The New Deal

Herbert Hoover

■ Did little to nothing at first to stop economic

downturn

■ People who became homeless built shacks out of scrap

materials formed shantytowns or “Hoovervilles”

■ Later in desperation passed Federal Home Loan

Bank Act (lowered mortgage rates for homeowners)
and Reconstruction Finance Corporation $2 Billion in
emergency funds for banks and businesses

■ Bonus Army – Group of WWI veterans camped out

in Washington D.C. to get war bonus immediately
rather then at retirement

◻Had the current army kick them out when they didn’t leave and lost
respect from American public

■ Created Hoover Dam

■ Blamed for Depression by not acting soon enough

by the Public

Herbert Hoover
& Hoover Dam

Franklin Delano Roosevelt (FDR) is elected

promising a “New Deal” (1st 100 Days) 1932

■ New Deal- designed to alleviate the depression

and had 3 goals

◻ Relief for the needy

◻ Economic recovery

◻ Financial reform

100 Days – 3/9 to 6/16/1933

■ 15 Major Pieces of Legislation

◻ Emergency Bank Relief Act – Inspect the banks

◻ Glass-Steagal Act – FDIC Insured for first $100,000

◻ Federal Securities Act – Required Business to provide

all information on stocks

◻ Created Securities and Exchange Commission (SEC)

to regulate the Stock Market

Franklin Delano
Roosevelt or
FDR

New Deal Cartoons

■

Agriculutre Adjustment Act (AAA), Civilian Conservation Corps
(CCC), Public Works Administration (PWA), National Industrial
Recovery Act (NIRA) etc.-all paid farmers and hired
workers for gov. jobs (didn’t help
unemployment)

2nd 100 Days or 2nd New Deal

■
WPA, NYA, Wagner Act, Social Security Act

Effects on Taxes & Economy

■
Revenue Acts in 1932, 1935, & 1937 largest
tax increases in American History (slowed
job growth)

■
Deficit Spending- spending more then the
country makes.

Print and Read to class. They don’t
have to copy down

■ Revenue Act of 1932—one of the largest tax increases in

American history, which doubled the estate tax,
increased corporate taxes by almost 15 percent, and
raised taxes on the highest incomes from 25 percent to
63 percent—the Revenue Act of 1935 raised new taxes
on higher income levels, corporations, and estates. The
Revenue Act of 1937 taxed short-term capital gains as
ordinary income. And in 1936, Roosevelt added a higher
top rate of 79 percent on individual income greater than
$5 million—a rate that was increased again in 1939.

■ By 1937, the undistributed profits surtax severely

restricted the ability of small companies to build up their
capital out of earnings, and the large surtax on individual
incomes discouraged rich people from investing in new
companies.

Black Defender

Newspaper criticizes

the New Deal

■ New Deal Coalition – alignment of diverse groups

including Southern whites, African Americans, and
Union workers. Results in:

◻ Democratic Party dominating national politics

through the 1930s and 40s

◻ Democrats held a 2/3rds majority in Senate and

3/4ths majority in the House

■ FDR doesn’t support civil rights and the NRA, CCC,

and TVA all discriminated against blacks

■ In general, however, African Americans supported

Roosevelt and Democrats as a majority

■ Mexican-Americans favored New Deal even though

they saw few benefits from it

Grapes of Wrath about dust bowl
migrants to California and Gone
with the Wind movie is a popular
hit at that time