The New Deal

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The impact of the New Deal on the government's role in American lives

Summary:

The New Deal significantly expanded the government's role in American lives. It introduced numerous programs and reforms aimed at providing economic relief, recovery, and reform during the Great Depression. This included social security, unemployment insurance, and various public works projects, fundamentally changing the relationship between the government and its citizens by increasing federal intervention in the economy and welfare.

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How did the New Deal change the government's role?

It should be noted, during the early Twentieth Century, the United States government took on a more significant and active role under the Progressives. Theodore Roosevelt, for example, was famous for his efforts in prosecuting big business operations (furthermore, it should be noted that his successor, Taft, was far more active in prosecuting big business than Roosevelt himself had been). Later, government would take on still greater power for itself, with the advent of World War I and the requirements of coordinating a wartime economy.

After the end of World War I, there was a reaction against this increase in government power represented by the Progressives and, later, the First World War. Thus, in the 1920's, Republican presidents, starting with Warren Harding, restored a policy of laissez faire economics, which eschewed government regulation of the economy. However, the Great Depression made laissez faire untenable. The election of Franklin Delano Roosevelt signaled a profound shift towards the political left, with a far more powerful and interventionist federal government than had ever previously been seen in US history.

Roosevelt advocated for deficit spending, and under the New Deal, federally funded organizations and agencies were created, aimed at providing relief and getting people working again. Under his leadership, the government also famously imposed an audit of the banking industry in order to stabilize that sector of the economy. New regulatory measures and safeguards were put in place (such as the FDIC, which insured savings accounts, or the SEC, which regulated the Stock Market). Additionally, as part of the New Deal, the US government would adopt a system of social security for the first time. These are only a few examples. There are many more you can point to.

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How did the New Deal change the government's role?

The New Deal significantly impacted the way the government worked and related to everyday peoples' lives. The New Deal was the first experience people had with a government that was actively and intimately involved with their livelihood and every day activities.

Prior to the New Deal, the government dealt strictly with major legislation, the overall economy and federal reserve, and foreign affairs such as wars and treaties. Obviously this minimizes many of their actions, but in general, these were its functions. The New Deal, however, overthrew much of those ideas.

When Roosevelt introduced the New Deal, the American economy was in the middle of the worst depression the world had know, and many people were out of jobs, becoming homeless, and starving. In order to revitalize the economy, FDR decided to create the New Deal, which created countless jobs for the citizens, in an attempt to create new industries and more economic growth. This action was fairly successful, helping to create new highway systems, expand America to the west, and create new opportunities at gathering resources. This stimulated the economy and helped people find jobs. Prior to this event, however, the government had been largely separate from people's everyday lives, including their jobs and housing situations. This was the first step to creating a personal government, that would involve itself in the daily details of everyone's lives and activities.

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How did the New Deal change the government's role?

Before the New Deal, the government was not as deeply involved in the financial and personal lives of ordinary people, and the bureaucracy of the federal government was far less developed. For example, Herbert Hoover tried to resolve the Great Depression with a limited public works project and the Reconstruction Finance Corporation, which loaned money to businesses. However, the bureaucracy and power of the federal government were too limited under Hoover to really stop the financial woes of the country.

Under Franklin D. Roosevelt's New Deal, government bureaucracy greatly expanded to provide relief, recovery, and reform. Relief was money and grants paid to states that went to individuals through agencies such as FERA (Federal Emergency Relief Act). Recovery helped to "pump prime" or restart the economy through providing jobs in agencies such as the Works Progress Administration (WPA). The government was also actively involved in reforming the economy through acts such as the establishment of the Federal Deposit Insurance Corporation (FDIC) to ensure that a massive economic depression would not reoccur. Finally, the government established entitlement programs such as Social Security that provided a safety net for the elderly and poor. These entitlement programs were later expanded to include Medicare and Medicaid under Lyndon B. Johnson's War on Poverty (and the Affordable Care Act under Barack Obama). During the Great Depression, the government began to play an active role in protecting the poor and disenfranchised—a role that liberal Presidents would continue in the years to come. 

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How did the New Deal change the government's role?

