President Franklin D. Roosevelt Vs. Ronald Reagan: A Comparison
Amongst all the serving presidents of America, Franklin Delano Roosevelt, popularly known as FDR, stayed in the White House for the longest period of the years from 1933-1945. Nonetheless, the 12 years of service to America saw him bring critical changes both socially and politically, unlike all his predecessors (Leuchtenburg 147). However, his tenure was short of challenges beyond his control. Nevertheless, with his responsive tactics as a leader and the revolution caused by the New Deal, FDR became a defining figure in United States history. On the other hand, President Ronald Reagan was the 40th president of America, serving from 1981 to 1989. However, when he took office, America’s economy was in decline. Still, he established a great vision of resolving the crisis of high taxation, unemployment, interest rates, and a lowered national spirit. With his high hopes and a small but specific plan, Reagan brought America’s economy back on the ascending track (Leuchtenburg 581). Notably, both presidents were remarkable figures in the history of America, but their ideologies, approaches, and policies differed greatly. Therefore, this study will evaluate the different policies and laws introduced during FDR’s tenure and how President Reagan’s administration redefined those strategies.
President Reagan’s and Roosevelt’s Philosophies on the Role of Government
President Roosevelt’s philosophy was premised on the concept that government was what the American people needed. Therefore, the state and federal government’s responsibility was to regulate the economy by directly supporting society (Leuchtenburg 146). In fact, FDR argued that the destitute and wealthy needed to be considered to recover America’s economy. Consequently, he enacted policies where both economic groups would merge and become dependent on each other. Moreover, with this philosophy, Roosevelt’s administration directly resolved the issues of the citizens instead of the local governments. Due to this approach, the relationship between the government and its people changed for the better, with the New Deal cementing it further and upholding Roosevelt’s legacy (Freedman 95).
On the other hand, President Reagan’s philosophy was directly opposite to FDR’s rationale. Reagan claimed that the government was not a solution for the American people in his inauguration speech. Instead, it was the source of all the crises facing the US. Therefore, he argued that the federal government needed to pave the way for the American people to resolve their economic problems. Indeed, after taking the oath to serve for the sake of Americans, Reagan enacted policies that saw lowered taxes and controlled spending. At the same time, government regulations were minimized to help unleash the entrepreneurial spirit of Americans (Groom 100). In essence, Reagan believed that with the incentives to invest or build businesses, it would result in job opportunities, tamed inflation, and reduced interest rates.
President Roosevelt’s and Reagan’s Policies Regarding Unions
During his tenure, FDR noticed that employees were treated unfairly in their workplaces. Therefore, to resolve this problem, Roosevelt and Senator Wagner 1935 lobbied the Senate to sign the National Labor Relations Act into law. According to this legislation, an independent board would be formed where they would enforce the rights of employees instead of only arbitrating disputes between laborers. As a result, under section 7 of the constitution, employees were allowed to join and form labor unions (Freedman 99). In addition, workers were rightfully allowed to bargain collectively with their unions in an appropriate procedure. Consequently, with a board installed to make a ruling, most workers within the American commercial sector were represented and covered, thus their jobs were secured. In fact, FDR’s administration renewed national labor policies in America (Leuchtenburg 150).
On the other hand, President Reagan’s tenure in office saw the end of unions. Although he campaigned that the rights of a worker in the private sector should be upheld, his term in office confirmed that the union should adhere to the 1955 labor law. In this Act, it was stipulated that federal employees were not allowed to strike. Therefore, in 1981 when the Professional Air Traffic Controllers Organization (PATCO) industrial action took place, Reagan used his executive powers to sack nearly 13,000 employees and prohibit them from holding public office (Groom 92). With this kind of approach and backlash on workers, organized unions became an idea of the past in America. In fact, organized labor groups still face anti-union sentiments in the country (Leuchtenburg 585). Nevertheless, private sectors still use harsh stances and treat their employees as expendable due to the unions’ limitations.
