Why there has been so much disagreement in the USA over the effects of the New Deal

The New Deal was probably one of the most influential set of policies that were ever implemented in American history. The New Deal was seen as a great change, and represented two major turning points in America. One of the major turning points was in the way that America was governed, because when FDR came to power, he increased the dominance of the executive branch of government in the tri-partite Federal system that ruled America. The other major turning point was in the economic policies of America.

The implementation of a new type of economic policy, known as ‘Keynesian Economics’ destroyed the tradition of ‘Rugged individualism’ in America. These two huge turning points, and the fact that such a huge amount of money was spent in America at the time, because of the New Deal policies meant that people debate how effective the New Deal was in comparison to what FDR initially had promised the American public. However, the greatest reason why the New Deal is such a hotly debated topic is the fact that it was never allowed to run its full course, because it was interrupted by the war.

Because of this vast, and major interference into the New Deal, people could not class the New Deal as being a success or a failure, as the policies that it proposed were never allowed to take full effect. Many historians argue that if the New Deal was allowed to run its full course, then it would have proved to be successful and effective, while other historians argue that the war saved America, as it provided many jobs, and restored the country to full employment. The first major turning point was in the way the American government operated.

America was governed by the Federal system, which consisted of three branches that were equally influential: the President (the executive branch), Congress and the nine judges of the Supreme Court. When FDR came to power, the executive branch of government was thought to have become too powerful, and was thought to be overpowering the Supreme Court and Congress. A famous historian called Arthur Schlesinger called the time from which FDR came to power as the ‘Imperial Presidency’, as the President had a significantly greater role in the running of the country in comparison with the other branches of government.

FDR was thought of as being a very interventionist, and very public President, because of the degree of control he had in the lives of the American people, and because of the ‘Fireside chats’ that he had on the radio talking to the public. Some historians think that FDR fortified the executive branch so much, that it allowed future Presidents, such as JFK and LBJ to make single-handed important decisions that had serious repercussions. The two Presidents mentioned supported, and launched the Vietnam War, which lasted for over ten years without the approval of Congress.

This war cost an enormous amount of money from the American taxpayers, not just in the form of funding, but also in the form of human lives, which is priceless. An example of FDR belittling the power of the other branches of government was in the ‘Sick chicken case’. This case involved the Supreme Court ruling that some of FDR’s alphabet agencies were unconstitutional (such as the National Recovery Administration), and they also ruled that the Agricultural Adjustment Administration has to be dismantled.

The Supreme Court said that the Federal government had no right to intervene so greatly into the lives of the American people. FDR retaliated by threatening to increase the number of Supreme Court judges from nine to fifteen. As the Supreme Court had a greatly Republican dominance at the time, and FDR threatened to appoint six new Democrat judges into the Supreme Court, the nine justices backed down. The justices of the Supreme Court did not question FDR, or any of his policies from that day onwards. Because of FDR being such an interventionist President, he was called a dictator in the way that he ran the country.

There is support for this statement from Source G, which portrays FDR as being a strong, powerful, and very confident doctor, while also portraying Congress as being a frail, old, easily overpowered woman. This shows that some people thought that FDR misused his expanded power of the executive branch into bullying the other branches of government into doing as he says by threatening them. However, other historians argue that the crisis that America was in at the time required an active President, who had more power, and was able to make important decisions quickly.

One of these historians (Hugh Brogan) said that the complexities of modern government required the executive branch to take over some of the responsibilities from the legislative. There is much support for this in both Source F and in Source B. Source F portrays FDR as a strong, active man who is ready to take action. This is evident from the cartoon, as FDR is shown with his sleeves rolled up, and also shows him carrying a can of rubbish that contains all of his predecessor’s (Herbert Hoover’s) mottos, such as ‘Rugged individualism’ and also ‘Prosperity is just around the corner’.

This shows that FDR was right in the extra power that he gave the executive branch, because the situation required the President to have such a role. In addition, Source B heavily supports FDR in the way that he governed the country, and supports the policies that he introduced. Source B dismisses the fact that FDR was a dictator in its final few sentences, which say ‘All power is still in the hands of the people. They can vote out of power governments that they do not like. The charge that Roosevelt has been a dictator is not true’.

The two sources both make favourable comments about FDR, and how he used his power while he was President, and say that the dire situation that America was in at that time demanded a strong, and active President to make decisions quickly, and decisively. The second major turning point was in the economic policies that America had. The New Deal involved the introduction of ‘Keynesian Economics’, which meant that the previous American traditions, such as ‘Rugged individualism’ and ‘America’s business is business’ were demolished.

Some historians thought that this new economic policy intervened too much in society, and gave no incentive to entrepreneurs. These historians also say that only the inactive and lazy in society benefited from this policy. This is because ‘Keynesian Economics’ involved the fact that the people who were worse off, such as the unemployed received benefits, which came from the taxpayer’s money. The richer among society were outraged that their money was funding the unemployed. They thought that if the unemployed were given handouts, then they had no drive to go out and find themselves a job.

