Critics of the New Deal

Critics of the New Deal

The Right, the Left, and the Court

Attack from RightAmerican Liberty League

American Liberty League

• Formed in 1934 by conservative Democrats such as Al Smith along with many industrialists, notably members of the Du Pont family.

• Its stated goal to "defend and uphold the Constitution" and "foster the right to work, earn, save and acquire property."

• The League spent between $500,000 and $1.5 million in promotional campaigns; its funding came mostly from the Du Pont family, as well as leaders of U.S. Steel, General Motors, Standard Oil, and Goodyear Tire and Rubber Company.

• It reached over 125,000 members and supported the Republicans in 1936.

American Liberty League• The League used print media and radio to distribute

information including 1,600 newspapers.

• Its political goal was defeating FDR in 1936, backing the presidential candidacy of Republican Governor Alf Landon.

• Members made large contributions individually to Landon. “Without Liberty League money,” Republican National Chairman John D. Hamilton would admit, “we wouldn't’ have

had a national headquarters.”• FDR’s strategy: Make the Liberty League synonymous with

social and economic privilege, associate it closely with the Republican Party, then attack the Republicans by attacking the League.

Election of 1936

Attack from the LeftHuey P. Long

Huey P. Long• Nicknamed The Kingfish, A Democrat, Long was noted for his

radical populist policies. He served as Governor of Louisiana from 1928 to 1932 and as a U.S. senator from 1932 to 1935.

• Long split with Roosevelt in June 1933 over Long’s perception that the New Deal was too conservative.

• Long’s political career was launched in Louisiana attacking banks, Standard Oil Co., and the ruling oligarchy

• His support of populist issues: free textbooks, lowering utility rates, revising tax codes endeared him to the powerless.

Share-Our-Wealth• Long proposed a radical wealth redistribution plan which

called for heavy taxes on accumulated wealth over one million dollars.

• Revenue would support the following:1) A family homestead allowance of 5,0002) An annual guaranteed income of 2,500.3) Old age pensions at 60 4) Immediate payment of veteran’s benefits5) Free college and vocational school tuition6) Govt. purchase and storage of agricultural surplus

• Long boasted 7 million member in Share-Our-Wealth Societies across the nation

• Long considered challenging FDR in’36, Democratic National Committee polls showed he would get 10% of the vote as a third party candidate. An assassin silenced Long Sept. ‘35

Attack from the LeftFather Charles Coughlin

Golden Hour of the Little Flower

• Canadian-born Roman Catholic priest at Royal Oak, Michigan's National Shrine of the Little Flower Church. He was one of the first political leaders to use radio to reach a mass audience,

• Forty million tuned to his weekly broadcasts during the 1930s.

• During the 1932 Presidential election. He was an early supporter of Roosevelt's New Deal reforms and coined the phrase "Roosevelt or ruin“ & "The New Deal is Christ's Deal.“

• Coughlin split with FDR because he felt that the administration did not deal harshly enough with “money powers” (bankers, stock brokers, & corporate magnates)

National Union for Social Justice

• 1936, preamble, “I believe that wealth … originates from the natural resources and from the labor which the sons of God expend upon these resources. It is all ours except for the harsh, cruel and grasping ways of wicked men who first concentrated wealth into the hands of a few.”

• His Sixteen Principles called for:1) A living wage 2) Strict regulation (nationalization) of banking and utility co.3) Abolition of the Federal Reserve4) Lifting taxes on the working class

• After ’36 Election the tone of radio messages became more antiemetic and pro-fascist. Suggesting that the Depression was a conspiracy of Jewish bankers.

• FCC regulations limited his audience in an attempt to silence his message. ‘42 the Archbishop of Detroit ordered him to stop his broadcasts.

Attack from the LeftDr. Francis Townsend

Townsend Plan• California physician proposed a revolving old-age pension

plan to ease the impact of the Depression.

• His movement had over 5 million supporters

• “Townsend Plan”1) Providing a $200 monthly pension for everyone 60 yrs. old2) Recipients would be required to spend the monthly benefit within 30 days3) The plan would be funded by a 2% tax on the production of

goods (value added tax)

Townsend Plan• The plan was to lower unemployment by removing everyone

over 60 from the labor force, resulting in greater demand for workers and higher wages.

• Requiring seniors to spend the benefit would increase demand, also lowering unemployment

• Critics of the Townsend Plan saw it as simply shifting purchasing power to elderly by taxing younger workers.

