CHAPTER 33 - THE GREAT DEPRESSION AND THE NEW

DEAL

FDR: A POLITICIAN IN A WHEELCHAIR

• In 1932, voters still had not seen any economic improvement, and they wanted a new president.

• President Herbert Hoover was nominated again without much vigor andtrue enthusiasm, and he campaigned saying that his policies preventedthe Great Depression from being worse than it was.

FDR: A POLITICIAN IN A WHEELCHAIR

• The Democrats nominated Franklin Delano Roosevelt, a tall, handsomeman who was the fifth cousin of famous Theodore Roosevelt and hadfollowed in his footsteps. – FDR was suave and conciliatory while TR was

pugnacious and confrontational. – FDR had been stricken with polio in 1921, and

during this time, his wife, Eleanor, became his political partner.

– Franklin also lost a friend in 1932 when he and Al Smith both sought the Democratic nomination.

• Eleanor was to become the most active First Lady ever

Question 1

• Franklin Roosevelt's ____ contributed the most to his development of compassion and strength of will.– a. education– b. domestic conflicts with Eleanor Roosevelt– c. family ties with Teddy Roosevelt– d. affliction with infantile paralysis– e. service in World War I

PRESIDENTIAL HOPEFULS OF 1932

• In the campaign, Roosevelt seized the opportunity to prove that hewas not an invalid, and his campaign also featured an attack on Hoover’s spending (ironically, he would spend even more duringhis term).

• The Democrats found expression in the airy tune “Happy DaysAre Here Again,” and clearly, the Democrats had the advantage inthis race.

Question 2• In 1932, Franklin Roosevelt campaigned on the

promise that as president he would attack the Great Depression bya. nationalizing all banks and major industries.

b. mobilizing America's youth as in wartime.

c. returning to the traditional policies of laissez-faire capitalism.

d. continuing the policies already undertaken by President Hoover.

e. experimenting with bold new programs for economic and social reform.

Question 3• The Democratic party platform on which Franklin

Roosevelt campaigned for the presidency in 1932 called fora. extensive social reforms and a balanced budget.

b. deficit spending and a higher military budget.

c. higher tariffs and support for American manufacturers.

d. nationalization of key industries.

e. breaking up monopolistic corporations and supporting small business.

HOOVER'S HUMILIATION IN 1932

• Hoover had been swept into the presidential office in 1928, but in1932, he was swept out with equal force, as he was defeated 472 to 59.

• Noteworthy was the transition of the Black vote from the Republican to the Democratic Party.

• During the lame-duck period, Hoover tried to initiate some ofRoosevelt’s plans, but was met by stubbornness and resistance

– an anti-inflationary policy that would have made much of the New Deal impossible

• Hooverites would later accuse FDR of letting the depression worsen so that he could emerge as an even more shining savior.

Question 4• One striking new feature of the 1932 presidential

election results was thata. the South had shifted to the Republican party.b. Democrats made gains in the normally Republican

Midwest.c. urban Americans finally cast more votes than rural

Americans.d. a clear gender gap opened up in which more women

favored the Democrats.e. African Americans shifted from their Republican

allegiance and became a vital element in the Democratic party.

FDR AND THE THREE R’S: RELIEF, RECOVERY, AND

REFORM • On Inauguration Day, FDR asserted,

“The only thing we have to fear is fear itself.”

• He called for a nationwide bank holiday to eliminate paranoid bank withdrawals, and then he commenced with his Three R’s.

• The Democratic-controlled Congress was willing to do as FDR said, and the first Hundred Days of FDR’s administration were filled with more legislative activity than ever before. – Many of the New Deal Reforms had

been adopted by European nations a decade before. He also borrowed ideas from war time agencies which took a direct role in the economy.

Question 5

• The phrase Hundred Days refers to thea. worst months of the Great Depression.

b. time it took for Congress to begin acting on President Roosevelt's plans for combating the Great Depression.

c. flood of legislation passed by Congress in the first months of Franklin Roosevelt's presidency.

d. "lame-duck" period between Franklin Roosevelt's election and his inauguration.

e. time that all banks were closed by FDR.

