New Deal

   Accepting the Democratic Party’s nomination in June 1932 President Franklin D. Roosevelt promised the American people “a new deal” to tackle the problems of the Great Depression. The phrase was used by the press to describe the legislative program he enacted following his successful election. The New Deal represented an unprecedented period of federal reform. It promised relief, recovery, and reform, and has traditionally been seen in terms of a “First New Deal” and a more radical “Second New Deal.” In the “First Hundred Days” the Roosevelt administration secured the passage of 15 major bills, reforming banking and investment, establishing relief agencies, and initiating programs of industrial and agricultural recovery. This was achieved through the Emergency Banking Act, Glass-Steagall Act, Securities and Exchange Act, Federal Emergency Relief Administration, National Industrial Recovery Act, and Agricultural Adjustment Act. Relief was also provided through the Public Works Administration, Civilian Works Administration, Civilian Conservation Corps, and Tennessee Valley Authority. The First New Deal ended in 1934.

   In the face of growing opposition from groups like the American Liberty League and such individuals as Huey Long, Father Charles Coughlin, Upton Sinclair, and Francis Townsend, some of whom appeared to offer more radical programs and growing labor militancy, the New Deal embarked upon a further wave of reform. Additional legislation was also needed as a consequence of the Supreme Court’s decision in Schechter Poultry Corp. v. United States declaring the National Recovery Administration unconstitutional. From 1935, a Second New Deal, including further legislation to tackle the continuing problem of unemployment and introduce several major reforms, began. The Works Progress Administration established a massive series of public works that eventually employed almost one-third of the unemployed. Reform came in the shape of the Social Security Act and the National Labor Relations Act or Wagner Act. The Social Security Act established a basic pension system and unemployment insurance, while the National Labor Relations Act guaranteed workers the right to organize and prohibit unfair labor practices on the part of employers. The Fair Labor Standards Act set minimum wage levels and maximum works hours in interstate commerce. Further housing reform was also initiated with the National Housing Act of 1937. At the same time, some attempt at wealth redistribution was evident in the Wealth Tax Act of 1935.

   The Second New Deal ran out of steam due to a further economic downturn, known as the “Roosevelt recession,” in 1937, and because of the political controversy occasioned by Roosevelt’s attempt at “court packing” to change the make up of the Supreme Court. Increasingly, too, foreign affairs began to dominate political concerns, and once the United States entered World War II, “Dr. Win the War” replaced “Dr. New Deal.”