Countries of the World/COUNTRYS.BIN/dp/0388/03885.txt

Text File | 1991-06-25 | 26KB | 441 lines

$Unique_ID{COW03885}
$Pretitle{444}
$Title{United States of America
Chapter 7B.   New Deal Brings Social Reforms}
$Subtitle{}
$Author{United States Information Service}
$Affiliation{United States Government}
$Subject{new
american
united
states
war
roosevelt
government
germany
deal
japan}
$Date{1991}
$Log{}
Country:     United States of America
Book:        An Outline of American History
Author:      United States Information Service
Affiliation: United States Government
Date:        1991

Chapter 7B.   New Deal Brings Social Reforms

     The new President brought an air of cheerful confidence that quickly
rallied the people to his banner. Before long, the complex of reforms known
as the New Deal was well on its way. In a certain sense, it can be said that
the New Deal merely introduced into the United States types of reform familiar
to Englishmen, Germans, and Scandinavians for more than a generation.
Moreover, the New Deal represented the culmination of a long-range trend
toward abandonment of laissez faire, going back to the regulation of the
railroads in the 1880s and the flood of state and national reform legislation
of the Theodore Roosevelt-Wilson era.

     What was truly novel about the New Deal was the speed with which it
accomplished what elsewhere had taken whole generations. Many of the reforms
were hastily drawn and weakly administered; some actually contradicted others.

     During the entire New Deal period, despite its speed in decision and
execution, public criticism and discussion were never interrupted or
suspended; in fact, the New Deal brought to the individual citizen a sharp
revival of interest in government.

     When Roosevelt took the presidential oath, the banking and credit system
of the nation was in a state of paralysis. With astonishing rapidity the banks
were reopened, and a policy of moderate currency inflation was adopted in
order to start an upward movement in commodity prices and to afford some
relief to debtors. New governmental agencies brought generous credit
facilities to industry and agriculture. Savings-bank deposits up to $5,000
were insured, and severe regulations were imposed upon the sale of securities
on the stock exchange.

     In agriculture, far-reaching reforms were instituted. Following the
Supreme Court nullification of the Agricultural Adjustment Act three years
after its passage, Congress passed a more effective farm-relief act, providing
that the government make money payments to farmers who would devote part of
their land to soil-conserving crops or otherwise cooperate in long-range
agricultural goals. By 1940, nearly six million farmers were receiving federal
subsidies under this program. The new act likewise provided loans on surplus
crops, insurance for wheat, and a system of planned storage to ensure an
"ever-normal granary." Soon, prices of agricultural commodities rose, and
economic stability for the farmer began to seem possible.

     Another goal of the New Deal was to bring independence to farm tenants.
The federal government set up the Farm Security Administration to subsidize
the purchase of farms for tenants on easy terms, and it refinanced farm
loans, bringing relief to the holders of farm mortgages. Simultaneously,
Secretary of State Cordell Hull was attempting to restore some foreign markets
by reciprocity agreements designed to break down the economic autarky created
by high tariffs. Under the Trade Agreements Act of June 1934, Secretary Hull
negotiated unconditional most-favored-nation reciprocity treaties with Canada,
Cuba, France, Russia, and some 20 other countries. Within a year, American
trade had improved materially, and by 1939 farm income was more than double
what it had been seven years before.

     The New Deal program for industry went through an experimental phase in
the opening years of the Roosevelt Administration. In 1933 a National Recovery
Administration (NRA) was set up, based essentially upon the idea that the
crisis could be resolved by limiting production and fixing higher prices; but
even before the NRA was declared unconstitutional in May 1935, it was widely
considered unsuccessful. By this time other policies were fostering recovery,
and the administration soon took the position that administered prices in
certain lines of business were a severe drain on the national economy and a
barrier to recovery.

     As progress toward recovery continued, the federal government spent
thousands of millions of dollars for relief of the unemployed, for public
works, and for the conservation of national resources. These "pump-priming"
expenditures created new demands at home for the products of American
industry.

     It was during the New Deal that organized labor made greater gains than
at any previous time in American history. Section 7 (a) of the National
Recovery Administration Act had guaranteed to labor the right of collective
bargaining, and in July 1935, to replace the labor provisions of the defunct
NRA, Congress passed the National Labor Relations Act, which set up a
labor board to supervise collective bargaining, administer elections, and
assure workers the right to choose the organization that should represent them
in dealing with employers.

     Great progress was made in labor organization. The American Federation of
Labor, with its principle of craft unionism, was slow to organize the
unorganized, and some of the dissatisfied mass unions broke away and formed
the Congress of Industrial Organizations (CIO). A successful organizing drive
by the CIO, particularly in basic industries like automobiles and steel,
spurred the AFL to competitive action. Whereas there had been 4 million
organized workers in 1929, there were 11 million in 1939 and 16 million in
1948.

     Organization brought a growing sense of common political interests, and
labor's power increased not only in industry but also in politics. This power
was exercised largely within the framework of the two major parties, and
although the Democratic Party generally received more union support than the
Republic an Party, no labor party as such emerged.

Social Security Enacted

     The threat of old-age unemployment and dependency, long a subject of
public discussion, led to passage of the Social Security Act of 1935, assuring
modest retirement allowances at the age of 65 to many kinds of workers. An
insurance fund for this purpose was built up by contributions from workers and
employers. The states, with funds provided by a compulsory federal payroll
tax, were to administer unemployment compensation for active workers of all
ages. By 1938, every state had some form of unemployment insurance.

     Recurrent droughts in the 1930s led to the enactment of an Omnibus Flood
Control Bill, which provided for a series of large reservoirs and power dams
and thousands of smaller dams. To combat soil erosion, particularly on the
plains of the midwest resulting from misuse of the nation's abundant natural
resources, a gigantic program of soil conservation was undertaken, including
the planting of trees. Other important work involved the elimination of stream
pollution; the creation of fish, game, and bird sanctuaries; the conservation
of coal, petroleum, shale, gas, sodium, and helium deposits; the closure of
certain grazing lands to homestead entries; and a vast increase in national
forests.

     Of all these undertakings, the one of greatest future importance was
perhaps the Tennessee Valley Authority (TVA), which became a comprehensive
laboratory for social and economic experimentation. In addition to major
dams in three states along the Tennessee River, a number of tributary dams
were constructed. These were used not only for improving navigation, flood
control, and nitrate production, but also for generating electric power. The
government constructed some 8,000 kilometers of transmission lines and sold
power to nearby communities at rates sufficiently low to permit widespread
consumption. Rural electrification was financed by a TVA sub