Question 6The early New Deal experiments borrowed rather

freely and randomly froma. the American labor movement and European

socialism.b. early twentieth-century economists and social

theorists Thorstein Veblen and John Dewey.c. Mussolini's fascism and Hitler's Nazism.d. U.S. wartime and pre-war agencies and European

social reform models.e. the late nineteenth-century utopian literature of Henry

George, Edward Bellamy, and Charlotte Perkins Gilman.

ROOSEVELT MANAGES THE MONEY

• The Emergency Banking Relief Act of 1933 was passed first. FDR declared a one week “bank holiday” just so everyone wouldcalm down and stop running on the banks.

• Then, Roosevelt settled down for the first of his thirty famous “Fireside Chats” with America.

ROOSEVELT MANAGES THE MONEY

• The “Hundred Days Congress” passed the Glass-Steagall Banking Reform Act, that provided the Federal Deposit Insurance Corporation (FDIC) which insured individual deposits up to $5000, thereby eliminating the epidemic of bank failure and restoring faith to banks.

• FDR then took the nation off of the gold standard and achieved controlled inflation by ordering Congress to buy gold at increasingly higher prices. – In February 1934, he announced that the U.S. would pay

foreign gold at a rate of one ounce of gold per every $35 due.

ROOSEVELT MANAGES THE MONEY

• The Emergency Banking Relief Act gave FDR the authority to manage banks.

• FDR then went on the radio “fireside” and reassured people it was safer to put money in the bank than hidden in their houses. – The Glass-Steagall Banking Reform Act was passed. – This provided for the FDIC (Federal Deposit Insurance

Corp.) to insure the money in the bank.

• FDR wanted to stop people from hoarding gold. – He urged people to turn in gold for paper money and took

the U.S. off the gold standard. – He wanted inflation, to make debt payment easier, and

urged the Treasury to buy gold with paper money.

Question 7The most immediate emergency facing Franklin

Roosevelt when he became president in March 1933 wasa. the collapse of nearly the entire banking system.

b. runaway inflation.

c. the growing power of demagogues such as Huey Long and Father Coughlin.

d. the near collapse of international trade.

e. riots by unemployed workers and farmers unable to sell their goods.

Question 8Immediately after taking office, President

Roosevelt responded to the banking crisis bya. restoring the gold standard to guarantee the

soundness of American currency.b. reassuring Americans that all their banking deposits

were safe.c. providing major federal loans to the largest and

soundest banks.d. establishing a new Bank of the United States to

guarantee deposits.e. closing all American banks for a week, while

reorganizing them on a sounder basis.

Question 9

The Glass-Steagall Acta. took the United States off the gold standard.

b. empowered President Roosevelt to close all banks temporarily.

c. created the Securities and Exchange Commission to regulate the stock exchange.

d. permitted commercial banks to engage in Wall Street financial dealings.

e. created the Federal Deposit Insurance Corporation to insure individual bank deposits.

Question 10

Franklin Roosevelt took America off the gold standard and adopted a managed currency policy designed toa. stimulate inflation.

b. reduce the price of gold.

c. restore confidence in banks.

d. reduce the amount of money in circulation.

e. shake up the Federal Reserve Board.

A DAY FOR EVERY DEMAGOGUE

• Roosevelt had no qualms about using federal money to assist the unemployed, so he created the Civilian Conservation Corps (CCC), whichprovided employment in fresh-air government camps for about 3 million uniformed young men. – They reforested areas, fought fires,

drained swamps, controlled floods, etc.

– One of the most popular of his programs

– However, critics accused FDR of militarizing the youths and acting as dictator.

Question 11

The single most popular New Deal program was probably thea. Works Progress Administration.

b. Agricultural Adjustment Act.

c. National Recovery Administration.\

d. Civilian Conservation Corps.

e. Tennessee Valley Authority.

