The Great Depression and the New Deal Essay

When he was inaugurated as the president of the US, Franklin D. Roosevelt decided to make an assessment of the huge damage that prevailed in the country. The assessment pertained to the withered leaves that pertained to the industrial enterprise; inability of farmers to gather markets for their farm produce, the disappearance of the savings that families had made for many years; the unattractive problem related to existence that the unemployed people faced; and the a great number toil that did not yield sufficient returns (Chase 93). In this case, Roosevelt was talking about the Great Depression that took place between 1920 and 1940, which started in the US before spreading to the rest of the industrial world. Despite giving a description to the great depression while using grim words, the economic catastrophe that thus incident impacted on the US as well as other industrialized states was beyond description. The US had never before experienced such a blow on its economy.

The New Deal that was introduced by Roosevelt played a crucial role with respect to reshaping and structuring the US. However, in order to bring an end the prevailing poverty in the nation, the programs that were introduced were supposed to employ as well as offer millions of Americans with financial security. This way, the programs would prove as effective as well as beneficial to the entire American society. Some of the programs that were implemented still play a vital role in the country with respect to providing the people in America with economic benefits and security (Ickes 111)

The Great Depression

The failure of the stock market that took place in 24th October, 1929 is the one that offset the Great Depression. During this time, approximately 13 million shares were traded. This damage extended to October 29th when approximately 16 million shares got sold, and thus making this day to be declared as Black Tuesday (Merrill 703). The value associated with most of the shares that dominated the market fell sharply, which later led to financial ruin and panic. There had never before been witnessed a collapse that led to such devastating effects to the US economy. These effects were also long-term in nature. Businesses were closed and bans failed to undertake their operations in an efficient manner, and this made mane people to be jobless. The wages of the people who were able to secure their jobs fell by sharp margins (Merrill 703).

The value of money went down significantly while the demand for goods went down sharply. During this time, the industrial production had gone down by more than half, and the bottom had gone outside the stock market (Zimand 326). By the year 1932, the number of people who did not have jobs went up by 13 million, and most people lived in primitive conditions that were associated with a preindustrial society that had suffered the impacts of a famine (Roosevelt 647).

The agricultural sector in the economy remained in a state of devastation for many years. The onset of the depression almost brought an end to the agricultural sector whereas the drought that generated the Great Plains Dust Bowl elevated the damage further. The government also lacked sufficient income since the taxes that were paid to it fell in a dramatic manner. During this time, the government did not have sufficient ability to allow it to respond to the economic crisis. The structure of the international world trade also went down, and every nation around the world imposed high tariffs on goods that were being imported to help them protect their industrial base (Ickes 111). However, this initiative only made the conditions to become worse.

Part 2

The Great Depression and the New Deal

The stock market crash that took place in the late 1920s devastated the American economy leaving approximately 13 million Americans without jobs. According to Merrill (703), budget cuts, wage reduction and retrenchment occurred during this time leaving many disgruntled people. It was during this time that Franklin Roosevelt took office where he implemented the New Deal that transformed the US. As the Great Depression came to an end, World War II followed. As the Great Depression deepened, most Americans lost their jobs and homes. The deteriorating diet subjected many people to diseases. This crisis did not only affect those people who were in the urban areas, but also who were in the farm community

The situation during the depression was very bad and many companies went bankrupt or undertook extreme measures to stay afloat. Passos (29) describes the situation of coal miners in Kentucky forced to poverty and sickness by companies trying to survive in the harsh market. Children were not spared during this period. Zimand (37) carried out a survey in 1932 on children injured in the work place. The survey carried out in Illinois and Tennessee found out that children are exposed early into the work environment without ample training and proper safety gear.

Hoover is portrayed as having expressed hostility when the government offered direct relief. However, as the depression got worse, he offered support to a number of responses that the federal government was undertaking. The Reconstruction Finance Corporation provided the local and state governments, as well as businesses with financial assistance in order to help stimulate the economy. When tariff increase was proposed, Hoover supported it since he believed that it would provide American manufacturers and farmers with protection from the aftermath of the depression, but it led to the weakening of the economy (Norton et al. 45).

Though Franklin Roosevelt was paralyzed from Polio, he portrayed great optimism while appealing to a large number of Americans. While serving as the governor of New York from 1928, Roosevelt responded in a vigorous manner to the great depression. Roosevelt together with his advisors believed in government regulation towards big businesses in order to create scarcity that would help to save the economy (Ickes 111).

