Defunct
114-576: The New Deal was a series of domestic programs, public work projects , and financial reforms and regulations enacted by President Franklin D. Roosevelt in the United States between 1933 and 1938, with the aim of addressing the Great Depression , which began in 1929. Roosevelt introduced the phrase upon accepting the 1932 Democratic presidential nomination, and won the election in a landslide over Herbert Hoover , whose administration
228-405: A national security viewpoint and the impact on the community that the loss of such facilities would entail. Furthermore, the term public works has recently been expanded to include digital public infrastructure projects. For example, in the United States , the first nationwide digital public works project is an effort to create an open source software platform for e-voting (created and managed by
342-464: A " Conservative Manifesto " in December 1937, which included several statements of conservative philosophical tenets, including the line "Give enterprise a chance, and I will give you the guarantees of a happy and prosperous America." The document called for a balanced federal budget, state's rights , and an end to labor union violence and coercion . Over 100,000 copies were distributed and it marked
456-655: A broader term. Construction may be undertaken either by directly employed labour or by a private operator. Public works has been encouraged since antiquity. The Roman emperor Nero encouraged the construction of various infrastructure projects during widespread deflation . Public works is a multi-dimensional concept in economics and politics , touching on multiple arenas including: recreation (parks, beaches, trails), aesthetics (trees, green space), economy (goods and people movement, energy), law (police and courts), and neighborhood (community centers, social services buildings). It represents any constructed object that augments
570-539: A contrast. Prior to World War II most, though not all, conservative Republicans were non-interventionists who wanted to stay out of the war at all costs, while most, though not all, Southern conservatives were interventionists who favored helping the British defeat Nazi Germany . After the war, a minority of conservative Republicans (led by Taft) opposed military alliances with other nations, especially NATO , while most Southern Democrats favored such alliances. During
684-563: A decisive point in the consolidation of the conservative coalition in Congress. The liberal bloc in the House had been halved, and conservative Democrats had escaped 'relatively untouched ' ". In the House elected in 1938 there were at least 30 anti-New Deal Democrats and another 50 who were "not at all enthusiastic". In addition, "The new Senate was split about evenly between pro- and anti-New Deal factions." The Fair Labor Standards Act of 1938
798-470: A gold outflow. Under the gold standards, price–specie flow mechanism countries that lost gold, but nevertheless wanted to maintain the gold standard, had to permit their money supply to decrease and the domestic price level to decline ( deflation ). As long as the Federal Reserve had to defend the gold parity of the dollar it had to sit idle while the banking system crumbled. In March and April in
912-447: A government, are characteristic of socialism and other public or collectivist forms of government because of their 'tax and spend' policies to achieve long-term economic improvement. However, in the private sector, entrepreneurs bear their own losses and so private-sector firms are generally unwilling to undertake projects that could result in losses or would not develop a revenue stream. Governments will invest in public works because of
1026-536: A majority of Southern Democrats and Republicans it could muster, but also on how many votes it would win away from the opposing faction, the Northern Democrats. In 1968 , Nixon and native Southerner and American Independent candidate George Wallace carried the same number of states in the South . The coalition "found itself frequently allied with a conservative President against the restricted power of
1140-434: A much stronger position. The House contained 169 non-southern Democrats, 93 southern Democrats, 169 Republicans, and 4 third-party representatives. For the first time, Roosevelt could not form a majority without the help of some southerners or Republicans. In addition, the president had to contend with several senators who, having successfully resisted the purge, no longer owed him anything. Most observers agreed, therefore, that
1254-517: A nation's physical infrastructure. Municipal infrastructure, urban infrastructure , and rural development usually represent the same concept but imply either large cities or developing nations ' concerns respectively. The terms public infrastructure or critical infrastructure are at times used interchangeably. However, critical infrastructure includes public works (dams, waste water systems, bridges, etc.) as well as facilities like hospitals, banks, and telecommunications systems and views them from
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#17327582696211368-587: A provision for the "construction, reconstruction, alteration, or repair under public regulation or control of low-cost housing and slum-clearance projects". Many unemployed people were put to work under Roosevelt on a variety of government-financed public works projects, including the construction of bridges, airports, dams, post offices, hospitals, and hundreds of thousands of miles of road. Through reforestation and flood control, they reclaimed millions of hectares of soil from erosion and devastation. As noted by one authority, Roosevelt's New Deal "was literally stamped on
1482-665: A provision for unexpected expenses (cost overruns), which typically amount to 10% of the value of the contract. This money is spent during the course of the project only if the construction managers judge that it is necessary, and the expenditure must typically be justified in writing. [REDACTED] The dictionary definition of public works at Wiktionary Conservative coalition Newspapers Journals TV channels Websites Other Economics Gun rights Identity politics Nativist Religion Watchdog groups Youth/student groups Miscellaneous Other The conservative coalition , founded in 1937,
1596-468: A public housing provision when conservatives split. Truman was frustrated by continued conservative strength in Congress, in spite of liberal gains in the 1948 midterm elections. As noted by one study, "First of all, only one-third of the Senate is up for election every two years. In spite of the fact that the House has a narrow liberal majority, there are only 38 votes in the Senate wholeheartedly committed to
