American Stories

Fourth Edition

Chapter 26
Franklin D. Roosevelt
and the New Deal
1929–1939

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 Focus Questions
26.1 What were the causes and effects of the Great
Depression?
26.2 How did Franklin Roosevelt fight the Depression?
26.3 How did the New Deal reform American life?
26.4 What was the lasting impact of the New Deal?
26.5 How and why did the New Deal end?
26.6 How did the American government and society react
to the economic hardships of the Great Depression?

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 The Great Depression

During the Great Depression, market prices for produce were so low that farmers could scarcely
afford to harvest their crops. Many resorted to destroying produce in an attempt to limit supplies
and force prices higher. Among them were these striking dairy farmers in Illinois
dumping cans of milk onto the street.

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 The Struggle Against Despair
• The Depression decade had profound effects on
individuals and institutions
– Many individuals were forced to make difficult choices
– Many families lost fathers
– Hard times, but also times of determination, adaptation, and survival
– Americans looked to government as never before
– Franklin Delano Roosevelt’s answer to country’s demand: New Deal

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26.1 The Great Depression (1 of 4)
What were the causes and effects of the Great Depression?

• Consumer revolution of 1920s fostered confidence

that American way of life would continue to
improve
• Depression of 1930s shocked those who had
grown up in prosperity

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26.1 The Great Depression (2 of 4)
What were the causes and effects of the Great Depression?

• 26.1.1 The Great Crash

– Consumer-goods revolution contained seeds of its own demise
▪Auto and appliance industries grew faster than demand for
products
▪Production faltered; mild recession in 1927
– 1928: Investors believed they could make a killing in the stock market
despite declining production figures
▪Attracted individual and corporate investment
▪Speculation became a national pastime
▪Everyone felt assured economy was healthy

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 Hooverville

Camps of the homeless sprang up all over America during early 1930s.
Their inhabitants called them “Hoovervilles,” in mocking reference to the president.

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26.1 The Great Depression (3 of 4)
What were the causes and effects of the Great Depression?

• 26.1.1 The Great Crash

– October 24, 1929: Black Thursday
▪Rise in stock prices faltered
▪Speculators panicked, causing prices to plummet further
– Crash spilled over into larger economy
▪Banks and other financial institutions had heavy losses and
curtailed lending
▪Consumers stopped buying, factories cut back production, workers
laid off or had hours cut
– Downward economic spiral continued for four years
– Basic explanation for Great Depression: Overproduction

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26.1 The Great Depression (4 of 4)
What were the causes and effects of the Great Depression?

• 26.1.2 The Effect of the Depression

– Human cost of Great Depression
▪Material hardship: Poor housing, poor diet
▪Psychological hardship: Years of grinding poverty with no relief
– Hardship affected all classes and races
▪Factory workers first to be laid off
▪Mexican immigrants had to compete for low-level jobs
– Poor knew how to survive in poverty
▪Middle class hit hard; many refused to ask for charity
▪Upper class gave up luxuries and watched friends sink into poverty
– Many rode the rails to search for jobs

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Figure 26.1: U.S. Unemployment, 1929–1942

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 Lining Up for Food

The Great Depression devastated millions who lost their jobs and often
the means to provide food and shelter for themselves and their families. Local and private charities
could not keep up with the demand for assistance, and many looked to the federal government.
Breadlines stretched as far as the eye could see.

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 Journal 26.1
What were the causes and effects of the Great
Depression?

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26.2 Fighting the Depression (1 of 7)
How did Franklin Roosevelt fight the Depression?

• Great Depression challenged politicians

– Republican attempts to overcome catastrophe floundered
– Democrats regained power
▪Alleviated some suffering
▪Established political dominance

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26.2 Fighting the Depression (2 of 7)
How did Franklin Roosevelt fight the Depression?

