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FDR's Economic Planning and Policies

By caylahmanuel Dec 16, 2013 1354 Words
Franklin Delano Roosevelt was our nations thirty second president. Unlike all the other presidents Franklin Delano Roosevelt was elected for four consecutive terms. However he died in the first year of his fourth term. During his lengthy presidency F.D.R. did many incredible things as our Nation’s leader. He pulled us out of the great depression, dealt with civil rights issues, created many reforms for our nation including the twenty-first amendment, handled the attack on Pearl Harbor, and handled World War Two efficiently. During the weeks preceding Roosevelt's inauguration, the country was engaged in an economic crisis that was quickly spiraling downward. Banks failed, people panicked, and the nation looked to someone, anyone, for help. Hoover, sensing the country's desperation, but realizing his lack of power, and the feelings of resentment towards him, looked to Roosevelt. He asked the president to join in economic planning, support policies, and most importantly to reassure the nation. When Roosevelt became president, the Great Depression was at its worst. Sixteen million or more people were unemployed, and many had been out of work for a year or even longer. The American banking system had collapsed. Whether Americans would be happy with the new leadership depended on Roosevelt's success in bringing aid to those in distress and in achieving some measure of economic improvement. Franklin D. Roosevelt's administration was able to create many laws that benefited the people, however the people complained that they were not created fast enough, even though they were effective and had a lasting impact on the federal government. When Roosevelt became president, he immediately called a special session of Congress to deal with the depression rather than wait for the regular session in December. The legislation passed by Congress and signed by Roosevelt in the spring of 1933 was remarkable. The time was called the Hundred Days. The special session had been called to deal with the banking crisis, economy in government, and changes to the liquor law. Congress quickly responded to the crises. The Emergency Banking Act was created, passed, and signed by the president during a single day and it gave the federal government sweeping power to deal with the banking crisis. The Beer Act made it possible to sell beer, which had been illegal under the 18th Amendment. The Economy Act reduced government salaries and pensions to meet Roosevelt's campaign pledge. The basic New Deal legislation was passed in slightly more than five years, from 1933 to 1938. Solutions were found for the problem of the unemployment. The Federal Emergency Relief Administration gave large amounts of money to the states. The subdivision to the FERA was the Civil Works Administration, which provided work relief for a large number of men during the winter of 1933 and 1934. In 1935 a new organization, the WPA was set up by executive order and the FERA was abolished. The WPA built roads, streets, schools, libraries, and other public buildings. Congress designed two relief operations specifically for young men, the Civilian Conservation Corps and the National Youth Administration. The most spectacular agency designed to promote general economic improvement was the National Recovery Administration, an organization set up NIRA, which was passed by Congress in June 1933. The NRA was designed to help business help itself by eliminating unfair competition through the establishment of codes of fair competition. Unfortunately, the NRA did not work as its supporters had hoped, and the NRA was unanimously declared unconstitutional by the Supreme Court of the United States in 1935. However one of the New Deal reforms that did work was the Tennessee Valley Authority. The TVA built a series of dams for power production, flood control, navigation improvement, and cheap fertilizers. It distributed its own hydroelectric power to many who never before had enjoyed the benefits of electricity. As a result, the standard of living of the people in its area steadily improved. The reform that did the most good was the Social Security Act of 1935. The act gave unemployment insurance, old-age pension, child care and benefits for the blind however; the act did not cover health insurance. It was paid for by employers, employees, and the federal government. It is still in use today. Congress passed the National Labor Relations Act to replace the National Industrial Recovery Act, which now guaranteed to workers the right to organize and bargain collectively. The Fair Labor Standards Act of 1938 set a minimum wage and a limit to the hours worked. Solutions to the Great Depression had different responses and impacts on the federal government. One of the solutions that Franklin Roosevelt set up was a Public Works Administration and he put it under the jurisdiction of Secretary of the Interior, Harold L. Ickes. The PWA built huge public buildings, great dams, and irrigation and flood-control projects. A special recovery agency for one major segment of the economy was developed called the Agricultural Adjustment Administration. It was set up in the Department of Agriculture and supervised by Secretary Henry A. Wallace. The AAA sought to eliminate overproduction of basic crops and thus to bring prices back to the average prices of the period from 1909 to 1914, a time of agricultural prosperity. The AAA was declared unconstitutional by the Supreme Court in 1936. Congress established a voluntary system in 1936 for the same purposes as the AAA as a replacement until in 1938 the second AAA was created. Another issue was in banking. A solution for some of the problems was the banking legislation. It created insurance for small savings depositors, separated commercial and investment banking, and greatly increased the authority of the Federal Reserve Board, the government agency that oversees banking activity. Related to these reforms was the establishment of the Securities and Exchange Commission, an independent agency empowered to regulate the sale of stocks and bonds. Roosevelt appointed a new Secretary of State, Senator Cordell Hull. Hull felt that his main duty should be to eliminate trade barriers by lowering import tariffs. He proposed the Reciprocal Trade Agreements Act, and it was passed and is one of the most resourceful of the New Deal measures. The act authorized the president to negotiate agreements with other nations for a mutual lowering of import taxes, and took tariff making out of the hands of Congress. The federal government also became involved with housing. In the depths of the depression many people lost their homes because they were unable to pay their mortgages causing lending institutions then seized these homes. Two of the most popular New Deal agencies were the Home Owners' Loan Corporation and the Federal Housing Administration, which were set up to help rebuild and encourage low-cost housing construction. This was the first direct involvement of the federal government in building houses. To make many of the necessary "repairs" to America, Roosevelt's administration had to change some things in the federal government. The first thing that Franklin Roosevelt changed was his Secretary of Labor. The new person was the first female Cabinet member, Frances Perkins. From 1933 to 1938, Congress passed reforms that increased the existing regulatory activities of the federal government causing the administrations to be involved in regulating many more areas of economic activity than they had been. Beginning in 1935, the economy began to recover and the labor movement, encouraged by New Deal legislation, began to be effective. In addition the Supreme Court began to declare New Deal legislation unconstitutional. These developments encouraged conservatives to oppose the administration causing middle-class support for the New Deal began to slip away between 1937 and 1938, and the Democratic Party became more than ever the party of urban labor. Roosevelt created a plan called the court-packing plan. It was a scheme to enlarge the Supreme Court that he suddenly presented to Congress in 1937. The plan did not pass. Despite many people being out of work during the Great Depression, and the almost complete and total collapse of America, there were some benefits. Some of the laws that were passed then are still in place today and it was able to change some of the aspects of our government. All in all the Great depression had some very effective results due to the unity of the American people.

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