The U.S. Supreme Court declared the NRA unconstitutional in 1935. Congress passed the Fair Labor Standards Act to restore parts (the minimum wage, standardized working hours, and collective bargaining) of the NRA in 1938.
The Tennessee Valley Authority (TVA) (1933): This corporation brought the federal government into the public utilities. The federal government constructed dams to generate hydroelectric power. The government then provided the power cheaply to people in Tennessee and seven surrounding states.
The Agricultural Adjustment Administration (1933): This administration had the tough order of saving U.S. farmers from financial ruin. It bought surplus agricultural goods and even paid farmers to produce less. With fewer goods available on the market, agricultural prices shot up, providing farmers with much-needed cash.
The Supreme Court declared the Agricultural Adjustment Administration unconstitutional in 1936. But it worked so well that Congress brought it back in 1938. Although terms have changed significantly, this act is the basis for the farms subsidies in place today.
The National Housing Act (1934): This act created the Federal Housing Authority, which guaranteed home loans for up to 80 percent of their value. With the federal government backing mortgages, banks wouldn’t lose money if homeowners defaulted on their loans, so they were willing to lend more money to more home buyers. This, in turn, stimulated the housing industry. After 1937, the U.S. Housing Authority helped build low-income housing in economically depressed areas.
The Securities Exchange Act (1934): This act established the Securities and Exchange Commission. The commission, headed by FDR’s friend Joseph Kennedy (father of future president John F. Kennedy), regulated stock and bond sales. The idea behind the Securities and Exchange Commission was to make sure that the risky speculation that led to the Great Depression wouldn’t reoccur.
The Works Progress Administration (WPA) (1935): Roosevelt created this agency through an executive order. It provided jobs for the unemployed. Over four million people worked for the WPA. By 1943, the WPA had constructed 125,000 public buildings, 75,000 bridges, and 650,000 miles of roads.
The Social Security Act (1935): This act created the country’s present social security, the retirement system for people 65 and older. Employers and employees pay equally into it. Unemployment benefits and disability insurance were also included in the act. Finally, the federal government provided funds to the blind and qualifying dependent children.
The Wagner Act (1935): This act guaranteed workers the right to unionize, bargain collectively, and strike.
The Reciprocal Trade Agreements Act (1937): This act, often overlooked, continues to affect U.S. presidents today. It allows U.S. presidents to negotiate their own trade agreements with foreign countries without Congressional approval. If the president and the foreign country agree, tariffs can be lowered by up to 50 percent.
The Fair Labor Standards Act (1938): This act set a minimum wage and limited the working hours for U.S. citizens. The minimum wage was 25¢ an hour, and the workweek was 44 hours.
Roosevelt started his famous fireside chats in March 1933 to assure the public over the radio that changes for the better were taking place. The president’s warm and reassuring voice played a great role in calming the nation after the upset of the Great Depression and garnering support for the president and his policies. As president, Roosevelt gave over 20 fireside chats.
Fighting the Supreme Court in term two
By late 1935, the economy was on the slow road to recovery. (The best year the stock market ever had was 1931, just two years after its worst year, 1929.) Roosevelt received credit for the economic recovery. He was easily renominated at the 1936 Democratic convention. The Republicans nominated the governor of Kansas, Alf Landon, who supported most of the New Deal programs. Landon proceeded to lose to Roosevelt in a landslide.
After the election, the New Deal sparked controversy. Conservative Republicans and southern Democrats opposed the government intrusion into the economy, while many on the left of the Democratic Party hoped for even more government intervention.
In 1937, the economy began to decline again. The Supreme Court proved to be a major handicap to Roosevelt’s plans for economic recovery. The Court, filled with conservative Democrats and Republicans, declared piece after piece of the New Deal unconstitutional.
Roosevelt decided to show the Supreme Court who was boss. He came up with a plan to pack the Supreme Court. Under the Constitution, the number of Supreme Court justices is not fixed: It is determined by Congress. When the justices started opposing his policies, Roosevelt proposed increasing the number of justices — nine — so that he could get enough like-minded justices on the Supreme Court to give him a majority.
With Roosevelt’s plan, the president could appoint one additional justice for each justice over the age of 70. This revision would allow Roosevelt to appoint six more justices to the court.
Even Democrats started to desert Roosevelt, refusing to go along with his court-packing plan. He suffered a bitter defeat when Congress rejected his proposal. Ironically, the threat of packing the Court was enough to convince one of the conservative justices to switch sides. In subsequent cases, the Supreme Court let New Deal programs stand.
Winning a Third Term, Facing a World War
The public punished Roosevelt and the Democratic Party for FDR’s court-packing attempt and a declining economy in the 1938 Congressional elections. Republicans increased their number of seats in Congress dramatically. It looked as if Roosevelt’s presidency was coming to an end.
Events in Europe and Asia saved Roosevelt and the Democratic Party. In Asia, Japan had invaded China, while fascism was on the rise in Europe. Foreign policy suddenly came to the forefront. The public demanded an experienced foreign policy leader for president. So Roosevelt received the nomination from the Democratic Party one more time.
