The Great Depression of the 1930’s was characterized by bank and business failures and high unemployment. Even the agricultural sector was not shielded as a severe drought, known as the Dust Bowl, hit the Midwest. The New Deal was President Franklin Roosevelt’s program to address the problems of the Depression. He focused on relief to the unemployed by providing jobs through work relief projects. His focus on recovery was to create programs that would provide jobs for individuals that would help rebuild the ability of people to purchase items thus stimulating the economy. Finally, the president sought to reform the parts of the economy that led to the Depression.

People

Franklin D. Roosevelt was born in New York and, after attending prestigious schools, he followed the example of his fifth cousin, President Theodore Roosevelt, and entered politics. He was elected to the state senate in 1910 and later appointed Assistant Secretary of the Navy by President Woodrow Wilson. In the summer of 1921 Roosevelt was stricken with polio. He persevered through physical therapy but never fully regained the use of his legs. Seven years later he was elected governor of New York, and in 1932 was elected President of the United States.

When he took office the country was in the depths of the Great Depression. Thirteen million people were out of work and almost all banks had closed. In his First Inaugural Address he likened the crisis to a foreign invasion, and asserted that the Constitution’s separation of powers and system of checks and balances would have to be temporarily suspended in order to see the country through. He proposed what he called the New Deal: expansive federal programs, funded by citizens paying taxes. He sent a record number of bills to Congress attempting to bring relief to farmers and the unemployed. In 1935 he proposed the Social Security Act. Controls were enacted on utilities and businesses, and the government moved towards regulating the economy. The repeal of Prohibition also brought in more tax revenue for the federal government.

After his decisive reelection victory in 1936, Roosevelt became frustrated with the Supreme Court which had been overturning some New Deal legislation as unconstitutional expansions of Congress’ powers. In what has come to be called his “Court-packing scheme,” he proposed that Congress increase the size of the Supreme Court to a maximum of fifteen members. This proposal failed, but two justices changed their voting, and the court began upholding New Deal laws.

Roosevelt faced issues of national interest and foreign policy. He attempted to keep the country out of World War II, favoring a “Good Neighbor” policy of neutrality. When the Japanese attacked Pearl Harbor on December 7, 1941, Roosevelt believed he had to act; Congress declared war on Japan the next day, and on Germany and Italy three days later. Roosevelt served as Commander in Chief of the military making the defeat of Nazi Germany the first priority. Fearing Japanese saboteurs, he signed Executive Order 9066 authorizing the forced internment of Japanese-Americans living on the West Coast. This action was upheld as constitutional by the Supreme Court in Korematsu v. United States (1944).

In all, President Roosevelt was elected to four terms as President. Until that time, U.S. presidents had followed the example of President George Washington who had limited his service to two terms. In 1951, the 22nd Amendment was passed limiting U.S. Presidents to two terms.

Documents/Supreme Court Cases
Following his election as President of the U. S. in November,1932, Franklin D. Roosevelt, in his First Inaugural Address in 1933, famously urged his fellow Americans, millions of whom were out of work at the height of the Great Depression, to demonstrate courage. He proclaimed: “The only thing we have to fear is fear itself.”

He explained that because of the nation’s financial crisis, “the normal balance of power” in American government needed to be altered. He said that he would “ask the Congress for…broad executive power to wage a war against the emergency as great as the power that would be given to me if we were in fact invaded by a foreign foe.”

In his so-called New Deal, Roosevelt thus argued for a shift in the balance of power between the national government and the states in our federal system of government. A substantial growth in the role and power of the national government resulted as a consequence of several major New Deal laws which FDR persuaded Congress to adopt.

In the early 20th century the United States was the only developed nation in the Western world which did not have a national social insurance system aimed at assisting those in need. When difficult economic times occurred, workers and the elderly were largely on their own. Government at this point in history had little involvement with caring for the unemployed or the elderly. This was particularly true of the national government. Except for veterans’ benefits, the national government did not provide pensions, social insurance, or other forms of assistance. Any relief provided to people was from the private sector or from state or local governments. Only one state, Wisconsin, had adopted an unemployment compensation program and only did so in 1932. Besides helping the unemployed, the other major concern was protection for the growing number of elderly Americans. By 1930, the number of elderly more than doubled. Many elderly lived on the edge of survival and feared that injury, sickness, or economic downturn would ruin them. Following the stock market crash of 1929, the nation and the world experienced what is called the Great Depression during which workers and the elderly found themselves in desperate situations.

