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Alternative meaning: New Deal (United Kingdom)

The New Deal is the name given to the series of legislative initiatives passed by Franklin Roosevelt with the goal of stabilizing and stimulating the United States economy in the Great Depression. It had three parts (the 3-Rs): Relief, Recovery and Reform. Relief was the immediate effort to help the one-third of the population that was hardest hit by the depression. Roosevelt expanded Hoover's FERA work relief program, and added the CCC, PWA, and (starting in 1935) the WPA. In 1935 the Social Security and unemployment insurance programs were added. Separate programs were set up for relief in rural America, such as the RA and FSA. Recovery was the goal of restoring the economy to pre-depression levels. It involved "pump priming" (deficit spending), dropping the gold standard, efforts to re-inflate farm prices that were too low, and efforts to increase foreign trade. Much of the New Deal's efforts to help corporate America was channelled through a Hoover program, the Reconstruction Finance Corporation (RFC). Reform was based on the assumption that the depression was caused by the inherent instability of the market and that government intervention was necessary to rationalize and stabilize the economy, and to balance the interests of farmers, business and labor. It included the NRA (1933), regulation of Wall Street (SEC, 1933), the AAA farm programs (1933 and later), insurance of bank deposits (FDIC 1933) and the Wagner Act encouraging labor unions (1935). Despite urgings by some New Dealers, there was no major anti-trust program. Roosevelt said that he opposed socialism (in the sense of state ownership of the means of production), and only one major program, the TVA (1933), involved government ownership of the means of production. Whether the New Deal was successful in achieving the 3-Rs, and whether the program had a beneficial or deleterious effect, remains a topic of heated debate. The New Deal is also used to describe the New Deal Coalition that Roosevelt created to support his programs, including the Democratic party, big city machines, labor unions, European and African-American minorities or ethnics, and farm groups. By 1934, the Supreme Court began declaring significant parts of the New Deal unconstitutional. This led Roosevelt to propose the Court-packing Bill in 1937. Although the bill failed, the Lochner era soon ended when Supreme Court Justice Owen Roberts switched his vote in several critical New Deal cases, and Roosevelt soon had the opportunity to appoint new Justices as the old Lochner court retired. By 1942, the Supreme Court had almost completely abandoned its attempts to second-guess Congress's economic policy, ruling in Wickard v. Filburn that the Commerce Clause covered almost all such regulation.

The Origins of the New Deal

On October 29, 1929, the crash of the U.S. stock market—known as "Black Tuesday"—reflected a trend of a worldwide economic crisis. In 1929-1933, unemployment in the U.S. soared from 3 percent of the workforce to 25 percent, while manufacturing output collapsed by one-third. Prices declined, especially for farm products. Heavy industry, mining, lumbering and agriculture were badly hit. The impact was much less severe in white collar and service sectors, but every city and state was hit hard.

Upon accepting Democratic nomination for president on July 2, 1932, Roosevelt promised "a new deal for the American people," a phrase that has endured as a label for his administration and its many domestic changes. Meanwhile, other governments worldwide exacerbated economic recovery by continuing protectionist policies (high tariffs, import quotas, and barter agreements)—the very cause of the collapse of world trade in the late 1920s with its resultant job loss. Britain led by the Labour party, was unable to adopt major programs to stop its depression. That led to collapse of Labour and replacement in 1931 by a National coaltion (predominantly Conservative). As a result there was no "new deal" in Britain. In Nazi Germany, economic recovery was pursued through wage controls, suppression of unions, and spending programs such as public works; large-scale rearmament came later in the 1930s. In Mussolini's Italy, the economic controls of his corporate state were tightened. In the Soviet Union, Stalin continued his massive program of economic planning and state ownership. The apparent failure of capitalism led many Americans to flirt with communist or fascist ideology.

Roosevelt entered office with no single ideology or plan for dealing with the depression. He was willing to try anything, and indeed in the "First New Deal" (1933-34) virtually every organized group (except Socialists) gained much of what they demanded. This "First New Deal" thus was self-contradictory, pragmatic, and experimental. The economy eventually recovered from the deep pit of 1932, and started heading upward again until 1937. Whether the New Deal was responsible for the recovery, or whether it even slowed the recovery, is a subject of debate.

