How did the role of the federal government change during the Great Depression?
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During the Great Depression, the role of the federal government changed tremendously. Before the Depression hit, the federal government did little or nothing to help people financially. This was not seen as something the government ought to do. With the Depression came a change in this perception. President Roosevelt's New Deal made government responsible for helping people in many ways. These ways ranged from guaranteeing that they would not lose money they had deposited in banks (FDIC) to ensuring that they would have money to live on after they retired (Social Security). In general, the New Deal brought on a new role for government, one in which the government did a great deal more to help individuals financially.
There are many historians who view the New Deal policies of President Franklin D. Roosevelt as the beginning of the social welfare system of the Federal Government. During the Great Depression, there were many men who had no jobs; consequently, their families suffered deprivation and hunger. The New Deal programs were a series of domestic programs such as the Federal Emergency Relief Administration, which provided $500 million for state and city relief operations, and the Civil Works Administration, which provided localities funds to operate "make-work" jobs, jobs created to give men something to do so they could receive pay; these jobs did not profit the localities.
In the Second New Deal of 1935-1938, the Wagner Act, which promoted labor unions, was passed. The Works Progress Administration (WPA) was also begun; this became the largest employer in the nation. To protect citizens from losing their savings because of a "run," or other circumstances, the Federal Deposit Insurance Corporations (FDIC) was formed. In addition, the Federal Housing (FHA) Administration was begun, the Tennessee Valley Authority (TVA) which employed thousands and provided water to many, who hitherto had none, was initiated. Also, the Social Security System was begun. Another institution was that of the Securities and Exchange Commission (SEC), whose duty is to provide protection to investors; maintain orderly, fair, and efficient markets; and enable capital formation. With the exception of the WPA, these new elements of the Roosevelt government yet operate today. So, the federal government was greatly expanded during the Depression, making great efforts to help the local governments and its citizenry. Ironically, Roosevelt was criticized by conservatives and liberals alike. On the conservative side, people felt that the government was interfering in what should be laissez-faire competition and not a government-controlled economy; on the other side, people felt the government was not doing enough to help people.
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