Relief, Reform, and Recovery
President Franklin D. Roosevelt took office in 1933, in the midst of the Great Depression, and quickly acted to try to provide aid to those in need and to help the economy. FDR was elected for his campaign promise of a New Deal, which was a range of federal programs to help provide the “Three Rs” – relief, recovery, and reform. A lot of his New Deal legislation was enacted in the first three months of his presidency, also known as the Hundred Days.
“Relief” referred to more immediate economic relief for the people detrimentally affected by the Great Depression, namely the poor and unemployed. FDR was quick to provide such relief; two days after he took office, he declared a Bank Holiday, which suspended all banking activity for four days from March 6 to March 10, because Americans had been anxiously withdrawing their bank deposits and thus depleting many banks of all their cash. During these four days, Congress passed the Emergency Banking Act, which worked to stabilize the bank system and insured bank deposits. To alleviate high unemployment rates, two temporary job creation programs called the Civil Conservation Corp (CCC) and the Civil Works Administration (CWA) were enacted to help unemployed people get by. In addition, the Federal Emergency Relief Act (FERA) provided grants to state agencies that, in turn, provided economic assistance to the people in those states.
“Recovery” referred to recovery of the economy by creating new jobs and spending federal money to revive the economy. To stimulate the economy, FDR created temporary programs like the Agricultural Adjustment Act (AAA), which increased agricultural prices by controlling the amount of supply, and the National Industrial Recovery Act (NIRA), which controlled wages and prices.
The creation of the Home Owners Loan Corporation (HOLC) transformed the way mortgage loans were carried out and helped homeowners who were having trouble paying back their mortgage loans during the Great Depression. Other recovery agencies and legislation included the Works Progress Administration (WPA), and the National Youth Administration (NYA), the Federal Housing Act (FHA).
“Reform” referred to implementing new regulations and permanent programs into the financial system to avoid another Great Depression in the future, such as the Securities Exchange Act, which created the Securities and Exchange Commission (SEC) to regulate the stock market. The Social Security Administration (SSA), which still exists today, provided and continues to provide economic assistance to the elderly and other more vulnerable populations during the Great Depression. As a way to protect workers and enhance workers’ welfare, the National Labor Relations Act (NLRA) created the National Labor Relations Board (NLRB), which guaranteed the right of workers to enter into trade unions and engage in collective bargaining. Prior to this, employers could condition someone’s employment on a promise to not join a trade union. Other reforms also included the Federal Deposit Insurance Corporation (FDIC) and the Soil Conservation Act.
The New Deal came in three waves and was considered a success in growing the economy and softening the blow of the Great Depression. Even today, there are still significant vestiges of the New Deal transformations, such as the Social Security System and the FDIC.