Some historians argue that the tax and spend policy set a dangerous precedent. There is a great deal of support for this view in Source J, which is written by a self-made businessman named S. B. Fuller. He says that ‘Welfare kills a man’s initiative’. He thinks that if the people who now receive benefits continue to do so, then they will simply become lazy, and never try to find themselves a real job. Fuller criticises FDR as being a ‘Rich man’s son’ who had everything given to him, so he had no idea what work was, and was out of touch with life in the real world.

He uses an example that talks of how people take things for granted when they don’t have to work for them. This quote from the source says this perfectly: ‘A dog you feed will not hunt. If you want a dog who hunts, you have to let him get hungry. You’re free to eat if you can pay for the food, and you’re free to starve if you don’t pay’. Fuller was a self-made businessman, and is a perfect example of someone who through hard work and effort has achieved a lot, and made something of himself.

Fuller criticises FDR that if people are given money from other people, even when they are out of a job, then it destroys their will-power to go out and hunt for a new job. This side of the argument says that the Government intervened too much into people’s lives, so destroyed their urges to be employed, because if they weren’t employed, then they would soon end up on the streets. However, the other side of the argument is that during 1933, the American people were in desperate need of assistance, so if they did not have support, then a large number of people would have starved.

The country was in desperate need, as Hoovervilles (shanty towns) had popped up on the outskirts of all the big American cities. This was because of problems that were facing the country at that time, such as import tariffs, such as the Fordney – McCumber Tariff leading to foreign goods being difficult to sell in America, and retaliation by other countries by implementing their own tariffs against US goods. This meant that the American market became self-saturated, as they weren’t able to sell their goods abroad very easily.

This coupled with the new idea of mass production using an assembly line led to saturated markets, falling profits, and to a huge growth in unemployment. In addition, during the 1920s there was a ‘credit-boom’. At that time, the banks were not properly regulated by the Federal Government and lent out enormous amounts of money. At this time, new plots of land could be bought with a 10% ‘binder’, and shares could be bought ‘on the margin’ with a simple 10% down payment. As a result, banks’ asset ratios became desperately low. As well as these problems, some problems in agriculture resulted in countless numbers of extra unemployed.

The over-farming in the Western states of the country resulted in the ‘dust bowl’, which meant that the soil became very arid, and simply blew away, leaving the West in darkness, due to clouds of swirling dust. Also, an insect known as the ‘boll-weevil’ attacked the cotton crop in the South leaving thousands of ‘share-croppers’ in that area unemployed, and led to the great migration North in look for employment. In Source K, it talks about how the ordinary American would have been unable to survive the Depression without the help of Government benefits.

This Source says that everyone was hit hard, even the rich, but they had something left to fall back on, but the ordinary American, and the poorer Americans had no chance of surviving, and would have most probably starved otherwise. In Source K, it says that ‘The New Deal meant that ordinary people would have a better chance in life’. The Source also says that FDR understood what the situation demanded, and acted accordingly to ensure that the people worst hit by the Depression received the most help. Another Source that supports that the country was in dire need of assistance is Source D.

This Source shows a long line of people waiting in order to collect benefits. If FDR had not given out benefits to the unemployed, then thousands upon thousands of people would have been left hungry. To try and solve the problems that were facing the country at the time, FDR didn’t just give out financial support to people in need, but also created millions of jobs by establishing several alphabet agencies, such as the PWA (Public Works Administration), the WPA (Works Progress Administration) and the CCC (Civilian Conservation Corps).

These jobs helped to revive some of the determination in the American people that had been lost as a result of the Depression. These three agencies alone employed over 3 million Americans, and helped to vastly improve the infrastructure of the country. Over 70% of America’s schools were built in the period between 1933 and 1939. When FDR came into office, the country was suffering the effects of the ‘Vicious Circle’. The circle starts with the American markets being saturated by the tariffs that had been established during the time when Hoover was in office.

As a direct result of the American market being self-saturated, the American company profits fell, and as a result of that, there were job losses. These job losses meant that less money was being spent in the US economy, which meant that fewer American goods were being produced. As fewer goods were produced, the company profits fell more, and resulted in more job losses, and so the circle goes on. This circle was inescapable if nothing was done, but FDR had an idea that would break the circle.

He thought that if money was injected into the economy in the form of benefits and wages from the new jobs created, then more money would come out at the end. This was known as the ‘Multiplier Effect’. There has also been vast disagreement over the effects of the New Deal, due to historical developments in America. During the 1930s, when FDR was still President, and the New Deal seemed to be successful, FDR was looked upon as being an active/ dynamic leader. Some people even went so far as to call him the saviour of democracy.

