The New Deal 1933-2939

The New Deal 1933-2939

1933-1939 periods were one of the most critical periods in the American History. Around 1929, Americans faced unremitting economical privation, where complete reformation was required in order to restore its economical health. The Great Depression of America destroyed its confidence and trusts in the government, furthermore, the causes of the Great Depression were merely due to the failure of the economical status of America. President Franklin D. Roosevelt- one of the greatest American presidents of his time and elected by the Democrats- proposed a treaty to be called the New Deal of 1933-1939. The New Deal projected new principles for government interference in the economy. The steps the New Deal acquired many Americans to restore their financial status or even gain one. Although the New Deal did not end the Great Depression, it helped America gain some of its confident back and generate some deals that helped many Americans.

Firstly, domestic and worldwide conditions in the USA as early as 1929 were the causes of the American Great Depression. Many economical and social inequality conditions in the United States led to the failure of the American civilization. The main causes that led to depressing the American economical society were: -according to The American Pageant pg 762

1. " plague of plenty" Overproduction by farming and manufacturing works- due to the high levels of unemployment, hence, poor financial status; a slight amount of people were able to purchase goods.

2. "The nation's capability to produce goods had clearly exceeded its competence to consume or pay for them". Once again, not everyone afforded buying goods, hence, controlling the market, since the wealthy were few.

3. "Over expansion of credit through instalment-plan buying over stimulated production- citizens"- citizens were putting themselves in debt more than they can burden.

4. Europe's crisis and its reflection to the American economy: reaction to the financial collapse in Europe.

5. The Drought in the Mississippi Valley.

The result was high unemployment rate, collapse of financial and economical system.

Secondly, Franklin D. Roosevelt promised to stabilize the nation's budget and reduce the heavy Hooverian shortfall. The first step he took was holding the "Hundred days Congress", where a series of laws and regulations were passed to cope with the national emergency. "Roosevelt's New Deal programs aimed at three R's- relief, recovery and reform" (pg 775). The three R's program had two goals; short-term and long-term. Short term recovery were instant recoveries, whereas long term where permanent recoveries. The New Deal embraced progressive ideas such as unemployment insurance, old-age insurance, minimum-wage regulations, conservation and development of natural resources and restrictions on child labour (pg 775). Embracing these ideas was thought to put an end to such National Emergency, and they will be briefly discussed. Moreover, the congress gave the president "Blank-check powers" where the president had full legislative authority. Most of the bills Roosevelt passed formed new government agencies. Each Agency held a goal of reducing/ dealing with the specific problem and tried to solve it. For instance, Emergency Relief Act of 1933- gave the president full authority of controlling banking transactions and foreign affairs. He cancelled the gold-payment clause, and ordered all private holders of gold to exchange it with the treasury box. According to him " ..." managed Currency" was inflation, which he believed would relieve debtor's burdens and stimulate new production" ( pg 776). Such strategy increased the amount of the currency in flow. In addition, immediate relief was presented to farmers to meet their loan mortgage by passing the "Agriculture Adjustment Act (AAA)". Similar act was passed to help those with house loan mortgage to pay, Home Owner Loan Corporation (HOLC), where it assisted many households to repay their mortgage.

Unemployment was one of main disasters; unemployment was relatively high and intolerable. The Congress's first step towards the unemployment was passing the "Federal Emergency relief Act" its goal was immediate relief. "Roosevelt had no hesitancy about using federal money to assist the unemployment and at the same time to "prime the pump" of industrial recovery" (pg 776). One of the responses to the high rate of unemployment was the Civilian Conservation Corps (CCC) - this law provided job for the unemployed in the movement camps; in restoration, fire fighting, flood control and swamp drainage. Furthermore, National Recovery Administration was by far the most important and complex relief. It was both long-term and immediate relief, it motto was "fair competition". It Acted both on labour, industry and the unemployment; minimum-wage was established with less work hours, leaving a chance for others to work, hence hiring more people- once again " fair competition". However, the attempts to aid employment did not just end there. Another agency was formed; Public Work Administration (PWA), this agency both acted on unemployment relief and industrial recovery, it dealt with public projects such as highways and public buildings "long range recovery was the primary purpose of the new agency and in time over $4 billion was spent on some thirty-four thousand projects, which included public building, highways, and parkways."(pg 782)

Another step the congress took was