INTRODUCTION
Franklin D. Roosevelt won presidential campaign in 1932 because H. Hoover was unable to lead the country out of the economic crisis of 1929-33. The policy of President Roosevelt in 1933-1941, became known under the name “New Deal”. It was an attempt to overcome the crisis and alleviate social tension in society, through deep reforms. In the presidential race, Roosevelt emphasized the need of the help to the millions of disadvantaged citizens; he promised that the American people would get the “New Deal”!
Roosevelt did everything to maintain and develop the existing socioeconomic system in the country and strengthen the dominant position of the US in the world. Before Franklin Roosevelt, no person held the presidency of the United States more than two terms in succession. This is largely a consequence of tradition that comes from George Washington, the first president of the United States, who refused to run for a third term.
First steps of recovery
The elected President Roosevelt took office only on 4 March 1933. The time of the reign of the two presidents was the most dramatic phase of the USA crisis. The state was close to the complete paralysis. The banking crisis has not given Roosevelt time to adapt to the new role of president. In March 1933, work of all banks in the country was suspended that allowed to stop an exchange of banknotes for gold. In April 1933, the Congress adopted a law that banned the export of gold, and a decree under which nationals were required to hand over to the banks all their gold reserves of more than $ 100. By the end of 1933, the government has made large purchases of monetary metal on the international market. At the same time, all gold reserves were withdrawn from the Federal Reserve banks and transferred to the Federal Treasury. The conducted devaluation of the dollar contributed to the distribution of income in favor of the industrial sector, not loan capital. Existing banks received a government loan of $ 1 million, which revived the scope of lending operations. In addition, the government has committed to insure bank deposits and created the Corporation for Insurance of Bank Deposits. In order to reduce the public deficit and improve the financial situation of the state, the president has recommended cutting back on wages of federal officials, members of Congress and pensions to veterans of war. Despite the strong opposition of the Senate, the law has been adopted on March 20, 1933. In late 1933, the Congress allowed alcohol, but introduced a significant tax on its sale.
The stabilization of the banking and financial system created the preconditions for the resumption of production. On June 1933, the Congress passed the National Industrial Recovery Act, which established the system of state regulation of the industrial sector. Simultaneously, the industry associations of entrepreneurs, according to the first section of the law have developed and adopted “Codes of Fair Competition”. The provisions of this Code strictly regulate the production volumes, the limits of wages, hours of work a week, determined sales markets, product prices and so on. The codes prohibit the use of child labor. Established by the US Congress Administration of community service carried out extensive activities to create new jobs in the municipal sector, road construction, created the labor camps for unemployed young people aged 18 to 25 years. For the more efficient use of labor resources, the government started implementing major national projects that have contributed to the economic progress of the country. Implemented social measures for the restore of the industry have yielded positive results. By spring 1935, the government established quite effective control over the industrial sector.
Roosevelt’s anti-crisis agricultural policy was very important; it was carried out based on the “Law on the regulation of agriculture”. Congress passed it in the spring of 1933, on the eve of a general strike declared by farmers. To overcome the crisis of overproduction government introduced a system of incentives in the form of bonuses and compensation to those farmers who would cut production in their farms.
Roosevelt’s “New Deal” launched a transformation of the US to the socially oriented state. President’s “New Deal” had features of a liberal-reformist version of the regulated capitalism. The state budget was an essential tool for government actions that were performed in such areas as the financing of social programs. All these measures allowed the United States, to divert the revolutionary change of authorities, and to overcome the economic crisis. For the first time in US history, the state has assumed the role of the guarantor of the social security of Americans. This was a crucial step in creating a state of prosperity. Functions of the state were extremely wide. However, since 1939 Roosevelt refused implementation of further reforms, his administration sought to work on the reforms that were already part of the “New Deal”.
Imbalance of the social sphere forced Roosevelt to pay a special attention to the reforms of the social policy. The program of reforms offered by Roosevelt showed what exactly he understood as the social responsibility of the state. He considered necessary to carry out measures for the help to farmers and farmer cooperatives, to improve the working legislation, to support schools, to restructure the taxation, to transfer electricity generation to public sector and to develop the health care system.