After being sworn into office, the New Deal was launched, and the congress began to observe the massive output attributed with the New Deal. People were assured that banks were safe, and a number of acts were enacted in order to regulate the state of the economy (Roosevelt 133). The beer-Wine Revenue Act permitted the sale of wines that were low in alcohol, and taxes were imposed on those products; The Agricultural Amendment Act paid the farmers so that they could minimize their production in order to receive subsidies from the government; Other relief measures that were imposed comprise of the CCC, which served as a jobs corps that were undertaken by young men; The federal Emergency Relief Act widened its help to both the local and state governments. However, there were a number of critics who opposed the New Deal. For instance, when partial recovery of the economy was observed, there were a number of conservatives and business people who opposed the New Deal (Ickes 111).

Criticisms were mostly based on the codes that had been established under the NRA. The book also portrays how the Second New Deal came to be after Roosevelt’s second term in Office. It led to the implementation of Emergency Relief Appropriation Act, national Labor Relations Act, and Social Security Act. There were also cultural programs that provided employment opportunities for the musicians, writers, actors and artists. Business control measures were also implemented through corporate taxes and antitrust suits.

Primary Sources

Great Depression Impact

By 1932, the entire industrial output of the US had been sliced into half. Approximately 15 million people were jobless, and issues incentives such as employment insurance did not exist at the time (Guild 667). The wages that the employees used to be paid on an hourly basis went down by about 50 percent, and hundreds of banks fell. The prices associated with agricultural products went down to their lowest levels ever since the aftermath of the Civil War. About 90,000 businesses ended their operations completely.

Statistics only give a partial account of the devastating hardships that millions of citizens in the US went through. This is because almost every person in the country who was unemployed needed to be provided with food and housing. This kind of poverty had never been witnessed in the US before. Most of the people who served as former millionaires used to stand on the streets trying to sell apples for a price of 5 cents each (Merrill 703). People were noted to queue in bread lines in each city hoping that they would get something to eat. Approximately 20,000 Americans killed themselves in 1931 alone.

Any person who had money was declared to be lucky, and one could be able to purchase a new home for an amount that was less than $3,000. The suit of a man was approximately $10 while a shirt was not worth more than 50 cents, and shoes went for about $4. There were not many lucky people who were left with change after buying food and paying for their rent. During the Hoover years, turning to the government for assistance was regarded as a useless undertaking. There also lacked welfare programs that would prevent the working class people to fall into poverty after losing their jobs (Merrill 703).

The New Deal

When President Franklin Roosevelt was elected, he brought optimism and confidence to the hearts of the people after declaring the start of the program, which was referred to as the New Deal. During his inauguration speech, he advised the American citizens that the only thing that they had to fear was fear itself. He portrayed determination to make changes that were effective while service as the president of the US (Roosevelt 74). He went in a swift manner so that he could be able to address the financial illness that was paralyzing the nation. When he entered office for the first time, he advised the secretary of treasury at the time to draft a banking bill that was meant to address emergencies, and gave the man in charge five days for it to be ready.

The New Deal was noted to introduce a number of economic and social reforms that had been familiar among Europeans for many years. Additionally, the New Deal served as a representation of the end of laissez-faire capitalism. It aimed at fostering the regulations that were being imposed to the railroads in 1880s, national reform and flood of state legislation (Thomas 308).

The idealistic concept regarding the New deal was that it was able to accomplish agendas at a fast face on issues that used to take generations to implement before Roosevelt came into power. Most of the reforms were being drawn in a hasty manner, and they were also being administered in a weak manner, and thus making them to contradict. During the entire era when the New Deal was in place, no interruptions were being directed towards the debates and criticism that were being raised by members of the public (MacNeil 458). This is because the New Deal was noted to make the citizens to develop a sharp interest in the affairs that the government was undertaking.

Impact of New Deal on Unemployment

By the year 1933, there were millions of Americans who were jobless, and bread lines were common in most of the cities in the country. Thousands of people used to roam around the country while searching for food and housing. The early step related to unemployment was noted when it came as Civilian Conservation Corps (CCC). This program was initiated by the Congress to help offer relief to those people who were aged from 18 years to 25 years (Thomas 308). CCC was implemented in a semi-military manner, and it embarked on enrolling young men to work in various camps across the country where they were awarded about $30 every month. There were approximately 2 million young men who were noted to participate in this program in the 1930s (Chase 93). While in the CCC program, the young men engaged in various conservation initiatives that comprise tree planting in order to regulate soil erosion, eliminate stream pollution and maintain natural forests. They also created game, fish and bird sanctuaries. Moreover, they undertook initiatives aimed at conversing petroleum, coal, gas, shale, helium and sodium deposits (Guild 667).

