Franklin D. Roosevelt And The Great Depression

Just like every political leader, Franklin D. Roosevelt was subject to much criticism and controversy during his time in office. Elected during the worst economic crisis in U.S history, he was faced not only with saving the economy, he was also expected to end the Great Depression. Although he was the longest serving President in American history, many still argue that his New Deal only perpetuated the Great Depression and stifled the economy. Like the president that proceeded Roosevelt, there are still historians who believe the economy would’ve corrected itself effectively without government involvement. While the depression did last until World War II, it is undeniable that FDR’s New Deal was the most effective solution to the Great Depression

In their panic, millions of Americans had withdrawn their life savings from the banks. Relief programs such as the Emergency Banking Act aimed to stop the nation wide panic that was running rampant, while also preventing the American economy from collapsing completely. The Emergency Banking act proved to be successful, and in the two weeks following the National Bank Holiday of 1933, over 65% of the wealth hoarded by the public was returned to the banks. These relief efforts, along with Roosevelt’s Fireside Chats, persuaded the American people to have faith in the American economy. This led to private investment in industry growing from $2 billion in 1933 to $10 billion in 1939. As stated by historian Alan Brinkley, “Roosevelt’s first and most important contribution to solving the great economic crisis [was to] invite frightened Americans to put their trust in his energy and activism.” It’s ability to prevent a further economic collapse was the first step that made the New Deal the solution to the Great

As stated by President Herbert Hoover, “[e]conomic depression cannot be cured by legislative action”. However, upon his inauguration, Roosevelt began to redefine how the Federal Government should handle economic affairs. Instead of watching developments play out from a distance, he made it the government's job to work alongside businesses and corporations, which resulted in “a long-term structural shift in the financial responsibilities of the national, state, and local governments”. The impact of this structural shift was most recently evident in the 2008 recession, when the Federal Government bailed out the Big Three auto manufacturers (General Motors, Chrysler, and Ford). Although it cost the American government billions of dollars (similar to the New Deal), the initial cost to stimulate industries has proven to benefit the nation in the long run. According to a 2013 study by the Center for Automotive Research, “2.6 million jobs were saved in the U.S. economy in 2009 alone and $284.4 billion in personal income saved over 2009-2010”. In addition, “as of May 2014, the U.S. economy finally recovered the millions of jobs that the labor market shed between 2008 and 2010”. Nearly a century later, it is clear that although subject to criticism, Franklin Roosevelt’s New Deal was not only the solution to the Great Depression, but also a