The New Deal Notes

Background

1. Franklin D. Roosevelt’s New Deal (1933–1939) fundamentally redefined the U.S. government’s role in the economy.
2. For the first time, the federal government became responsible for social welfare, regulation, and employment.
3. While many Americans credited Roosevelt with saving capitalism, others accused him of undermining democracy or doing too little for social justice.
4. Opposition from conservatives, business leaders, populists, and even the Supreme Court shaped the limits of the New Deal and its eventual legacy.

Critics from the Political Right

1. Business and Conservative Opposition
   1. Industrial and financial elites resented government interference in the economy.
   2. The U.S. Chamber of Commerce and American Liberty League (1934) denounced the New Deal as “socialist” and unconstitutional.
   3. Critics argued that Roosevelt’s regulations (e.g., NRA, Wagner Act) discouraged investment and weakened free enterprise.
2. Constitutional Concerns:
   1. Conservatives believed Roosevelt had exceeded his authority by expanding executive power and centralizing control.
   2. The Supreme Court struck down several key programs, including the National Industrial Recovery Act (1935) and Agricultural Adjustment Act (1936), ruling them unconstitutional.

Critics from the Political Left

1. Socialist and Populist Movements
   1. Many radicals believed the New Deal failed to redistribute wealth or challenge corporate power.
   2. Socialist and Communist parties accused Roosevelt of preserving capitalism rather than replacing it.
2. Populist Demagogues
   1. Huey Long (Louisiana): Proposed the “Share Our Wealth” plan, advocating confiscation of large fortunes to guarantee every family a $5,000 income.
   2. Dr. Francis Townsend: Proposed old-age pensions funded by a national sales tax, a precursor to Social Security.
   3. Father Charles Coughlin: A radio priest who blamed bankers and promoted anti-Semitic and isolationist rhetoric; his movement drew millions of listeners before being discredited.

The Role of the Supreme Court and Constitutional Debate

1. Early Opposition
   1. In Schechter Poultry Corp. v. United States (1935), the Court ruled the NIRA unconstitutional, citing violation of the separation of powers.
   2. In U.S. v. Butler (1936), the Court struck down the AAA for federal overreach into agriculture.
2. Shift in Stance (“The Switch in Time”)
   1. In 1937, Justice Owen Roberts shifted votes in West Coast Hotel v. Parrish, upholding minimum wage laws and signaling judicial acceptance of New Deal principles.
3. Outcome
   1. The Court’s resistance reinforced checks on executive authority but also compelled Roosevelt to seek constitutional justification for economic management.

Political Impact of the New Deal

1. Transformation of the Democratic Party
   1. The New Deal created a new “Democratic coalition” uniting urban workers, farmers, African Americans, intellectuals, and the South.
   2. Marked the beginning of modern liberalism and a realignment of U.S. politics lasting until the 1960s.
2. Expansion of Executive Power
   1. The presidency became the center of national leadership, setting policy through federal agencies and emergency powers.
   2. The “Imperial Presidency” concept emerged from Roosevelt’s expansion of the administrative state.
3. Rise of the Welfare State
   1. The federal government assumed responsibility for employment, social security, and economic regulation, fundamentally altering its relationship with citizens.