1710-541: A series of laws and executive orders, the government suspended the gold standard. Roosevelt stopped the outflow of gold by forbidding the export of gold except under license from the Treasury. Anyone holding significant amounts of gold coinage was mandated to exchange it for the existing fixed price of U.S. dollars. The Treasury no longer paid out gold for dollars and gold would no longer be considered valid legal tender for debts in private and public contracts. The dollar
1824-444: A short-term period of employment, has come to dominate practice, particularly in regions such as Sub-Saharan Africa . Applied in the short term, this is appropriate as a response to transient shocks and acute labour market crises. Investing in public works projects in order to stimulate the general economy has been a popular policy measure since the economic crisis of the 1930s. Spearheaded by U.S. Secretary of Labor Frances Perkins ,
1938-593: A steady, sharp upward recovery. Thus the Federal Reserve Index of Industrial Production sank to its lowest point of 52.8 in July 1932 and was practically unchanged at 54.3 in March 1933. However, by July 1933 it reached 85.5, a dramatic rebound of 57% in four months. Recovery was steady and strong until 1937. Except for employment, the economy by 1937 surpassed the levels of the late 1920s. The Recession of 1937
2052-449: A system of domestic allotments, setting total output of corn, cotton, dairy products, hogs, rice, tobacco, and wheat. The farmers themselves had a voice in the process of using the government to benefit their incomes. The AAA paid land owners subsidies for leaving some of their land idle with funds provided by a new tax on food processing. To force up farm prices to the point of "parity", 10 million acres (40,000 km) of growing cotton
2166-502: A total of 96) and 89 congressmen (out of a total of 431). Given his party's overwhelming majorities, FDR decided he could overcome opposition to his liberal New Deal policies by the conservative justices of the Supreme Court , which had struck down many New Deal agencies as unconstitutional. Roosevelt proposed to expand the size of the court from nine to fifteen justices; if the proposal met with success, he would be able to "pack"
2280-459: A total of five million. Political and business leaders feared revolution and anarchy. Joseph P. Kennedy Sr. , who remained wealthy during the Depression, recalled that "in those days I felt and said I would be willing to part with half of what I had if I could be sure of keeping, under law and order, the other half." Throughout the nation men and women, forgotten in the political philosophy of
2394-467: A turning point in terms of congressional support for New Deal legislation. Coalition opposition to Roosevelt's "court packing" Judiciary Reorganization Bill of 1937 was first led by House coalition Democrat and House Judiciary Committee chairman Hatton W. Sumners . Sumners refused to endorse the bill, actively chopping it up within his committee in order to block the bill's chief effect of Supreme Court expansion. Finding such stiff opposition within
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#17327582696212508-399: Is the provision of employment by the creation of predominantly public goods at a prescribed wage for those unable to find alternative employment. This functions as a form of social safety net . Public works programmes are activities which entail the payment of a wage (in cash or in kind) by the state, or by an Agent (or cash-for work/CFW). One particular form of public works, that of offering
2622-542: The 2008 European Union stimulus plan , and the American Recovery and Reinvestment Act of 2009 . While it is argued that capital investment in public works can be used to reduce unemployment, opponents of internal improvement programs argue that such projects should be undertaken by the private sector , not the public sector , because public works projects are often inefficient and costly to taxpayers. Further, some argue that public works, when used excessively by
2736-535: The Bonus Bill that would give World War I veterans a cash bonus. Congress finally passed it over his veto in 1936 and the Treasury distributed $ 1.5 billion in cash as bonus welfare benefits to 4 million veterans just before the 1936 election. New Dealers never accepted the Keynesian argument for government spending as a vehicle for recovery. Most economists of the era, along with Henry Morgenthau of
2850-422: The Great Depression 's economic damage was caused directly by bank runs. Herbert Hoover had already considered a bank holiday to prevent further bank runs but rejected the idea because he was afraid to incite a panic. However, Roosevelt gave a radio address, held in the atmosphere of a Fireside Chat . He explained to the public in simple terms the causes of the banking crisis, what the government would do, and how
2964-510: The Securities Act of 1933 was passed. It required the disclosure of the balance sheet, profit and loss statement, and the names and compensations of corporate officers for firms whose securities were traded. Additionally, the reports had to be verified by independent auditors. In 1934, the U.S. Securities and Exchange Commission was established to regulate the stock market and prevent corporate abuses relating to corporate reporting and
3078-684: The Securities and Exchange Commission (SEC), which protected investors from abusive stock market practices; and the Agricultural Adjustment Administration (AAA), which raised rural incomes by controlling production. Public works were undertaken in order to find jobs for the unemployed (25 percent of the workforce when Roosevelt took office): the Civilian Conservation Corps (CCC) enlisted young men for manual labor on government land, and
3192-657: The Senate Foreign Relations Committee in April 1943 stated that although the committee had 15 Democrats, seven Republicans, and one independent, because of the Republican-conservative Democratic alliance only 12 of the 23 members supported Roosevelt's policies. Conservatives also had strong representation in Congress in the post-war years. A handful of liberal measures, notably the minimum wage laws, did pass when
3306-713: The Tennessee Valley Authority (TVA) promoted electricity generation and other forms of economic development in the drainage basin of the Tennessee River . Although the First New Deal helped many find work and restored confidence in the financial system, by 1935 stock prices were still below pre-Depression levels and unemployment still exceeded 20 percent. From 1935 to 1938, the "Second New Deal" introduced further legislation and additional agencies which focused on job creation and on improving