Question 12All of the following are true statements about the

men who joined the CCC (Civilian Conservation Corps) excepta. there were about three million men in the program.b. the men were mostly young, hired to work in fresh-air

camps.c. many of the men had had criminal records.d. they worked on reforestation, flood control and swamp

drainage projects.e. CCC workers helped families by sending most of their

paychecks home.

A DAY FOR EVERY DEMAGOGUE

• The Federal Emergency Relief Act looked for immediate relief rather than long-term alleviation, and its Federal Emergency Relief Administration (FERA) was headed by the zealous Harry L. Hopkins.

• The Agricultural Adjustment Act (AAA) made available many millions of dollars to help farmers meet their mortgages.

• The Home Owners’ Loan Corporation (HOLC) refinanced mortgages on non-farm homes and bolted down the loyalties of middle class, Democratic homeowners.

• The Civil Works Administration (CWA) was established late in 1933, and it was designed to provide purely temporary jobs during the winter emergency.– Many of its tasks were rather frivolous (called “boondoggling”) and were designed for

the sole purpose of making jobs.

A DAY FOR EVERY DEMAGOGUE

• The New Deal had its

commentators. – One FDR spokesperson

was Father Charles Coughlin, a Catholic priest in Michigan who at first was with FDR then disliked the New Deal andvoiced his opinions on radio.

A DAY FOR EVERY DEMAGOGUE

– Senator Huey P. Long of Louisiana was popular for his “Share the Wealth” program. Proposing “every man a king,” each family was to receive $5000, allegedly from the rich. The math of the plan was ludicrous. • His chief lieutenant was former

clergyman Gerald L. K. Smith.

• He was later shot by a deranged medical doctor in 1935.

A DAY FOR EVERY DEMAGOGUE

– Dr. Francis E. Townsend of California attracted the trusting support of perhaps 5 million “senior citizens” with his fantastic plan of each senior receiving $200 month, provided that allof it would be spent within the month. Also, this was a mathematicallysilly plan.

Question 13Match each New Deal critic below with the cause

or slogan that he promoted.A.Father Coughlin 1."social justice“B.Huey Long 2."every man a king“C.Francis Townsend 3."a holy crusade for liberty“D.Herbert Hoover 4."$200 a month for everyone over 60"

a. A-l, B-2, C-4, D-3b. A-2, B-1, C-3, D-4c. A-3, B-4, C-2, D-1d. A-4, B-3, C-1, D-2e. A-1, B-4, C-3, D-2

Question 14

Senator Huey P. Long of Louisiana gained a large national following by promising toa. nationalize all banks and public utility companies.

b. make Jews pay for causing the Great Depression.

c. help farmers and workers organize to resist the power of corporations.

d. provide the unemployed and elderly a $200-a-month social security payment.

e. "share our wealth" by raising taxes on the rich and giving every family $5,000.

A DAY FOR EVERY DEMAGOGUE

• Congress also authorized the Works Progress Administration (WPA) in 1935, which put $11 million on thousands of public buildings, bridges, and hard-surfaced roads and gave 9 million people jobs in its

eight years of existence. – It also found part-time jobs for needy high school and college

students and for actors, musicians, and writers. – John Steinbeck counted dogs (boondoggled) in his California

home of Salinas county. • Boondoggled-An unnecessary or wasteful project or activity

NEW VISIBILITY FOR WOMEN • Ballots newly in hand, women

struck up new roles. • First Lady Eleanor Roosevelt

was the most visible, but other ladies shone as well: Sec. of Labor Frances Perkins was the first female cabinet member and Mary McLeod Bethune headed the Office of Minority Affairs in the NYA, the “Black Cabinet”, and founded a Florida college.

– Bethune-Cookman (Pitt hoops played them in 2012)

NEW VISIBILITY FOR WOMEN • Anthropologist Ruth

Benedict helped develop the “culture and personality movement” and her student Margaret Mead reached even greater heights with Coming of Age in Samoa.

• Pearl S. Buck wrote a beautiful and timeless novel, The Good Earth, about a simple Chinese farmer which earned her the Nobel Prize forliterature in 1938.