The role of government during FDR's New Deal was an expansive one.  President Roosevelt understood government's role as one to provide relief, recovery, and reform to the nation's economic institutions that had failed after years of governmental non- intervention.  Roosevelt saw government differently.  As opposed to a force whose presence was largely absent from business and economic affairs, the New Deal saw government as an agent of action.  Roosevelt understood that the stagnant nature of the American economy featured so much inertia that government had to be the source of all action, initiating paths where job creation and growth could be evident.  It was in this light that the New Deal's alphabet soup of initiatives along with broadened executive power enabled Roosevelt to use government as a source of solutions towards people's power.

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How did the New Deal change the government's role?

The New Deal changed the role of government completely.  Before the New Deal, government had essentially no role in steering the economy or in providing for the people.  After the New Deal, the government has come to play a huge role in both of these things.

Before the New Deal, the government was expected to be more or less laissez-faire.  It was supposed to just stay out of the way and let the economy rise or fall "naturally."  If people were too old to work, they needed to rely on family.  If a bank failed, its depositors were out of luck.  The New Deal changed all of that.

Since the New Deal, the government has started to take care of us.  It provides Social Security and Medicare for the elderly.  It runs the FDIC to insure our bank deposits.  It lowers taxes and increases spending and does other things like that when the economy goes into a recession.

Because of the New Deal, the government has taken a huge role in the economy.  This is something that simply was not the case before the New Deal.

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How did the New Deal change the federal government's role in American life?

The New Deal brought about many social service programs into the sphere of the federal government that had not formerly existed on the size, scope, and scale of The New Deal. As a response to the Great Depression, in which the US experienced the worst economic crisis in its history, President Franklin D. Roosevelt enacted several laws that aimed to alleviate the heavy burden of the economic crisis from the shoulders of working class America.

Dozens of programs and agencies were created by FDR (Franklin D. Roosevelt) through the New Deal. There were two waves of the New Deal in which FDR's administration sought to address economic, housing, food, and quality of life issues for working class and unemployed Americans. Previously, much of the social and economic inequality in America was addressed through charity and private aid. Welfare was not really a realm of the government. However, because of the immense size of the economic crisis, the federal government decided to introduce agencies and programs within the federal government realm that addressed the economic welfare of its citizens.

This shift led to a cultural shift in the ways in which the state was viewed by Americans. While these views could certainly be affected by the race, class, and gender of an individual, there was a general shift in the view that the government could perhaps provide a form of economic security to Americans. The New Deal greatly expanded the role of the state in citizens' lives, which was previously thought to be an oppressive and unwanted force in people's everyday lives. After the New Deal, people who were able to benefit from the programs began to see the growth of the state as not inherently oppressive.

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How did the New Deal change the federal government's role in American life?

The New Deal had a significant impact on the role of the American government in people’s lives. Before the Great Depression, most Americans believed the government should have a very limited role in their lives. This laissez-faire philosophy worked very well during most of the 1920s. Many people didn’t want there to be too many government rules and regulations.

When the United States went through its worst depression ever, people began to shift their attitude about the role of government. During the Great Depression, people looked to the government for answers. They expected the government to develop programs to provide them with relief from the devastating effects of the Great Depression. They also expected the government to bring about changes so this type of crisis wouldn’t happen again. People began to the view the government as a safety net during times of crisis or difficulty.

To this day, people look to the federal government when times are tough. We expect the federal government to provide relief from natural disasters. We expect the government to act when the economy significantly slumps. It is no longer acceptable for the government to be inactive during times of serious crisis. This shift in attitude came about as a result of the Great Depression.

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How did the New Deal change America's view of government's role?

The term "New Deal" was intentionally ambiguous and euphemistic. It suggested that what was being proposed was something like Huey Long's radical suggestion of a "redistribution of the wealth," but it was actually much more conservative than that. The term "New Deal" comes from the game of poker. It suggests that rather than inaugurating a socialistic system, there would be a reshuffling of the cards and then the people could continue operating independently in a free market system. However, the conservatives, and Republicans generally, understood a new deal to be a redistribution of all the country's wealth--taking everything away from the haves and sharing it equally with the have-nots. The New Deal was very popular with the have-nots but very unpopular with the haves. Franklin D. Roosevelt, himself a wealthy aristocrat, was wildly popular with the masses. When he appeared in newsreels in movie theaters audiences would applaud and cheer. But they probably expected more from him and his administration than they were constitutionally able to provide and probably more than Roosevelt really intended to provide.