• 26.2.1 The Emergence of Roosevelt

– Depression took Herbert Hoover by surprise
▪Relied on economy to restore itself
▪Called for businesses’ voluntary cooperation in managing salaries
and compensation
▪Looked to state governments and private charities to alleviate
public suffering
▪Reluctantly gave federal assistance to business
▪His mishandling of the Bonus Army made him very unpopular
– World War I vets traveled to Washington seeking federal help
– General MacArthur used army to forcibly disperse the vets

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26.2 Fighting the Depression (3 of 7)
How did Franklin Roosevelt fight the Depression?

• 26.2.1 The Emergence of Roosevelt

– Franklin D. Roosevelt
▪Experience
– Served in New York legislature and as assistant secretary of
Navy
– 1920: Ran unsuccessfully for vice president
– 1921: Struck with polio
– 1928: Elected governor of New York
▪Personality
– Self-confident aristocrat
– Able to persuade and motivate other people
– Illness gave him ability to understand human suffering

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 FDR

Franklin D. Roosevelt couldn’t cure the Depression all at once, but his smile and his public optimism
helped lift American spirits.

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26.2 Fighting the Depression (4 of 7)
How did Franklin Roosevelt fight the Depression?

• 26.2.1 The Emergence of Roosevelt

– Franklin D. Roosevelt
▪Political style
– Understood give-and-take of politics
– Was adept at using flattery to win over doubters
– Was effective in exploiting media
– Had little patience with nuances of issues
– Politically flexible
▪1932 election
– Cultivated both wings of the divided Democrats
– Pledged a “new deal” for American people
– Defeated Herbert Hoover in a landslide

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26.2 Fighting the Depression (5 of 7)
How did Franklin Roosevelt fight the Depression?

• 26.2.2 The Hundred Days

– March 4, 1933: FDR took office as economy on the brink
▪13 million unemployed; banks closed in 38 states
▪Inaugural address: “the only thing we have to fear is fear itself”
– First New Deal victory: Saved banking system from collapse
▪Closed the banks
▪Presented new banking legislation providing for government
supervision and aid to banks
▪Kept nation informed in first of his radio Fireside Chats
▪Banks started reopening and failures ceased
– Roosevelt out to reform and restore American economic system, not
change drastically

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 Map 26.1: Election of 1932

In the 1932 presidential election, Franklin Roosevelt trounced Herbert Hoover

in both the popular and electoral votes.

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26.2 Fighting the Depression (6 of 7)
How did Franklin Roosevelt fight the Depression?

• 26.2.2 The Hundred Days

– Next “Hundred Days”
▪Congress responded to presidential initiatives
▪Roosevelt sent 15 requests and received 15 pieces of legislation
– Tennessee Valley Authority (TVA)
– Civilian Conservation Corps (CCC)
– Works Progress Administration (WPA)
▪Other agencies met specific economic problems of the Depression
– None were completely successful
– Allowed people to feel hopeful

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Map 26.2: The Tennessee Valley Authority

The Tennessee Valley Authority (TVA) served a seven-state region in the Southeast.

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26.2 Fighting the Depression (7 of 7)
How did Franklin Roosevelt fight the Depression?

• 26.2.3 Steps Toward Recovery

– National Recovery Administration (NRA)
▪FDR’s attempt to achieve economic advance through cooperation
between government, business, and labor
▪Permitted companies to write codes of fair competition
▪Bogged down in bureaucracy
▪1935: Supreme Court ruled the NRA unconstitutional
– Agricultural Adjustment Act (AAA)
▪In answer to problem of farm overproduction, government set
production limits for leading crops
▪Farm income increased
▪Most benefit to large farmers

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 The NRA

The National Recovery Administration blue eagle signaled a firm’s participation in

the National Recovery Act. Roosevelt’s innovative program met resistance,
and signs modeled on this original example attempted to make participation patriotic and respectable.

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 Journal 26.2
How did Franklin Roosevelt fight the Depression?

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26.3 Reforming American Life (1 of 4)
How did the New Deal reform American life?

• FDR’s first two years: Concentration on shoring up

sagging American economy
• New Deal assisted bankers and industrialists,
large farmers, and union members
– Did little to help elderly and poor
– Dispossessed had no political voice

• Continuing depression created pressure for

sweeping changes

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 Work Relief

Federal work relief programs helped millions maintain their self-respect.