An example of this is when a famous historian, Alistair Cooke was in a bar in the Rocky Mountains. While he was there, he saw a poster of FDR behind the bar, and subsequently questioned the barman why it was there. The barman was outraged, and threw Alistair Cooke out of the bar, which clearly shows that the barman had a lot of respect for FDR, and the New Deal that he had implemented. Another historical development was when FDR died in 1945 after the end of the Second World War. He dies as a victorious war-leader, with a good reputation.

He died shortly after being elected to serve his fourth term as President, which is the longest reign of any American President. However, between 1945 and 1990 his reputation suffered while America was engaged in the Cold War with Russia. The conflict between the two ‘superpowers’ was simply ideological. The USA was a capitalist country with democracy and free economics, while Russia was a communist country without democracy and a planned economy. Both countries criticised one another on the way they ran their countries.

During the time of the Cold War, the American people had a clear idea of what communism is, and thought that the New Deal resembled it, as the economy at that time was planned by the state, the NRA set prices and wages, and introduced productivity targets. In the 1950s, there was the ‘Red Scare’ in America where people feared the spread of communism. FDR was labelled a communist by Senator Joe McCarthy of Wisconsin. He said that he was on a personal crusade to exterminate all communists from government.

After this came the Claus Fuchs conspiracy, where it was thought that the Germans were telling the Russians all of the American secrets to do with the economy and defence. People said that by the time you are a part of government, you are already biased to a certain point of view. There has been a huge amount of disagreement in the US over the effects of the New Deal, because it was never allowed to run its full course, but was interrupted by the Second World War. Some people say that the war masked the effects of the New Deal, so you could not say id it was a success or a failure.

Full employment in America was only restored in 1941, while in 1938, there were still 11 million unemployed, so the war must have been the major source of employment that saved the New Deal. However, as no one can be totally sure if the New Deal was or wasn’t a success, the controversy continues. There is support that FDR still had 2 years left of his Presidential term left when he died. Source B says that the principal success of the New Deal was to restore self-confidence, and save democracy in the US, which was achieved in 1933, so in that way, the New Deal could be classed as a success.

The New Deal did help to restore self-confidence, if only temporarily, and that is evident from Source A. FDR’s motivating speeches helped people feel positive about working their way out of the depression, and this point is also supported in Source B. However, the development of history effected the way in which the New Deal was perceived. Because the New Deal contained two major turning points in America – the first in the system of government, and the second in the economic policies that were used by this new system of government.

As the war intervened, it would be impossible to deem if the New Deal was, or was not a success. The last reason why there has been so much disagreement over the effects of the New Deal is because of the changes that were implemented. Some people regarded the New Deal as being revolutionary, while others classed it as being evolutionary. A revolution is a wholesale turn around in the personnel, and the way in which a government is run, while evolution is the progressional change from the personnel in one government, and a progression in the way in which the government is run.

A historian called Carl Degler said that FDR and the New Deal were ‘Out of our time’, and described the New Deal as being the ‘Third American Revolution’. He says that it is the Third American Revolution, as there was a great political and economic change in the country during the 1930s – the same time when FDR came to power, and the New Deal was first implemented. Source F shows this point well, as it shows FDR as an active President who is getting rid of all the Neo-Classical ideas of past governments and adopting Keynesian Economics. However, another historian named Hugh Brogan presents a counter argument to Degler’s theory.

He thinks that there was no revolution, but what FDR did was simply evolution. Brogan says that FDR was following the precedent set by the Presidents between 1901 and 1920. The Presidents who served during this time were Teddy Roosevelt, William Howard Taft and Woodrow Wilson. Together, these Presidents were known as the ‘Progressives’. Brogan argues that the Presidents between 1920 and 1932 were odd (Hoover, Harding and Coolidge). Brogan also argues that as FDR served in Wilson’s cabinet between 1912 and 1920, he just carried on where they left off, so he was not really revolutionary in the way he governed the country.

FDR had similar ideas to the Progressives, as all of them wanted to help the poor in America, as well as having a united community that would help each other. After considering the arguments from both Degler and Brogan, I understand both of their ideas, and see that this reason also contributes towards why there has been so much disagreement over the effects of the New Deal. From the evidence that I have already given, you can see why there has been so much disagreement over the effects of the New Deal in the US.

The New Deal marked a major turning point in the system of government that operated in America, and the economic policy that the new system of government adopted. It also marked a major turning point in the way government was run, as the Executive branch of government gained more power than the others, (Congress and the Supreme Court). Also, people saw the New Deal in two ways: as being revolutionary or evolutionary. Some people thought that the New Deal was a radical change, while others thought that it simply followed on from what the Progressives did in America, and referred to it as being evolutionary.

However, the biggest reason why there has been disagreement over the New Deal’s effects is because of the intervention of the war. The Second World War meant that people could not clearly see if the New Deal had been a success or a failure. As no clear answer was evident, people disagreed over how much the New Deal actually did for America. Also, as FDR died before he finished his fourth term in office, people disagreed over if the New Deal would have gone on to be a success or not, as there were two years left in which FDR could have made a lot of changes. The verdict is still undecided.