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How did the New Deal change America's view of government's role?

The New Deal completely changed Americans' attitudes towards the role of government.  Before the New Deal, many or most Americans believed that the government had no real role in maintaining the health of the economy or in providing for people who were too old to work or who were otherwise unemployed.  The government was supposed to set tax rates and tariffs and things like that, but it was not supposed to otherwise intervene in the economy.

After the New Deal, this all changed.  Americans came to accept the idea that the government would be responsible for the performance of the economy as well as for the well-being of the people.  We have come to accept this to the extent that even budget cutters in Congress say they will not touch Social Security or Medicare.  These are programs that were unthinkable before the New Deal but which are seen as indispensable by many Americans today.

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How did the New Deal change citizens' relationship with the federal government?

The New Deal (1933-1941) of President Franklin Delano Roosevelt fundamentally altered the relationship between the citizens of the U.S. and their government. The Great Depression, which began in 1929, inflicted untold suffering on most of the people. Myriad reforms implemented by the New Deal included banking, the stock market, and aid to the jobless, aged, or impoverished.

One aspect of the far-reaching New Deal was bank reform. Bankrupt banks could not repay people who had deposited money. The Federal Deposit Insurance Corporation (FDIC) was established to insure deposits.

Because the Great Depression started after a stock market collapse, FDR backed the creation of the Securities and Exchange Commission (SEC). There had been a lot of fraud in the stock market in the twenties, so regulation was badly needed.

Ordinary workers and farmers bore the brunt of the economic collapse. Unemployed workers built infrastructure for the Works Progress Administration (WPA). The Agricultural Adjustment Administration (AAA) helped farmers by increasing crop prices. The Social Security Act—perhaps the New Deal's most important legacy—provided financial aid to retirees.

The many programs of the New Deal were revolutionary. The New Deal sought to mitigate the ill effects of the economic collapse and stimulate the economy. It remains the basis of government social policy to this day.

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How did the New Deal change citizens' relationship with the federal government?

Before the New Deal, the federal government primarily saw its role as defending the nation militarily and left other financial issues in the hands of state and local governments, the private sector, and private, often religious, charities. However, the magnitude of the economic collapse brought on by the Depression overwhelmed local and private institutions. More and more people began to look to communism and other radical solutions to alleviate the widespread economic distress. More troublingly, people began to feel that the capitalist system was the wrong way to organize society, as it had so obviously failed to bring prosperity. President Roosevelt's New Deal has been credited with saving the capitalist system in the US by both regulating it more strictly and providing a social safety net that allowed it to function without destroying itself.

For the first time, the federal government began safeguarding the economic wellbeing of the average citizen through federal programs that covered the whole country. These included Social Security and the beginnings of the welfare state. For the first time, as well, legislation set a nationwide minimum wage, abolished child labor, and more fully protected worker's rights, including the right to unionize. Federal programs provided infusions of cash to local governments and administered programs more efficiently than local initiatives. Since the advent of the New Deal, the majority of the public has accepted the role of the federal government in ensuring a minimum standard of economic safety and wellbeing for the average citizen. 

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How did the New Deal change citizens' relationship with the federal government?

The New Deal fundamentally changed the relationship between the federal government and its citizens by creating a relationship in which the people came to depend more on the government than they had in the past.

Before the New Deal, the federal government was relatively detached from the lives of average members of the public.  Most importantly, the federal government took little or no responsibility for the people’s prosperity or financial security.  There was much more of a sense that people should take care of themselves.  In the event that people could not do so, families and things like private charities should step in.

With the New Deal, all of this changed.  All of a sudden, the government was taking a major role in ensuring that people would be at least somewhat secure.  It created programs like Social Security and the FDIC to do this.  The New Deal also created the expectation that, when things go really badly, the federal government will help people.  This is what the government was doing through programs such as the WPA and the CCC.

The major change, then, is that the people came to expect that the federal government would help to ensure their prosperity and economic security.   

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How did the federal government change during the New Deal?