The New Deal drew heavily on the experiences of its leaders; it reflected the ideas of, and was influenced by, the programs that Roosevelt and most of his original associates had absorbed in the progressive era, while serving in the Wilson administration, especially the emergency of World War I. Some New Dealers, led by Louis Brandeis and Thurmond Arnold tried to revive the Progressive crusade against monopolies, but made little headway. Other New Dealers, such as Hugh Johnson of the NRA harked back to the wartime controls and spending of 1917-1918. Roosevelt brought together the Brain Trust of academic advisors.

The First Hundred Days

Having won a decisive victory in the 1932 presidential election, and with his party having decisively swept Congressional elections across the nation, the new president entered office with unprecedented political capital. Furthermore, many Congressmen had their favorite projects, like the TVA plan of Senator George Norris, which the administration adopted and treated as its own. Finally there were numerous Hoover plans that the discredited Hoover could not get passed but were ready to go, such as the emergency banking laws. Americans of all political persuasions were demanding immediate action, and Washington responded with a remarkable series of new programs in the “first hundred days” of the administration.

The "bank holiday" and the Emergency Banking Act

Upon taking office the administration moved readily to take a series of measures to restore a banking system that was frozen and almost in collapse. On March 6, the president issued an order closing all U.S. banks for four days until Congress could meet in a special session. By demonstrating that the federal government was stepping in to stop the alarming pattern of bank failures, the action created a general sense of relief. (Earlier, many states had already closed down the banks before March 6.)

Three days later, Roosevelt sent to Congress the Emergency Banking Act, drafted in large part by officials appointed by the Hoover administration. The bill provided for Treasury Department to initiate reserve requirements and a federal bailout to large failing institutions. Congress passed the bill within four hours of its introduction. Three-quarters of the banks in the Federal Reserve System reopened within the next three days, and billions of dollars in "hoarded" currency and gold flowed back into them within a month, thus stabilizing the banking system. Economic indicators show the economy reached nadir in the first days of March, then began a steady, sharp upward recovery that persisted until 1937.

The Economy Act

The Economy Act, drafted by Budget Director Lewis Douglas passed on March 20, 1933. The act proposed to balance the "regular" (non-emergency) federal budget by cutting the salaries of government employees and cutting pensions to veterans by as much as 15 percent. It saved $500 million a year and reassured deficit hawks like Douglas that the new president was as fiscally conservative. Roosevelt argued there were two budgets: the "regular" federal budget which he balanced, and the "emergency budget" needed to defeat the depression. It was imbalanced on a temporary basis. Roosevelt thus reflected the classical Democratic party position, dating back to Grover Cleveland, Andrew Jackson, and Thomas Jefferson, that federal deficit spending was economically unwise and morally repugnant, and he redeemed his campaign promises in favor of a balanced budget. Douglas, however, rejecting the distinction between a regular and emergency budget, resigned in 1934, and became an outspoken critic of the New Deal. Roosevevelt strenuously oppposed the Bonus Bill that would give World War One veterans a cash bonus. Finally , and the Treasury distributed $1.5 billion in cash to 4 million veterans just before the election.

The Farm Programs

Roosevelt was keenly interested in farm issues, and emphasized that true prosperity would not return until farming was prosperous. Many different programs were directed at farmers. The first hundred days produced a federal program to protect commercial farmers from the uncertainties of the depression through subsidies and production controls. This program began with the Agricultural Adjustment Act, creating the Agricultural Adjustment Administration (AAA), which Congress passed in May 1933. The Act reflected the desires of leaders of major farm organizations, especially the Farm Bureau, and reflected debates among Roosevelt's farm advisors such as Henry A. Wallace, Rex Tugwell, and George Peek. The AAA implemented a provision for crop reductions known as the "domestic allotment" system of the act. Under this system producers of corn, cotton, dairy products, hogs, rice, tobacco, and wheat would decide on production limits for their crops. The AAA would then pay land owners subsidies for leaving some of their land idle with funds provided by a new tax on food processing. Farm prices were to be subsidized up to the point of parity. Some crops were ordered to be destroyed and some livestock slaughtered to maintain prices. The idea was that the less produced, the higher the price, and the farmer would benefit. The government created shortage led to smaller supplies so farm incomes increased significantly in the first three years of the New Deal. The AAA established an important and long-lasting federal role in the planning on the entire agricultural sector of the economy. The AAA did not provide for any sharecroppers or tenants or farm laborers who might become unemployed, but there were other New Deal programs especially for them.