One of Franklin D. Roosevelt’s first appointments after he was elected President in 1932 was that of Frances Perkins as U. S. Secretary of Labor. She played a key role in what eventually became the Social Security Act of 1935. In 1931 she had gone to England to study that nation’s old age pension and unemployment programs. On her return, she urged President Roosevelt to persuade Congress to adopt similar programs for the U. S. Both chambers of Congress adopted the Social Security Act by overwhelming margins, and FDR signed it into law in 1935. The law had four major components: (1) a federal-state unemployment insurance program administered by the states; (2) federal grants to states for welfare payments for needy children, the blind, and the elderly; (3) federal grants to the states for vocational rehabilitation, infant and maternal health, aid to crippled children, and public health programs; and (4) old-age insurance paid directly by the national government to individuals when they retired at age 65, financed by employer and employee taxes while employed. The law has been amended and added to several times since 1937.

In 1937 when the law was challenged as to its constitutionality, the U. S. Supreme Court ruled that Congress had the constitutional power to pass the law.

Events

On October 24, 1929, the stock market crashed due to an unprecedented volume of selling on Wall Street. This caused a decline in the stock market unprecedented in U.S. history. Millions who had invested in the market when it was booming lost their entire fortunes and life savings. This event signaled the beginning of the Great Depression in the United States, which lasted through the 30s and into the early 40s. The Great Depression was characterized by bank and business failures and the highest unemployment rate in U.S. history.
Even the agricultural sector was not immune to the economic problems of the Great Depression. In the 30s a severe drought coupled with unsuitable farming practices resulted in terrible dust storms in the southern section of the Midwest region. This situation caused crops to fail and livestock to die. The area affected became known as the Dust Bowl. The Dust Bowl resulted in a mass exodus of farmers who lost their land to the banks when they were unable to repay the loans, they had taken out to get through the drought. Many left their farms in hopes of finding work in California. John Steinbeck wrote about the struggles of these farmers in one of America's greatest novels, The Grapes of Wrath, published in 1939. His novel was based on the lives of agricultural workers, he called” Okies,” who had migrated to California from Oklahoma during the Dust Bowl. The novel painted a vivid picture of the Depression Era and the Dust Bowl created by the drought. It is estimated that over one million farmers lost their land and left searching for better opportunities.
As the radio became increasingly popular, President Roosevelt conducted a series of radio addresses to the American people, known as the" Fireside Chats." During these chats, he spoke as if he were directly speaking to each listener. He used this time to explain his policies and ideas. In the first of these broadcasts, President Roosevelt addressed the banking crisis that had forced the government to call for a bank holiday to stop the panic caused by people withdrawing all of their money. Later on, his chats described other programs designed to provide relief to Americans, to help them recover from their struggles of the Great Depression, and to reform systems that needed greater regulation. Critics were concerned that New Deal legislation was leading to an expansion of executive power, especially those designed to protect the economy through government intervention in private business. Finally, as the fascist dictators began to threaten Europe, Roosevelt used the chats to calm the fears of the American people in the years before World War II.
One example of Roosevelt's relief and recovery program was the Tennessee Valley Authority (TVA). The TVA was created in 1933 to provide jobs and improve the regional standard of living by tackling issues from erosion, flood control, reforestation and power production. By building dams, the TVA was able to generate electricity for a region that included Tennessee and parts of Alabama, Georgia, Kentucky, Mississippi, North Carolina, and Virginia that had not had access to electricity before. Electricity made life on the farms in this region easier and much more productive. It also encouraged new industry and jobs for those living in the region.
The Securities and Exchange Commission is a regulatory agency created by President Roosevelt to prevent the problems with the market that caused the Crash in 1929. The commission does this by providing oversight of the securities markets to provide accurate information for investors. As a result, the SEC today has had a positive impact on investments in the U.S. markets.
By the mid-1930s, criticism of President Roosevelt's New Deal programs began to grow. Critics were concerned that New Deal legislation was leading to an expansion of executive power, especially with his efforts to protect the economy through government intervention in private businesses. When some of his programs faced court challenges and resulted in the Supreme Court striking down some New Deal legislation as unconstitutional, President Roosevelt felt it was time for him to extend his reforms to the judicial branch. President Roosevelt had not made any appointments to the Supreme Court during his first term in office and there was no evidence that any of the current Justices were planning to retire; therefore, he proposed the Judicial Procedures Reform Bill and presented it to the American people in one of his Fireside Chats. The proposed legislation would add a new justice to the court every time a Justice reached the age of seventy and still planned to serve on the court. He felt he was able to do this constitutionally since the number of justices on the Court is set by Congress where he enjoyed a healthy majority. This proposed plan was called the "Roosevelt's Court Packing Plan" by his critics. They felt he was merely trying to fill the court with justices who would support his policies. As criticism grew even within his own party, President Roosevelt withdrew his proposed plan for court reform.