A program names Civil Works Administration provides jobs to a large number of people who were not employed. Though this program received a lot of criticism, the jobs that were funded comprised of teaching, repairing highways and digging ditches. The program was created on November 1933, but it was later abandoned in 1934. However, Roosevelt’s administration kept favoring the unemployment initiatives that were targeted towards work relief as opposed to welfare.

New Deal Impact on Agriculture

The years when the New Deal prevailed were characterized by beliefs that the imposition of a large number of regulations would help in addressing most of the problems that the country was facing. For instance, in 1933, the Congress paved way for the Agricultural Adjustment Act (AAA) whose goal was to offer relief to farmers (Le Sueur 86). In this case, the role of AAA was to help in raising the prices of farm products by providing farmers with subsidy so that they could be able to compensate on the voluntary cutbacks that were witnessed in agricultural production (Lewis 72). The funds that would be used for the repayment would be derived from the tax that as levied from those industries that used to process the crops. By the time that the act became law, the growing season was on the horizon, and AAA offered farmers encouragement plow the crops that they received in abundance (NARA). Despite the prevalence of both the Commodity Credit Corporation and AAA programs, the level of output went down (Lewis 72).

From 1932 to 1935, the income that was being realized from farms rose by about 50 percent (Lewis 72). But this was partially influenced by the federal programs that have been set in place. During these years, farmers were being encouraged bring land out of the production process, and this initiative would displace sharecroppers and tenants. There was a significant reduction in produce once a severe draught was witnessed in the states that were found in the Great Plains.

Though AAA had been noted to emerge as one of the most successful programs, it was gotten rid of in 1936, especially when the tax that was being levied on the food processors was declared as being unconstitutional (Nation 61). After a period of six weeks, the Congress passed an act that was regarded as being more effective because it allowed the government to pay those farmers who minimized the planting of crops that depleted the soil. By 1940, approximately 6 million farmers were being provided with subsidies by the government. This act provided room for the provision of loans of crops that were surplus (MacNeil 458). Additionally, wheat insurance was implemented and stores were introduced in order to ensure that there was a stable supply of food.


From the paper, it is evident that Franklin Roosevelt Administration together with his New Deal concept, the role of the government was witnessed to grow more than it had been witnessed in the previous years. Between 1932 and 1940, there were a number of examples that symbolized the growth that the government facilitated. There were approximately 32 new agencies that the government created when it was in power for eight years (MacNeil 458). Though most of the agencies that were formed became abolished later, or got replaced, some of them still take effect today. Between 1933 and 1938, there was a great upheaval related to American institutions while compared to any other period in America’s history.

However, today, the institutions and programs that were developed do not prove to be valuable especially with respect to contributing to the growth and success of the nation that is treated as being the most powerful all over the world. This is because, after stability was restored in the country, a large number of projects have emerged in the country, which have allowed it to dominate most of the world’s industrial, agricultural and service undertakings. Therefore, it is evident that A People and A Nation provides an elaborated account of the way in which America managed to overcome the hardships that it witnessed during the Great Depression to becoming the most powerful nation around the world.

Works Cited

Chase, Stuart. “Eating Without Working: A Moral Disquisition.” The Nation 28.7 (1933): 93.

Ickes, Harold. “The Social Implications of the Roosevelt Administration.” Survey Graphic 23.3

(1934): 111.

Lewis, E. “Black Cotton Farmers and the AAA.” Opportunity, Journal of Negro Life 13.3

(1935): 72.

MacNeil, Douglas. “Success Stories–Work Relief Style.” Survey Associates 28.7 (1939): 458.

Merrill, Julia. “The Challenge of the Depression.” Bulletin of the American Library Association

25.12 (1931): 703.

Nation, The. “The Supreme Court Swings the Ax.” The Nation 142.3260 (1936): 61.

Passos, John. “Harlan: Working under the Gun” New Republic 12.2 (1931): 29

Roosevelt, Franklin. The Public Papers and Addresses of Franklin D. Roosevelt New York City:

Random House, 1938)

Thomas, Jesse. “Will the New Deal Be A Square Deal For the Negro?” Opportunity, Journal of

Negro Life 11.10 (1933): 308.

Zimand, Gertrude. “Children Hurt at Work.” The Survey 68.8 (1932): 37.