Roosevelt, Eleanor Roosevelt, and many New Dealers were highly sympathetic to the marginal farmers who lived on the land in severe poverty, especially in the South. Major programs addressed to their needs included the Resettlement Administration (RA), the Farm Security Administration (FSA), the Rural Electrification Administration (REA), the Tennessee Valley Authority (TVA) and rural welfare projects sponsored by the WPA, NYA, Forest Service and CCC, including school lunches, building new schools, opening roads in remote areas, reforestation, and purchase of marginal lands to enlarge national forests.

In 1936 the Supreme Court declared the AAA to be unconstitutional, stating that "a statutory plan to regulate and control agricultural production, a matter beyond the powers delegated to the federal government..."

Other initiatives

Also early in Roosevelt's first term, the administration launched a new federal regulatory agency to oversee the stock market dubbed the U.S. Securities and Exchange Commission (SEC). Another agency, the FDIC Federal Deposit Insurance Corporation set out to reform of the banking system by setting up a system of insurance for deposits.

The administration launched a series of relief measures and welfare agencies to give meaningful jobs to the unemployed, especially unskilled laborers. The largest programs were the Civilian Conservation Corps CCC, the Civil Works Administration(CWA), the Federal Emergency Relief Administration (FERA), the National Youth Administration(NYA), and above all, the Works Progress Administration(WPA). All these emergency programs were terminated in 1942-43, when unemployment had vanished due to World War II related employment offers.

In 1933 the administration launched the Tennessee Valley Authority TVA, a project involving planning on an unprecedented scale in order to curb flooding, generate electricity, and modernize the very poor farms in the Tennessee Valley region of the Southern United States.

In a measure that garnered substantial popular support, Roosevelt in his first days supported and signed a bill to legalize the manufacture and sale of beer, an interim measure pending the repeal of Prohibition, for which a constitutional amendment (the Twenty-first) was already in process.

A separate set of programs operated in Puerto Rico, headed by the Puerto Rico Reconstruction Administration. It promoted land reform and helped small farms; it set up farm cooperatives, promoted crop diversification, and helped local industry. It was directed by Ernest Gruening.

The National Industrial Recovery Act (NIRA)

Business, labor, and government cooperation

Besides programs for immediate 'relief' the New Deal started quickly on an agenda of long-term 'reform' so that another depression would not happen. Falling prices hurt the economy; the New Dealers responded to demands to inflate the currency by a variety of means. Another group of reformers sought to build consumer and farmer co-ops as a counterweight to big business. The consumer co-ops did not take off, but the Rural Electrification Administration used co-ops to bring electricity to rural areas. (As of 2005, many still operate.)

The National Industrial Recovery Act (NIRA), was the most publicized reform of the first Hundred Days; it passed in June, 1933. It guaranteed to workers of the right of collective bargaining and helped spur union organizing drives in major industries. (Much faster growth of union membership came after the 1935 Wagner Act.) Responding to business clamor for anti-deflationary trade associate agreements, the NIRA established the National Recovery Administration (NRA), which attempted to stabilize prices and wages through cooperative "code authorities" involving government, business, and labor.

The new program was hailed at its inception as a miracle. Indeed, it had something for everyone. Just as business leaders hailed it as the beginning of a new era of cooperation between government and industry, labor leaders hailed it as a "Magna Carta" for trade unions.

To prime the pump and cut unemployment, the NIRA created the Public Works Administration (PWA), a major program of public works. PWA spent $6 billion with private companies to build 34,500 projects, many of them quite large.