The general election showed Roosevelt’s vulnerability. He won reelection, but by a much smaller margin than in 1936.
Fighting isolationism
When FDR assumed the presidency, he made major changes to U.S. foreign policy.
In Latin America, Franklin Roosevelt changed Theodore Roosevelt’s policies of open intervention (see Chapter 13) and proclaimed a Good Neighbor policy, restricting U.S. intervention in Latin American domestic affairs. Franklin Roosevelt pulled U.S. troops out of Cuba and Haiti, and signed mutually beneficial trade agreements with Latin American countries.
In 1933, Roosevelt’s secretary of state, Cordell Hull, proclaimed that the United States would stop interfering in the domestic and external affairs of other countries. Mexico soon put this new policy to the test when it nationalized all foreign oil companies. The U.S. government didn’t react, leaving U.S. oil companies to fend for themselves.
The mood of the country became isolationist, as many people wanted the United States to stay out of world affairs. Many citizens believed that U.S. intervention in World War I was wrong and that rich companies were the only beneficiaries of the war.
Congress, reacting to the will of the public, passed numerous neutrality acts to make sure that the United States wouldn’t become involved in another war in Europe. Congress prohibited the government from loaning money to a foreign government that hadn’t paid its debts to the United States. France, which owed the U.S. money going back to WWI, was included in the ban imposed by Congress. In addition, the president couldn’t send weapons to countries at war, and U.S. ships couldn’t carry weapons to countries at war.
The acts tied Roosevelt’s hands. He wanted to help countries in Europe and Asia, but he couldn’t. Things soon changed.
The origins of World War II
In 1937, the Japanese empire invaded China. Roosevelt had opposed Japanese expansion in Asia since coming to power, and the attempted conquest of China was the last straw for him. He imposed an economic embargo on Japan, preventing even oil from reaching the country. Roosevelt also provided China with much-neede
d economic and military aid.
In another part of the world, fascism was expanding rapidly. Germany had started to rearm — a violation of the Versailles Treaty that ended World War I. In 1935, Germany occupied the demilitarized Rhineland and began to pursue a policy of territorial expansion. In 1936, the Spanish civil war broke out. By 1939, General Francisco Franco and his fascist allies, with the help of fascist Italy and Nazi Germany, had prevailed. Much of Eastern Europe also went fascist, and in 1938, Hitler annexed Austria. The two great democratic powers in Europe, Great Britain and France, decided to make a deal with Hitler. So a conference was called for in 1938 to discuss Hitler’s demands.
At the Munich conference in 1938, Great Britain and France appeased Hitler by giving him the parts of Czechoslovakia that were taken from Germany in 1919. Britain and France believed that Hitler was now satisfied and would stop trying to expand. Boy, were they wrong! By 1939, it had become clear that appeasement wasn’t working. Hitler had seized the rest of Czechoslovakia and invaded Poland on September 1, 1939. Great Britain and France, who had pledged to defend Polish security, declared war on Germany, starting World War II. Democracy was fighting for its life in Europe.
Dealing with neutrality
Roosevelt’s biggest problem in 1939 was Congress, which was still isolationist in nature. Roosevelt’s hands were temporally tied. Events in Europe changed this. By 1940, France, Belgium, Luxemburg, the Netherlands, Denmark, and Norway fell to Germany — Great Britain was suddenly on its own in Europe. Consensus emerged in Congress that Britain needed help. Roosevelt took advantage of this, declaring, “We are fighting to save a great and precious form of government for ourselves and for the world.”
In November 1939, shortly after WWII broke out in Europe, Roosevelt signed the Neutrality Act of 1939. This act changed previous neutrality acts by allowing the United States to export weapons to countries at war. The British Empire was the main beneficiary of this policy — a fact Roosevelt was well aware of. In turn, this change in U.S. foreign policy stimulated German submarine warfare in the Atlantic.
Helping democracy survive
By 1940, Roosevelt’s policies favoring the democracies in Europe became clearer. When France fell to the Germans in June 1940, Roosevelt changed official U.S. foreign policy to protect democracy in Europe. Instead of being neutral, the U.S. became non-belligerent in European affairs. This change in foreign policy allowed the United States to openly support the Allies without going to war against the Axis powers. The United States was now officially able to intervene in World War II.
Roosevelt immediately delivered 50 destroyers to Great Britain to replace the heavy losses the British suffered from German submarines. The Lend-Lease Act of 1941 allowed the president to lend arms to any country that he determined to be of vital interest to U.S. national security. He promptly lent weapons to Great Britain.
In September 1940, Roosevelt announced that all men between the ages of 21 and 35 were to register for military training. The legislation started the draft in the United States.
The term axis was coined in 1936 when Italy and Germany signed a treaty of alliance called the Rome-Berlin Axis. Later, Japan, Romania, Hungary, and Bulgaria joined the Axis.
