Historical issues

On the success or failure of Roosevelt's New Deal

For a long time, domestic academic circles have held a positive attitude towards Roosevelt's New Deal. Therefore, when some foreign scholars put forward new ideas about the New Deal and broke the aura of Roosevelt's head, it was hard for people to accept it, as if they were insulted. In the book "New American Economic History: From Colonial Period to 1940", the author thinks that as long as you study the statistics of unemployment rate, gross national product, money supply and prices during the Great Depression, no matter how much you like Roosevelt's New Deal, you will find that recovery did not come with the New Deal. Until the end of 1938, the unemployment rate in the United States was as high as 19%, and the output did not return to the level of 1929. It was the outbreak of World War II and the subsequent "war machine" that really got the United States out of the quagmire of the Great Depression, not Roosevelt's New Deal. In other words, Roosevelt's New Deal was not successful. American scholar David? Kennedy's fearless freedom: the American people and Paul in the great depression and war? Johnson's American History has a similar view. In these books, Roosevelt's economic policies are compared with those of his predecessor Hoover. Now let's look at the facts. Is the aura of Roosevelt's New Deal really going to be broken? 1929 10 in late October, a storm of capitalist economic crisis first violently attacked the United States, and then spread to the whole capitalist world, and affected many colonial, semi-colonial and underdeveloped countries. The United States was the first country to have a crisis, and it was also the country hit hardest by the crisis. Industrial production has declined for three years. 1932 compared with 1929 before the crisis, the national industrial production decreased by 46.3%. The economy regressed to the level of 19 13 years. The crisis affected all industrial sectors. The decline in output in the heavy industry sector is particularly worrying. The steel industry has dropped by 80%, and the automobile industry has dropped by 95%. During the crisis, 1.3 million enterprises closed down, and thousands of workers were driven out of the factory and lived on the streets. 1933 The number of unemployed people was nearly 6.5438+0.3 million, which was about 654.38+0/4 of the working population. Why is the crisis in America so serious? The main reason is six economic imbalances: 1, 1920. The long-term agricultural depression has severely hit farmers, which has reduced agricultural income, agricultural product prices and farmers' purchasing power, and a large number of agricultural banks have gone bankrupt, bringing trouble to other industries. 2. The industrial climax in the 1920s was mainly in some emerging industrial sectors. Some industries with outdated equipment, such as coal mining and shipbuilding, are underemployed. As for the old textile industry and leather industry, there is still a crisis of production reduction. A large number of workers lost their jobs as a result. Fundamentally speaking, the prosperity in the 1920s was built on a narrow foundation. During this period, the wind of merger prevailed, and wealth increasingly fell into the hands of a few people. Monopoly organizations control the lifeblood of the economy, resulting in uneven distribution of national income and widening gap between the rich and the poor. This leads to a relatively small domestic market. 4. Instability of the international economy. After World War I, countries in Europe and other regions owed about 654.38+03.3 billion yuan to the United States, and the overseas market of the United States was shrinking day by day, which formed the fundamental weakness of the new international exchange system-Europe's dependence on the United States. 5. There is a lack of proper balance between government and private control over financial institutions and financial activities. The government adheres to the strict gold standard and binds the government when it is conducive to expanding the money supply. 6. No state or federal agency has the right to prevent the securities market from encouraging speculation and illegal activities. What did the Hoover government do in the face of such a serious social crisis? 1929, Hoover summoned representatives of leaders from all walks of life at the White House, asking business people to allow railways to be built normally, and enterprises to maintain production and not to significantly reduce wages; Require the construction industry to maintain the current wage and working hours standards; Asking workers to withdraw their demands for higher wages; Call on the state, city and federal governments to increase public project expenditure. What is the result? By 1930, most government and business leaders still insisted that the economic situation was basically healthy. This "prosperity propaganda" helped restore the strong stock market in the first four months of this year, and the Dow Jones Industrial Average rose from the low of 198 to 294. However, the number of unemployed people has risen from about 1929 10 in October to 4 million this spring. Almost every type of industrial production began to decline, because consumers were uncertain about the future and businessmen reduced their business, thus saving money. The credit crisis that broke out in May pushed the economy into a deeper abyss. I think there are four reasons for the credit crisis: 1. Europe is unable to pay the loan with gold, so it is forced to withdraw gold from American banks with a large amount of gold, but the banks have lent gold and have no choice but to force domestic repayment. It caused great panic throughout the country. 2. European countries demand that Germany return its short-term commercial paper and bank acceptance bills, which forms a vicious circle with the first reason. 3. Foreigners put a lot of securities on the new york Stock Exchange, which led to a sharp drop in securities prices. 4. The draft devalues, loses its function and is forced to stop foreign trade. 193 1 year, the situation continues to deteriorate. By the end of this year, at least 9 million people will be unemployed. In September, American steel companies announced that they would cut the salaries of more than 200,000 employees, and other big companies followed suit. In one year, 2,294 banks closed down, twice as many as in 1930. The flow of population from rural areas to cities was reversed for the first time; In some industrial cities, one third of the workers are unemployed. Faced with the deteriorating economic situation, Hoover had to take more active and powerful measures to save the collapsing economy and the political system in which the American people were losing confidence. The government set up an unemployment relief committee and stopped immigration. 