President Franklin D. Roosevelt's New Deal programs substantially increased the size of the federal government while simultaneously greatly expanding the government's role in the daily lives of much of the populace.

While the Constitution of the United States established the structures, roles, and responsibilities of the federal government, it allowed the possibility of the government's expansion in the years following ratification. With expansion came the increase in the federal government's powers—a development possibly anathema to the ideas of limited government, which, ultimately, the New Deal and future president Lyndon Johnson's 1960s-era "Great Society" essentially supplanted. 

Prior to the onset of the Great Depression, the catalyst for the New Deal programs that were created during the 1930s, the size of the federal government was fairly limited. The catastrophic consequences of the depression, however, required measures that were unique to the situation. However, these measures fundamentally changed the government's role relative to that of the population it purportedly served. Roosevelt understood that the extremely high level of unemployment coupled with the collapse of the banking industry necessitated extreme measures. Those measures included the establishment of a number of agencies and departments designed to put people back to work while improving the country's infrastructure and industries. New Deal agencies like the Civil Works Administration, the Civil Conservation Corps, the Public Works Administration, the Tennessee Valley Authority, and others were all intended to provide jobs while constructing infrastructure like roads and dams.  That some of these programs continue to exist today is testimony to the resiliency of federal bureaucracies. 

The federal government is much larger today than it was prior to the New Deal. It plays a much more prominent role in the national economy and the programs it created remain living testaments to the will of Roosevelt and his cabinet in expanding the government's presence in the lives of the public.

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How did the federal government change during the New Deal?

The main way in which the federal government changed during the New Deal was by expanding greatly and expanding its role in American society.

Before the New Deal, the federal government was a relatively small entity.  It was not expected to do very much and it did not have a huge number of employees.  People were generally expected to fend for themselves.  The economy was supposed to be left alone to fix itself in bad times.  This was a very limited government.

During the New Deal, this all changed.  The government inserted itself into many areas of economic life that had never been contemplated before.  It involved itself in providing jobs for people who did not have them.  It involved itself in trying to ensure that retired people would have enough money to live on.  It involved itself in trying to ensure that people would not lose their money when banks failed.  It tried to completely remake the physical environments through programs like the Tennessee Valley Authority.  These are all things that had not previously been expected of the federal government.

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How did the New Deal change the role of the federal government?

As a result of the New Deal, the role of the federal government has expanded tremendously.  Before the New Deal, Americans generally did not expect the federal government to do much for them.  Now, we expect a great deal from it.  Let us look at three examples of this.

  • We expect the government to make sure we do not lose our money if our banks fail.  This is because the FDIC was created during the New Deal.
  • We expect the government to provide us with jobs when the economy is bad.  During the Depression, the government did this directly with programs like the WPA.  Nowadays, we expect the government to do this indirectly through fiscal stimulus packages.
  • We expect the government to provide for us during our retirements.  This is because of the creation of the Social Security program.

Expectations like these have also led to general expectations that it is the responsibility of the government to ensure that our economy works smoothly and that we are protected as much as possible from negative economic outcomes.

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How did the Depression and New Deal change the government's role in American lives?

The federal government's response to the Great Depression with the New Deal marked a permanent change in domestic policy. Previously, the government took a rather hands-off approach to manage the domestic affairs of the people. However, the Great Depression forced many policymakers to see that local governments and private charities were insufficient to mitigate the damage being done to most Americans and the economy. That is why the Roosevelt administration instituted the New Deal programs.

One fundamental change was taking the country off of the gold standard. Roosevelt and the Treasury put policies into place that stopped the outflow of gold from the country. Gold was then exchanged for dollars. All this allowed the Federal Reserve to have better control over the value of the dollar.

Many New Deal programs were implemented to create work for the people. Never before had the government taken such a large scale and active role employing civilians. Work programs included the Civilian Conservation Corps and the Work Project Administration. The government also passed minimum wage laws and passed the Social Security Act. These were, and still are, guarantees by the federal government that all working Americans could earn a certain standard of living. The Federal Housing Administration was created to set national standards in home construction, and the Home Owner's Loan Corporation ensured that fair mortgages were given.

All this greatly expanded the role of the government by making it a guardian of the basic needs of Americans. Many of these New Deal programs still exist today.

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