In 1935, the Congress adopted a law on social insurance, which set up the largest social program in the state. “The Social Security Act established a system of old-age benefits for workers, benefits for victims of industrial accidents, unemployment insurance, aid for dependent mothers and children, the blind, and the physically handicapped” (“Social Security Act (1935)”). Act introduced a system of old age pensions and unemployment benefits. Pension payments began with 65 years, the Act also provided assistance to the sick and disabled. Pension funds were formed from contributions of workers and enterprises. The norms pension provision was similar across the country. State law determined the number of pension recipients, amounts, and timing of payments. The law was applied to the workers and employees of trade and services scope. Over time, the volume of public works has expanded and the number of those who received pensions has increased to 21, 3 million people. Therefore, it caused the growth of the budget deficit, which in 1939, amounted to 2.2 billion dollars, and the number of supporters of Keynesian theory in the United States has significantly increased. Evaluating the place and importance of the Social Security Act, the president called it “This law, too, represents a cornerstone in a structure which is being built, but is by no means complete” (“FDR's Statements on Social Security”). The improvement of this system for several decades made it not only an inherent part of the life of American society in 21 centuries, but also considered as the most successful national social program, of all that ever existed in the country. Millions of elderly, disabled, and the younger generation are interested in this program. Today insurance system evolved into a powerful instrument of state social policy. The main aim of the public insurance system was to reduce mass unemployment, which was the most actual social problem in the 30s. The legislation of 1935, established both types of insurance at an old age and on unemployment. The broad movement of the American society promoted this process.
In the process of creation and the subsequent development of the system were laid down a number of basic principles based on which, were formed insurance funds and pension payments. Within several decades, the ratio between the accounting of an individual contribution to the insurance fund, and providing the minimum standard of living changed in favor of the second and strengthened the redistributive function of the system. This tendency was fixed in a formula of charge of payments, which provided the greatest level of compensation for low-paid citizens. All this made the state pension the most reliable source of the pension income, and the main income earner for two-thirds of Americans.
In the second, half of the 30s the course for social reform continued to evolve. However, the earlier proclaimed trade-union rights did not meet the requirements of workers. They do not guarantee the right to strike, and there was not fixed the traditional requirement of American workers the prohibition for entrepreneurs to provide jobs, not to union members, which opened the way to Strikebreaker, and possible disruption of the strike. Therefore, the Congress enacted and President Roosevelt signed the “The National Labor Relations Act” (Wagner Act) in 1935. This Act for the first time in US history declared the official recognition of trade union rights and provided the legal guarantees of these rights. The seventh section of the Act listed the rights of workers, the violation of which was defined as “unfair labor practice” of entrepreneurs. Entrepreneurs were not allowed to intervene in the establishment of workers' organizations, through their funding or to discriminate union members while hiring them, and other (“National Labor Relations Act”). The law fixed the “majority rule”, according to which only an organization that was recognized by the majority of workers can participate on behalf of workers in a contractual relationship with the owner. The law establishes the right of workers to strike. The main aim of this reform was to reduce the grounds for massive conflicts. Thanks to the reforms that were conducted by the administration of Roosevelt, today the role of trade unions in the functioning of civil society and ensuring the protection of labor rights of workers is extremely high. Signed by the Franklin Delano Roosevelt “National Labor Relations Act” are still valid.
Ideas and experience of social reformism, which Roosevelt got in the late 20s subsequently, helped him to build the new country, and to make the time of his presidency the brightest page in the history of XX century. This social policy of President Roosevelt found great support in society. The president became a national leader in the eyes of Americans and all social changes were identified exclusively with his personality. The success of his reforms was approved in the elections for four times in 1932, 1936, 1940 and 1944. The biggest supporters of the social reforms were workers, middle class, intellectuals and the liberal wing of the Democratic Party. The President refused to nominate obviously impossible tasks and to promise impracticable achievements. The help to the “forgotten man” and prosperous economy, saved from competitive struggle, and uncontrolled monopolization, were the main points of the ideological platform of the president. The main idea of the President was very simple, although they had an important distinguishing feature, even during the war policy of Roosevelt always was socially oriented.
