New Deal

Definition

The New Deal was a series of programs and policies established by President Franklin D. Roosevelt in response to the Great Depression, aimed at economic recovery, relief for the unemployed, and reform of the financial system. This transformative initiative connected directly to the dire economic conditions of the time, focusing on providing jobs and stimulating economic growth, while also laying the groundwork for a more regulated economy to prevent future downturns.

5 Must Know Facts For Your Next Test

1. The New Deal included multiple programs categorized into relief, recovery, and reform, significantly reshaping the American economy and government role.
2. Key agencies created under the New Deal, such as the Works Progress Administration (WPA) and the National Industrial Recovery Act (NIRA), focused on job creation and industrial recovery.
3. The New Deal led to a significant expansion of federal government power and influence in everyday economic life, establishing regulatory frameworks that still exist today.
4. Critics of the New Deal, including some business leaders and politicians, argued that it expanded government control too much, leading to debates about the balance between free enterprise and government intervention.
5. The legacy of the New Deal has been significant, with many programs still in place and its principles influencing future social safety nets and economic policies.

Review Questions

• How did the New Deal address the economic challenges faced during the Great Depression?
  • The New Deal tackled the economic hardships of the Great Depression by implementing various programs aimed at providing immediate relief to those affected. Programs like the Civilian Conservation Corps (CCC) provided jobs for unemployed young men while other initiatives like the Works Progress Administration (WPA) focused on large-scale infrastructure projects. By creating jobs and stimulating economic activity, the New Deal sought to alleviate suffering and boost confidence in the economy.
• What were some of the long-term effects of the New Deal on American society and government policy?
  • The New Deal had profound long-term effects on American society by fundamentally altering the relationship between citizens and their government. It established a precedent for federal involvement in economic matters and created a safety net through programs like Social Security. Additionally, it spurred debates on government intervention in the economy that continue to shape political discourse regarding welfare policies and economic regulations.
• Evaluate how the New Deal changed perspectives on government regulation of business and its role in economic recovery.
  • The New Deal transformed perspectives on government regulation by demonstrating its necessity during times of economic crisis. Prior to this period, many believed in minimal government interference; however, the widespread unemployment and financial instability during the Great Depression showed that such a hands-off approach was inadequate. The establishment of regulatory agencies like the Federal Deposit Insurance Corporation (FDIC) highlighted a shift toward viewing government as a crucial player in ensuring economic stability and preventing future crises through active oversight.

Related terms

Social Security Act:

A landmark piece of legislation enacted in 1935 that established a social insurance program designed to provide financial assistance to retirees, the unemployed, and disabled individuals.

Civilian Conservation Corps (CCC): A New Deal program that employed young men in environmental conservation projects, providing jobs while also enhancing the nation's natural resources.

Federal Deposit Insurance Corporation (FDIC): A government agency created in 1933 to insure bank deposits, thereby restoring public confidence in the banking system and preventing bank runs.