The NRA "Blue Eagle" campaign

At the center of the NIRA was the National Recovery Administration (NRA), headed by former general Hugh Johnson. Johnson called on every business establishment in the nation to accept a stopgap "blanket code": a minimum wage of between 20 and 40 cents an hour, a maximum workweek of 35 to 40 hours, and the abolition of child labor. Johnson and Roosevelt contended that the "blanket code" would raise consumer purchasing power and increase employment.

To mobilize political support for the NRA, and the administrations "blanket code", Johnson launched the "NRA Blue Eagle" campaign. The "Blue Eagle" was to be displayed in commercial establishments by employers who accepted the provisions of the blanket code. Blue Eagle flags, posters, and stickers, with the slogan "We Do Our Part," rapidly became visible in shops and workplaces throughout the country.

Meanwhile, Johnson needed extraordinary public and corporate support for enough bargaining strength to negotiate the codes with both business and labor. Cooperation proved to be a great burden; a firm could, after all, ignore such codes in search for a competitive advantage. In the short run, enough support among key sectors of society was generated. Even so, Johnson won agreements from almost every major industry in the nation.

On May 27 1935, the NRA was found to be unconstitutional by a unanimous decision of the US Supreme Court in the case of Schechter v. United States on the grounds that its codes were an illegal delegation of legislative authority to the executive branch and an excessive use of the commerce clause.

The Second New Deal

Legislative successes and failures

In the spring of 1935, responding to the setbacks in the Court, a new skepticism in Congress, and the growing popular clamor for more dramatic action, the administration proposed or endorsed several important new initiatives. Historians refer to them as the "Second New Deal" and note that it was more radical, more pro-labor and anti-business, than the "First New Deal" of 1933-34. The National Labor Relations Act (July 5), also known as the Wagner Act, revived and strengthened the protections of collective bargaining contained in the original (and now unconstitutional) NIRA. The result was a tremendous growth of membership in the labor unions comprising the American Federation of Labor. Labor thus became a major component of the New Deal political coalition. Roosvelt nationalized unemployment relief through the Works Progress Administration (WPA), headed by close friend Harry Hopkins. It created hundreds of thousands of low-skilled blue collar jobs for unemployed men (and some for unemployed women and white collar workers). Applicants for WPA jobs did not have to be Democrats, but their foremen quickly explained that Roosevelt created their paychecks and that conservative Republicans wanted to abolish the program. The National Youth Administration was the semi-autonomous WPA program for youth. Its Texas director, Lyndon Baines Johnson, later used the NYA as a model for some of his Great Society programs in the 1960s. But the most important achievement of 1935, and perhaps the New Deal as a whole, was the Social Security Act (August 14), which established a system of insurance against Old Age, unemployment insurance, and welfare benefits for such protected groups as dependent children and the handicapped, establishing a framework for U.S. welfare system. He decided that it should be funded by payroll taxes rather than from the general fund; he said "We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program."

Defeat: Court Packing and Executive Reorganization

Roosevelt, however, emboldened by the triumphs of his first term, set out in 1937 to consolidate authority within the government in ways that provoked powerful opposition. Early in the year, he asked Congress to expand the number of justices on the Supreme Court so as to allow him to appoint members sympathetic to his ideas and hence tip the ideological balance of the Court. In one sense the proposal succeeded; Justice Owen Roberts, almost certainly in response to the threat, switched positions and began voting to uphold New Deal measures, effectively creating a liberal majority in West Coast Hotel Co. v. Parrish and National Labor Relations Board v. Jones & Laughlin Steel Corporation. Journalists called this change the "switch in time that saved nine." But the "court packing plan," as it was known, did lasting political damage to Roosevelt and was finally rejected by Congress in July. At about the same time, the administration proposed a plan to reorganize the executive branch in ways that would significantly increase the president's control over the bureaucracy. Like the Court-packing plan, executive reorganization garnered opposition from those who feared a "Roosevelt dictatorship" and failed in Congress; a watered-down version of the bill finally won passage in 1939.

