Keynesian Economics : The New Deal

After the Great Depression, many Americans were left disheveled. They needed some form of financial assistance to help them get their lives back to normal. Many government officials such as Hurbert Hoover and Franklin D. Roosevelt helped to enact bills and programs that would assist Americans in rehabilitating their lives. The amount of unemployed workers, the economic relief for retired workers, and the creation of legislature directed towards financial stability all illustrate that the most important effects that the New Deal legislation had on the American government was a liberal one..

The United States encountered many ordeals during the Great Depression (1929-1939). Poverty, unemployment and despair clouded the “American Dream” and intensified the urgency for solutions to address and control the nationwide damage. President Franklin Roosevelt proposed the New Deal to detoxify the nation of its suffering. It can be argued that the New Deal was ineffective due to the inability to end the Great Depression with its short-term solutions and created more problems, however; it was successful in regards to providing direct relief for the needy, economic recovery and some structural reform for the majority of the general public in the severity of the Great Depression.

Instead, most money was in the hands of a few families and businesses who saved or invested rather than spent their money on American goods. Supply became greater than demand on products. Certain people profited, but many others did not. As a result of this, prices went up and Americans could not spare the money for many goods. While the wealth in America was not being distributed evenly, and overspeculation of the stock market led to a lack of confidence, the United States began to fall into a deep depression that would last until the beginning of World War II (Gupta).

In the past, the nation’s government took the “laissez-faire” approach to dealing with the economy and/or free market affairs. The government intervened as little as possible, asserting the belief felt that if left alone, economic problems would be resolved without government interference. However, this approach was not guaranteed, and at times, the government had to put aside the “laissez-faire” approach of the past. The government had no other choice but to intervene in these instances to return balance to the economy and protect its citizens it served. The government changed both its approach and its size through programs initiated by the Industrial Revolution, New Deal programs during and following the Great Depression, and World

In FDR’s Folly: How Roosevelt and His New Deal Prolonged the Great Depression, Jim Powell discusses how Roosevelt’s New Deal actually prolonged the Great Depression and made it significantly worse economically for the people in the 1930s United States. Powell reveals a different angle of the “hero” Franklin Delano Roosevelt, his New Deal, and how he allegedly lead the United States out of the Great Depression. Throughout this book, the author analyzes the actions and repercussions of Roosevelt’s economic decisions revealing how these decisions actually made the depression significantly worse. Along with that, the author analyzes the various policies and implementations in a more in-depth way that really convinces the reader of the poor

Consequently, Keynes brought clarity to the subject of the Great Depression and unemployment, his argument suggested that unemployment may not be a temporary condition that the system could naturally recover. Keynes believed that unemployment could in fact reach equilibrium. In this article the Depression was seen as a condition of unemployment brought about a

D. Roosevelt in 1933 in direct response to the unemployment, poverty and economic deflation caused by the Great Depression (Romer, 2003:2), was a system of policy adjustments for which “Keynesian economics form the basis” (Henretta, et al., 2011:368). Before Roosevelt’s election, President H. Hoover had adopted policies based largely on classical economics – an essentially laissez-faire approach which favoured minimal government intervention (Dautrich & Yalof, 2013:426). The “Keynesian View” (Parkin, 2009:634), adopted by Roosevelt, “attempts to alleviate the pain of economic downturns, hold down the unemployment rate, and boost the disposable income of the worst off” (Boix, 1997:816) with government-implemented policy at its

The book “Taking Sides: Clashing Views in United States History” by Madaras, Larry and James SoRelle draws attention on controversial issues. James and Madaras wrote the book in a debate-style format, which intrigues many students, hence supporting them in enhancing their critical thinking skills. James and Madaras ensured that every issue in the book has a summary, introduction, challenge question and postscript. Therefore, the paper will focus on issue 10, which debates on whether the new deal prolonged the great depression. The great depression refers to an era in US history, which happened from 1929 to 1941 during president Franklin Delano Roosevelt era, and it made the US citizens face economic hard times. The great depression era had much overproduction, inequality in wealth distribution and over borrowing. Consequently, the president implemented the new deal with the aim of saving American citizens from the great depression. However, people had different feelings regarding the effectiveness of the new deal, which brought up the debate in the book. For example, Burton Folsom believed that the new deal was not effective because he thought that it prolonged the great depression. On the contrary, Roger Biles alleged that the new deal was effective, and it did not prolong the great depression (Madaras and James 227).