3420-758: The Tennessee Valley Authority (TVA). The largest programs still in existence are the Social Security System and the Securities and Exchange Commission (SEC). From 1929 to 1933 manufacturing output decreased by one third, which economist Milton Friedman later called the Great Contraction . Prices fell by 20%, causing deflation that made repaying debts much harder. Unemployment in the United States increased from 4% to 25%. Additionally, one-third of all employed persons were downgraded to working part-time on much smaller paychecks. In
3534-633: The United States Congress throughout the 1970s and 1980s. These included Democratic House members as conservative as Georgia 's Larry McDonald , who was also a leader in the John Birch Society . During the administration of Ronald Reagan , the term "boll weevils" was applied to this bloc of conservative Democrats, who consistently voted for Reagan administration policies, such as tax cuts, increases in military spending, and deregulation . The boll weevils were contrasted with
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3648-618: The " gypsy moth Republicans "—moderate Republicans from the Northeast and Midwest who opposed many of Reagan's economic policies . As a result of the 1994 " Republican Revolution ", Republicans became the majority of Southern members of the U.S. House of Representatives for the first time since the Reconstruction era , also replacing many conservative Democratic congressmen. A few Democratic Congressmen switched parties, such as Alabama Senator Richard Shelby . After declining in
3762-421: The 1920s more than five hundred banks failed per year, and then it was less than ten banks per year after 1933. Under the gold standard , the United States kept the dollar convertible to gold. The Federal Reserve would have had to execute an expansionary monetary policy to fight the deflation and to inject liquidity into the banking system to prevent it from crumbling—but lower interest rates would have led to
3876-773: The 1920s, such as the TVA. The "First New Deal" (1933–1934) encompassed the proposals offered by a wide spectrum of groups (not included was the Socialist Party , whose influence was all but destroyed). This first phase of the New Deal was also characterized by fiscal conservatism (see Economy Act , below) and experimentation with several different, sometimes contradictory, cures for economic ills. Roosevelt created dozens of new agencies. They are traditionally and typically known to Americans by their alphabetical initials. The American people were generally extremely dissatisfied with
3990-623: The AAA. In 1936, the Supreme Court declared the AAA to be unconstitutional , stating, "a statutory plan to regulate and control agricultural production, [is] a matter beyond the powers delegated to the federal government". The AAA was replaced by a similar program that did win Court approval. Instead of paying farmers for letting fields lie barren, this program subsidized them for planting soil-enriching crops such as alfalfa that would not be sold on
4104-456: The American landscape". The rural U.S. was a high priority for Roosevelt and his energetic Secretary of Agriculture, Henry A. Wallace . Roosevelt believed that full economic recovery depended upon the recovery of agriculture and raising farm prices was a major tool, even though it meant higher food prices for the poor living in cities. Many rural people lived in severe poverty, especially in
4218-641: The Congressional liberals" in Nixon's first year as president in 1969, according to the 1969 Congressional Quarterly almanac. Conservative senators blocked an amendment that would have blocked the Safeguard anti-ballistic missile but lacked the votes to confirm Supreme Court nominee Clement Haynsworth . With Nixon's reelection and sweep of the South—as well as nearly every state in the country—in 1972 ,
4332-583: The Democratic Party's base to the New Deal coalition of labor unions , blue-collar workers, big city machines , racial minorities (most importantly African-Americans), white Southerners, and intellectuals. The realignment crystallized into a powerful liberal coalition which dominated presidential elections into the 1960s, as an opposing conservative coalition largely controlled Congress in domestic affairs from 1937 to 1964. Historians still debate
4446-591: The Democratic stronghold of the Solid South had fallen to the GOP at the presidential level, save for 1976, 1992, and 1996, when a Southern Democrat was the Democratic nominee. However most of the state and local elections were still dominated by Democrats until the 1990s; at first these long-serving Southern Democrats still wielded great power due to the seniority system through chairing powerful committees; however,
4560-764: The Farm Security Act to raise farm incomes by raising the prices farmers received, which was achieved by reducing total farm output. The Agricultural Adjustment Act created the Agricultural Adjustment Administration (AAA) in May 1933. The act reflected the demands of leaders of major farm organizations (especially the Farm Bureau ) and reflected debates among Roosevelt's farm advisers such as Secretary of Agriculture Henry A. Wallace, M.L. Wilson , Rexford Tugwell and George Peek . The AAA aimed to raise prices for commodities through artificial scarcity . The AAA used
4674-484: The Government, look to us here for guidance and for more equitable opportunity to share in the distribution of national wealth... I pledge myself to a new deal for the American people. This is more than a political campaign. It is a call to arms. Franklin D. Roosevelt , 1932 The phrase "New Deal" was coined by an adviser to Roosevelt, Stuart Chase , who used A New Deal as the title for an article published in
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4788-487: The House agenda through the House Rules Committee and the threat of possible filibusters in the Senate (which then required a 2/3 majority to break) several liberal initiatives such as a health insurance program were stopped. Truman's civil rights act died in Congress, leaving him to use executive orders to act against segregation. Much of Truman's Fair Deal in 1949–1951 was defeated, with exceptions such as
4902-568: The House as a whole, liberals were preponderant." In 1961, the House narrowly voted 217–212 in favor of a plan to enlarge the Rules Committee from 12 to 15 members. The aim of this was to provide committee liberals with a majority on most issues "and thereby prevent conservative Republicans and Southern Democrats on the Committee from blocking House floor action on liberal Administration proposals approved by legislative committees." In this
