Back to the video list: North American History

 

The Great Depression of 1929 hit Germany and the United States the hardest. President Roosevelt responded with the New Deal which was established in the years between 1933 and 1938.

 

Video

 

 

Overview

  • Date: 1933 – 1938
  • Location: United States of America
  • Event: Means to overcome the Great Depression

 

Parties & Persons Involved

  • Franklin D. Roosevelt (1882 – 1945), U.S. President

 

The Great Depression

  • 24 Oct 1929: The Black Thursday is the start of the Great Depression

 

  • 04 Mar 1933: The presidency of Roosevelt & the New Deal policy start
  • The Brain Trust, think tank of economic & legal experts, is the main advisory board for the president

 

 

The New Deal

First New Deal (1933 – 1934)

Year

  

Law / Organisation

  

Measures

1933

  

Tennessee Valley Authority & others

  

Job creation measures
 

Agricultural Adjustment Act (adjusted 1938)

  

Measures to stabilise the agricultural prices
 

Glass-Steagall Act (repealed 1999)

  

Separation of business & investment banks
 

Federal Deposit Insurance Company

  

Deposit protection funds
 

Securities Act

  

Regulation of financial markets
 

Securities & Exchange Commision (SEC)

  

1934

  

Federal Housing Administration

  

Public insurances for mortgages
 

Reciprocal Trade Agreement Act

  

Reducing protective duties & enhancing free trade
 

Gold Reserve Act

  

De facto abolishment of the gold standard

 

Second New Deal (1935 – 1938)

Year

  

Law / Organisation

  

Measures

1935

  

Emrgency Relief Appropriation Bill

  

Extension of the job creation measures
 

Social Security Act

  

Introduction of social insurances
 

Public Utility Holding Company Act

  

Dissolution of large & complex holdings
 

Wagner Act

  

Recognition of trade unions
 

Income Tax

  

Increase in the income tax

1936

  

Corporation Tax

  

Introduction of corporate taxes

1937

  

US Housing Authority

  

Social housing

1938

  

Fair Labor Standards Act

  

Minimum wages, 44h week & prohibition of child labour

 

Developments after 1938

  • 1941: After the U.S. enter World War II the economy reaches full production capacity & full employment
  • 1940 – 1980: Republicans & Democrats join the New Deal Consensus which defines economic policy as demand-oriented interventions by the government
  • 20 Jan 1981: Inauguration of President Ronald Reagan
  • The Reagonomics (officially) end the demand-oriented economic policy of the New Deal

 

Consequences & Impact

  • The New Deal eases the economic & social distress of the Great Depression
    • But please note: full production capacity & full employment is only reached after the publicly induced increase in demand because of the U.S. engagement in World War II
  • The Success & the effects of the New Deal are subject to controversial discussions
  • The New Deal is the basis for the U.S. social state
  • Establishment of economic interventions by the government
  • The U.S. society regains self-esteem, orientation & hope in the desolate situation of the Great Depression