31 May 2023

What is the New Deal? – Learn the history of the New Deal

By Donald

The New Deal was a convention of interventionist policies adopted by the Government of President Franklin D. Roosevelt in response to the Great Depression that affected the country in the 1930s. The main objective of the New Deal was to revitalize the economy and provide relief to Americans who were in poverty and unemployment situation.

At that certain moment, the concern of deflationary incidents (sustained drops in the price level) arises, since even the population noticed the reduction of their purchasing power and, therefore, they did not have the possibility of obtaining the available goods. There was even an excess of proposals, resulting in the price drop.

Definition & Meaning of New Deal

The words “New Deal” come from the English language, translating as “New Deal”. This is how President Roosevelt named it, at the time of the economic political crisis that dates back to the 1930s. Due to this situation, he applied said strategy to reduce and reverse the consequences of Great Depression.

With the intention of renewing the economy and reducing unemployment, this is how much of the government business went to the public infrastructure growth: roads, bridges, buildings. The latter caused energy to be created at a low price and drew the attention of new companies, some interested in cheap labor.

As the story goes, the program was implemented in various stages between 1933 and 1938 and included a wide range of measures. One of the first events was the creation of the Emergency Relief Administration and the Public Works Administration in order to offer employment and financing for construction.

The main purpose of the 1933 law was focused on raise prices of agricultural products until reaching a balance with non-agricultural prices, which had become relevant during the base period from August 1909 to July 1914.

Initially, the law worked with the following dynamics: Annually, from the expected demand the Secretary of AgricultureHenry A. Wallace, diagnosed the land area that should be removed from processing for each commodity (they were originally seven: cotton, corn, tobacco, rice, milk, pork and wheat) with the aim of increasing prices up to the established goals.

the new deal was not without criticism. Some argued that the government was acquiring too much power and that the policies were inefficient, while others argued that it was not bold enough to fully fix the problems. economic problems that society faced at that time.

Despite criticism, the new deal had a significant impact on the Economic recovery from United States. He helped stabilize the financial system, provided employment to millions of people, improved working conditions, and laid the foundation for a broader welfare state.

Years later a new pact called Green New Deal (or Green New Deal). This same one was popularized through the Democratic congresswoman Alexandra Ocasio Cortez, who presented it in the company of other members of her party at the beginning of February 2019.

The Green New Deal is a highly ambitious project: it aims primarily to modify the US economy to combat climate change without avoiding, at the same time, tackling inequality and keeping jobs. For this reason, the name is related to the color green connected with the fight for the climate and in coordination with the New Deal that President Roosevelt launched to get out of the Great Depression in the 1930s.

What did the New Deal propose?

The New Deal project suggested a series of measures and policies aimed at taking responsibility for the economic and social challenges caused by the Great Depression in the United States, a developed country. These proposals had aim main to revitalize the economyprovide employment, restore confidence in the financial system and establish a basic welfare state.

Below are some of the main New Deal proposals:

  • financial regulation: The New Deal sought to restore confidence in the financial system after the banking collapse of the Great Depression. established the Federal Deposit Insurance Corporation (FDIC)which insured bank deposits and regulations were implemented to prevent abusive and speculative practices in financial markets, such as the Securities and Exchange Commission (SEC).
  • Labour reform: The New Deal promoted workers’ rights and collective bargaining. The National Labor Relations Act, also known as the Wagner Act, which protected the right of employees to form unions and bargain with employers. Therefore, a minimum wage was established and working hours were limited through the Fair Labor Standards Act (FLSA).

These are just some of the main proposals of the New Deal. In general, the project sought a balance between the Economic recovery in the short term and the implementation of policies that would establish a fairer and safer system for citizens in the long term.

What are the characteristics of the New Deal?

There are various characteristics that can be understood as who was the president, what are the measures, among others. Here we tell you about some:

Who is the president of the New Deal?

Franklin Delano Roosevelt was born on January 30, 1882, the only child of powerful marriage by James and Sara Delano Roosevelt (despite the fact that his father had a son in his previous marriage). Roosevelt studied at Harvard University, graduated from him in three years, married Eleanor Roosevelt, who was also his distant cousin. They were married on March 17, 1905.

Was the thirty-second president in 1932 and began the campaign whose main objective was to solve the issue of the Great Depression, which guaranteed the Democrats an advantage in securing the position of Franklin D. Roosevelt in the White House.

What are the measures of the New Deal?

  • The state invested mainly in the construction of works by infrastructure (hydroelectric plants, airports, bridges, ports, among others). The acquisitions were also allocated for the construction of other public facilities such as schools and hospitals.
  • The main intention of these measures was the job productionbecause the United States endured a lot with high levels of unemployment after the great depression of 1929.
  • The North American mandate, through the reform and invention of laws would have control domains and control of the financial market. The objective was to prevent financial fraud and reduce the operational difficulties of banks and other financial entrepreneurs.
  • Contributions, credits and other decisions They were aimed at increasing the agricultural work of family farming and the considerable estates. Also, to promote the agricultural industry, all this was directed to the progression in the amount of work in the rural sector.
  • These privileges for the agricultural sector also tried to retain the progressive rural relocation (leaving the cities) that was causing social conflicts in major urban centers.
  • One of the reasons for the 1929 crisis was the increase in the inventory of companies. The New Deal looked at how to fix the problem by checking the realities so they won’t rise high enough to cause operational risk by driving companies out of business. Besides, media costs they were examined by the government in order to prevent the increase of inflation.

What is the history of the New Deal?

The New Deal initiative was an effort to establish a new economy and take steps to stabilize the country, during the period following the Great Depression of the 1930s. The New Deal was proposed by President Franklin D. Roosevelt in 1933 and its goal was to help Americans get out of the terrible economic and social situation in which they found themselves. During his tenure, President Roosevelt promoted projects such as the National Industrial Recovery Act (NIRA) and the creation of the federal employment program Civilian Conservation Corps (CCC).

These programs helped regenerate America’s economy by providing stable employment for workers and helping communities with subsidies and financial benefits. The Great Depression was a period of deep depression, which left a large part of the working population without a job.

Americans needed jobs and resources, so President Roosevelt saw the need to provide financial support to the federal government to help the population. Seeking solutions to the crisis, the president proposed the New Deal, which included nonew government investment policies, along with new legislation that sought to provide social security for the most vulnerable citizens.