Question 15

Prominent female social scientists of the 1930s, like Ruth Benedict and Margaret Mead, brought widespread contributions to the field ofa. economics.

b. political science.

c. psychology.

d. sociology.

e. anthropology.

HELPING INDUSTRY AND LABOR

• The National Recovery Administration (NRA), by far the most complicated of the programs, was designed to assist industry, labor, and the unemployed. – There were maximum hours of

labor, minimum wages, and more rights for labor union members, including the right to choose their ownrepresentatives in bargaining.

– Largely failed because it required too much self-sacrifice on the part of industry, labor, and the public.

HELPING INDUSTRY AND LABOR

• (NRA)• The Philadelphia Eagles were

named after this act, which received much support and patriotism, but eventually, it was shot down by the Supreme Court.

• One of the Hundred Days Congress’s earliest acts was to legalize light wine and beer with an alcoholic content of 3.2% or less and also levied a $5 tax on every barrel manufactured.

– He could possibly raise revenue and create jobs

– Prohibition was repealed with 21st Amendment

– Besides too much was expected of labor, industry, and the public.

– The Public Works Administration (PWA) also intended both for industrial recovery and for unemployment relief. • Headed by Secretary of the Interior

Harold L. Ickes, it aimed at long-range recovery by spending over $4 billion on some 34,000 projects that included public buildings, highways, and parkways (i.e. the Grand Coulee Dam of the Columbia River).

Question 16

The most complex and ambitious New Deal effort to achieve recovery and reform the entire American economy was thea. Public Works Administration.

b. National Recovery Administration.

c. Tennessee Valley Authority.

d. National Labor Relations Act (Wagner Act).

e. Social Security Administration.

Question 17The National Recovery Administration (NRA) failed

largely becausea. businesses resisted regulation by the agency. b. it required too much self-sacrifice on the part of

industry, labor, and the public.c. Harold Ickes, the head of the agency, proved to be an

incompetent administrator.d. it did not provide enough protection for labor to

bargain with management.e. the agency did not have enough power to control

business.

Question 18Roosevelt supported the repeal of prohibition

becausea. he thought it was unconstitutional.b. he believed the problem of drunkenness could be

solved by restricting alcohol content to 3.2 percent by weight.

c. he thought that it afforded the opportunity to raise needed federal revenue and provide jobs.

d. he needed support from the repeal movement to gain reelection.

e. drys - those who opposed alcohol - were an increasingly small segment of the population.

PAYING FARMERS NOT TO FARM

• To help the farmers, which had been suffering from deflation ever since the end of World War I, Congress established the Agricultural Adjustment Administration, which paid farmers to reduce their crop acreage and would eliminate price-depressing surpluses. – However, it got off to a rocky start when it killed lots of pigs

for no good reason, and paying farmers not to farm actually increased unemployment.

– The Supreme Court killed it in 1936. • The New Deal Congress also passed the Soil Conservation

and domestic Allotment Act of 1936, which paid farmers to plant soil-conserving plants like soybeans or to let their land lie fallow.

• The Second Agricultural Adjustment Act of 1938 was a more comprehensive substitute that continued conservation payments but was accepted by the Supreme Court.

Question 19

The Agricultural Adjustment Act (AAA) proposed to solve the farm problem bya. reducing agricultural production.

b. subsidizing American farm exports overseas.

c. encouraging farmers to switch to industrial employment.

d. helping farmers to pay their mortgages.

e. creating farm cooperatives.

DUST BOWLS AND BLACK BLIZZARDS

• After the drought of 1933, furious winds whipped up dust into the air, turning parts of Missouri, Texas, Kansas, Arkansas, and Oklahoma into the Dust Bowl and forcing many farmers to migrate west to California and inspired Steinbeck’s classic The Grapes of Wrath. – The dust was very hazardous to the

health and to living, creating further misery.

– Caused by soil erosion, over cultivation on marginal Great Plains farm land, and a severe drought

DUST BOWLS AND BLACK BLIZZARDS

• The Frazier-Lemke Farm Bankruptcy Act, passed in 1934, made possible a suspension of mortgage foreclosure for five years, but it was voided in 1935 by the Supreme Court.