Creeping closer to war
By the summer of 1941, German and Italian consulates were closed in the United States. U.S. marines had landed in Iceland to protect that country from Germany. Finally, in September 1941, Roosevelt initiated a massive tax increase (the Revenue Act of 1941) to pay for possible increased military expenditures. U.S. involvement in World War II appeared imminent.
Fighting World War II
On November 3, 1941, the U.S. ambassador to Japan, Joseph Grew, sent a warning that the Japanese were planning a surprise attack on U.S. military installations throughout the world. The warning alerted Roosevelt of a possible attack.
The imperial Japanese government issued a final proposal on November 20, 1941, to settle the differences between the United States and Japan peacefully. The proposal called for an end to the U.S. economic embargo and demanded that the United States stop interfering with Japanese activities in China and the Pacific. On November 26, 1941, the United States rejected the offer and, in turn, demanded the withdrawal of Japanese troops from China and Indochina.
The Japanese empire launched an attack on U.S. military installations at Pearl Harbor, Hawaii on December 7, 1941. In the evening of the same day, Japan declared war on the United States. The following day, December 8, 1941, President Roosevelt appeared in front of a joint session of Congress and asked for a declaration of war on Japan. His immortal words were: “Yesterday, December 7, 1941 — a date which will live in infamy — the United States of America was suddenly and deliberately attacked by the naval and air forces of the Empire of Japan.”
Three days later, Germany and Italy declared war on the United States, and the United States found itself involved in a world war.
Roosevelt turned the U.S. economy from a peace economy into a wartime economy. The president froze wages and prices for goods for the war period. He also set production goals for armaments and other goods. In one year alone, the United States produced almost 50,000 aircraft. By 1944, the United States produced more weapons and military supplies than Germany, Italy, and Japan combined. Close to 10 million men were serving in the armed forces. Women went to work in the factories to keep the war effort going.
Roosevelt even went as far as imposing strict censorship for the wartime period and placing hundreds of thousands of Japanese Americans in internment camps.
Winning the War
By 1942, the war had turned in favor of the Allies. The U.S. navy won major victories against the Japanese in the Pacific. The Allies invaded North Africa, and more importantly, the Russians defeated the Germans in the battle of Stalingrad. The victory signaled a possible end to the German victories on the eastern front. This allowed FDR to discuss strategies to win the war and to focus in on the postwar era.
For this purpose, Roosevelt attended several conferences in the next three years. The first one, the Casablanca Conference held in January 1943 with British Prime Minister Winston Churchill, stipulated that only unconditional surrender by the Axis powers was acceptable to the United States. At the Teheran Conference, held in November 1943 in Iran, Roosevelt met with Churchill and Soviet Premier Joseph Stalin. The three leaders were referred to as the “Big Three.” They agreed to invade France by the summer of 1944. After the successful invasion of France at Normandy, Roosevelt decided to run for an unprecedented fourth term. The Yalta Conference, held in February 1945, was the last conference attended by Roosevelt. The Yalta Conference laid out the structure of the postwar world. It called for the creation of the United Nations — an organization whose member countries pledge to defend each other and work to ensure international peace — the division and occupation of Germany, and the entry of the Soviet Union into the war with Japan.
Running and Winning One More Time
In 1944, Roosevelt faced a tough decision. Should he run for another term in office? He felt physically weak, and many believed that an unprecedented fourth term was not acceptable. On the other hand, the country was still involved in a world war, and it needed an experienced leader. So Roosevelt decided to run one more time.
During the election, Roosevelt faced Republican Thomas Dewey, the governor of New York. Roosevelt won the presidency: However, his margin of victory was even smaller than it was in 1940.
Pondering post-war problems
Roosevelt expected to achieve victory in World War II by 1944. He faced the problem of figuring out what to do with all the returning soldiers. Roosevelt knew that in a peacetime economy many of the soldiers wouldn’t get jobs as soon as they returned home. This, in turn, could push the country back into a recession.
To avoid a possible recession, Roosevelt and Congress passed the Servicemen’s Readjustment Act in 1944. The act stipulated that veterans would receive free medical treatment, low-inter
est loans to buy homes and businesses, and a free education. The bill today is known as the GI Bill of Rights. When the war ended in 1945, over 20 million soldiers went to college, greatly enhancing the educational level of the U.S. public.
Dying suddenly
Roosevelt was exhausted when he returned home from the Yalta Conference, which ironed out the details of the end of the war, in 1945. He went to Warm Springs, Georgia for a brief vacation. While sitting for an official presidential portrait, he suddenly complained of headaches. Two hours later, on April 12, 1945, Roosevelt died of a cerebral hemorrhage, and the country went into mourning. Figure 16-2 shows FDR’s funeral procession. Vice President Harry Truman became the new president.
President Roosevelt had a lifelong affair with Lucy Page Mercer, one of Eleanor Roosevelt’s assistants. When Eleanor found out about the affair, Roosevelt promised to end it for her. He lied. Throughout his presidency, FDR and Mercer saw each other in the White House whenever Eleanor traveled. The affair continued for the rest of Roosevelt’s life. Lucy was with him when he died and was quickly escorted away by Secret Service agents when Eleanor arrived.
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