President FDR’s and Reagan’s Views on Government Regulations
Upon assuming office, Roosevelt found unstable banking where almost a quarter of the sector had already failed. Therefore, FDR closed down all banks for a hundred days to resolve this issue by proclaiming a banking holiday in America. In essence, the forthcoming legislation was enacted in 1933, known as the Glass-Steagall Act. This enactment implied that bank assets would be directed to safer and more practical use, ensure improved interbank control, and prevent the diversion of funds into unimportant operations or other careless purposes (Freedman 94). Moreover, within this legislation, the Federal Reserve’s authority was expanded to ensure they could regulate their member banks. At the same time, a Federal Deposit Insurance Corporation was created as insurance for retail deposits to prevent the risk of failing banks.
While FDR’s administration built a fair and competitive economy, President Reagan chose to trample on them during his term (Leuchtenburg 160). Due to his philosophy of a lax nation without government oversight, the idea of lending became a wild enterprise. As a result, people stopped recognizing government regulations enacted to serve all businesses’ interests (Groom 94). Consequently, banks stopped wisely managing savings and loans, and their leaders recklessly invested the people’s money (Leuchtenburg 600). For instance, mortgage brokers started promoting sub-prime loans, deceived their home buyers, and passed fake documents to naive investors.
FDR’s and Reagan’s Taxation Policies on the Rich
It is worth noting that the Wealth Tax Act was enacted in 1935 when Roosevelt intended to promote wealth redistribution (Leuchtenburg 230). Nonetheless, in 1936 America agreed that all World War I veterans would be compensated 2 billion dollars, leading to the raise of the taxes. Consequently, to ensure equality, FDR enacted the Undistributed Profit Tax Act of 1936, where the rich saw their personal income taxes, corporate, estate, excise, and gift tax increase (Freedman 98). On the other hand, ordinary people’s taxes were raised for liquor products in their social security payrolls. Therefore, top earners were submitted to 100% tax on their incomes. Nonetheless, after heated debates, the taxes on the rich people’s income were reduced to 94%, but this was after ensuring that all loopholes of capital were exploited. As a result of tax reform, Americans had less money to invest in the business, thus leading to high unemployment rates.
While FDR upheld the idea of increased taxation on the rich people’s income, Reagan took to relieving their taxes. Concisely, after assuming office, Regan ensured passed the Economic Recovery Act in 1981, where more than 25% of taxes were reduced for American citizens. Further, in 1986 he initiated the enactment into law the Tax Reform Act, which lowered tax rates by 15% for middle-class earners while the rate for the wealthy was reduced by 28%. Due to Reagan’s policy investment plans, employment opportunities increased, and national growth was realized (Groom 96). However, despite the vast benefits achieved by middle and working-class families, America’s national debts increased considerably due to reduced taxation.
FDR’s Keynesian Economics and Reagan’s Supply-Side Economics
From the outset, Roosevelt’s idea was based on balancing the budget to instill confidence in business and the American market. However, when the Great Depression persisted, he was forced to embrace necessary relief programs despite the cost (Leuchtenburg 170). Eventually, FDR’s administration was urged to embrace John Maynard Keynes’s Keynesian economics theory. With Keynes’s theory of supply and demand, Roosevelt’s administration allowed the economy to balance itself. Consequently, new jobs were created through programs such as the Civilian Conservation Corps and Works Progress Administration (Freedman 96). With these occupations, people were empowered financially, which increased their desire to spend, demand for goods, and employment rates and balanced the fragile economy. Accordingly, the Keynesian economic scheme established that individual freedom came from independence and economic security.
However, while Roosevelt fully embraced Keynesian economics, Reagan was more of the supply-side approach. With this theory, Reagan intuited that if people were allowed to keep more money, they would be incentivized to increase their earned income. Nonetheless, the realization of this policy required cutting down on taxation (Groom 102). However, the optimism in this model was not seen immediately because America experienced a considerable recession in the period of 1981-1982. Consequently, the nation saw an increase in imports and a decrease in exports due to the inflated dollar on the international stock exchange.