The main social aspects of the “New Deal” program
Labor camps for the unemployed. On March 31, Roosevelt signed the Emergency Conservation Work Act that is also known as the Civilian Conservation Corps. This Act gave the job, in the national parks and forests, to more than 250 thousand unemployed young people. Generally, more than 2 million of young Americans got a job in Civilian Conservation Corps. This program covered the whole country into the network of labor camps, where the unemployed mainly young people, got a shelter, clothes, food, medical care. The workers received monetary reward $ 30 per month, which was provided to them in case if they sent $ 25 per month to their families (Speakman). The workers performed various works related to afforestation, beautification of parks, nature reserves. The program included young people, which were a major part of the Civilian Conservation Corps program, but the program also included Indians, unemployed foresters, and veterans.
Creation of aid system at the state level. In 1933, the “Federal Emergency Relief Administration” declared that unemployment and related to it poverty was a national problem and that help to victims of the crisis was the general competence of the central government, the federal subjects and their political subdivisions. While the “Emergency Relief Administration” created by Herbert Hoover in 1932, declared that social assistance was a prerogative of state and local authorities. Instead of loans, Roosevelt imposed irrevocable subsidies, on which the Congress has allocated $ 500 million. Thereby, the subjects of the federation intensified activities in aid. For this purpose was applied the grant-in-aid model which previously was used by the federal government in such areas as road construction. Taking into commitments for partial financing of the aid, Washington insisted that the states and municipalities should have reasonable proportion in financing.
The system has reached its peak in early 1935, when “FERA had distributed over $3.1 billion and employed more than 20 million people” (Deeben). However, even in its best days, it did not extend to all those in poverty. Many families of the low paid workers were out of the system, and their wages were insufficient for self-sufficiency. The policy of intensification has caused an increase in the average aid of $ 15 in May 1933 to $ 35 in July 1935, but the main sacrifice was objective need of significant expansion of aid.
The agrarian crisis gave rise to a program of assistance to farmers in need. The most promising of them was the rural reconstruction program launched in 1934. According to this program, small farmers-owners, and tenants who worked the fertile land received small short-term loans for the purchase of equipment, livestock seeds or debt repayment. Those farmers who had unprofitable land received assistance in resettlement to the villages with developed cooperative ties that were constructed specially for them.
Social work
However unfortunately even after the organization of labor camps for unemployed and issuing regular subsidies to states to help cover the aid the administration of Roosevelt were nor a step closer to “recovery”. On June 16 was adopted a “National Industrial Recovery Act”. The NIRA was divided into two parts: “Industrial Recovery” and "Public Works and Construction Projects" (“Industrial Recovery”). It was believed that this program would play a supporting role in the fight against unemployment. It was thought that the new program of public works had more opportunities. It contained not only the work on urban greening and, but also the construction of bridges, roads, streets cleaning and other works. By attracting unemployed to perform these works a question of unemployment was partly solved.
The reforms of the Roosevelt’s administration in the sphere of social security had the defining value for the American history. Roosevelt overcame promotion of the “American individualism”, and the first of U.S. Presidents began funding programs to help socially disadvantaged people. The sharp intensification of the class struggle and the confidence in the strength of states economic and political positions have created a favorable environment for the clotting of the “New Deal” program. Roosevelt always was prone to compromise and intrigue. On the eve of the presidential election in 1940, he sought to control the left and progressive forces and strengthen his positions on the right side of the social spectrum. Thus, it was determined the new line of rapprochement of the president’s administration with big business.
The 1941 - 1942 were a milestone in the domestic and foreign policy of the USA. After the United States, entry into World War II started an extensive restructuring of the economy towards the development of the defense industry. The state financed a construction of munitions factories, allocated funds to the private sector for the conclusion of military contracts. The war has provoked significant changes in the social class structure, which took place against a background of economic growth.
In the foreign policy, after the attack of Nazi troops on the Soviet Union, the idea of the formation of an anti-Hitler coalition, the principles of coalition warfare, and coalition strategy developed. For the realization of these plans, it was necessary to overcome the remnants of isolationism, defeatist moods, and unfriendly (sometimes-rude) attacks of the opponents of military cooperation with the Soviet Union. Political persistence and common sense were required in the assessment of the military situation and the prospects of confrontation, the search for unifying incentives of military and political cooperation.