Workers in the CCC received $30 a month for planting trees and building parks and trails.

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26.3 Reforming American Life (2 of 4)
How did the New Deal reform American life?

• 26.3.1 Challenges to FDR

– Discontent was widespread by 1935
▪Midwest: Progressives and agrarian radicals wanted rise in farm
and labor income
▪California: Upton Sinclair and campaign to “end poverty” there
– Three major demagogues challenged FDR
▪Father Charles Coughlin: Crank monetary schemes and anti-
Semitism
▪Francis Townsend: Monthly pensions for the elderly
▪Senator Huey Long: “Share the Wealth” movement

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26.3 Reforming American Life (3 of 4)
How did the New Deal reform American life?

• 26.3.2 Social Security

– January 1935: Roosevelt ready to address measures that addressed
national dissent
– 1935: Social Security Act
▪Welfare system to aid elderly, disabled, and unemployed
▪Established pattern of government responsibility for aged, those
with disabilities, unemployed
– Criticisms
▪Too few people would collect pensions
▪Excluded farmers and domestic servants
▪Unemployment package inadequate
▪Took money out of circulation

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 Social Security

Despite the administration’s boosterism,

many believed that Social Security could not fulfill its promises.

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26.3 Reforming American Life (4 of 4)
How did the New Deal reform American life?

• 26.3.3 Past and Present: What Should Government

Do?
– 1935: Society Security provided unemployment relief and old-age
pensions; no government-funded health care
– 1965: Lyndon Johnson: Got Congress to approve Medicare and Medicaid
– 2010: Barack Obama had difficulty pushing Affordable Care Act through
Congress
▪Survived Supreme Court scrutiny
▪Punching bag for Republicans
▪Americans who received coverage for first time liked program
▪Those with preexisting conditions could not be denied coverage

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Frances Perkins

The mother of Social Security.

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Barack Obama

The father of the Affordable Care Act.

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 Journal
How have attitudes about the proper role of government
changed since the 1930s?

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 Shared Writing
Some critics of Social Security say the system will be
bankrupt and defunct long before you retire. Do you agree?

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 Journal 26.3
How did the New Deal reform American life?

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26.4 The Impact of the New Deal (1 of 4)
What was the lasting impact of the New Deal?

• New Deal: Broad influence on quality of life in

United States
– Some programs brought improvements; others failed to reduce
inequities
– Most important advances came with growth of labor unions
– Working women and minorities in nonunionized industries helped least

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26.4 The Impact of the New Deal (2 of 4)
What was the lasting impact of the New Deal?

• 26.4.1 The Rise of Organized Labor

– John L. Lewis, expelled from the AFL, founded the Congress of Industrial
Organizations (CIO)
▪Used Wagner Act, passed in 1935, to extend collective bargaining
to major industries
– Act provided federal support for efforts to unionize
– Outlawed unfair labor practices
▪Unionized many industries, including steel and auto
– By 1930s, CIO had 5 million members
▪Unskilled as well as skilled workers
▪Women and African Americans
– Still, by 1930s only 28 percent of Americans belonged to unions

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 Sit-Down Strike

To keep the car companies from hiring replacements, striking autoworkers occupied the plants.

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26.4 The Impact of the New Deal (3 of 4)
What was the lasting impact of the New Deal?

• 26.4.2 The New Deal Record on Help to Minorities

– New Deal did not confront racial injustice
▪Southern blacks received smaller payments
▪NRA permitted lower wage scales for blacks
▪AAA crop reduction program led to eviction of black tenants and
sharecroppers
▪Social Security and minimum wage did not apply to farmers or
domestic servants
– African Americans still rallied behind Roosevelt
▪Appointed African Americans to high-ranking positions
▪Eleanor Roosevelt denounced racial discrimination

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 Minorities and the New Deal

With the statue of Abraham Lincoln as a backdrop, African American contralto Marian Anderson sang
on the steps of the Lincoln Memorial in a concert on April 9, 1939.

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26.4 The Impact of the New Deal (4 of 4)
What was the lasting impact of the New Deal?