Policies Favoring Equality or Inequality in Both Roosevelt’s and Reagan’s Tenure
In a bid to respond to the Great Depression, Roosevelt embraced the New Deal program, where superior principles included economic recovery, relief, and reforms. The aid package, in particular, targeted the poor, unemployed, and the common American. Therefore, to curb unemployment, FDR created the Civilian Conservation Corps in 1933. As a result, young men got jobs as tree planters and public park builders, drained swamps, restocked fish in rivers, engaged in flood control projects, and did other environmental conservation work (Freedman 89). On the other hand, the emergency relief program was formed where federal money could be provided to the extremely needy people in society. In addition, other equalities upholding Acts were enacted into law, including the Agricultural Adjustment law in 1933, the Federal Securities and National Housing laws in 1934, and the Social Security law of 1935 (Leuchtenburg 150).
Notably, President Reagan’s term introduced inequality in America, especially after the supply-side theory was popularized. However, the living standards improved during his tenure but not as fast as in the 1950s. In fact, the reason for increased inequality was owing to the cutbacks in money transfers and all other bank transactions. Moreover, the initiative of changing tax policies led to greater wealth but translated to inequality, while poverty decreased, leading to sufficient incomes (Groom 115). Another reason that widened the gap between the poor and the rich was the aspect of the busted spirit of organized labor groups that occurred in the 1981 PATCO saga.
FDR’s and Reagan’s Programs and their Impacts on Women
American women, especially those in the working sector, associate their benefits with the New Deal sparked during FDR’s tenure. In essence, it was the active role of Eleanor Roosevelt that advocated for the social and economic rights of women, which supported American gender equality. She understood that women suffered from the Great Depression, especially due to unemployment (Freedman 98). Therefore, Eleanor lobbied policymakers to consider women in granting employment opportunities in all relief programs formulated in FDR’s administration. Consequently, special programs were created for women where female leaders were the heads. In addition, women saw their wages equalized with those of men and benefited from the Fair Labor Relations Law, which allowed them to form unions. Therefore, women received standardized minimum wages and working hours and acquired top positions within the federal government (Leuchtenburg 190).
On the other hand, Reagan’s administration saw the introduction of policies that negatively impacted women. For instance, in 1984, he actively lobbied the Human life Amendment Act which intended to ban abortion and some birth control initiatives. Further, Regan’s office offered little support to the Equal Employment Opportunity Commission in charge of the investigation of discrimination on gender basis at workplaces (Groom 109). Consequently, more women lost their jobs while the anti-equality judge Clarence Thomas failed to eradicate the pay gaps and sexual harassment cases in various jobs. In addition, Reagan refused to raise the minimum wage for low-level workers considering that most adult women were in this category (Leuchtenburg 590). Besides, to further diminish women’s rights, the president lobbied for enacting the family protection act in 1981, but the bill did not pass.
As evident from the discussion, both President Roosevelt and Reagan’s administrations significantly impacted the social and economic platforms of America’s history. However, their landmark changes were influenced by their difference in ideologies during their leadership periods. Clearly, FDR advocated for an intervening government, while Reagan supported an unrecognized administration. On the other hand, while FDR took to creating trade unions, Reagan ended active and organized labor groups in America. In addition, Roosevelt withheld that regulations in the banking and security sector were crucial to a fair and competitive economy. However, Reagan’s administration insisted that government regulations were unnecessary because they led to a disrupted economy. Additionally, FDR campaigned and enacted laws that supported progressive taxation to help pay off federal debts. Reagan’s term, on the other hand, saw charges reduced, especially those that affected the rich. Moreover, their economic approaches differed, with Roosevelt embracing Keynesian economics’s supply and demand theory, where equality prevailed considerably. Reagan consequently took a different approach to reduce taxes, a method that encouraged and increased inequality in America. Regarding gender equality, FDR guaranteed that women were considered and even awarded top positions in his administration. At the same time, Reagan and other anti-equality activists actively acknowledged gender inequality laws, especially in the health and employment sectors.
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Freedman, Russell. Franklin Delano Roosevelt. New York: Clarion Books, 1990. Print.
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Groom, Winston. Ronald Reagan: Our Fortieth President. Washington, D.C: Regnery
Publishing, Inc, 2012. Print.
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Leuchtenburg, William E. The American President: from Teddy Roosevelt to Bill Clinton. Washington, D.C: Oxford University Press, 2015. Print.