The New Deal

The Great Depression put America’s economy to its knees that it needed drastic economic policies to lift America from depression. Having this desperate economic backdrop with unemployment soaring high, it created a favourable political environment for the New Deal policies.  The New Deal was a government program of action by President Roosevelt to address the Great Depression when he assumed office as a President of the United States on March 4, 1933.

The New Deal did not only lift America from depression but also changed the public opinion on the role of the federal government.  Before the Depression, the federal government was not expected to do something about the market but to leave on its own dynamics.  With the implementation of the New Deal, the federal government took active role in helping the people and the economy in general get out of depression.  These measures in the New Deal involved a series of economic programs focused on Relief, Recovery and Reform of the economy. Among the programs of his new deal was the obtained permission to reopen most banks and provided grants to citizens.  The New Deal also initiated work programs to generate employment through the Works Progress Administration (WPA) programs.  President Roosevelt also pump primed the economy with the widespread public spending on infrastructure by constructing roads, buildings, dams and similar projects through his Public Works Administration (PWA) which provided not only jobs but income in the system.  He also enlisted young men in the Civilian Conservation Corps (CCC) to work on conservation projects as part of the New Deal.

As a result, the New Deal lifted the United States economy from the shambles of the Great Depression to become an economic superpower after the Second World War.  It however came from excessive taxes of which the New Deal was also criticized.