Great Depression History


Why he matters to Livingston County, the U.S. and the World

Born and bred right here in New York state, Franklin Delano Roosevelt was known to one and all as FDR. Roosevelt was elected Governor in 1928 with a large majority of the rural vote. In return Governor Roosevelt cut taxes for New York state farmers.

FDR was elected to four terms as President of the United States during the Great Depression and World War II. He did more for rural America than almost any other president. FDR also made the government more responsive to the needs of the people.

Historians rank FDR as the greatest 20th century president and one of our three greatest presidents along with Washington and Lincoln. No one is perfect, and neither was FDR or his programs. However, for a president, he was remarkably willing to try to help the common people.

Roosevelt’s wife said that suffering from polio gave the wealthy, privileged FDR great empathy for the downtrodden. Roosevelt was paralyzed from the waist down at the age of 39 but he didn’t want anyone’s pity. Everyone knew he had suffered an attack of polio, but most people didn’t know he could no longer walk.

Roosevelt was the father of modern rehabilitative treatment. He spent 2/3 of his personal fortune to create the first modern rehabilitative treatment center in Warms Springs, Georgia. FDR also founded the March of Dimes.

Presidents can only work within our nation’s narrow political and ideological framework. Candidates are nominated by political parties because they will maintain this framework. Politicians are interested in doing good only within the status quo. You will find neither a reactionary nor a radical in their ranks. On rare occasions you might find a reformer.

After Lincoln, the President who did the most to reform the system was Franklin Delano Roosevelt. FDR believed in capitalism but he knew no system is perfect. History proves that market capitalism has cyclical booms and busts. FDR saw how people suffered during the Great Depression. He decided something had to buffer the shocks of the inevitable downturns in the business cycle.

Roosevelt came to realize those shocks could be buffered if the government did three things. First, regulate market abuses. Second, give farmers, workers & consumers a voice. Third, create jobs when businesses can’t so the 99% have money to stimulate the economy. “The American people want a hand-up, not a hand-out.” he said. FDR favored programs that gave people jobs rather than welfare. Before Roosevelt became president most Americans only dealt with the federal government when they went to the post office.

Roosevelt’s predecessor was more dogmatic and less pragmatic than FDR. Herbert Hoover was a good man, but he believed people’s economic suffering should be solved by voluntarism. Hoover encouraged private charities, as well as state and local governments, to help the destitute. He encouraged businesses to put more people to work and to raise wages. But businesses wouldn’t cooperate and charities could only help the few, not the many.

After three years of calling for voluntarism things were worse than ever. Roosevelt defeated Hoover in a huge landslide. FDR, a religious man, began a presidential tradition of attending church on the morning of inauguration. That day he prayed to God to help him find a way to help the country battle the Depression. With his sunny disposition FDR gave a battered nation the spirit to lift itself out of despair.

Presidents can’t legislate. In order for Roosevelt to get any of his programs enacted he needed Congress. When FDR was elected, Congress and the American people were looking for strong leadership and someone who was willing to try things. For a president, Roosevelt had bold programs. These programs, and those created by Congress, came to be known as The New Deal.

Roosevelt believed that farmers were the backbone of the country. The first bill proposed and passed by the Roosevelt administration was the very first Farm Bill. There would be several more during his presidency. They refinanced farmers’ mortgages, provided insurance and made crop and price-support loans. A system of planned storage was set up to ensure a stable food supply.

FDR set up an agency to fight soil erosion and perform flood control. New Deal programs rescued western farmlands from the Dust Bowl which had been caused by environmentally damaging farming practices. After just two years of Roosevelt’s presidency farm income had increased by 50%.

While suspicious of Wall Street, FDR really believed in free enterprise. He was generally opposed to the government competing with business. The public work programs he created were forbidden from offering jobs that people could get in a private business. However, there was one area where FDR did fight with private corporations- rural electric power.

Roosevelt tried to get utility companies to run more rural power lines and reduce the price of electricity. Private utilities refused. So FDR used the federal government to run miles and miles of electric lines to rural areas. The government then loaned money to co-ops to keep the price affordable. When FDR took office 10% of rural homes had electricity; at the time of his death, almost 70% did.

FDR was a great proponent of conservation. Many of his farm policies were tied to conservation. He opened many new parks and was the creator of the national historic parks system. He also desegregated the nation’s parks. Park improvements were made by FDR’s Civilian Conservation Corps. This included Livingston County’s own Letchworth State Park. The CCC also planted millions of trees, stocked millions of fish, provided disaster relief and gave its employees vocational and educational training.

