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Home : History & Biography : History Study Guides : American : The Great Depression (1920–1940) : The Second New Deal: 1935–1938
The Second
New Deal: 1935–1938
Events
1934 -
Indian Reorganization Act (IRA)
1935 -
Works Progress Administration (WPA)
National Labor Relations Act (Wagner Act)
Social Security Act
1936 -
Soil Conservation and Domestic Allotment Act
Roosevelt is reelected
1937 -
United States Housing Authority (USHA)
1938 -
Second Agricultural Adjustment Act
Fair Labor Standards Act
Key People
Franklin Delano Roosevelt -
32nd
U.S. president; reelected in 1936;
brought Second New Deal programs and policy through Congress
Huey P. Long - Louisiana
senator who criticized New Deal for not doing enough to help American
people; was assassinated before he could seriously challenge Roosevelt
Father Charles Coughlin -
Catholic priest in Michigan and outspoken New Deal
critic; blamed Crash of 1929 on
wealthy financiers and Jews; wanted federal government to take over
entire banking system
Alfred M. Landon -
Kansas governor who ran against FDR on anti–New Deal Republican
ticket in election of 1936 The Second New Deal
The Second New Deal—the legislation that
Roosevelt and Congress passed between 1935 and 1938—was
strikingly different from the First New Deal in certain ways. Perhaps
most important, the Second New Deal legislation relied more heavily
on the Keynesian style of deficit spending than the First New Deal
did. Roosevelt altered his policy making in part because of complaints
from critics and in part because, by 1935,
it was clear that more Americans still needed federal relief assistance.
Roosevelt thus aimed approximately half the Second New Deal programs
and policies at long-term reform. New Deal Critics
Predictably, Roosevelt’s New Deal came under attack from
the right, from Republicans, conservative Democrats, bankers, and Wall
Street financiers who claimed that it doled out too many federal
handouts. Many of these critics also feared that the policy and programs
involved were a dangerous step toward socialism and
the destruction of the American capitalist system. Such misgivings
were understandable given the political atmosphere in the 1930s,
as communism was becoming a more imminent threat. In fact, Soviet agents
in the United States went so far as to launch a “popular front” campaign
to actively support the president. Moreover, an unprecedented number
of people joined the American Communist Party during the
decade.
Perhaps more surprising, the New Deal also came under
attack from the far left. Many socialist activists denounced the
New Deal because they believed that it was too conservative and
that it did not provide enough relief and assistance.
Over the years, many historians have tended to agree with this argument.
Several have argued that the Great Depression would not have been
so devastating for so long had Roosevelt handed more federal money
out to a greater number of Americans. Coughlin and Long
One of the most vocal of Roosevelt’s critics was Father Charles Coughlin.
A Catholic priest from Michigan, Coughlin began broadcasting a weekly
radio show in 1930 that
outwardly criticized the New Deal. Within a few short years, Coughlin
had amassed a following of 40 million
listeners who agreed with his anti–New Deal opinions. He blamed
the Great Depression on Wall Street, crooked financiers, and Jews
and campaigned for the nationalization of the entire American banking
system.
Senator Huey P. Long of Louisiana was another
major thorn in Roosevelt’s side, albeit from the left rather than
the right. Long was among those who believed that the New Deal was
not doing enough to help Americans. Believing that income inequality
had caused the depression, he promoted his own “Share the
Wealth” program (sometimes referred to as the “Every
Man a King” program), which would levy enormous
taxes on the rich so that every American family could earn at least
$5,000 a
year. Long enjoyed enormous popularity during the first few years
of Roosevelt’s first term but was assassinated in 1935. The Works Progress Administration
The first major legislation that Roosevelt and Congress
passed in the Second New Deal—in response to the critics—was the Works Progress
Administration (WPA). Created in 1935,
the WPA was an effort to appease the “Longites” who
clamored for more direct assistance from the federal government.
The WPA was similar to the Public Works Administration of the First
New Deal, this time hiring nearly 10 million
Americans to construct new public buildings, roads, and bridges.
Congress dumped over $10 billion
into the projects in just under a decade. The Social Security Act
Congress also passed the Social Security Act in 1935,
creating a federal retiree pension system for many workers, funded
by a double tax on every working American’s paycheck. The act also
created an unemployment insurance plan to provide temporary assistance to
those who were out of work, while also making funds available to the
blind and physically disabled. Furthermore, Congress agreed to match
federal dollars for every state dollar allocated to workers’ compensation
funds.
Despite its vocal critics, the Social Security Act had
an enormous impact on Great Depression–era Americans and future
generations. It brought the most sweeping change of the Second New
Deal legislation as it not only gave income to some of the most
destitute in society but also forever changed the way Americans
thought about work and retirement. The paycheck taxes were advertised
as a personal retirement savings plan even though those tax dollars
were actually being redistributed as soon as they were collected.
Nevertheless, retirement came to be seen as something every worker
could enjoy. Still, many criticized the Social Security system for
not extending pensions to enough people, particularly unskilled
black and women laborers. Legislation for Farmers and Homeowners
The Second New Deal provided even more assistance to farmers. After
the Supreme Court declared the Agricultural Adjustment Administration
unconstitutional in 1936,
Democrats immediately responded with the passage of the Soil
Conservation and Domestic Allotment Act that same year. This
act continued to subsidize farmers to curb overproduction and also
paid them either to plant soil-enriching crops (instead of wheat)
or to not grow any crops at all. In 1938,
Congress also created a Second Agricultural Adjustment Administration to
reduce crop acreage. Meanwhile, the United States Housing
Authority (USHA), created by Congress in 1937,
gave assistance to American urbanites, building new houses for over
half a million Americans. The Indian Reorganization Act
Native Americans also received federal assistance
during Roosevelt’s second term. In 1934,
Congress passed the Indian Reorganization Act (IRA) to
promote tribal organization and give federal recognition to tribal
governments. The IRA also reversed the 1887 Dawes Severalty
Act, changing the relationship between various tribes and the federal
government. The Dawes Act had weakened tribal affiliations because
it stated that only individual Native Americans—not tribal councils—could
own land.
Despite Roosevelt’s efforts to alleviate Native
American suffering, however, the IRA was only partially
successful. Some tribes had difficulty understanding the terms of
the new treaty, while others, such as the Navajo in the Southwest,
flat-out rejected it. Many tribes saw more immediate benefit from
relief programs such as the Civilian Conservation Corps, Public
Works Administration, and Works Progress Administration, in which
nearly 100,000 young
Native American men participated. Labor Reforms
These labor reforms had a lasting effect on
America. The Wagner Act paved the way for more effective
collective bargaining and striking, and within a year, fledgling
labor unions had I-line workers in the General Motors automobile
factory, for example, used the Wagner Act to initiate a series of
sit-down strikes, in which workers would sit at their stations and
refuse to leave, preventing the company from hiring new, non-union
“scab” workers to fill in for the strikers. By 1937,
General Motors had recognized its workers’ right to organize. The Election of 1936
With the 1936 presidential
election on the horizon, Republicans stood virtually no chance
against Roosevelt and his party. Democrats’ efforts to provide relief,
recovery, and reform were highly visible. Roosevelt had especially
strong support among blacks (voting as Democrats in large numbers
for the first time), unskilled laborers, and residents of the West
and South. The Republican nominee was Kansas governor Alfred
M. Landon, a moderate who campaigned on an anti–New Deal
platform. Not surprisingly, Roosevelt won a landslide victory, with 523 electoral
votes to Landon’s 8. Roosevelt’s resounding
victory proved that Americans widely supported the New Deal. |
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