In the 1928 election, President Hoover had promised Americans ‘a chicken in every pot and a car in every garage ... but by 1932, America was in depression.

In the November 1932 election, therefore, Roosevelt promised ‘a new deal for the American people’ if they elected him.   The result was a landslide – Roosevelt won 42 of the 48 states, the biggest election victory of all time.

In his Fourth Fireside Chat (June 1934), Roosevelt said that his ‘New Deal’ had three related steps:

•   Relief (helping the poor and unemployed to survive)

•   Recovery (getting the economy going again) and

•   Reform (changing things so a depression could never happen like that again).

Roosevelt's New Deal had two parts.

(Can Fdr Achieve ... New Social Standards 'N Fairness)

First, he set about offering relief and trying to get the economy to recover.

After 1935, however, he set about a much more radical agenda of social reform.

First, however, he was faced by a crisis.   During the four months Roosevelt was waiting to come into office (March 1933), the economy declined further, culminating in a banking crisis.   At the beginning of March, millions of people marched into their banks and demanded their money – as they were allowed – in gold.   It was impossible; banks in 34 states closed and padlocked their doors.   The entire financial system of the USA was in the verge of collapse.

Roosevelt undertook a series of measures to keep the American people on his side.

a.  Abolished Prohibition

-   He said: ‘I think this would be a good time for a beer”.   This restored faith in the government because it stopped the humiliation of the government’s laws being openly ignored.  

-   (It also increased the government’s revenues.)

b.  Fireside Chats

-   FDR made sure that everyone who sent him a letter got a reply (he got up to 8,000 letters a day), and that everyone who telephoned the White House was never cut off.

-   FDR described his policies in radio broadcasts called ‘fireside chats’.  

c.  Bank holiday

-   The Emergency Banking Act closed the banks for four days.   The government checked that all were financially sound, and when they reopened, they reopened with the backing of the Federal Reserve.   

-   This restored confidence in the banks, and people deposited their money there again.  

d.  Stock Exchange

-   The Securities and Exchange Commission introduced rules for the Stock Exchange to prevent another Crash like 1929.