New Deal brings social reforms
Attempts were also made to bring independence to farm tenants. The federal government subsidized the purchase of farms for tenants on easy terms. It refinanced farm loans and so brought relief to the holders of farm mortgages. Money was lent directly to farmers by the newly created Commodity Credit Corporation. Simultaneously an effort was made, under Secretary of State Cordell Hull, to restore some foreign markets by reciprocity agreements designed to break down the economic autarchy toward which the United States had been tending under the high-tariff regime. Under the terms of the Trade Agreements Act of June 1934, Secretary Hull negotiated unconditional most-favored-nation reciprocity treaties with Canada, Cuba, France, Russia, and some twenty other countries. Within a year, American trade had improved materially, and by 1939 farm income was more than double what it had been seven years before.
The New Deal program for industry went through an experimental phase in the opening years of the Roosevelt administration. In 1933 a National Recovery Administration was set up, based essentially upon the idea that the crisis could be resolved by limiting production and fixing higher prices; but even before the NRA was declared unconstitutional by the Supreme Court in May 1935, it was widely considered to be unsuccessful. By this time a movement toward recovery had already begun under the spur of other administration policies, and the administration soon reversed itself and began to act on the assumption that administered prices in certain lines of business were a severe drain on the national economy and a barrier to recovery.
In the meantime, however, much progress toward recovery had been made. Thousands of millions of dollars were spent by the federal government on relief for the unemployed, on public works, and on work for the conservation of national resources. Through these "pump-priming" expenditures, new demand was created at home for the products of American industry. Organized labor also made greater gains during the New Deal period than at any previous time in American history. Section 7 (a) of the NRA had guaranteed to labor the right of collective bargaining, and in July 1935, to replace the labor provisions of the defunct NRA, Congress passed the National Labor Relations Act, which set up a labor board to supervise the process of collective bargaining. Elections were administered by the Labor Board, and workers were assured the right to choose the organization that should represent them in dealing with employers. The American Federation of Labor, with its principle of craft unionism, was slow to organize the unorganized. When some of the mass unions became dissatisfied with this condition, they broke away, formed the Congress of Industrial Organizations (CIO), and carried on a spectacularly successful organizing drive, particularly in basic industries like automobiles and steel. Under the spur of CIO competition, the AF of L also grew. Where there had been 4,000,000 organized workers in 1929 there were 11,000,000 in 1939 and 16,000,000 in 1948, Labor's power increased not merely in industry, but also in politics, as organization brought a growing sense of a common political interest, It exercised this power largely within the framework of the two rnajor parties, however, and while the Democratic Party generally received more union support than the Republican Party, no Labor Party as such emerged.
The threat of old-age unemployment and dependency, long a subject of public discussion, was dealt with in the Social Security Act of 1935, which assured modest retirement allowances at the age of sixty-five to many kinds of workers. The insurance fund for this purpose was built up by contributions from workers and employers. Unemployment compensation for active workers of all ages was to be administered by the states with funds provided by a compulsory federal payroll tax. By 1938 every state had some form of unemployment insurance.
The threat of old-age unemployment and dependency, long a subject of public discussion, was dealt with in the Social Security Act of 1935, which assured modest retirement allowances at the age of sixty-five to many kinds of workers. The insurance fund for this purpose was built up by contributions from workers and employers. Unemployment compensation for active workers of all ages was to be administered by the states with funds provided by a compulsory federal payroll tax. By 1938 every state had some form of unemployment insurance.
The recurrent droughts of the 1930's led to the enactment of an Omnibus Flood Control Bill which provided for the construction of a series of large reservoir and power dams and of many thousand smaller dams. Because of their abundant resources, Americans had been grossly careless of their natural wealth. In many regions, soil erosion was beginning to cut deep, ugly gaps upon the face of the earth. To combat it, particularly oil the plains of the midwest, a gigantic program of soil conservation was accelerated, which included the planting of an iinmense shelter belt of trees. Other important work involved the elimination of stream pollution; the creation of fish, game, and bird sanctuaries; the conservation of coal, petroleum, shale, gas, sodium, and helium deposits; the closure of certain grazing lands to homestead entries; and the vast increase of national forests.
