Monday, December 2, 2013
Roosevelt's New Deal
In class today we talked about what many consider one of the greatest economical panics in world history. This is the Great Depression. Many causes have been considered the root of this depression but the greatest is probably the collapse of the speculative bubble in 1929 caused by an excessive run up in share prices. This caused overall government turmoil and the economy was greatly damaged for a longer amount of time then ever before in American History. This was during the presidency of Herbert Hoover. As you can guess after his first term he was not elected again. Instead who came to power was a president who unlike many others was a progressive thinker this caused him to create many important changes in America's history during this period of uncertainty and revealed him to be one of the greatest presidents in our nations history. The biggest reform that he instigated that clearly demonstrated his progressive views was the New Deal. The New Deal was Roosevelt's response to the economic downturn that came with the Great Depression. Basically what the New Deal was, was a series of government programs that were overall set to bring the nation out of deep recession and help strengthen the economy. The various measures included government support for the reform of the collapsing bank industry, a new stock market regulatory agency, and arguably the most important social security. Though many of these reforms didn't fix the problem at hand instantly (in-fact much of the issues of the great depression did not end until world war 2) it had a heavy influence on the development of America. The New Deal issued a new era of government activism in terms of both regulation and intervention in the economy. Though to many this may sound like a beneficial check and balance that is necessary some may argue that it is bringing socialism to America. By having government influence in what the nation does both positives and negative outcomes can happen. So my question lies here do you believe that the New Deal was a reform essential to the development of America's economy or an unnecessary socialist evil that came about during this error?
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Ryan, you've made great points that FDR saved the United States during the Great Depression with the policies he created with the Hundred Days Congress and that he demonstrated progressive views unlike other presidents who were either liberal/conservative. I agree with your point since the powerpoint that showed the stock trend which we looked at in class showed that the economy improved by a great deal. However, one thing that I would like to point out is that FDR failed to save the recession that followed after the depression itself based on the fact that unemployment remained as a prevalent problem until WWII. Also, his policies and positions seemed as somewhat dictatorial or fascistic to the Americans who feared that the country will head towards the path Russia took. Based on the criticisms posed on FDR, it really is debatable whether he was that much of a great president that people nowadays revere him as and it is strictly up to the perspectives that people have.
ReplyDeletesources: http://en.wikipedia.org/wiki/Criticism_of_Franklin_D._Roosevelt#Criticism_of_Roosevelt_as_a_.22Fascist.22
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ReplyDeleteI have to say that the New Deal was a reform essential to the redevelopment of America's economy. Saying that it was an unnecessary socialist evil that came about is just far too extreme. I think that with the economic situation being as bad as it was, anything the government did in an effort to improve it would be helpful. I mean, it would be hard to make the situation worse.
ReplyDeleteThe New Deal added regulations to the financial industry, such as limiting the margin requirements when purchasing stocks. This means that a person could not buy stock on such large loan in the hopes that its value would go up.
Another thing to note is that the structural stability and social security that were provided by the New Deal's reforms lead to a post WWII economic boom which has been labeled as the "golden age of American capitalism."
Today the government has great control over the economic stability of the United States. It is interesting to note that when the government cancelled the Glass-Steagall Act, which encompassed financial regulations such as those established in the New Deal, the financial crash of 2008 occurred. In this way the government may have hindered the economic situation of the United States. On the other hand, government printing of money has helped greatly in ending the recession. Printing money is something that European countries who circulate the Euro, for example, cannot do, because they are not in sole control of their currency.
Sources: http://en.wikipedia.org/wiki/New_Deal
I don't believe the New Deal was a socialist evil, rather a continuation of the progressive reforms of the age. The Emergency Banking Relief Act of 1933, for example, gave the president the power to regulate banking transactions and foreign exchange and to reopen solvent banks. Now, I understand the argument that this concentrated economic control in the government seems socialist, but in a democratic government the people decide what they want the government to do. The people elected Roosevelt, therefore, the people wanted Roosevelt to have a stronger control, was essential. Imagine someone had their life savings in a bank, and that bank was wiped out. So would their life savings. They would obviously be forced to cut back their spending. If consumers cut back spending, the economy does even worse– and hence, the chain reaction. If Roosevelt saves a bank for going under, he can not only help investors of that bank, but stop the chain reaction too.
ReplyDeleteI agree with Sam on this one. The people elected Roosevelt because they wanted a leader who would take more control of the government and take radical measures to pull the nation out of the depression. He had to do something to stop the chain reaction that had destroyed credit, and capitalism in the USA. It was not a socialist evil, but a necessary step in the process of attempting to save the country from the great depression.
ReplyDeleteWhile it is true that the New Deal helped get America out of the Great Depression, it was the combination of the New Deal and World War 2 that pulled America out of the depression. The New Deal reformed America and changed the structure of the economy, however, it did not really bring economic gain to America that brought it out of the Great Depression. World War 2 did. The war helped America's economy because Americans were able to make war supplies and therefore make money off of the newly sparked economy.
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