Roosevelt's New Deal


The New deal as coined by President Franklin. D. Roosevelt was a term that referred to the US government’s efforts to redeem the economic growth after their economy went through a great depression in the early 1900’s.The term “New deal” was first spoken on 2nd of July 1932 during the Democratic National Convention. President Franklin pledged himself to initiating a series of programs and reforms by taking measures that would moderate the capitalism contradictions in America. The Americans had experienced a crisis in its economy for the period between 1929-33. The American economy had come to a halt as a result of the crash in the stock market which led to high rates of unemployment characterized by failed businesses, low prices for agricultural produces, poor wages and unequal distribution of income.

First phase of the New deal

During this phase between1933-34 two acts were passed, the National Industrial Recovery Act (NIRA) and the Agricultural Adjustment Act (AAA). NIRA was passed in 1933 with the aim the aim of creating a fair competition in the industrial sector. This Act gave support to large monopolies while neglecting the small and middle employers by fixing production costs, production levels and allocating market shares.

The AAA was also passed in1933; it introduced compensation to farmers who had reduced their acreage and livestock by raising the prices for agricultural produces.


2nd Phase

This was during the period 1935-38 when there was rapid growth of the working class and democratic movements (Brock, 1988). These reforms aimed at stopping the class struggle and the efforts of democratic movements. The national labor relations Act it emphasized the rights of the workers to organize trade unions, engage in collective agreement with employers. This Act was also referred to as the Wagner Act and it was the first of its kind in the US history to provide for social security to workers and aid for the unemployed (Allswang, 2008). The fair labor standards Act was passed in 1938, it fixed the minimum wages and the maximum time length for a workday concerning certain categories of workers.


The new deal was enacted within the 3 months that President Roosevelt had promised .The agencies that were established included; the Civilian conservation corps, the National recovery administration,, the Federal deposit insurance corp., the security and exchange commission, the Agricultural Adjustment Administration, the Tennessee Valley Authority, the National Labor relations board, the works progress Administration and the social security. However, part of the legislations was nullified by the supreme court of US while other agencies failed to accomplish their work. The role of the U.S government was thereafter changed by the later administrations that which continued with the reforms.

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