• In 1935, FDR set up the Resettlement Administration, charged with the task of removing near-farmless farmers to better land.

• Commissioner of Indian Affairs was headed by John Collier who sought to reverse the forced-assimilation policies in place since the Dawes Act of 1887. – He promoted the Indian

Reorganization Act of 1934 (the Indian“New Deal”), which encouraged tribes to preserve their culture and traditions.

– Not all Indians liked it though, saying if they followed this “back-to-the-blanket” plan, they’d just become museumexhibits. 77 tribes refused to organize under its provisions (200 did).

Question 20

All of the following contributed to the Dust Bowl of the 1930s excepta. dry-farming techniques.

b. drought.

c. farmers' failure to use steam tractors and other modern equipment.

d. the cultivation of marginal farmlands on the Great Plains.

e. soil erosion.

Question 21In 1935, President Roosevelt set up the

Resettlement Administration toa. help farmers migrate from Oklahoma to California.

b. place unemployed industrial workers in areas where their labor was needed.

c. move Indians from land that could be farmed by victims of the Dust Bowl.

d. find jobs for farmers in industry.

e. help farmers who were victims of the Dust Bowl move to better land.

Question 22

Most Dust Bowl migrants headed toa. Oklahoma.

b. Arizona.

c. Nevada.

d. Oregon.

e. California.

Question 23The Indian Reorganization Act of 1934 attempted

toa. reverse the forced assimilation of Native Americans

into white society by establishing tribal self-government.

b. encourage Native Americans to give up their land claims.

c. reinforce the Dawes Act of 1887.d. pressure Native Americans to renounce self-

government.e. define clearly which tribes were federally recognized.

Question 24Native Americans responded to the Indian

Reorganization Act of 1934a. with some thrilled by its efforts to stop the loss

of Indian lands.b. with many Indians rejecting its provisions to

organize tribes and tribal governments.c. by denouncing it as a "back to the blanket"

measure.d. All of thesee. None of these

BATTLING BANKERS AND BIG BUSINESS

• The Federal Securities Act (“Truth in Securities Act”) required promoters to transmit to the investor sworn information regarding the soundness of their stocks and bonds.

• The Securities and Exchange Commission (SEC) was designed as a stock watchdog administrative agency, and stock markets henceforth were to operate more as trading marts than as casinos.

• In 1932, Chicagoan Samuel Insull’s multi-billion dollar financial empire had crashed, and such cases as his resulted in the Public Utility Holding Company Act of 1935.

Question 25The Federal Securities Act and the Securities

Exchange Commission aimed toa. halt the sale of stocks on margin (i.e. with borrowed

funds). b. force stockbrokers to register with the federal

government.c. prevent interlocking directorates and business

pyramiding schemes.d. provide full disclosure of information and prevent

insider trading and other fraudulent practices.e. enable the Chicago Board of Trade to compete with

the New York Stock Exchange.

THE TVA HARNESSES THE TENNESSEE RIVER

• The sprawling electric-power industry attracted the fire of New Deal reformers. – New Dealers accused it of gouging the

public with excessive rates. • Thus, the Tennessee Valley

Authority (TVA) (1933) sought to discover exactly how much money it took to produce electricity and then keep rates reasonable. – It constructed dams on the Tennessee

River and helped the 2.5 million extremely poor citizens of the area improve their lives andtheir conditions.

– Hydroelectric power of Tennessee would give rise to that of the West.

Question 26

The federally-owned Tennessee Valley Authority was seen as a particular threat toa. the entire capitalist system.

b. the Republican party.

c. the automobile industry.

d. the private electrical utility industry.

e. white southern racial practices.

HOUSING REFORM AND SOCIAL SECURITY

• To speed recovery and better homes, FDR set up the Federal Housing Administration (FHA) in 1934 to stimulate the building industry through small loans to householders. – It was one of the “alphabetical” agencies

to outlast the age of Roosevelt. • Congress bolstered the program in

1937 by authorizing the U.S. Housing Authority (USHA), designed to lend money to states or communities for low-cost construction. – This was the first time in American history

that slum areas stopped growing.