5016-437: The House, making it more responsive to the overall Democratic Caucus and leadership, and with less power for committee chairs (and the minority party.) Over in the Senate, the similarly large Democratic majority modified Rule 22, which governs the filibuster, shrinking the required majority to invoke cloture in most cases from two-thirds of the Senate to the current three-fifths, or 60 votes. These actions together greatly reduced
5130-437: The House, the administration arranged for the bill to be taken up in the Senate. Congressional Republicans decided to remain silent on the matter, denying pro-bill congressional Democrats the opportunity to use them as a unifying force. Republicans then watched from the sidelines as their Democratic coalition allies split the Democratic party vote in the Senate, defeating the bill. In the hard-fought 1938 congressional elections,
5244-593: The NRA and the first version of the Agricultural Adjustment Act (AAA) unconstitutional, but the AAA was rewritten and then upheld. Republican President Dwight D. Eisenhower (1953–1961) left the New Deal largely intact, even expanding it in some areas. In the 1960s, Lyndon B. Johnson 's Great Society used the New Deal as inspiration for a dramatic expansion of progressive programs, which Republican Richard Nixon generally retained. However, after 1974
5358-607: The New Deal, such as unemployment relief and public works programs. Roosevelt entered office with clear ideas for policies to address the Great Depression , though he remained open to experimentation as his presidency began implementing these. Among Roosevelt's more famous advisers was an informal " Brain Trust ", a group that tended to view pragmatic government intervention in the economy positively. His choice for Secretary of Labor , Frances Perkins , greatly influenced his initiatives. Her list of what her priorities would be if she took
5472-690: The Open Source Digital Voting Foundation). Reflecting increased concern with sustainability , urban ecology and quality of life , efforts to move towards sustainable municipal infrastructure are common in developed nations , especially in the European Union and Canada (where the FCM InfraGuide provides an officially mandated best practice exchange to move municipalities in that direction). A public employment programme or public works programme
5586-523: The Republicans scored major gains in both houses, picking up six Senate seats and 80 House seats. Thereafter the conservative Democrats and Republicans in both Houses of Congress would often vote together on major economic issues, thus defeating many proposals by liberal Democrats. The Fair Labor Standards Act of 1938 was the last major New Deal legislation that Roosevelt succeeded in enacting into law. A confidential British Foreign Office analysis of
5700-681: The Roosevelt administration launched the Tennessee Valley Authority , a project involving dam construction planning on an unprecedented scale to curb flooding, generate electricity, and modernize poor farms in the Tennessee Valley region of the Southern United States. Under the Farmers' Relief Act of 1933, the government paid compensation to farmers who reduced output, thereby raising prices. Because of this legislation,
5814-674: The South. Major programs addressed to their needs included the Resettlement Administration (RA), the Rural Electrification Administration (REA), rural welfare projects sponsored by the WPA, National Youth Administration (NYA), Forest Service and Civilian Conservation Corps (CCC), including school lunches, building new schools, opening roads in remote areas, reforestation and purchase of marginal lands to enlarge national forests. In 1933,
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#17327582696215928-564: The Treasury Department, rejected Keynesian solutions and favored balanced budgets. At the beginning of the Great Depression, the economy was destabilized by bank failures followed by credit crunches . The initial reasons were substantial losses in investment banking, followed by bank runs . Bank runs occur when a large number of customers withdraw their deposits because they believe the bank might become insolvent. As
6042-510: The administration, in which he met with Congress for 100 days. During those 100 days of lawmaking, Congress granted every request Roosevelt asked and passed a few programs (such as the Federal Deposit Insurance Corporation to insure bank accounts) that he opposed. Ever since, presidents have been judged against Roosevelt for what they accomplished in their first 100 days. Walter Lippmann famously noted: At
6156-427: The aggregate, almost 50% of the nation's human work-power was going unused. Before the New Deal, USA bank deposits were not "guaranteed" by government. When thousands of banks closed, depositors temporarily lost access to their money; most of the funds were eventually restored but there was gloom and panic. The United States had no national safety net, no public unemployment insurance and no Social Security . Relief for
6270-563: The average income of farmers almost doubled by 1937. In the 1920s, farm production had increased dramatically thanks to mechanization, more potent insecticides, and increased use of fertilizer. Due to an overproduction of agricultural products, farmers faced severe and chronic agricultural depression throughout the 1920s. The Great Depression even worsened the agricultural crises and, at the beginning of 1933, agricultural markets nearly faced collapse. Farm prices were so low that in Montana wheat
6384-588: The bank run progressed, it generated a self-fulfilling prophecy : as more people withdrew their deposits, the likelihood of default increased and this encouraged further withdrawals. Milton Friedman and Anna Schwartz have argued that the drain of money out of the banking system caused the monetary supply to shrink, forcing the economy to likewise shrink. As credit and economic activity diminished, price deflation followed, causing further economic contraction with disastrous impact on banks. Between 1929 and 1933, 40% of all banks (9,490 out of 23,697 banks) failed. Much of
6498-541: The banks in the Federal Reserve System reopened within the next three days. Billions of dollars in hoarded currency and gold flowed back into them within a month, thus stabilizing the banking system. By the end of 1933, 4,004 small local banks were permanently closed and merged into larger banks. Their deposits totaled $ 3.6 billion. Depositors lost $ 540 million (equivalent to $ 12,710,128,535 in 2023) and eventually received on average 85 cents on
