New Deal

The New Deal was the name of President Franklin Roosevelt's legislative agenda for rescuing the United States from the Great Depression. It was widely believed that the depression was caused by the inherent instability of the market and that government intervention was necessary to rationalize and stabilize the economy.

The New Deal consisted of large scale government financed building and infrastructure projects, such as road building which were designed to relieve unemployment and provide a boost to the economy.

The New Deal was loosely based upon an economic theory called Keynesianism. Which believes that in times of ressession, governments should try to stimulate the economy by creating employment, which Keynesianism believes creates a "multiplier effect" whereby newly employed people spend money thus further stimulating economic growth.

Those who distrust markets argue that the New Deal was the right approach to the problem.

Those who favor markets argue that the depression was both caused by and continued by government intervention in the market.

Regardless, the New Deal successfully reduced unemployment from 15 million in 1933 to 9 million in 1938, and also boosted America's GDP. Versions of the New Deal were also successfully tried in other countries such as Sweden during the 1930s.

The New Deal was composed of a countless number of programs, called an "alphabet soup" by its distractors. Among the New Deal acts were the following, most of which were passed within the first 100 days of his administration:

• United States Bank Holiday[?], 1933 -- closed all banks until they became certified by federal reviewers
• Abandonment of gold standard, 1933 -- allowed more money to be put in circulation to create a mild inflation
• Civilian Conservation Corps (CCC), 1933 -- employeed young adults to perform unskilled work for the federal government
• Tennessee Valley Authority (TVA), 1933 -- a government program that ran a series of dams built on the Tennessee River[?]
• Federal Emergency Relief Administration[?] (FERA), 1933 -- provided breadlines and other aid to the unemployed
• Agricultural Adjustment Act (AAA), 1933 -- paid farmers to not grow crops
• National Recovery Act (NRA), 1933 -- created fair standards in favor of labor unions
• Civil Works Administration
• Public Works Administration (PWA), 1933 -- employeed middle-aged skilled workers to work on public projects, cost $4 billion
• Federal Depositor's Insurance Corporation[?] (FDIC) / Glass-Stegall Act[?] -- insures deposits in banks in order to restore public confidence in banks
• Securities Act of 1933, created the Security Exchange Commission]] (SEC), 1933 -- codified standards for sale and purchase of stock, required risk of investments to be acccurately disclosed
• Indian Reorganization Act, 1934
• Social Security Act (SSA), 1935 -- provided financial assistance to: elderly, handicapped, delinquent, unemployed; paid for by employee and employer payroll contributions
• Works Progress Administration (WPA), 1935 -- a reiteration of the PWA, created useful work for middle-aged skilled workers
• National Labor Relations Act (NLRA) / Wagner Act, 1935 -- granted right of labor unions to exist
• Judiciary Act 1937 -- FDR requested power to appoint a new Supreme Court judge for every judge 70 years or older; failed to pass
• Fair Labor Standards Act (FLSA)), 1938 -- established a maximum work week of 40 hours, and a minimum pay of 40 cents/hour