HOUSING REFORM AND SOCIAL SECURITY

• The Social Security Act of 1935 was the greatest victory for NewDealers, since it created pension and insurance for the old-aged, theblind, the physically handicapped, delinquent children, and otherdependents by taxing employees and employers. – Republicans attacked this bitterly, as

such government-knows-bestprograms and policies that were communist leaning and penalized the rich for their success. They also opposed the pioneer spirit of“rugged individualism.”

Question 27The Social Security Act of 1935 provided all

of the following excepta. unemployment insurance.

b. old-age pensions.

c. economic provisions for the blind and disabled.

d. support for the blind and physically handicapped.

e. health care for the poor.

A NEW DEAL FOR LABOR • A rash of walkouts

occurred in the summer of 1934, and after the NRA was axed, the Wagner Act (AKA, National Labor Relations Act) of1935 took its place. The Wagner Act guaranteed the right of unions to organize and to collectively bargain with management.

– Under the encouragement of a highly sympathetic National Labor Relations Board, unskilled laborers began to organize themselves into effective unions, one of which was John L. Lewis, the boss of the United Mine Workers who also succeeded in forming the Committee for Industrial Organization (CIO) within the ranks of the AF of L in 1935.

• CIO wanted to organize all workers in an entire industry not just a plant

– The CIO later left the AF of L and won a victory against General Motors.

A NEW DEAL FOR LABOR • The CIO also won a victory

against the United States Steel Company, but smaller steel companies struck back, resulting in such incidences as the Memorial Day Massacre of 1937 at the plant of the Republic Steel Company of South Chicago in which police fired upon workers, leaving scores killed or injured.

FAIR LABOR STANDARDS ACT

• In 1938, the Fair Labor Standards Act (AKA the “Wages and Hours Bill”) was passed, setting up minimum wage and maximum hours standards and forbidding children under the age of sixteen from working.

• Roosevelt enjoyed immense support from the labor unions.

• In 1938, the CIO broke completely with the A F of L and renamed itself the Congress of Industrial Organizations (the new CIO).

Question 28

The Wagner Act of 1935 proved to be a trailblazing law thata. gave labor the right to bargain collectively.

b. established the NRA.

c. established the Social Security system.

d. authorized the Public Works Administration (PWA).

e .guaranteed housing loans to workers.

Question 29

The primary interest of the Congress of Industrial Organizations wasa. the effective enforcement of yellow dog

contracts.

b. the organization of trade unions.

c. the maintenance of open shop industries.

d. the organization of all workers within an industry.

e. maintaining existing wage levels.

LANDON CHALLENGES “THE CHAMP”

1936 PRESIDENTIAL ELECTION

• The Republicans nominated Kansas Governor Alfred M. Landon to run against FDR. – Landon was weak on the

radio and weaker in personal campaigning, and while he criticized FDR’s spending, he also favored enough ofFDR’s New Deal to be ridiculed by the Democrats as an unsure idiot.

LANDON CHALLENGES “THE CHAMP”

1936 PRESIDENTIAL ELECTION

• In 1934, the American Liberty League had been formed by conservative Democrats and wealthy Republicans to fight “socialistic” New Deal schemes.

• Roosevelt won in a huge landslide, getting 523 electoral votes to Landon’s 8.

• FDR won primarily because he appealed to the “forgotten man,” whom he never forgot.

“PACKING THE COURT”• The 20th Amendment had cut the

lame-duck period down to six weeks, so FDR began his second term on January 20, 1937, instead of on March 4.

• He controlled Congress, but the Supreme Court kept blocking hisprograms, so he proposed a shocking plan that would add a member to the Supreme Court for every existing member over the age of 70, for a maximum possible total of 15 total members.

– For once, Congress voted against him because it did not want to lose its power.

– Roosevelt was ripped for trying to become a dictator.