Historical assessment

Historians on the right and left have generally been disappointed with Roosevelt's second term. On the right, there have been charges of an FDR "executive dictatorship" since the 1930s. Journalist John T. Flynn, for example, denounced FDR as a socialistic radical and a despot in The Roosevelt Myth (1956).

Conversely, historians on the left have denounced the New Deal as a conservative phenomenon that let slip the opportunity to radically reform capitalism. Since the 1960s, "New Left" historians have been among the New Deal's harsh critics. (For a list of relevant works, see the list of suggested readings appearing toward the bottom of the article.) Barton J. Bernstein, in a 1968 essay, compiled a chronicle of missed opportunities and inadequate responses to problems. The New Deal may have saved capitalism from itself, Bernstein charged, but it had failed to help—and in many cases actually harmed—those groups most in need of assistance. Paul K. Conkin in The New Deal (1967) similarly chastised the government of the 1930s for its policies toward marginal farmers, for its failure to institute sufficiently progressive tax reform, and its excessive generosity toward select business interests. Howard Zinn, in an essay in 1966, criticized the New Deal for working actively to actually preserve the worst evils of capitalism.

Yet, much of the more recent work on the New Deal has been less interested in the question of whether the New Deal was a "conservative" or "revolutionary" phenomenon than in the question of constraints within which it was operating. Political sociologist Theda Skocpol, in an influential series of articles, has emphasized the issue of "state capacity" as an often-crippling constraint. Ambitious reform ideas often failed, she argued because of the absence of a government bureaucracy with significant strength and expertise to administer them. Other more recent works have stressed the political constraints that the New Deal encountered. Both in Congress and among certain segments of the population conservative inhibitions about government remained strong; thus some scholars have stressed that the New Deal was not just a product of its liberal backers, but also a product of the pressures of its conservative opponents.

The New Deal and the "broker state"

Government role: balance labor, business and farming

The effect of the New Deal was to elevate and strengthen new interest groups so as to allow them to compete more effectively for the interests by having the federal government evolve into an arbitrator in competition among all elements and classes of society, acting as a force that could mediate when necessary to help some groups and limit the power of others. By the end of the 1930s, business found itself competing for influence with an increasingly powerful labor movement, one that was engaged in mass mobilization and sometimes militant action; with an organized agricultural economy, and occasionally with aroused consumers. The New Deal accomplished this by creating a series of state institutions that greatly, and permanently, expanded the role of the federal government in American life. The government was now committed to providing at least minimal assistance to the poor and unemployed; to protecting the rights of labor unions; to stabilizing the banking system; to building low-income housing; to regulating financial markets; to subsidizing agricultural production; and to doing many other things that had not previously been federal responsibilities.

Thus, perhaps the strongest legacy of the New Deal, in other words, was to make the federal government a protector of interest groups and a supervisor of competition among them. As a result of the New Deal, political and economic life became politically more competitive than before, with workers, farmers, consumers, and others now able to press their demands upon the government in ways that in the past had been available only to the corporate world. Hence the frequent description of the government the New Deal created as the "broker state," a state brokering the competing claims of numerous groups. If there was more political competition, there was less market competition. Farmers were not alowed to sell for less than the official price. The transportation industry (especially airlines, trucking and railroads) was tightly regulated so that every firm had a guaranteed market and management and labor had high profits and high wages, all at the cost of high prices and much inefficiency. Quotas in the oil industry were fixed by the state ]] with the federal Connally Hot Oil Act of 1935 guaranteeing that illegal "hot oil" would not be sold. To the New Dealers, the free market meant "cut-throat competition" and they considered that evil. Not until the 1970s and 1980s would most of the New Deal regulations be relaxed.

The liberal assumptions that the New Deal acted as the foe of private business interests have been challenged. After all, in many cases New Deal efforts were intended to enhance the position of private entrepreneurs—especially their concerns over inflation—even, at times, at the cost of some of the liberal reform goals that some administration officials espoused. The New Deal also did enhance the positions of some previously disadvantaged groups, but did little or nothing for many others, especially blacks, sharecroppers, and the urban poor.

