The New Deal
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On October 29, 1929, the crash of the U.S. stock market reflected a trend of a worldwide economic crisis. That day was known as “Black Thursday”. From 1929-1933, unemployment in the U.S. soared from 3 percent of the workforce to 25 percent, while manufacturing output collapsed by one-third. Upon accepting Democratic nomination for president on July 2, 1932, Roosevelt promised “a new deal for the American people,” a phrase that has endured as a label for his administration and its many domestic changes. Meanwhile, other governments worldwide exacerbated economic recovery by continuing protectionist policies such as high tariffs, import quotas, and barter agreements. This was the very cause of the collapse of world trade in the 1920s. Britain adopted far-reaching measures in the development of a planned national economy. In Nazi Germany economic recovery was pursued through various government spending programs such as defense spending and public works programs. In Mussolinis Italy the economic controls of his corporate state were tightened. Observers throughout the world saw in the massive program of economic planning and state ownership of the Soviet Union what appeared to be a depression-proof economic system and a solution to the crisis. Unlike many other world leaders in the 1930s, Roosevelt entered office with no single ideology
or plan for dealing with the depression. The New Deal would often be contradicting, pragmatic, and experimental. What many considered incoherence of the New Deals ideology might more accurately be characterized as the interaction of several competing ideologies. The New Deal drew heavily on the experiences of its leaders; it reflected the ideas of, and was influenced by, the programs that Roosevelt and most of his original associates had absorbed in their political youths early in the progressive era, while serving in the Wilson administration, and while holding other offices in the 1920s. The New Dealers borrowed their opposition to monopoly and their move toward government regulation of the economy from ideas of the progressive era, and were influenced by the dispelling of age-old notions that poverty was a personal moral failure rather than a product of impersonal social and economic forces. Their ideas about government spending were shaped by the efforts of the Wilson administration to increase spending for the Great War. And from the policy experiments of the 1920s, New Dealers picked