6612-472: The bill, the 1964 GOP Presidential nominee, Barry Goldwater (R-AZ), voted against cloture; before his presidential campaign Goldwater had supported civil rights legislation but opposed the Civil Rights Act of 1964 on constitutional grounds, believing private individuals had the right to choose with whom they engaged in business . The GOP was massively defeated in 1964, but recovered its strength in
6726-706: The call for deregulation of the economy gained bipartisan support. The New Deal regulation of banking ( Glass–Steagall Act ) lasted until it was suspended in the 1990s. Several organizations created by New Deal programs remain active and those operating under the original names include the Federal Deposit Insurance Corporation (FDIC), the Federal Crop Insurance Corporation (FCIC), the Federal Housing Administration (FHA), and
6840-505: The coalition did have the power to prevent unwanted bills from even coming to a vote. The coalition included many committee chairmen from the South who blocked bills by simply not reporting them from their committees. Furthermore, Howard W. Smith , chairman of the House Rules Committee , often could kill a bill simply by not reporting it out with a favorable rule; he lost some of that power in 1961. The conservative coalition
6954-585: The coalition usually voted together on urban and labor issues, they were divided on other economic issues, such as farm and Western issues (such as water). Conservative Southern Democrats generally favored high government spending on rural issues, and in this urban and liberal Democrats supported them while Republicans were opposed. For this reason, Democratic caucuses of 230 to 260 seats were enough to pass Democratic farm programs, whereas on labor issues even Houses with in excess of 280 Democratic Members could not pass labor priorities. Foreign policy goals also presented
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#17327582696217068-593: The conditions of the elderly, workers, and the poor. The Works Progress Administration (WPA) supervised the construction of bridges, libraries, parks, and other facilities, while also investing in the arts; the National Labor Relations Act guaranteed employees the right to organize trade unions ; and the Social Security Act introduced pensions for senior citizens and benefits for the disabled, mothers with dependent children, and
7182-415: The congressional conservatives agreed in opposing the spread of federal power and bureaucracy, in denouncing deficit spending, in criticizing industrial labor unions , and in excoriating most welfare programs. They sought to 'conserve' an America which they believed to have existed before 1933." The coalition dominated Congress from 1937 to 1963, when former Senate Majority Leader Lyndon Johnson assumed
7296-477: The congressional elections of 1966, and elected Richard Nixon president in 1968. Throughout the 1954–1980 era the Republicans were a minority in both the House and Senate, but most of the time they cooperated with Conservative Democrats. In defining the size of the Conservative Coalition in 1964, one study noted that As of adjournment Oct. 3, the potential strength of the conservative coalition
7410-399: The conservative coalition split. Some infrastructure bills received conservative support, and funding for more highways was approved under both FDR and President Dwight D. Eisenhower ; Eisenhower also expanded public housing. While such liberal successes did happen, they often required negotiations between factions controlling different House committees. With conservatives heavily influencing
7524-711: The court with six new justices who would support his policies. However, the Southern Democrats , who controlled the entire South at the time with little Republican opposition, were divided between liberal and conservative factions. While the Southern Democrats included many New Deal supporters, there were also many conservatives among them who were opposed to the expansion of federal power. Among their leaders were Senators Harry Byrd and Carter Glass of Virginia and Vice President John Nance Garner of Texas. U.S. Senator Josiah Bailey ( D - NC ) released
7638-534: The crumbling economy, mass unemployment, declining wages, and profits, and especially Herbert Hoover 's policies such as the Smoot–Hawley Tariff Act and the Revenue Act of 1932 . Roosevelt entered office with enormous political capital . Americans of all political persuasions were demanding immediate action and Roosevelt responded with a remarkable series of new programs in the "first hundred days" of
7752-547: The decline in prices would finally end. In her essay "What ended the Great Depression?" (1992), Christina Romer argued that this policy raised industrial production by 25% until 1937 and by 50% until 1942. Before the Wall Street Crash of 1929 , securities were unregulated at the federal level. Even firms whose securities were publicly traded published no regular reports, or even worse, rather misleading reports based on arbitrarily selected data. To avoid another crash,
7866-409: The dollar of their deposits. The Glass–Steagall Act limited commercial bank securities activities and affiliations between commercial banks and securities firms to regulate speculations. It also established the Federal Deposit Insurance Corporation (FDIC), which insured deposits for up to $ 2,500, ending the risk of runs on banks. This banking reform offered unprecedented stability because throughout
7980-518: The effectiveness of the New Deal programs, although most accept that full employment was not achieved until World War II began in 1939. The First New Deal (1933–1934) dealt with the pressing banking crisis through the Emergency Banking Act and the 1933 Banking Act . The Federal Emergency Relief Administration (FERA) provided US$ 500 million (equivalent to $ 11.8 billion in 2023) for relief operations by states and cities, and
8094-413: The emergency budget, which was needed to defeat the depression. It was imbalanced on a temporary basis. Roosevelt initially favored balancing the budget, but soon found himself running spending deficits to fund his numerous programs. However, Douglas—rejecting the distinction between a regular and emergency budget—resigned in 1934 and became an outspoken critic of the New Deal. Roosevelt strenuously opposed
8208-421: The end of February we were a congeries of disorderly panic-stricken mobs and factions. In the hundred days from March to June, we became again an organized nation confident of our power to provide for our own security and to control our own destiny. The economy had hit bottom in March 1933 and then started to expand. Economic indicators show the economy reached its lowest point in the first days of March, then began