Thus, it did not transform American capitalism in any genuinely radical way. Except in the field of labor relations, corporate power remained nearly as free from government regulation in 1939 as it had been in 1933, but that changed dramatically during the war, as Washington took control over wage rates, prices, and allocation of raw materials, and sent military officers into munitions plants. All the relief programs were closed down during the war, but one major program survived--Social Security--to become the liberal hallmark of the New Deal into the 21st century.

African Americans

African Americans benefited in significant though limited ways from New Deal relief programs. The WPA, NYA, and CCC allocated 10% of their budgets to blacks (who comprised about 10% of the total population, and 20% of the poor). They operated separate all-black units with the same pay and conditions as white units. The African American community responded favorably, so that by 1936 the majority who voted (usually in the North) were voting Democratic. This was a sharp realignment from 1932, when the most African Americans preferred the Republican ticket. The New Deal thus established a political alliance between African Americans and the Democratic Party that survives into the 21st century.

The great majority of Southern Congressmen supported the New Deal, but Roosevelt knew they would revolt if he tried to abolish segregation or make lynching a federal crime. The NRA tolerated widespread practices of paying blacks less than whites; blacks were largely excluded from employment at the TVA; the FHA refused to provide mortgages to blacks moving into white neighborhoods; and the AAA was ineffectual in protecting the interests of black sharecroppers and tenant farmers.

Some liberal historians argue the New Deal laid the ground work for the "broker state" to be expanded a generation later, mostly through the work of the next wave of liberal reform—the civil rights movement and the Great Society—to embrace groups marginalized in the 1930s. However many African American historians insist that the Civil Rights movement owed everything to black activists, and very little to the New Deal. Note that the New Deal was especially beneficial to white ethnic minorities, who responded with 80-90% of their votes for Roosevelt's reelection.

The recession of 1937 and recovery

As the Depression wore on, Roosevelt tried public works, farm subsidies and other devices to restart the economy, but he never completely gave up trying to balance the budget. Unemployment remained high throughout the New Deal years. On the whole, however, the direction of the economy was steadily upward from March, 1933, until a sudden unexpected downturn that started in May 1937 and continuing through June 1938. Production declined sharply, as did profits and employment. Unemployment jumped from 14.3% in 1937 to 19.0% in 1938. The administration reacted by launching a rhetorical campaign against big business as the villain. Talk of a strong antitrust effort went nowhere, and ended once the war began because the nation needed all its business executives to expand production, not defend lawsuits.

The administration's other response to the deepening recession of 1937 had more tangible results. Ignoring the protests of the Treasury Department and responding to the urgings of the converts to Keynesian economics and others in his administration, Roosevelt abandoned his efforts to balance the budget and launched a $5 billion spending program in the spring of 1938, an effort to increase mass purchasing power. The Keynesian inspiration was problematical; the idea of priming the pump with deficit spending was Hoover's plan in 1930.

World War II and the end of the Great Depression

The Depression, however, continued until the U.S. entered the Second World War; Roosevelt, once committed to war in Europe and Asia, then had little choice. Under the special circumstances of war mobilization, massive war spending doubled the GNP. Businessmen ignored the mounting national debt and heavy new taxes, redoubling their efforts for greater output as an expression of patriotism. Patriotism drove most people to voluntarily work overtime and give up leisure activities to make money after so many hard years. Patriotism meant that people accepted rationing and price controls for the first time. Cost-plus pricing in munitions contracts guaranteed that businesses would make a profit no matter how many mediocre workers they employed, no matter how inefficient the techniques they used. The demand was for a vast quantity of war supplies as soon as possible, regardless of cost. Business hired every person in sight, even driving sound trucks up and down city streets begging people to apply for jobs. New workers were needed to replace the 12 million working aged men servining in the military. These events magnified the role of the federal government in the national economy. In 1929 federal expenditures accounted for only 3 percent of GNP. Between 1933 and 1939, federal expenditure tripled, and Roosevelt's critics charged that he was turning America into a socialist state. However, spending on the New Deal was far smaller than on the war effort. In the first peacetime year of 1946, federal spending still amounted to $62 billion, or 30 percent of GNP. Wartime spending and other measures were able to provide an enormous output. Between 1939 and 1944 (the peak of wartime production), the nation's total output almost doubled. This, along with the conscription and removal of soldiers, meant that unemployment plummeted—from 14 percent in 1940 to less than 2 percent in 1943 as the labor force grew by ten million. Millions of farmers left marginal operations, students quit school, and housewives returned to the labor force. The war economy was not run on the basis of free enterprise, but was the result of government/business sectionalism, of government bankrolling business. A major result of the full employment at high wages was a sharp, permanent decrease in the level of inequality. The gap between rich and poor narrowed dramatically in the area of nutrition, because food rationing and price controls guaranteed a reasonably priced diet to everyone. Large families that had been poverty-stricken in the 1930s had four or five or more workers, and shot to the top one-third income bracket. Overtime made for huge paychecks in the munitions factories; white collar workers were fully employed too, but they did not receive overtime and their salary scale was no longer much higher than the blue collar wage scale.

