meant to maintain the fertile soil. The intention was to avoid another dust bowl etc.

Alphabet Agencies

            The Alphabet Agencies are also known as the New Deal Agencies. This is because they were U.S. federal government agencies brought into effect after the introduction of the New Deal implemented by President Franklin Roosevelt. Some are still in effect up to this day.

·       Federal Deposit Insurance Corporation

The Federal Deposit Insurance Corporation is a U.S. government agency that offers insurance to people who deposit in U.S. banks. The FDIC is governed by The Banking Act (1933). What made the introduction of such an agency necessary? According to FDIC, between 1929 and 1933, “bank failures resulted in losses to depositors of about $1.3 billion” (FDIC.gov, 2014). Since the introduction of FDIC, the banking industry will still function even after large withdrawal amounts from numerous people.

 

·       Federal Crop Insurance Corporation

The Federal Crop Insurance Corporation manages the federal insurance program. FCIC offers insurance for the crops that U.S farmers plant. At the time of the Great Depression, farmers believed that they could sustain themselves with food because they could simply plant their own crops. However, this assumption turned out to be false. The Dust Bowl drought made planting crops difficult.

Without crops, farmers were unable to supply themselves with food neither could they make money of their harvests. In time, the 1994 act made involvement in the FCIC program compulsory to those that desire deficiency payments. As a result of mandatory involvement, the Catastrophic Coverage was created. According to USDA, “CAT coverage compensated farmers for losses exceeding 50 percent of an average yield paid at 60 percent of the price established for the crop for that year” (USDA, n.d). This agency was necessary to keep agriculture alive thus reviving the economic state of USA.

 

·       Federal Housing Administration

The Federal Housing Administration is a government agency that sets certain criteria for construction and insures loans coming from banks or private loaners for construction of homes. Before the FHA was created, the housing industry was in disarray. Construction workers were unemployed, criteria were difficult to attain for homebuyers and America was generally a nation of renters- 4 in 10 households owned homes (HUD.gov, n.d). FHA makes the conditions and standards of homes better. FHA provides equilibrium to the mortgage market.

 

·       Social Security Administration

The Social Security Administration is a federal government agency that provides Social Security (Disability, Survivor benefits, Retirement etc.) meant to secure the survival of the elderly. This guaranteed that retired Americans would be able to spend money for the rest of their lives all in the effort to maintain the economic state of the U.S.

 

·       Securities and Exchange Commission

SEC was an agency created in 1934. It helped manage the buying and selling of stocks, bonds plus further securities. The Securities and Exchange Commissions objectives can be divided into three main goals: to secure investors; maintain just, law-abiding markets and facilitate capital formation.

Minorities and Women

During the time of the Great Depression, women were easily disregarded as a result they went unrecognized. Most of the programs of The New Deal were targeted towards the white people. The main advocate women had at this time was Eleanor Roosevelt, President Franklin Roosevelt’s wife. She knew women were under a great deal of pain because of the Great Depression (more so working women). Eleanor Roosevelt pushed those responsible for introducing the relief programs to make sure that women get a chance at employment. As a result, Harry Hopkins, one of President Franklin Roosevelt’s closest advisors created a woman’s division in the Federal Employment Relief Program. Henceforth, the way women were looked at by the economy took a turn for the better.

Minorities was another group that benefitted the least from the New Deal. It was hard for racial minorities to tell the difference between normal economic times and the Great Depression because it was pretty much the same thing for them, only worse. Minorities were discriminated upon daily. They were the first ones to lose their jobs and the last ones to be considered for employment. Violence against minorities rose during the Great Depression as whites fought for positions previously held by minorities. Nevertheless, the New Deal did benefit some minorities however so slightly. For example, in 1935, Black Americans began to experience some reforms. The Roosevelt administration brought racial discrimination in some federal programs to an end, blacks were allowed to serve in some federal positions etc. Eleanor Roosevelt’s determination to end discrimination helped minorities gain a fighting chance and would soon lead to liberty.

Significance of the New Deal

            The New Deal helped provide immediate resolutions to the economy and long-term changes to the country. It provided employment for the general population, it helped reduce racial discrimination, encouraged the construction of infrastructure such as schools, hospitals, amusement parks etc. It also showed the weaknesses of America as a whole country and how efficient they can be as a country at the same time. The New Deal forced both state and federal governments to work together to resolve the effects of the Great Depression. 

Conclusion

Regardless of the numerous downfalls, the New Deal had on the economy and certain minorities, it definitely had more benefits as a whole. The whole country experienced decline because of The Great Depression. Something had to be done or the whole populace would have fallen. The New Deal alleviated economic and social despair and brought the USA to an even greater glory. It may not have completed eliminated the effects of the Great Depression, but, it set the stage for democracy, liberty, and equality.  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

REFERENCES

History.com Staff. (2009). New Deal. Retrieved January 27, 2018, from http://www.history.com/topics/new-deal

The New Deal. (n.d.). Retrieved January 27, 2018, from https://livingnewdeal.org/what-was-the-new-deal/

FDIC. (2014, January 2). Federal Deposit Insurance Corporation. Retrieved January 27, 2018, from https://www.fdic.gov/about/history/timeline/1930s.html

USDA. (n.d.). History of the Crop Insurance Program. Retrieved January 27, 2018, from https://www.rma.usda.gov/aboutrma/what/history.html

HUD.gov. (n.d.). The Federal Housing Administration (FHA). Retrieved January 27, 2018, from https://www.hud.gov/program_offices/housing/fhahistory

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