8322-629: The federal government the largest employer in the nation), the Social Security Act and new programs to aid tenant farmers and migrant workers. The final major items of New Deal legislation were the creation of the United States Housing Authority and the FSA, which both occurred in 1937; and the Fair Labor Standards Act of 1938 , which set maximum hours and minimum wages for most categories of workers. The FSA
8436-528: The first female Cabinet member in the United States, the New Deal resulted in the creation of programs such as the Civilian Conservation Corps , Public Works Administration , and the Works Progress Administration , among others, all of which created public goods through labor and infrastructure investments. More recent examples are the 2008–2009 Chinese economic stimulus program , India's National Infrastructure Pipeline of 2020,
8550-671: The informal conservative coalition . By 1942–1943, they shut down relief programs such as the WPA and the CCC and blocked major progressive proposals. Noting the composition of the new Congress, one study argued The Congress that assembled in January 1939 was quite unlike any with which Roosevelt had to contend before. Since all Democratic losses took place in the North and the West, and particularly in states like Ohio and Pennsylvania, southerners held
8664-537: The inner workings of Congress, liberal Democrats, together with Conservative and Liberal Republicans led by Senate Minority Leader Everett Dirksen , convinced all but six Republicans to vote for cloture on the Civil Rights Act of 1964 . This vote broke a Southern filibuster led by Senators Robert Byrd (D- WV ) and Strom Thurmond (D- SC ). Though a greater percentage of Republicans than Democrats (about 80% versus 60% respectively) voted for cloture and for
8778-711: The job illustrates: "a forty-hour workweek, a minimum wage, worker's compensation , unemployment compensation , a federal law banning child labor , direct federal aid for unemployment relief, Social Security , a revitalized public employment service and health insurance". The New Deal policies drew from many different ideas proposed earlier in the 20th century. Assistant Attorney General Thurman Arnold led efforts that hearkened back to an anti-monopoly tradition rooted in American politics by figures such as Andrew Jackson and Thomas Jefferson . Supreme Court Justice Louis Brandeis , an influential adviser to many New Dealers, argued that "bigness" (referring, presumably, to corporations)
8892-555: The largest faction in the Republican Party which had opposed the New Deal in some form since 1933. Despite Roosevelt being a Democrat himself, his party did not universally support the New Deal agenda in Congress. Democrats who opposed Roosevelt's policies tended to hold conservative views , and allied with conservative Republicans. These Democrats were mostly located in the South . According to James T. Patterson : "By and large
9006-722: The late 1930s. It remained a declining political force until it disappeared in the mid-1990s when few conservative Democrats remained in Congress. Following the 1994 Republican Revolution , many of the remaining conservative Democrats in Congress joined to form the Blue Dog Coalition . Never a formalized alliance, the conservative coalition most often appeared on votes affecting labor unions based on Congressional roll call votes. Congressional opponents of civil rights reform—consisting of white Southern Democrats and Republicans, despite being an overall minority in both chambers—prevented major congressional action on civil rights during
9120-486: The liberal program endorsed by the American voters last November." Also, while northern Democrats supported the Truman Administration's social welfare initiatives 91% of the time, the corresponding figure for southern Democrats was 46%. During his presidency, John F. Kennedy attempted with some success to reduce the conservative hold over the Rules Committee, which had blocked liberal reform measures over
9234-1121: The market. Federal regulation of agricultural production has been modified many times since then, but together with large subsidies is still in effect. Public works Public works are a broad category of infrastructure projects, financed and procured by a government body for recreational, employment, and health and safety uses in the greater community . They include public buildings ( municipal buildings , schools , and hospitals ), transport infrastructure ( roads , railroads , bridges , pipelines , canals , ports , and airports ), public spaces ( public squares , parks , and beaches ), public services ( water supply and treatment , sewage treatment , electrical grid , and dams ), environmental protection ( drinking water protection , soil erosion reduction, wildlife habitat preservation , preservation and restoration of forests and wetlands) and other, usually long-term, physical assets and facilities . Though often interchangeable with public infrastructure and public capital , public works does not necessarily carry an economic component, thereby being
9348-722: The money came from the PWA agency. PWA also built warplanes, and the WPA built military bases and airfields. To prime the pump and cut unemployment, the NIRA created the Public Works Administration (PWA), a major program of public works, which organized and provided funds for the building of useful works such as government buildings, airports, hospitals, schools, roads, bridges, and dams. From 1933 to 1935, PWA spent $ 3.3 billion with private companies to build 34,599 projects, many of them quite large. The NIRA also contained
9462-479: The overall benefit to society when there is a lack of private sector benefit (a project that does generate revenue) or the risk is too great for a private company to accept on its own. According to research conducted at the Aalborg University , 86% of public works projects end up with cost overruns. Some findings of the research were the following: Generally, contracts awarded by public tenders include
9576-534: The plan was successful, as the enlarged House Rules Committee gave liberals a majority; albeit a precarious one. In January 1963 the enlargement of the Rules Committee was made permanent, with the House voting 235–196 in favor. In its heyday in the 1940s and 1950s, the coalition's most important Republican leader was Senator Robert A. Taft of Ohio ; the leading Democrats in the coalition were Senator Richard Russell, Jr. of Georgia and Congressmen Howard W. Smith of Virginia and Carl Vinson of Georgia. Although