• 26.4.2 The New Deal Record on Help to Minorities

– Harry Hopkins’s color-blind policy and the WPA
▪Had more than 1 million blacks working for WPA by 1939
▪New Deal provided assistance to 40 percent of nation’s blacks
during Depression
– Less aid for Mexican Americans
▪Pool of unemployed expanded rapidly
▪Administration barred further immigration from Mexico
– Native Americans fared slightly better
▪John Collier appointed commissioner of Indian affairs
▪1934: Indian Reorganization Act
▪Despite modest gains, Indians still most impoverished citizens

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 Migrant Mother

Dorothea Lange’s photograph of a migrant mother with children became an iconic image of the Great
Depression and a spur to public support for the poor.

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 Journal 26.4
What was the lasting impact of the New Deal?

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26.5 The New Deal’s End (1 of 4)
How and why did the New Deal end?

• 1936: New Deal peaked

– Roosevelt reelected
– Democrats strengthened hold on Congress

• Nest two years, Roosevelt met defeat in Congress

• Roosevelt remained popular

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26.5 The New Deal’s End (2 of 4)
How and why did the New Deal end?

• 26.5.1 The Supreme Court Fight

– Roosevelt’s 1936 reelection victory went to his head
▪1937: Tried to remove Supreme Court obstacle from his path
▪Supreme Court had blocked several New Deal programs
– Three justices sympathetic
– Two justices unpredictable
– Four justices appeared to consider New Deal an assault on the
Constitution
– All were elderly

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26.5 The New Deal’s End (3 of 4)
How and why did the New Deal end?

• 26.5.1 The Supreme Court Fight

– FDR’s “Court-packing” scheme
▪Asked Congress to appoint new justice for every member of the
Court over age of 70, up to a maximum of six justices
▪Said move was justified because Court was falling behind schedule
– Response
▪Plan outraged both conservatives and liberals
▪Senate blocked early action on the proposal
▪Court defended itself
– One justice resigned, so FDR could make his first appointment
– Court fight weakened FDRs relations with Congress

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 Court Packing

FDR’s battle with the Supreme Court provoked both sympathy and contempt
among political cartoonists of the day. In the cartoon on the right, the NRA blue eagle lies dead,
nailed to the wall by the Supreme Court. The cartoon on the left, titled “Do We Want a Ventriloquist
Act in the Supreme Court?” satirizes FDR’s “court-packing” scheme.

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26.5 The New Deal’s End (4 of 4)
How and why did the New Deal end?

• 26.5.2 The New Deal in Decline

– Roosevelt’s second term
▪Less legislation
▪New Deal not extended into new areas
▪Attempt to purge conservatives
– Roosevelt recession: Summer of 1937
▪Critics claimed it showed lack of confidence in FDR’s leadership
▪Criticisms not without merit
– Republican upsurge

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 Journal 26.5
How and why did the New Deal end?

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26.6 Charting the Past: the Great Depression (1 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.1 Anatomy of a Depression

– Stock market crash of 1929 ended the Roaring Twenties
– Great Depression: Deep economic crisis
▪Began as catastrophic erosion of stock values on Wall Street,
followed by
– Wave of bankruptcies and budget shortfalls
– Contraction of the money supply
– Mass unemployment
▪Features of the country’s economy delayed recovery for years
– America’s economy, society, government, and landscape changed

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26.6 Charting the Past: the Great Depression (2 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.1 Anatomy of a Depression

– Wall Street, New York City
▪From mid-1920s on, more and more middle-class Americans
discovered the stock market
▪Growing number of companies put shares of the company up for
sale
– Banks invested eagerly
– Many speculators went into short-term debt to reap quick
riches
▪October 1929: Uncertainty triggered massive sell-off of stocks
– Wiped out billions of dollars in corporate wealth and in
everyday Americans’ savings

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 Bonus Expeditionary Force
March on Washington, 1932

Unsuccessfully seeking early payment of a “bonus” that all World War I veterans
were to receive in 1945, several thousand “Bonus Army” marchers converged
for a rally on the steps of the Capitol in 1932.