The legacies of the New Deal

Some economists argue that although the New Deal did not end the depression, all in all it helped to prevent the economy from decaying further by increasing the regulatory functions of the federal government in ways that helped stabilize previous trouble areas of the economy: the stock market, the banking system, and others. Others argue that it worsened the depression. All analysts agree the New Deal produced a new political coalition that sustained the Democratic Party as the majority party in national politics for more than a generation after its own end.

Roosevelt's 12 years in office saw a dramatic increase in the power of the federal government as a whole. Roosevelt also established the presidency as the preeminent center of authority within the federal government. By creating a large array of agencies protecting various groups of citizens—workers, farmers, and others—who suffered from the crisis, enabling them to challenge the powers of the corporations, the Roosevelt administration generated a set of political ideas—known to later generations as New Deal liberalism—that remained a source of inspiration and controversy for decades and that helped shape the next great experiments in liberal reform, the civil rights movement and Great Society of the 1960s.

Most Important New Deal programs

The New Deal was composed of countless programs, labeled an "alphabet soup" by its detractors. Among the New Deal acts were the following, most of them passed within the first 100 days of FDR's administration. Most were abolished around 1943, others remain in operation in 2005: Reconstruction Finance Corporation a Hoover agency exapanded under Jesse Jones to make large loans to big business. Ended in 1954. Federal Emergency Relief Agency (FERA) a Hoover program to create unskilled jobs for relief; replaced by WPA in 1935.

• United States bank holiday, 1933: closed all banks until they became certified by federal reviewers
• Abandonment of gold standard, 1933: gold reserves no longer backed curreency; still exists
• Civilian Conservation Corps (CCC), 1933: employed young men to perform unskilled work in rural areas; under Army supervision; separate program for Native Americans
• Tennessee Valley Authority (TVA), 1933: effort to modernize very poor region (most of Tennessee), centered on dams that generated electricity on the Tennessee River; still exists
• Agricultural Adjustment Act (AAA), 1933: raised fame prices by cutting total farm output of major crops (and hogs)
• National Recovery Act (NRA), 1933: industries set up codes to reduce unfair competition, raise wages and prices;
• Public Works Administration (PWA), 1933: built large public works projects; used private contractors (did not directly hire unemployed)
• Federal Deposit Insurance Corporation (FDIC) / Glass-Steagall Act: insures deposits in banks in order to restore public confidence in banks; still exists
• Securities Act of 1933, created the SEC, 1933: codified standards for sale and purchase of stock, required risk of investments to be accurately disclosed; still exists
• Civil Works Administration (CWA), 1933-34: provided temporary jobs to millions of unemployed
• Indian Reorganization Act, 1934 moved away from assimilation
• Social Security Act (SSA), 1935: provided financial assistance to: elderly, handicapped, paid for by employee and employer payroll contributions; required years contributions, so first payouts were 1942; still exists
• Works Progress Administration (WPA), 1935: a national labor program for 2+ million unemployed; created useful construction work for unskilled men; also sewing projects for women and arts projects for unemployed artists, musicians and writers.
• National Labor Relations Act (NLRA) / Wagner Act, 1935: set up National Labor Relations Board to supervise labor-management relations; In 1930s it strongly favored labor unions. Modified by Taft-Hartley (1947); still exists
• Judicial Reorganization Bill, 1937: gave President power to appoint a new Supreme Court judge for every judge 70 years or older; failed to pass Congress
• Fair Labor Standards Act (FLSA), 1938: established a maximum normal work week of 40 hours, and a minimum pay of 40 cents/hour; still exists