• The popular support for the plan prompted action on the Social Security Act. However, pension plans were considered early in FDR’s presidency

The List Continues…

Upton Sinclair• Muckraker, novelist, Socialist,

California gubernatorial candidate• End Poverty on California (EPIC)

1) Production for use, not profit2) Replace sales tax with a progressive income tax3) Idle land would be used to create agricultural colonies made up of unemployed workers. Surplus would be processed in state run factories for distribution to the needy

• Dismissed by FDR, Democrats and Republicans. Sinclair lost the race but still carried 45% of the vote

African-Americans• FDR had a significant number of

African-Americans serving in his administration:Mary McLeod Bethune-friend to Eleanor Roosevelt, she became a close advisor to FDR throughthe Federal Council on Negro Affairs known as the Black Cabinet.

• FDR was sympathetic toward African Americans but failed to use the New Deal to push racial issues to keep Southern Democrats in his political coalition

African-Americans• AAA forced scarcity through

crop destruction and federal subsidies paid directly to landowners. The result poor tenant farmers and share croppers were kicked off the land with no means of support

• Officials were aware of the problem of dispossessed croppers, but landowners continued to skirt Agriculture Dept. guidelines to keep croppers on the land

African-Americans• 250,000 African Americans

enrolled in nearly 150 all-black CCC companies. (10% of total)

• Integrated CCC camps were disbanded in July, 1935, when CCC Director Robert Fechner issued a directive ordering the "complete segregation of colored

and white enrollees." • In spite of efforts by Harold Ickes,

Fechner continued to discriminate and prevent blacks from taking

supervisory roles in the CCC

Attack from the Supreme Court

Supreme Court Challenges• The Supreme Court of 1937 was occupied by six justices

appointed by Harding, Coolidge, and Hoover

• For 30 years the Court had been interpreting the Constitution as espousing the doctrine of "freedom of contract,“

• A.L.A. Schechter Poultry Corp. v. United States (1935). – Court rules that price and wage fixing codes exceeded the

proper authority of the commerce clause– NIRA (part of the executive branch) did not have the

Constitutional authority to write regulatory codes (in effect making law)

– 9-0 decision, National Industrial Recover Act held to be unconstitutional

Supreme Court Challenges• United States v. Butler (1936)

– Provisions of the Agricultural Adjustment Act, placed a tax on processors of farm products (mills). The proceeds to be paid to farmers who would reduce their area and crops. The intent of the act was to increase the prices of certain farm products by decreasing the quantities produced.

– Court held that the specific target of the tax and the revenue did not pass the test of “general welfare” as defined in Article I, sec. 8 of the Constitution

– 9-0 decision, Agricultural Adjustment Administration held to be unconstitutional tax for an impermissible regulatory purpose.

Court Packing Scheme

Court Packing Scheme• Frustrated over the Supreme Court decisions that overturned

six New Deal programs FDR took action to pack the Court with justices sympathetic to his agenda.

• The "Four Horsemen" was the name given to the conservative members of the Court during the 1932-1937 terms, who

opposed the New Deal agenda • The Judiciary Reorganization Bill of 1937, was a law

proposed by FDR would have allowed the President the power to appoint an extra Supreme Court Justice for every sitting Justice over the age of 70½. (Allowing 6 appointments)

• FDR took his case to the public in his ninth fireside chat.

Court Packing Scheme• Public opinion, Congressional Democrats and Republicans

renounced the scheme "a needless, futile and utterly dangerous abandonment of constitutional principle… without precedent or justification."

• FDR depended on Senate Majority Leader Joseph Robinson to win Senate support. (he died of a heart attack 7-14-37) On 7- 22-37, the Senate voted 70-20 to send the judicial-reform measure back to committee, where the controversial plan was stripped.

• Within the year two “Horsemen”, Willis Van Devanter and George Sutherland retires allowing FDR to appoint pro-New Deal replacements Hugo Black and Stanley Reed

Consequences of the Scheme

• The new appointments shifted the Court in FDRs favor. Two liberal justices result in 5-4 decisions in favor of minimum wage laws, the National Labor Relations Act (unions and collective bargaining), and the Social Security Act.

• Historians continue to debate the effectiveness of the scheme1) Was FDR bluffing?2) Did Justice Owen Roberts voting swing toward FDR as a result of political pressure over the court packing plan?3) Did Van Devanter retire once he realized that the Court was leaning liberal after the NLRB v. Jones & Laughlin Steel Corp case?