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26.6 Charting the Past: the Great Depression (3 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.1 Anatomy of a Depression

– Washington, D.C.
▪Herbert Hoover seemed the ideal president for the Great
Depression
– Born into humble circumstances in Iowa
– Paid his way through Stanford University
– Traveled as a mining engineer through Australia and China
– Returned a millionaire and entered public service
• Organized hunger relief for victims of World War I in.
Europe
▪But his initiatives did little to address the depression
▪When World War I veterans asked for payment of military bonus, he
balked at government being responsible for Americans’ welfare

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 Investors Crowd Wall Street, 1929

Wall Street was in a near state of panic on Black Friday in October 1929
as hundreds of nervous investors refused to leave after the stock market closed.
A record of 16 million shares were traded that day, over the course of which
stocks had lost $15 billion. Over the next two years, the market would lose a total of $50 billion.

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26.6 Charting the Past: the Great Depression (4 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.2 Bank Failures, 1928–1933

– Before 1932, banks invested with few restrictions and many invested in
the stock market
– Stock market crash of 1929 ruined many banks
▪No protection for businesses and individuals who kept their savings
in those banks or had loans with them
– Crash triggered default of the businesses and debtors
▪Banks then strapped for liquid assets and could not meet demand
▪When panicked customers came to banks asking for their money,
banks failed
– Federal Reserve refused to serve as the banks’ lender of last resort
– Nation’s stock of money dwindled, fueling fear and uncertainty
– Employers had also slashed wages, and consumers refused to spend

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26.6 Charting the Past: the Great Depression (5 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.2 Bank Failures, 1928–1933

– Detroit, Michigan
▪Detroit’s city bank received a shipment of $30 million in
emergency cash to pay depositors
▪Unpaid workers lined up for their paychecks
▪Governor William A. Comstock declared emergency closure of all
Michigan banks to relieve pressure on the banks
– Left many people without money for days

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Workers Receiving Emergency Payroll

Workers line up to receive emergency funds.

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26.6 Charting the Past: the Great Depression (6 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.3 The Dust Bowl and Internal Migration

– High commodity prices of World War I had slumped in early 1920s,
resulting in declining agricultural profits
– High grain prices and mechanized farming equipment encouraged
farmers to plant as many acres as possible
– Grazers raised more and more cattle
– Postwar demand was lower than in wartime, resulting in low prices,
bankruptcies, and foreclosures
– Drought, heat and dust storms of the 1930s—the Dust Bowl—resulted
in widespread crop failures
– Thousands of farming families headed to California to start over

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 Abandoned Oklahoma Farmstead, 1937

This abandoned farm in rural Oklahoma was one of thousands left deserted because of the drought
and dust storms of the 1930s. Tenant farmers and sharecroppers were hit the hardest.

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26.6 Charting the Past: the Great Depression (7 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.3 The Dust Bowl and Internal Migration

– Rural North Dakota
▪Americans living on the Plains suffered:
– Low crop prices
– Debt
– Low rainfall
– Dark dust storms as topsoil blew away
▪Many farmers had not:
– Accounted for region’s semiarid conditions
– Failed to maintain windbreaks
– Failed to utilize dry farming methods more suited to the
climate

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26.6 Charting the Past: the Great Depression (8 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.3 The Dust Bowl and Internal Migration

– Salinas, California
▪Combination of Dust Bowl and depression spurred a mass
migration of hundreds of thousands of people to California
▪Often referred to as “Okies” or “Arkies”
▪Migrants usually endured poor living conditions and found few
opportunities for land ownership or employment

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Migrant Mother, Photo by Dorothea Lange

Roy Stryker, director of the Farm Security Administration’s (FSA) resettlement program,
wanted photographs to convince the public that rural Americans faced difficulties but
with help were capable of overcoming those troubles. Migrant Mother, by Dorothea Lange,
is one of the best-known photographs commissioned by the FSA during the 1930s.
It features Florence Owens Thompson and three of her children.