9690-471: The planning of the entire agricultural sector of the economy and was the first program on such a scale for the troubled agricultural economy. The original AAA targeted landowners, and therefore did not provide for any sharecroppers or tenants or farm laborers who might become unemployed. A Gallup poll printed in The Washington Post revealed that a majority of the American public opposed
9804-608: The poor was the responsibility of families, private charity and local governments, but as conditions worsened year by year demand skyrocketed and their combined resources increasingly fell far short of demand. The depression had psychologically devastated the nation. As Roosevelt took the oath of office at noon on March 4, 1933, all state governors had authorized bank holidays or restricted withdrawals—many Americans had little or no access to their bank accounts. Farm income had fallen by over 50% since 1929. Between 1930 and 1933, an estimated 844,000 non-farm mortgages were foreclosed on, out of
9918-444: The population could help. He closed all the banks in the country and kept them all closed until new legislation could be passed. On March 9, 1933, Roosevelt sent to Congress the Emergency Banking Act , drafted in large part by Hoover's top advisors. The act was passed and signed into law the same day. It provided for a system of reopening sound banks under Treasury supervision, with federal loans available if needed. Three-quarters of
10032-468: The post-war period, Republican presidents often owed their legislative victories to ad hoc coalitions between conservative Republicans and conservative southern Democrats. The liberal wing of the Democratic Party (elected mainly from Northern cities and Unionized regions), on the other hand, tended to combine with Republicans from the west and the north to put their own legislation through. Under President Lyndon Johnson , who had an intimate knowledge of
10146-444: The power of the Southern Democrats to steer and block legislation in the House and Senate, and reduced the institutional benefits of being loyal to the Democratic Party. Many surviving Southern Democrats switched parties and became Republicans after that party gained a majority in 1995. Boll weevils was a political term used in the mid-to-late 20th century to describe a bloc of conservative Democrats, mostly Southerners, who remained in
10260-401: The presidency and broke its influence. Johnson took advantage of weakened conservative opposition, and Congress passed many progressive economic and social reforms in his presidency. The conservative coalition, which controlled key congressional committees and made up a majority of both houses of Congress during Kennedy's presidency, had prevented the implementation of progressive reforms since
10374-411: The president could at best hope to consolidate, but certainly not to extend, the New Deal. James Farley thought that Roosevelt's wisest course would be "to clean up odds and ends, tighten up and improve things [he] already has but not try [to] start anything new." In any event, Farley predicted that Congress would discard much of Roosevelt's program. As noted by another study, "the 1938 elections proved
10488-427: The progressive magazine The New Republic a few days before Roosevelt's speech. Speechwriter Rosenman added it to his draft of FDR's presidential nomination acceptance speech at the last minute. Upon accepting the 1932 Democratic nomination for president, Roosevelt promised "a new deal for the American people". In campaign speeches, Roosevelt committed to carrying out, if elected, several elements of what would become
10602-407: The relevant time period through control of influential committees and by exploiting the Senate filibuster rule. The conservative coalition opposition weakened on civil rights bills, ultimately enabling President Johnson and Everett Dirksen to convince sufficient numbers of Senate Republicans to ally with liberal Democrats to invoke cloture and push through the Civil Rights Act of 1964 . However,
10716-413: The sale of securities. In a measure that garnered substantial popular support for his New Deal, Roosevelt moved to put to rest one of the most divisive cultural issues of the 1920s. He signed the bill to legalize the manufacture and sale of alcohol, an interim measure pending the repeal of prohibition , for which a constitutional amendment of repeal (the 21st ) was already in process. The repeal amendment
10830-543: The short-lived CWA gave locals money to operate make-work projects from 1933 to 1934. The Securities Act of 1933 was enacted to prevent a repeated stock market crash. The controversial work of the National Recovery Administration (NRA) was also part of the First New Deal. The Second New Deal in 1935–1936 included the National Labor Relations Act to protect labor organizing, the Works Progress Administration (WPA) relief program (which made
10944-632: The strong Democratic victory in 1974 following the Watergate scandal led to a tremendous number of Northern and liberal Democratic freshmen in House, tilting the balance of the Democratic Caucus away from the Southerners. These Watergate Babies joined forces with more senior liberals and stripped committee chairmanship from three senior Southern Democrats: Wright Patman , William R. Poage , and F. Edward Hébert , and otherwise reformed
11058-419: The two blocs in the coalition (the point at which the coalition is defined in this study), its strength, assuming all Members voted, would be 17 Republicans and 12 Southern Democrats in the Senate (29 total) and 89 Republicans and 53 Southern Democrats (142 total) in the House. In neither chamber would the coalition have a winning majority. Therefore, whether the coalition won or lost depended not only on how large
11172-572: The unemployed and for the poor, recovery of the economy back to normal levels, and reform of the financial system to prevent a repeat depression. Roosevelt declared a four-day bank holiday and implemented the Emergency Banking Act , which enabled the Federal Reserve to insure bank deposits; this was made permanent with Federal Deposit Insurance Corporation (FDIC). Other laws established the National Recovery Administration (NRA), which allowed industries to create "codes of fair competition";
11286-477: The unemployed but also to build needed schools, municipal buildings, waterworks, sewers, streets, and parks according to local specifications. While the regular Army and Navy budgets were reduced, Roosevelt juggled relief funds to provide for their claimed needs. All of the CCC camps were directed by army officers, whose salaries came from the relief budget. The PWA built numerous warships, including two aircraft carriers;