193 1 year1February, the outline of the recovery plan was formulated, and measures were taken to cut administrative expenses, develop federal public projects, expand the loan capacity of agricultural associations, establish a loan banking system, and set up emergency recovery projects. But it all came a little too late. There are millions of unemployed people, which makes unemployment relief the most serious problem facing the country. Hoover has always opposed the federal government's intervention in poverty alleviation. He vetoed the patman Bill on veterans' pensions, and the Ghana-Wagner Relief Act showed its significance. Instead, Hoover lent huge sums of money to companies on the verge of bankruptcy. The essence of his revival plan is to spend thousands of dollars to save the company from bankruptcy, but the company has laid off millions of people and is unwilling to hire them again before they can make money. At the same time, what was Roosevelt like as governor of New York State? He set up an emergency unemployment relief committee six months earlier than Hoover, headed by a banker, and considered making long-term suggestions on stabilizing unemployment. Later in the same year, measures were taken to alleviate people's suffering in time and develop public utilities. When the AFL opposed rigid unemployment insurance as "charity or relief", Roosevelt sponsored it and put forward the plan of New York State. 193 1 In August, the state legislature approved the establishment of a temporary emergency relief bureau, and allocated more than 20 million dollars to help the poor through the winter of 193 1- 1932. But this can't stop the decline of production, prices, wages and agricultural income when the economic depression began to seriously damage the economy of New York State. New york Bank of America did not fail in the biggest bank bankruptcy in American history, and thousands of unemployed people did not live on the streets. In the early days of the Great Depression, Roosevelt's views on domestic relief and economic recovery policies in the United States were not essentially different from those of Hoover. It opposes the direct payment of benefits by the federal government, and it is in favor of relying mainly on state and private relief agencies. The government should reduce the recurrent expenditure to a minimum. Although he didn't win a remarkable victory, he made remarkable achievements in a wide range of activities in the state and in dealing with all kinds of greater difficulties caused by the industrial and agricultural production crisis. 1932, at the Democratic National Congress, Roosevelt accepted the nomination of the presidential candidate and put forward the idea of "New Deal" in his speech. 1 1 On August 8th, Roosevelt was elected president. By the time he became president on March 4, 1933, the situation in the whole country was deteriorating. Industrial production has dropped by another 20%. According to statistics, by the day the president took office, almost one-third of the workforce was unemployed; Many people who have jobs are also working for low wages of a few cents an hour. The bank run was very serious, and in the two weeks before March 4, the withdrawal of deposits had reached nearly one billion dollars. Many states have declared all banks closed. Malnutrition has become a harsh reality in life all over the country, and even hunger has appeared. Roosevelt, who just took office as president, did not have a clear blueprint for the "New Deal". He just realized that Hoover's "natural adjustment" economic policy must be changed and government power should be used to intervene in the economy. As for the scope and degree of intervention, he did not plan, but gradually explored in practice. Roosevelt's first action was to rectify finance. Less than 24 hours after taking the oath of office, Roosevelt declared March 6 to March 9 as the National bank holidays and closed all financial institutions, including the Federal Reserve. And prohibit the export of gold, silver and currency. This move is actually an act of recognition and legalization of the country's own protective measures. Because before that, banks in most States had already closed. Then, on March 9, Congress met and passed the emergency banking law, which authorized the Ministry of Finance to manage various transactions such as currency, credit and bonds. At the same time, it is stipulated that it is illegal to own or export gold from May 1 day, and the Ministry of Finance is authorized to manage and restore the banking industry. In order to try to restore confidence and improve people's morale, Roosevelt first published "fireside gossip" to the whole country on March 12. He explained the purpose of the national bank holiday and the various measures being taken to deal with the financial crisis, and assured the people that it is safe to deposit money in the bank now. All these have achieved good results. Within two weeks after the bank reopened on March 13, 10 billion dollars was deposited in the bank again, and gold returned to the Federal Treasury. On the foreign financial policy, Roosevelt announced on April 19 that the United States would abolish the gold standard and no longer exchange money for gold. This move has enhanced the competitiveness of the United States in the international market. Then a powerful measure is the agricultural adjustment law. The decree passed on May 12 is to increase the purchasing power of agriculture to alleviate the existing national emergency. By managing surplus agricultural products, the problem of low prices of agricultural products can be solved, and the exchange value of agricultural products can be restored to 19 14 compared with other commodities. This goal will be achieved by providing sugar-free methods to farmers who reduce the output of rice, cotton, tobacco, wheat, corn, dairy products and pigs. Another measure is the national industrial recovery law. Its purpose is to improve business activities and provide employment. In particular, the Act lays down a series of rules on working conditions, wages and proper practices in business activities. Another provision of the law stipulates that workers have the right to "organize and conduct collective bargaining through their elected representatives". Article 2 provides for the establishment of a public works administration to stimulate the economy by building large-scale public works projects that require a large number of workers, such as dams, ports, sewage treatment plants, roads, airports, bridges and hospitals. As mentioned above, the biggest problem facing the government is unemployment benefits. The purpose of the government is to alleviate the suffering of people without employment conditions until local governments with financial constraints can shoulder this burden again, avoid simple relief, and let people engage in socially beneficial projects as much as possible, earning enough wages to buy necessities and restore purchasing power, until the demand for consumer goods increases and is re-absorbed into private enterprises. In order to achieve these two goals, the National Assembly (1) established the Civil Defence Corps on1March 3, 9331. (2) Act1May 933 12 provided for the establishment of the Federal Emergency Relief Agency; (3) The National Industrial Revival Law of July1933 16 stipulated the establishment of the Ministry of Public Works. Although these first-stage measures of Roosevelt's "New Deal" did not achieve the expected results, the increase in employment, the sharp rise in agricultural product prices, the bullish stock market and the slow growth of industrial production are all the biggest affirmations. However, in 1935 and 1936, Congress abolished the National Industrial Recovery Act and declared the Agricultural Adjustment Act invalid, which led to the failure of Roosevelt's "New Deal" in the first stage. The implementation of the "New Deal" is willing to solve various problems brought about by the economic collapse that has proved to be a comprehensive depression. Roosevelt has now begun a far-reaching effort to enrich its content, with the aim of solving some problems that have long plagued society. At the beginning of 1935, Roosevelt told Congress: "We can eliminate many factors that cause economic depression, and we can propose ways to alleviate its consequences. This economic security plan is both a preventive measure and a mitigation method. " The plan has produced a series of legislation, including social insurance and some projects, to strengthen workers' position towards employers. The Social Insurance Law embodies the first part of the plan. In order to protect Americans from financial difficulties caused by old age and career, the law stipulates that both workers and employers should donate a fund, which is managed by the federal government, and every worker can get a pension from the fund when he is 65 years old. At the same time, the law stipulates that once workers are temporarily employed, the funds donated by employers will be distributed by several state governments. Another rule is to help the blind, disabled and unattended children. As for the balance between labor and capital, the National Labor Relations Law was passed, and with the help and guidance of the National Labor Relations Committee, institutions and trade unions were established. The law stipulates that it is unfair for employers to prevent workers from forming trade unions and should be prohibited. Therefore, this law has promoted the smooth movement of expanding workers' organizational composition. These measures later became familiar terms: pension system, unemployment insurance system and so on. Regardless of the obvious effect at that time, their influence today is immeasurable. On the whole, Roosevelt's "New Deal" was not as successful as people thought at that time. The economic situation fluctuates repeatedly, sometimes good and sometimes bad. The huge number of unemployed people has not been fundamentally solved, and there are still 9 million people at the second stop. At the same time, with the deepening of the "New Deal", the resistance is growing, which proves that people's confidence in this is losing a little bit. The Supreme Court's rejection of the agricultural adjustment law and the national industrial revival law of the New Deal almost aborted the New Deal. Behind the glory of Roosevelt's three consecutive presidential re-election, the campaign support rate declined again and again. In addition, more and more large-scale workers' strikes are the vent of people's high expectations and dissatisfaction with the revival of instability. All these can show that the "New Deal" at that time was not successful. Indeed, without the tension in the international situation and the subsequent war in Europe, the American economy could not have fundamentally improved, and the "New Deal" would eventually end in failure. However, history does not judge heroes by success or failure. Although the direct effect of Roosevelt's "New Deal" is not obvious, it has left a far-reaching impact. First of all, a large number of public works have strengthened the infrastructure construction in the United States and improved its natural environment. Second, the principle that the government is responsible for the health, welfare and safety of all citizens has been established. Implement the policy of "welfarism". Third, the power of the federal government and the president has been greatly expanded because the government has intervened in the American economic life through the new legislation of Congress. Fourth, the democratic government and social system of the United States have been maintained, the confidence of the American people in the capitalist system has been restored, and the social crisis brought about by the economic crisis has been shaken off. Fifth, the embryonic form of modern state monopoly capitalist economic system has been formed. The practice and characteristics of the "New Deal" profoundly influenced the economic policies and measures of the American government after World War II.

Bibliography: 1, World History-Modern History, edited by Wu and Qi, Higher Education Press.

2. Reading, No.4, 2002, Sanlian Bookstore

3. [America] Arthur? Link William? Caton's American History since 1990, China Social Sciences Press.

4. [America] Samuel Eliot Morrison and others. The Growth of the United States and China, Tianjin People's Publishing House.

5. [America] Dwight? l？ Dumond's Modern America: 1896- 1946 Commercial Press.

6. [America] Calvin? d？ Linden, editor-in-chief of Two Hundred Years of Memorabilia in America, Shanghai Translation Publishing House.

7. James? McGregor? Burns wrote Roosevelt: The Lion and the Fox. Commercial press