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26.6 Charting the Past: the Great Depression (9 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.4 A New Deal for Americans

– Franklin Delano Roosevelt’s presidency began the New Deal
▪Program for relief, recovery, and reform to get America out of the
Great Depression
– Most economic historians agree that the New Deal resulted in a partial,
but incomplete, recovery
– Programs changed the lives of millions of Americans and remain
important features of the country’s systems today
▪Social Security
▪Banking reform
– Many American workers and companies were finally able to escape the
depression by ramping up production for World War II

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 CCC Men Take Care of a Fawn

Three men in a Civilian Conservation Corps (CCC) camp, one wearing a Forest Service badge,
feed a fawn.
Location: Big Springs Camp, California

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26.6 Charting the Past: the Great Depression (10 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.4 A New Deal for Americans

– Washington, D.C.
▪Most important initiative of Franklin D. Roosevelt’s initiatives to end
the Great Depression was the Social Security Act of 1935
▪Critics on the left had called for an assistance program for
Americans going through hard times
▪President took Democratic victories of 1934 midterm elections as
vote of confidence he needed to develop a plan
▪The program’s most significant features during the Depression
were unemployment compensation and child welfare

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 Social Security Act Poster

The Social Security Act of 1935 was signed by President Roosevelt. The Society Security Act (SSA)
had Americans pay a small portion of their paycheck to the SSA throughout their careers and then
receive a monthly stipend after they turned 65, taking care of them in their old age.

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26.6 Charting the Past: the Great Depression (11 of 11)
How did the American government and society react to the economic hardships of the Great
Depression?

• 26.6.4 A New Deal for Americans

– Big Springs Conservation Camp, California, and Shenandoah National
Park, Virginia
▪Public works projects made biggest impact on nation’s economy
and on Americans’ sense of self-worth and confidence
▪Works Progress Administration (WPA)
– Largest program, launched 1935
– Provided jobs to more than 8 million Americans
– Erected airports, schools, hospitals, roads, and dams
▪Civilian Conservation Corps (CCC)
– Focused on young men
– Worked on reforestation, trails, scenic roads, campgrounds,
erosion mitigation, and other environmental projects

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 Journal 26.6
How did the American government and society react to the
economic hardships of the Great Depression?

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Conclusion: The New Deal and American Life

• New Deal’s limitations

– Prosperity not restored in 1930s
– Economic system not fundamentally altered
– Little done for those without political clout

• New Deal’s achievements

– Social Security
– Wagner Act
– Roosevelt forged a new political coalition, attracting new groups to the
Democratic Party

• Roosevelt was the leader American people needed

in the 1930s

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 Photo Credits
623: AP Images; 625: World History Archive/Alamy Stock Photo; 628: AP
Images; 633: AP Images; 636l: Handout/MCT/Newscom; 636r: J. Scott
Applewhite/AP Images; 637: Everett Collection Historical/Alamy Stock Photo;
638: Hulton Archive/Archive Photos/Getty Images; 641l: Franklin D. Roosevelt
Library; 641r: World History Archive/Alamy Stock Photo; Hera Vintage
Ads/Alamy Stock Photo

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 Revel Image Credits
AP Images; World History Archive/Alamy Stock Photo; AP Images; AP Images;
Handout/MCT/Newscom; J. Scott Applewhite/AP Images; Everett Collection
Historical/Alamy Stock Photo; Hulton Archive/Archive Photos/Getty Images;
Franklin D. Roosevelt Library; World History Archive/Alamy Stock Photo; Hera
Vintage Ads/Alamy Stock Photo; Bettmann/Corbis/Getty Images;
Bettmann/Getty Images; Library of Congress Prints and Photographs Division
[LC-USZ62-35290]; "Abandoned Oklahoma Farmstead, 1937 This abandoned
farm in rural Oklahoma was one of thousands left deserted due to the drought
and dust storms of the 1930s. Tenant farmers and sharecroppers were hit the
hardest/National Archives and Records Administration(NARA).; Dorothea
Lange/Library of Congress Prints and Photographs Division [LC-DIG-fsa-
8b29516]; Library of Congress Prints and Photographs Division [LC-DIG-
ppmsca-07216]; Corbis Historical/Getty Images

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 Copyright

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