11400-479: The unemployed. The Fair Labor Standards Act prohibited "oppressive" child labor, and enshrined a 40-hour work week and national minimum wage. In 1938, the Republican Party gained control of Congress and joined with conservative Democrats to block further New Deal legislation, and some of it was declared unconstitutional by the Supreme Court . The New Deal produced a political realignment, reorienting
11514-407: The years. As noted by one study, "By the late 1930s, the coalition succeeded in winning enough votes in the Rules Committee to prevent many Roosevelt (and later, Truman) proposals from reaching the floor, even though the measures had been reported by legislative committees of the House. Because of the seniority system, conservatives retained control of the Rules Committee in many Congresses in which, in
11628-464: Was 56 of the 100 votes in the Senate and 280 of the 429 votes in the House (there were 5 vacancies and the House Speaker is not counted because he rarely votes). This constituted a winning majority in each chamber. The figures are based on a lineup of 33 Republicans and 23 Southern Democrats in the Senate and 176 Republicans and 104 Southern Democrats in the House. Counting only bare majorities of
11742-546: Was a negative economic force, producing waste and inefficiency. However, the anti-monopoly group never had a major impact on New Deal policy. Other leaders such as Hugh S. Johnson of the NRA took ideas from the Woodrow Wilson Administration, advocating techniques used to mobilize the economy for World War I . They brought ideas and experience from the government controls and spending of 1917–1918. Other New Deal planners revived experiments suggested in
11856-486: Was a temporary downturn. Private sector employment, especially in manufacturing, recovered to the level of the 1920s but failed to advance further until the war. The U.S. population was 124,840,471 in 1932 and 128,824,829 in 1937, an increase of 3,984,468. The ratio of these numbers, times the number of jobs in 1932, means there was a need for 938,000 more jobs in 1937, to maintain the same employment level. The Economy Act , drafted by Budget Director Lewis Williams Douglas ,
11970-475: Was allowed to float freely on foreign exchange markets with no guaranteed price in gold. With the passage of the Gold Reserve Act in 1934, the nominal price of gold was changed from $ 20.67 per troy ounce to $ 35. These measures enabled the Federal Reserve to increase the amount of money in circulation to the level the economy needed. Markets immediately responded well to the suspension in the hope that
12084-685: Was also one of the oversight authorities of the Puerto Rico Reconstruction Administration , which administered relief efforts to Puerto Rican citizens affected by the Great Depression. Roosevelt had built a New Deal coalition , but the economic downturn of 1937–1938 and the bitter split between the American Federation of Labor (AFL) and Congress of Industrial Organizations (CIO) labor unions led to major Republican gains in Congress in 1938. Conservative Republicans and Democrats in Congress joined
12198-539: Was an unofficial alliance of members of the United States Congress which brought together the conservative wings of the Republican and Democratic parties to oppose President Franklin Delano Roosevelt 's New Deal . In addition to Roosevelt, the conservative coalition dominated Congress for four presidencies, blocking legislation proposed by Roosevelt and his successors. By 1937, the conservatives were
12312-441: Was not unified with regards to foreign policy, as most Southern Democrats were internationalists. Most Republicans supported isolationism until President Dwight D. Eisenhower took office in 1953. In 1936 , President Franklin D. Roosevelt had won a second term in a landslide, sweeping all but two states over his Republican opponent, Alf Landon . For the 1937 session of Congress, the Republicans would have only 17 senators (out of
12426-429: Was passed on March 15, 1933. The act proposed to balance the "regular" (non-emergency) federal budget by cutting the salaries of government employees and cutting pensions to veterans by fifteen percent. It saved $ 500 million per year and reassured deficit hawks, such as Douglas, that the new president was fiscally conservative. Roosevelt argued there were two budgets: the "regular" federal budget, which he balanced; and
12540-443: Was plowed up, bountiful crops were left to rot and six million piglets were killed and discarded. The idea was to give farmers a "fair exchange value" for their products in relation to the general economy ("parity level"). Farm incomes and the income for the general population recovered fast since the beginning of 1933. Food prices remained still well below the 1929 peak. The AAA established an important and long-lasting federal role in
12654-513: Was ratified later in 1933. States and cities gained additional new revenue and Roosevelt secured his popularity especially in the cities and ethnic areas by legalizing alcohol. Relief was the immediate effort to help the one-third of the population that was hardest hit by the depression. Relief was also aimed at providing temporary help to suffering and unemployed Americans. Local and state budgets were sharply reduced because of falling tax revenue, but New Deal relief programs were used not just to hire
12768-409: Was rotting in the fields because it could not be profitably harvested. In Oregon , sheep were slaughtered and left to rot because meat prices were not sufficient to warrant transportation to markets. Roosevelt was keenly interested in farm issues and believed that true prosperity would not return until farming was prosperous. Many different programs were directed at farmers. The first 100 days produced
12882-400: Was the last major New Deal legislation that Roosevelt succeeded in enacting into law before the conservative coalition won control of Congress. Though he could usually use the veto to restrain Congress, Congress could block any Roosevelt legislation it disliked. Nonetheless, Roosevelt turned his attention to the war effort and won reelection in 1940–1944. Furthermore, the Supreme Court declared
12996-421: Was viewed by many as doing too little to help those affected. Roosevelt believed that the depression was caused by inherent market instability , and that massive government intervention was necessary to stabilize and rationalize the economy. During Roosevelt's first hundred days in office in 1933 until 1935, he introduced what historians refer to as the "First New Deal", which focused on the "3 R's": relief for
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