In 1944, Roosevelt agreed to run for president for a fourth term. Commander could not leave his army and the idea of the creation of the United Nations after the war. 25.6 million people voted for Roosevelt, for his opponent – 22 million.
CONCLUSION
I believe that in terms of social reforms, the President occupies the first place. This is a person that could lift a state from the deep economic crisis, choose the necessary methods to address each individual problem, and as much as possible protect the society from unwanted problems (mostly from war). His methods, in their principles, were rather simple. The most important detail was the approach to the particular case, the search for methods that would fit into that problem and satisfy the maximum number of people. He was forced to find methods of struggle immediately because the condition of the state and its economy demanded that. Thus, such methods had to be approached, because there was no time for remaking. The most important, of course, were the first 100 days after coming to power. These days laid the foundation for further reforms.
The social reform, which should have been performed, in my opinion, even before the crisis, occupies one of the basic places. However, due to the reluctance of government officials, the social reform has not been done. Again, thanks to the President, the legal framework for the development of this sector was made. With this basis, the unions developed and, in turn, initiated activities to protect workers affected by the government, thus installing the minimum wage and the maximum length of the working day. After the emergence of the labor unions – a real power that could legally protect the rights of workers appeared. It was a very important achievement.
I would also like to note the weight of certain foreign policy operations. Although other states and separate people did not approve some actions, they were aimed primarily at protecting the state as a whole and each citizen individually. In addition, in relation to foreign policy, I would like to define what important role a recognition of the USSR by the United States played. The establishment of the relations to some extent softened the relationship between the two great powers, which played a very important part in the future. Agreements were concluded, aimed at improving the economic and political relations, and in other directions. In the economic area, a good foundation for further development of relations was laid.
In general, concisely, you can describe this can be described as a correctly set legislation, and in particular the pressure on reforming social legislation. Legal measures that were implemented during the reforms have brought numerous positive results to the United States and a legal framework for further versatile development.
What do we use from the legacy of Roosevelt now? First, it is the changing role of the state – from a passive to an active transforming, aimed at the economic development. Such a strategy requires an increase in government spending, the budget of development, the creation of mechanisms for the effective use of public spending. All these measures were introduced by Roosevelt during his presidency and are useful today in the 21st century. The big bourgeoisie has been focused largely on the domestic market contributing to the social activity of the population. Our most successful companies work for the domestic market that contributes to the growth of the national economy. The usage of ideological heritage and the implementation of reforms, similar to Roosevelt’s reforms is an inevitable measure for reviving the country's economy during the periods of recession. As for me, one of the key achievements of the Roosevelt’s administration, which today gives the benefit to the United States was the Social Security Act.
References
Deeben, John P. (2012). “Family Experiences and New Deal Relief. The Correspondence
Files of the Federal Emergency Relief Administration, 1933–1936”. Fall 2012, Vol. 44, No. 2. Retrieved from: https://www.archives.gov/publications/prologue/2012/fall/fera.html
FDR's Statements on Social Security (n.d.). Official Social Security Website. Retrieved from:
https://www.ssa.gov/history/fdrstmts.html#fireside1
Industrial Recovery (n.d.). American Studies at the University of Virginia. Retrieved from:
http://xroads.virginia.edu/~ma02/volpe/newdeal/nira.html
National Labor Relations Act (n.d.). National Labor Relations Board. Retrieved from:
https://www.nlrb.gov/resources/national-labor-relations-act
Social Security Act (1935). The Our Documents Initiative. Retrieved from:
http://www.ourdocuments.gov/doc.php?flash=true&doc=68
Speakman, Joseph M. (2006). “Into the Woods: The First Year of the Civilian Conservation
Corps”. Fall 2006, Vol. 38, No. 3. Retrieved from: http://www.archives.gov/publications/prologue/2006/fall/ccc.html
Strikebreaker (n.d.). Merriam-Webster Dictionary. Retrieved from:
http://www.merriam-webster.com/dictionary/strikebreaker