During his first 100 days Roosevelt sent Congress a record number of bills, all of which passed easily. Prohibition was repealed, banks were stabilized and the FDIC was created so people wouldn’t lose their savings. The Glass-Steagall Act prevented investment banks from combining with commercial banks so that they couldn’t gamble with people’s savings.

Later New Deal legislation created several major hydro-electric dams, low-income housing, credit unions, the labor relations board, FHA insurance and the securities exchange commission. The WPA and PWA programs created jobs to build post offices, schools, hospitals, bridges, airports and playgrounds. WPA artists made paintings, sculptures and murals to decorate them. Native American groups were given greater autonomy. Child labor was banned. The 40 hour work week and the first minimum wage were created. Workers were guaranteed the right to form unions.

New Deal programs were financed by raising taxes on the richest Americans and by borrowing. Roosevelt disliked borrowing but it was really the only way, besides taxes, that the government could get money. FDR believed strongly in balanced budgets. Although he tried, circumstances never allowed him to balance the budget.

For most of the Depression, FDR’s spending and debt were only slightly higher than Hoover’s. FDR didn’t run significant deficits and debt until World War II started. Wages, the Dow, GNP and employment increased every year of his presidency except for the year he cut spending to balance the budget in the late 1930s.

As most people know, it was World War II that finally put an end to the Depression. That was because people now had money to spend to stimulate the economy. This was the result of a massive, budget-busting government spending plan. Who was paying for all those armaments that people were making at their new jobs? The federal government. This government spending (Eisenhower called it the military-industrial complex) has been, along with other government spending, supporting the economy ever since.

FDR’s programs did what he intended them to do: not end the Depression per se, but create a kinder, gentler capitalism. The government stepped in to help people who were victims of a business cycle they couldn’t control. The government lent a helping hand to those who were too young, too old or too injured to work. This led to the creation of one of FDR’s most important and long-lasting pieces of legislation- the Social Security Act.

In order to get legislation passed Roosevelt relied on the large contingent of southern Congressmen in his party. To maintain enough support for the New Deal FDR couldn’t do a lot to help blacks. The best he could do was ban discrimination in the government programs he created. There was also little FDR could do to help the Jews being massacred in Europe “Except help win the war,” he said.

During World War II Roosevelt concentrated on being an inspirational cheerleader. FDR turned much of the war over to others. He put big corporations in charge of producing the materials to make war. He left his military commanders alone to do their job. Sadly, this led FDR to agree to the internment of all Japanese-Americans on the west coast. Unfortunately, this sort of thing happened in many of the countries fighting the war. Roosevelt’s deferment to his commanders also meant things like the destruction of Dresden and the fire-bombing deaths of 50-90% of civilians in 67 Japanese cities.

Compared to the flurry of domestic policy initiatives during FDR’s first two terms, the war years saw very little. Roosevelt focused not just on winning, but also on creating a world that would never experience another global war. To do this he founded the United Nations.

FDR believed a peaceful world could only happen if all people everywhere had Four Freedoms: freedom of expression, freedom of religion, freedom from want and freedom from fear. To accomplish this at home he proposed a second bill of (economic) rights. This would give every American the right to a living wage job, health care, higher education and freedom from unfair business competition.

Roosevelt would not live to enjoy the end of the war. Neither would he live to see the failure of his dreams to be realized. He would not live to see his hopes for peace derailed by the cold war or to see the government increasingly controlled by financial & corporate elites. He would not live to see a nation that had never believed in standing armies become the largest and most pervasive military force on Earth.

However, many of FDR’s economic reforms lived into the 1970s. They helped create the post-war economic boom that swelled the middle-class and created the prosperous, confident America that so many people look back on with nostalgia.

The dismantling of FDR’s financial reforms and regulations began around 1980. This culminated in the repeal of Glass-Steagall in 1999. However, a few of Roosevelt’s other reforms survived. Farm Subsidies, Unemployment Insurance and Social Security survive to this very day. So too does the belief that government should step in to prevent another Great Depression, although not quite the way FDR had intended. FDR reined-in Wall Street; he believed in bailing-out regular folks.

Not everything FDR tried worked. He couldn’t do enough for small businesses or small farmers. Roosevelt couldn’t help the average black person or Native American very much.

FDR wasn’t perfect. He couldn’t prevent World War II. He didn’t save Japanese-Americans from internment. He couldn’t save millions of European Jews.

However, Roosevelt did save American capitalism. He also saved America’s farm lands and wild places. He saved the middle class and modernized America’s rural areas. He saved poor children, senior citizens and the disabled. He protected the people against predatory banks and corporations. FDR saved American democracy.

We can’t expect too much from politicians in our system of government. Roosevelt certainly didn’t do any of this on his own. He was prodded and supported by many congressmen and the American people. Because he listened to the people, and valued them over money, FDR made this country a better America.