The American History provides a predicament between the actions and different point of views of President Herbert Hoover and Franklin D. Roosevelt (FDR),in the new deal to save the American people during the Great Depression of the 1930s. In David M. Kennedy essay “FDR: Advocate for the American People” describes the difference between these two presidents, and also explains how the New Deal proposed by President Roosevelt help to deal with the chaos that whats’ happening at the time. The President FDR played an important role in bring reforms, and changing the way of life for many Americans. The New Deal stressed recovery through planning and cooperation with business, but also tried to aid the unemployment and reform the economic system.

It all started back in 1929, the depression era. The stock market had recently crashed and people were desperate for hope. Unemployment was at its all time high, more than one fourth of the U.S population was unemployed and gradually increasing. At the time of when the depression first began, President Herbert Hoover was in power. During the depression people would wait in long lines just for a few bites to eat. Volunteers would hand out food to the hopeless and hungry people, these were commonly known as Soup kitchens in “Hoovervilles” . The soup kitchens and the help efforts that were in place during the depression were named after the president of the time. The struggles did not get any better until the start of the CCC, The Civilian Conservation Corp.

Thesis 2: It is arguable that the New Deal proposed by Franklin Delano Roosevelt was vastly successful in stimulating the American economy and society as a whole, due to the series of federal programs and acts it created which, were aimed at relieving the calamities brought about by the Great Depression. (POL, WXT, 7.1.III.A)

In the 1930’s America faced a time of economical crisis that will become known as the Great Depression. It started with the stock market crash in 1929. Some stocks were being traded at 50 times their actual worth and it lost 12 times the money that the federal government uses in a year (Source A). 80% of American families had no money is savings and were unable to support their families (Source A). Banks became unstable and in the last 60 days of 1930, 600 banks closed and by 1933, 28 states had no banks. (Source A). By 1932 12 million people were unemployed and 34 million had no source of income (Source A.) During this time President Herbert Hoover was in office and he believed in having a small federal government and that in time the economy would eventually fix itself. Hoover planned to give money to the big businesses so they would hire people and give them a source of income so they could buy good and give the businesses money and the cycle would continue (Source B). The public became outraged at the plan and in 1933 Franklin Delano Roosevelt replaced him as President. Roosevelt came up with a plan called “The New Deal” to fix the Great Depression and it would provide many Americans with jobs and give help to many

In 1932, when Franklin Delano Roosevelt took office, the citizens of the United States had possessed sufficient time to realize that they could no longer be proud, but they must take anything they could get. Therefore, the programs set up by FDR’s New Deal program were perfect for the country at the time. These programs helped the people directly, providing relief, recovery, and reform. FDR based his plans on the philosophy of Keynesian economics, where the government spends money to make money. The government gave money and jobs to those in need, who in turn, had money to spend in the marketplace. The demand for products increased, and businesses were able to hire more workers and produce more products, as well as pay more money in taxes. FDR’s plans worked because they gave money not to those who would take advantage of the government, but to those who would use it in the way the government intended it to be used. During FDR’s first term in office alone, the unemployment rate dropped 4%. Because of FDR’s success in bringing the country out of the Depression, I give him an A.

Do you know what it’s like to live in a cardboard home, starve, and raise a family in poverty? Unfortunately, most Americans in the 1930s went through this on a day-to-day basis. In 1929 the stock market crashed. Many people lost their life savings; they invested everything they owned in a failing stock market. The country was falling, everyone needed strong leadership and help from the government.

These political figures of the early 20th century pushed to destroy Roosevelt’s New Deal while attempting to influence upcoming presidential elections. Having similar plans in combining diffuse local conservatism and radicalism, the two began pushing reform to create further government control, a positive outlook on the forming of unions, and redistribution of wealth across America. Through his book’s eleven chapters, Brinkley defends the result of Long and Coughlin’s presence and their intentions to make a positive effect in the development of future American policy. Brinkley provides the understanding of the demagogic public figures’ ideologies and their relationship with President Franklin D. Roosevelt in Voices of Protest.