Large-Scale State

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  Wanted more Government control of banking, even nationalisation.
  
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  Should not have subsidised banks to cover incompetence just so they could stay in business.
  
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  Large banks had more control over smaller ones.
  

The Alphabet Agencies

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  RELIEF: to stop people from starving and losing their homes
  
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  RECOVERY: to revive the economy
  
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  REFORM: to make the USA a better place to live in.
  

In the long term, Roosevelt wanted to set people to work again. This took time but action was needed to tide people over their immediate difficulties – to feed, clothe and shelter them.

For a $1 a day, the young men lived in camps run by the army, doing conservation work such as tree planting, strengthening river banks, and cutting fire-breaks in forests. Blacks and white volunteers were to be paid and treated the same. However, many southern states, whites were given preference and many camps were segregated. By August 1933 the CCC had given work to 250,000 young men and overall it provided 3 million young unemployed men with temporary work while exposing them to rustic living.

The Federal Government granted $500 million to provide food and other necessities for the 15 million unemployed. It gave $1 of this money to the state Governments for every $3 that they spent on helping the unemployed. Over 3 years it spent $1 billion, 2% of the national income. Benefits varied from state to state. Monthly payments were 10 times more in New York than in Mississippi. Despite regulations, many states and local agencies favoured whites. Even with its problems, FERA represented an enormous expansion of federal responsibility for the poor and unemployed.

Many states operated a means test principle before issuing any relief:

But the FERA programme left much to be desired. People on direct relief felt humiliated. Applying for assistance was like making a formal admission of inadequacy. The applicant’s esteem suffered another blow when an investigator entered his home to ascertain whether his application was truthful. Relief recipients were often too proud to go to the depot to accept surplus commodities because they may be recognised. One New York small businessman, determined to hold to the values he had learned, insisted on paying his rent regularly, even at the sacrifice of the family’s food. The government, after learning how little the family spent for food, cut off the relief altogether, suspecting fraud. From New Deal and War by W E Leuchtenburg 1964

In 1935, Roosevelt received a letter from Redville, Georgia.

“They gave us Black folks nothing but a few cans of pickle meat and to white folks they give blankets, bolts of cloth and things like that.”
Name: Civil Works Administration (CWA)

Date: November 1933

Aim: To provide temporary work of public value to the unemployed
In charge of the CWA was Harry Hopkins who believed in the self-respect of the unemployed. He said that keeping workers on the dole took away their pride and destroyed their morale, whereas “work relief preserves a man’s morale. It saves his skill. It gives him a chance to do something socially useful.” Within two months the CWA had found work for 4 million people, paying them 40c an hour for unskilled jobs and $1 an hour for skilled work.
Over the next three months CWA workers did all the following:

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  Built or improved 800,000km of roads
  
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  Built or improved 40,000 schools
  
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  Built 500 airports and improved 500 more
  
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  Built 150,000 public toilets.
  

The wages that the CWA provided people with increased the national purchasing power and contributed to the recovery of the American economy. But not all CWA jobs had an obvious public value. Unemployed actors were hired to give free shows, out-of-work researchers to research the history of the safety pin, and the CWA hired 100 people in Washington to walk the streets with balloons to frighten pigeons away from public buildings. Many people said that the cost of work relief was much greater than the cost of the dole. People soon began to call such jobs ‘boondoggles’, after plaits that American cowboys made from strips to pass time when they had no work to do.

Some businessmen who felt that the jobs created were pointless refused to support the CWA. This caused Roosevelt to end it in 1934. In 1935 it was replaced by a more carefully thought out organisation called the Works Progress Administration (WPA).

The TVA was an ambitious plan to build 16 dams on rivers in and around the Tennessee Valley, an area covering 7 states. The 45 million people living here had been badly hit by the Depression. This would provide work for thousands of construction workers and, once the dams were built, they would provide cheap hydroelectric power for industry. The dams would also help to control the frequent floods that wrecked the Tennessee Valley. Land reclamation, afforestation, re-housing, education and recreation projects were also undertaken. It is the best known and most widely admired New Deal achievement and dramatically raised living standards throughout the region.