The New Dealís Supporters and Opponents

The New Dealís Supporters and Opponents

New Deal The New Deal’s supporters were obviously the people who benefitted most from the reforms, such as the unemployed and the poor who either found work or received government assistance through the New Deal, or farmers or home-owners who managed to avoid losing everything through schemes such as the HOLC or the CCC. The fact that Roosevelt won the 1936 Presidential election with 60 per cent of the popular vote – even bigger than his 1932 victory over Hoover – shows that many, many people were behind the New Deal, or at least viewed it as better than the alternatives being offered by the Republicans. But the fact that the public supported Roosevelt doesn’t really tell us if the New Deal was successful. So let’s look at what it achieved, and what it did not achieve.

* Unemployment did fall. In 1932 the unemployment rate was 23.6 per cent; in 1934 it was 21.7 per cent, and in 1936 it was 16.9 per cent. There was a clear reduction, but by no means a massive one. Furthermore, in 1937 there was a recession (called the Roosevelt Recession), and in 1938 it was back up to 19 per cent.

* But the success of the New Deal has to be measured by more than just unemployment. The fact is that during these years thousands of schools and hospitals were built through it, many parts of the country received electricity for the first time and miles and miles of roads and bridges were built.

* And let’s not forget the banking system. The death spiral it was on was halted, and the laws put in place prevented later financial collapses. Looking beyond the 1930s, under the New Deal banking regulations, which were in effect until 1999, there was no repeat banking crisis.

* It did all cost a lot of money, through increased taxes on the rich and government borrowing. But if you weren’t paying for it, what did you care?

New Deal The opponents of the New Deal – mainly business owners, argued that the New Deal:

* was an attack on their constitutional rights

* Was anti-business

* encouraged communism and was in substance socialism

* was a big waste of public money

* interfered with natural market forces such as supply and demand, which ultimately would have fixed the problem themselves

The more powerful opponents of the New Deal were able to challenge aspects of the New Deal that they didn’t like in the courts, and in some cases, such as the NRA and the first AAA, managed to get the Supreme Court to rule the activities of these organizations as unconstitutional. Normally they were considered unconstitutional because the organizations created were given powers that interfered with the rights of individual States to set their own laws. This meant that some of Roosevelt’s ideas had to be abandoned or modified.