Roosevelt's New Deal From The Crisis of The Great Depression to The Era of Extraordinary Changes

By Davis Truman

The Roosevelt New Deal was a series of domestic programs and initiatives launched by President Franklin D. Roosevelt shortly after he assumed office in 1933. At that time, the United States faced one of the worst economic crises in its history, with unemployment rates exceeding 25%, banks failing, and businesses closing down. In response to this crisis, Roosevelt sought to implement a range of policies to address the immediate needs of the people, as well as the underlying causes of the economic downturn.

The New Deal was based on three primary goals: relief, recovery, and reform. Relief measures aimed to provide immediate assistance to those most affected by the Great Depression, including the unemployed, farmers, and the elderly. Recovery efforts focused on restoring the economy and creating jobs. At the same time, reform measures sought to address the structural issues that had contributed to the crisis, such as the lack of financial regulation and social safety nets.

Some of the critical initiatives of the New Deal included the creation of the Civilian Conservation Corps (CCC), which employed young men to work on public projects such as road building and conservation; the establishment of the Works Progress Administration (WPA), which provided jobs and training to millions of unemployed workers; and the implementation of agricultural subsidies to support struggling farmers.

The New Deal also saw significant changes in the regulation of the financial sector, including the creation of the Federal Deposit Insurance Corporation (FDIC) to insure bank deposits and the Securities and Exchange Commission (SEC) to regulate the stock market. Other reforms included establishing social security, which provided retirement benefits to elderly Americans, and the National Labor Relations Act, which protected workers' rights to unionize.

While the New Deal faced criticism from some who saw it as an overreach of government power, it is widely regarded as a turning point in American history. Its impact on American society and politics is still felt today, with many programs and policies remaining in place. The New Deal's legacy is often studied as a case study of the role of government intervention in economic and social policy. Its successes and failures continue to be debated by scholars and policymakers alike.

• Language: English
• Publisher: vincenzo nappi
• Release date: Apr 12, 2023
• ISBN: 9798215482308

Book preview

Chapter One

Introduction

THE NEW DEAL ERA WAS a significant turning point in twentieth-century American constitutional evolution. The deep economic crisis that gripped the country during the Great Depression sparked a period of remarkable legislative ferment, resulting in several astonishingly broad-ranging and far-reaching changes in the American legal and constitutional system. By the time the United States was dragged into World War II, Congress would have extraordinary power over the country's peacetime economy. The national legislature funded many expenditure initiatives to alleviate misery and boost economic growth while enacting a remarkable series of regulatory measures to restore health to the convulsing economy. The Administration of these new federal provisions and control programs necessitated the formation of several new federal agencies as well as the significant expansion of existing ones, resulting in an explosive growth in the size and power of the federal bureaucracy and the full flowering of what appeared to be a developing administrative state in retrospect. The presidency, supported by a greatly expanded staff and imbued with enhanced authority over executive branch agencies, stood at the summit of this rising budgetary and administrative structure. Just as the President emerged from the Great Depression with increased control over domestic Administration, the commander-in-chief would enter World War II with greater discretion over American foreign policy.

Meanwhile, the federal judiciary would grow more forceful in defending civil rights and liberties such as free speech and the rights of the accused, even as it retreated from its traditional role as the federal system's arbitrator and custodian of vested rights. In upholding new redistributive and protective legislation programs previously criticized as special or partial legislation, the Supreme Court's changing jurisprudence paved the way for a form of national politics openly based on an interest-group pluralism paradigm. The massive expansion of the federal government's size, authority, and responsibility was the New Deal's defining transformation. A growing belief that only the national government could successfully alleviate the prolonged misery created a significant impetus to the centripetal pressures of regulatory and fiscal centralization. President Franklin D. Roosevelt's New Deal would result in a dramatic expansion of both the extent and ambition of federal authority. Federal spending programs now sought to ensure economic security for all residents while Congress expanded its regulatory authority over areas traditionally dominated, if at all, by state governments. Federal authorities now have power over banking, stock markets, agriculture, energy, industrial labor relations, etc.

Because preemption of state regulation drastically curtailed state governments' formal authority, the states were not merged into a unitary national state. Local officials were given significant latitude in administering federal grants. At the same time, states retained most of their traditional authority over the content of legal domains governing subjects such as property, contracts and commercial transactions, business associations, crime, and the family. Similarly, the Supreme Court removed long-standing hurdles to state regulation by retiring economic substantive due process and relaxing constraints imposed by the federal Constitution's Contract and Dormant Commerce Clauses. Centralizing unprecedented authority and responsibility in a national regulatory and welfare state was a watershed moment in the American federal system. The breathtakingly novel reach of federal economic regulation, its impact on vested property rights, and the scope of discretionary authority confided to the executive branch in its Administration all stretched established understandings of constitutional limits to the breaking point, sometimes. To be sure, existing constitutional theory offered a secure framework for many New Deal poverty-relief initiatives. Nonetheless, several congressional measures were based on interpretations of federal regulatory powers that were unprecedented in their breadth, while several state and federal statutes curtailed private economic rights in ways that raised tough constitutional questions under the Fifth and Fourteenth Amendments' Contract and Due Process Clauses.

The fate of state and federal legislation addressing the economic devastation caused by the Depression thus hinged on two critical variables: legislators' ability to accommodate transformative statutory initiatives within the framework of contemporary doctrine and Supreme Court justices' willingness to relax or abandon constitutional constraints on federal and state regulatory power. The procedures by which the New Deal rule eventually obtained constitutional support from the Court are easily observable. The conditions of the Great Depression, as well as the inadequacy of Republican efforts to address them, reinforced the electoral influence of a political coalition that would entrust the Democratic Party with the presidency and both Houses of Congress from 1933 onward. The coalition's continued dominance assured that the need for national action to address the crisis would be powerful and persistent. This perseverance would have two significant consequences. First, if the justices ruled that an initial legislative attempt to solve a specific problem did not pass constitutional muster, the New Deal Congress could reformulate the program to attain the desired aim using ways consistent with current constitutional doctrine. Throughout the 1930s, New Dealers used this adaptable method with great effectiveness. The second resulted from Franklin D. Roosevelt's repeated reelection to President.

Faced with a federal judiciary marked by twelve years of Republican dominance in presidential politics, Roosevelt systematically filled lower court vacancies with committed Democrats throughout his term. Neither death nor resignation allowed a disappointed Roosevelt to appoint a Supreme Court justice during his first term. President Hoover's three selections to the Court formed a majority that appeared more amenable to government regulation than the Taft Court. However, that majority was fragile and far from devoted to the Administration's constitutional views. Nonetheless, between 1937 and 1941, the President appointed seven New Dealers to the nation's highest Court for life. These appointees will modify the nation's constitutional law to enable regulatory innovations that their judicial predecessors could not have accepted, fully expressing the constitutional sensitivities underlying the New Deal vision of government. Democrats' continuous electoral success after Roosevelt's death would allow the Party to further solidify its influence in the federal Court, ensuring that New Deal constitutionalism would remain a dominant orthodoxy even as its sponsoring political coalition frayed.

Chapter two

The Great Depression

AT THE END OF A DECADE known for its success, the American economy saw a deep recession with disastrous consequences that were both prolonged and intense. Though the Depression would last until the end of the 1930s, thanks to the stimulation of wartime industry, the rapid economic decline of the first four years was particularly shocking. National income was slashed in half between 1929 and 1933. Manufacturing output, retail sales volume, and wholesale and commodity prices all fell precipitously. In 1930 alone, a record 26,355 enterprises failed, and in 1931,