Roosevelt And The New Deal
The New Deal was prompted by the situation that existed during the Great Depression which threatened to collapse the American economy. The Great depression just like the recent financial crisis in the U.S was preceded by a period of unfounded market optimism especially in the stock market. In 1920s the most preferable form of investment was the stock market, therefore banks loaned money to investors on easy terms. There had been raised concerns that in the event that the stock market fell the banks would go bankrupt and many people would lose their money, however the excitement with the stock market investment led many to ignore these concerns. Eventually when the stock market came crashing, the rest of the American economy followed soon because banks and other financiers had invested so much money on the stock market. The results were that many people lost their money, banks could not give loans anymore and there were widespread job losses. The Great Depression occurred during the presidency of Herbert Hoover. President Hoover was adamant to offer financial assistance to Americans and argued that the American economy should be left to take its own cause and that the economy would soon improve. But this was not to be so and after much convincing by the Congress Hoover soon gave in and the government intervened through several measures. The measures included cutting back on the government spending and providing financial assistance to businesses. The Great Depression was a very tough period for every American because almost everybody was affected. As businesses and companies began to fall they were forced to lay off some workers. Life was already hard and was made worse by the rising rate of unemployment. President Hoover’s apparent reluctance in acting during the Great Depression saw him defeated by a Democrat Franklin Delano Roosevelt in 1932 elections. This paper will look at how the New Deal by President Roosevelt served to rescue the American economy, the critics of the New Deal and how the economy progressed after the New Deal.
Roosevelt and the New Deal
According to Tugwell (1972), Roosevelt was a leader who rose to leadership when the world was in crisis and left an impression that is still felt up to date. First he was faced with the task of reviving the American economy and later came the World War II. Some analysts and historians prefer to perceive the Great Depression as a period that was mandatory for the economy of America to undergo as it continued to grow. Other argue that the Great Depression served to bring into aspect the fact that the government in coming up with policies, should put the citizens welfare at the forefront. These perceptions have led many to separate the Great Depression from the New Deal.
Although many analysts prefer to look at the New Deal and the Great Depression separately it is without doubt that the Great Depression inspired Roosevelt to come up with the New Deal. Before his election as president Roosevelt was the New York Governor and was therefore well placed to experience the Great Depression and understand how it was influenced by certain policies. During his nomination as the Democrat presidential candidate Roosevelt strategically knew whatever was affecting American voters then and made the Great Depression his primary concern. During his campaign Roosevelt constantly referred to the problems of the Great Depression and promised Americans a new deal. His new deal soon became a message of hope for Americans that in the elections of 1932, Roosevelt won with a landslide.
Soon after his election it became clear that Roosevelt was not only using the Great Depression as publicity stunt to win him the elections but that it was in his heart to bring change. Soon after his election Roosevelt began implementing his policies. In contrast to President Herbert Hoover, Roosevelt believed that it was the responsibility of the Federal Government to help Americans out of the depression. Hoover believed that when Americans were given personal assistance by the Federal government it would be like interfering with the functioning of the system and that it would morally subject Americans to the assumption that they can always take risks because the Federal Government would always be there to rescue them. Roosevelt also knew that banking laws needed reforms that would prevent them from careless lending such as was witnessed during the Great Depression. The government also provided the major sectors of American economy with rescue packages including Agriculture. The first New Deal mainly concentrated on providing relief work relief and agricultural relief.
The one important aspect that ensured success of the New Deal was that Roosevelt and Congress were in harmony. During his campaigns Roosevelt promised Americans that he would address the problems of the Great Depression is a sustainable fashion but did not however disclose how exactly he planned to achieve that. Immediately after his election Roosevelt began implementing his plans and whatever idea he brought for debate to the Congress was quickly passed and implemented without any wastage of time. Furthermore all the proposals that were brought to the president by the Congress were also approved immediately. It is for this reason that Roosevelt’s government was able to pass and implement much legislation within a very short time and this was materialistic to the government’s success. The strategies took a twofold form where there were the short term and long term programmes. Roosevelt knew that Americans were suffering and immediate measures needed to be taken and so he devised short term relief programmes to address the sufferings of Americans. On the other hand Roosevelt knew that the government had to come up with a sustainable plan that would survive even after his presidency and that would prevent such an occurrence in future and he therefore devised the long term programmes.
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