See also

• Critics of the New Deal
• Fireside chats
• Great Depression
• Great Society
• World War II
• New Deal coalition

Scholarly Secondary Sources from Different Points of View

• Badger, Anthony J. The New Deal: The Depression Years, 1933-1940. (Chicago: Ivan R. Dee, 2002), a balanced overview.
• Bernstein, Barton J. "The New Deal: The Conservative Achievements of Liberal Reform." In Barton J. Bernstein, ed., Towards a New Past: Dissenting Essays in American History, pp. 263-88. (New York: Knopf, 1968), an influential New Left attack on the New Deal.
• Bernstein, Irving. Turbulent Years: A History of the American Worker, 1933-1941 (Boston: Houghton Mifflin, 1970), the best history of labor in the era.
• Best, Gary Dean. Pride, Prejudice, and Politics. (New York: Praeger, 1990), a conservative critique.
• Brinkley, Alan. The End Of Reform: New Deal Liberalism in Recession and War. (New York: Vintage, 1995)
• Conkin, Paul K. The New Deal. (Arlington Heights, Ill.: AHM, 1967), a brief New Left critique.
• Fraser, Steve and Gary Gerstle, eds., The Rise and Fall of the New Deal Order, (Princeton, N.J.: Princeton University Press, 1989), essays focused on the long-term results.
• Gordon, Colin. New Deals: Business, Labor, and Politics, 1920-1935 (New York: Cambridge University Press, 1994)
• Graham, Otis L. and Meghan Robinson Wander, eds. Franklin D. Roosevelt: His Life and Times. Boston: G. K. Hall, 1985. The best encyclopedic reference.
• Kennedy, David M. Freedom From Fear: The American People in Depression and War, 1929-1945. New York: Oxford UP, 1999, the best recent scholarly narrative.
• Leuchtenberg, William E. Franklin D. Roosevelt and the New Deal, 1932-1940. (1963). A standard interpretive history.
• Patterson, James T. The New Deal and the States: Federalism in Transition (Princeton UP, 1969).
• Powell, Jim. FDR's Folly: How Roosevelt and His New Deal Prolonged the Great Depression. (New York: Crown Forum, 2003), a stinging atack from the right.
• Rothbard, Murray. America's Great Depression. Princeton, NJ, 1963, an analytic attack from a leading libertarian.
• Saloutos, Theodore. The American Farmer and the New Deal (1982).
• Schlesinger, Arthur M. Jr., The Age of Roosevelt, 3 vols, (1957-1960), the classic narrative history. Online at vol 2 vol 3
• Sitkoff, Harvard. ed. Fifty Years Later: The New Deal Evaluated. (New York; McGraw Hill, 1984). A friendly liberal evaluation.
• Skocpol, Theda, and Kenneth Finegold. "State Capacity and Economic Intervention in the Early New Deal." Political Science Quarterly 97 (1982): 255-78.
• Zinn, Howard, ed. New Deal Thought. (Indianapolis, Ind.: Bobbs-Merrill, 1966), a compilation of highly useful primary sources.

Online Primary Sources

• FDR Cartoon Archive, 2000+ original editorial cartoons
• New Deal Document Library
• New Deal Photo Library
• Fireside Chats of Franklin D. Roosevelt

Online Secondary Sources

• National Youth Administration (in Texas)
• Arthur Schlesigner, Jr. ' ' The Age of Roosevelt ' ' (3 vol, 1957-60).
• The New Deal Debunked (again) by Thomas DiLorenzo
• Franklin Delano Roosevelt and His Fraudulent System
• When the Supreme Court Stopped Economic Fascism in America by Richard M. Ebeling - discusses the new deal as economic fascism

• New Deal
• U.S. presidential domestic programs