The Great Depression and the New Deal


The United States of America faced the Great Depression in 1929 when the US stock market was moving steadily for some years. However, the market crashed, banks collapsed, the companies became bankrupt, and workers were fired in many organizations. In fact, the depression put the country in the worst economic times. President Herbert Hoover called for public patience since he thought the crisis was just a temporary event in the country. He said it was not the government mandate to resolve the issue. In fact, he maintained that the citizens should not expect assistance from the government but should help the administration. As the years passed, almost a quarter of the America’s population was unemployed. Therefore, to understand the concept behind the New Deal, it is imperative to discuss the underlying factors, the initiated programs, and plans that stabilized the economy of the United States.

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Later in the year 1932, the nation went to the polls and elected Franklin Roosevelt as their President. Upon assuming office in 1933, President Roosevelt immediately took actions to stabilize the economy. He devised programs that would create jobs and relieve the suffering citizens. In the following years, the government undertook various programs and projects that became to be known as the New Deal. The main objective of these platforms was to restore the dignity of the American people and create prosperity of the United States (Morton 658). Thus, the programs initiated by Roosevelt permanently changed the relationship between the government and the citizens.

The First Hundred Days

During his campaign and inaugural speech, Roosevelt promised to work to stabilize the economy within the first 100 days. Hence, after being sworn in as the President, he declared a four-day bank holiday, stopping people from withdrawing money from the already collapsing banks. Later, he advised the Congress to pass the famous Roosevelt Emergency Banking Act, whose purpose was to reorganize and stabilize the banking industry (Schlesinger 1). He urged people to put back their savings in the banks, which led to the reopening of the banks that had closed. In this case, people regained confidence and trust in banks, a move that led to their restoration and stability in the industry.

In his quest to end the Great Depression, Roosevelt advised the Congress to amend the law on Prohibition, thus making it legal for the citizens to buy beer again. In May, Roosevelt signed the act into law and enabled the federal government to build dams to control flooding, thus giving jobs to the youth and providing cheaper hydroelectric power. The Congress continued to work closely with President Roosevelt, and in the same month, they passed a bill that ensured the commodity farmers were paid once they left the furrows, a move that would end surplus agricultural produce, thus boosting prices. In June the same year, the National Industrial Recovery Act (NIRA) was passed, which allowed workers to form unions to bargain collectively for better-working conditions and an increase in wages. The government suspended some laws that were referred to as antitrust and established a Public Works Administration that the federal government funded (Schlesinger 5). The Acts passed in the first 100 days of the Roosevelt administration pleased the citizens who felt he was delivering on his campaign and inaugural promises.

The New Deal worked well though it faced political opposition, especially from the people who benefited from the hard economic times. The banking industry had improved, since the Banking Act had led to the re-opening of some banks and stabilizing the collapsing ones. Youths had secured employment to build the dams that provided cheaper electricity in the region. The urge for workers to form unions had led to better remuneration, thus improving their lives. Therefore, it is evident that the various programs put in place within the first one hundred days of the Roosevelt administration were working for the betterment of the nation. Although most of the problems were solved, many people remained unemployed. However, to create more job opportunities for the unemployed and grow the dragging economy, the Roosevelt administration had to develop new ways of addressing the issue.

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The Second New Deal

Regardless of the efforts made by President Roosevelt and his cabinet, the Great Depression persisted, while high number of unemployed people became angrier and more desperate. Therefore, in 1936, Roosevelt launched another series of programs called the Second New Deal. In April, he formed a Works Progress Administration (WPA) whose goal was to offer employment to the jobless (Hamen70). However, the WPA projects were not supposed to compete with the private sector; therefore, they were focused on building schools, highways, offices, and parks. Additionally, the WPA gave jobs to musicians, artists, writers, and theater directors (Hamen 68). In July the same year, the National Labor Relations Act created the National Relations Labor Board, whose mandate was to supervise union elections and ensure that businesses treated their workers fairly. Roosevelt later signed the Social Security Act, whose objective was to set up an insurance policy for the unemployed ( 1). The Act stated that the federal government would help care for the disabled and the dependent children.

The projects initiated by the government provided more jobs for the unemployed population and those with talents. Thus, the young people earned income that supported them during those hard economic times. On the other hand, the government provided affordable hydroelectric power, thus lowering the industries’ cost of operation. The government initiative to ensure the unemployed people gave them hope. Additionally, the government ensured it helped the disabled and the children (Morton 659). The programs launched in the Second New Deal were thriving though they faced opposition where Roosevelt was accused of doubling the nation’s debt. In essence, it is evident that the second new deal programs fulfilled the goal of providing employment.

From the discussion, it is evident that desperate times call for desperate measures. The Roosevelt administration undertook various experimental programs that were said to have saved the country’s economy and democracy. America faced the worst economic times when many people were left jobless while banks and business organisations collapsed. However, the New Deal, an initiative launched by Roosevelt, provided jobs to millions of people and sponsored other public projects. The federal government passed a bill to protect the banks from the dangerous trends in which they were operating. The government structured a new Social Security system, which benefited the old, unemployed, disabled, and the dependent children. The workers were urged to form unions that they used to negotiate for increased wages and better working conditions. From then henceforth, the government took charge in the management of the economy. However, despite all the government efforts, the New Deal failed to achieve its objective, as a large percentage of the population was still unemployed. Irrespective of the limitations and the setbacks, the New Deal programs played a major role in reviving America’s economy through the hard financial times.


Works Cited

Hamen, Susan E. The New Deal. Edina, Minn: ABDO Pub. Co, 2011.

Keller, Morton. “The New Deal: A New Look.” Policy, vol. 31, no. 4, 1999, pp. 657–663.

Schlesinger, Arthur M. The Coming of the New Deal: 1933-1935. Houghton Mifflin, 2003. U.S. History. The New Deal, 2008, Accessed: 25 November 2016.

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