THE COURT CHANGES COURSE

• FDR’s “court-packing scheme” failed, but he did get some of the justices to start to vote his way, including Owen J. Roberts, formerly regarded as a conservative.

• So, FDR did achieve his purpose of getting the Supreme Court to vote his way.

• However, his failure of the court-packing scheme also showed howAmericans still did not wish to tamper with the sacred justice system.

Question 30

President Roosevelt's Court-packing scheme in 1937 reflected his desire to make the Supreme Courta. more conservative.

b. more independent of Congress.

c. more sympathetic to New Deal programs.

d. less burdened with appellate cases.

e. more respectful of the Constitution's original intent.

Question 31

After Franklin Roosevelt's failed attempt to pack the Supreme Courta. Roosevelt was unable to make any changes in the

Court.

b. the Democrats lost the next election in 1940.

c. Congress permanently set the number of justices at nine.

d. much New Deal legislation was ruled unconstitutional.

e. the Court began to rule that New Deal programs were constitutional.

Question 32Both ratified in the 1930s, the Twentieth

Amendment ____ and the Twenty-first Amendment ____.a. shortened the time between presidential election and

inauguration; ended prohibitionb. limited a president to two complete terms in office;

repealed the Eighteenth Amendmentc. rendered most New Deal programs unconstitutional;

limited a president to two complete terms in officed. ended prohibition; shortened the time between

presidential election and inauguratione. expanded the size of the Supreme Court; ended

prohibition

TWILIGHT OF THE NEW DEAL • During Roosevelt’s first term,

the depression did not disappear, and unemployment, down from 25% in 1932, was still at 15%. – In 1937, the economy took

another brief downturn when the “Roosevelt Recession,”

caused by government policies. Finally, FDR embraced the

policies of British economist John Maynard Keynes.

• In 1937, FDR announced a bold program to stimulate the economy by planned deficit spending.

• In 1939, Congress relented to FDR’s pressure and passed the Reorganization Act, which gave him limited powers for administrativereforms, including the key new Executive Office in the White House.

• The Hatch Act of 1939 barred federal administrative officials,except the highest policy-making officers, from active politicalcampaigning and soliciting.

Question 33

As a result of the 1937 Roosevelt recessiona. Roosevelt backed away from further

economic experiments.

b. Social Security taxes were reduced.

c. Republicans gained control of the Senate in 1938.

d. Roosevelt adopted Keynesian (planned deficit spending) economics.

e. much of the early New Deal was repealed.

NEW DEAL OR RAW DEAL? • Foes of the New Deal condemned its waste, citing that

nothing had been accomplished. • Critics were shocked by the “try anything” attitude of

FDR, who had increased the federal debt from $19.487 million in 1932 to $40.440 million in 1939.

• By 1938, the New Deal started to lose momentum and support

• It took World War II, though, to really lower unemployment. But, the war also created a heavier debt than before.

Question 34During the 1930s

a. the Great Depression forced President Roosevelt to trim the size of the federal bureaucracy.

b. the states regained influence over the economy.

c. business people eventually came to admire President Roosevelt's New Deal programs.

d. the New Deal substantially closed the gap between production and consumption in the American economy.

e. the national debt doubled.

Question 35

By 1938, the New Deala. had lost most of its momentum.

b. turned more toward direct relief than social reform.

c. had plainly failed to achieve its objectives.

d. had won over the majority of business people to its policies.

e. was prepared to embark on ambitious new initiatives.

FDR’S BALANCE SHEET • New Dealers claimed that the New Deal had

alleviated the worst of the Great Depression. • FDR also deflected popular resent against

business and may have saved the American system of free enterprise, yet business tycoons hated him.

• He provided bold reform without revolution. • Later, he would guide the nation through a titanic

war in which the democracy of the world would be at stake.

Question 36

Franklin Roosevelt's New Deal was most notable fora. ending the Great Depression.

b. providing moderate social reform without radical revolution or reactionary fascism.

c. undermining state and local governments.

d. aiding big cities at the expense of farmers.

e. attacking the American capitalist system.