The New Deal
The New DealDuring the 1930's American citizens witnessed a
breakdown of the Democratic and free enterprise
way of life. The government saw that the
free enterprise system was failing. The New Deal
increased the government's regulation and intervention
and the economic system, thus temporarily
abandoning the capitalism system and turning toward
socialism to find the answer. The answer...
the New Deal.
Socialism is usually thought of as a form
of government that advocates public ownership
and public control of wealth (Britannica Jr.
Encyclopedia 1980, p.231). In other words,
a socialistic government wants the wealth of
the nation spread out in such a way that the
money is equally distributed among the country's
citizens. Socialism is in favor
of tearing down the class structure and forming
a classless society. In this way, it was born out
of Marxism, whose founder was Karl Marx.
Leaders of the Communist Party of the Soviet
Union said that their country used socialism
as a major step towards "building communism".
However most socialist political parties in
democratic countries of the West rejected the
Communist idea of socialism. Socialists prefer
the government ownership of industries that are
vital to a country's welfare. These include the
coal, oil, iron, and steel industries. The
basic idea favored by all Socialists is the
public ownership and use of property in order
to extend the benefits of wealth more equally.
Many economic, political, and social factor lead
up to the New Deal. When staggering statistics
such as 25% unemployment, and the fact that 20%
of NYC school children were underwieght and
malnourished (World Book, p.200) hit the
White House, the government knew something had
to be done. With the economy at on all time
low people wanted change, Roosevelt's legislative
program represented a new way of government for
capitalism in America. Roosevelt first used the
term "new deal" when he accepted the
Democratic presidental nomination in 1932. He
said "I pledge you, I pledge myself, to a new deal
for the American people." When Roosevelt became
President on March 4, 1933, business was at
a standstill and a feeling of panic hit the
nation (World Book, Vol.14, p.200). Roosevelt
responded with a controversial policy that rocked
the nation and what our nation stood for.
Roosevelt's New Deal programs aimed at three R's-
relief, recovery, and reform. The government
established short range goals that included
relief and immediate recovery, especially in the
first two years. They then set up long-range
goals which included permanent recovery and
reform of current abuses particuarly those that
produced the boom-or-bust catastrophe
(World Book, Vol.14, p.748).
The Congress authorized the National Recovery
Administration (NRA) in a daring attempt
to simulate a nationwide comeback. This scheme
was to perform immediate relief with long range
recovery and reform. It was designed to assist
industry, labor, and the unemployed by setting
standards for prices, wages, and hours. It also
guaranteed the labor's right to organize unions
and to bargain collectively with employers through
agents of their own choosing (America The Glorious
Republic). The NRA gave the President power to
regulate interstate commerce. This power was
originally given to Congress. While the NRA was
effective it was bringing America closer to
socialism by giving the President unconstitutional
powers. The NRA was later ruled unconstitutional
by the Supreme court.
The Federal Emergency Relief Act (FERA) was the
first major effort of the new Congress to cope
with the millions of adult unemployed. The
main importance was immediate relief of economic
disaster rather than long range recovery.
This agency was founded in 1933 to
cooperate with the states in relieving hardships
caused by unemployment and drought.(Economic History
of the U.S., vol. 9). By letting the unemployed
draw unemployment payments, it
moved American society towards what has been called
"the Welfare State." The goal of this program was to bring
the unemployed to a higher financial level so that
the working class could survive in order to become
self-sufficient. This is an example
of socialist thinking because socialist policy
strives to insure the financial well-being of all
citizens.
The Depression was a major devastating factor
in America. Something different was needed to
pull Ameica out of this economic disaster.
Was FDR's New Deal the thing to do it?
The New Deal brought America one step closer
towards socialism. This step was temporilary
needed to pull the vast members of poor people
out of the Depression and back on their feet.
World Book Encyclopedia, Vol.14,
Britanica Jr Encyclopedia, Vol. 13,
Economic History of U.S Vol.9