NEW DEAL

New Deal and Economic Recovery

New Deal: Economic Recovery

Introduction

In these years of crisis we often hear from politicians that, to resolve it, you would need a New Deal; new covenant in English - with reference to the series of operations launched by the government of the United States after the economic crisis of 1929. In mid-February, for example, the president of Confindustria asked the representatives of the parties, a New Deal between the productive forces of the country. The same concept has been repeatedly evoked by the leaders of the Democratic Party and other political forces. Today I am exactly 80 years since the first of the long series of measures that composed the New Deal was approved.

Discussion

When in July 1932 Franklin Delano Roosevelt accepted the Democratic Party nomination to run as a candidate for president, delivered a historic speech that introduced for the first time the term New Deal in the political debate. “Anywhere in the nation, men and women, forgotten by the political philosophy of our government, they look at us waiting for guidance and opportunity to receive a more equitable distribution of national wealth. I am committed to establishing a new covenant (new deal) with the American people. This is more of an election campaign is a call to arms”.

The metaphor of war was then a constant throughout the reform commitment of Roosevelt and the so-called new dealers - in a rather ironic, as we will see later. This “new covenant” in practice, it was a great set of interventions on public spending, taxation, and monetary policies on the regulation. The main author was precisely Roosevelt, who won the elections in 1932. The New Deal lasted from 1933 to 1938 and is commonly divided into two phases: the first and second New Deal (the latter from 1935 to 1938). The approach was not systematic: the federal government sought to solve problems as they arose. Some of these patches were worst in the hole trying to close, others were temporary solutions caused by the state of emergency, others - especially those that regulatory measures and social protection - are still going today (Amity, 2007).

The beginning of the New Deal

Roosevelt took office in March 1933 with a large majority in both houses of parliament. Earlier this year the country had just reached the bottom of the economic crisis in terms of unemployment than of GDP - which at the time, as a statistical measure, did not yet exist. In the first hundred days or so of his term, Roosevelt met the Congress every day and pushed through the first set of measures of his New Deal, the so-called “Session of the 100 days.”

The first act, approved on 9 March 1933, was one of those meant to last even today. It was called Emergency Banking Act (EBA) and determined that no bank would have been able to operate in the United States without the approval and supervision of the Federal Reserve, the central ...