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To what extent did FDR's New Deal end the Depression?

As the concluding lesson on the New Deal it is necessary to step back and evaluate the impact of the New Deal. After all, the government spent billions of dollars on the New Deal; was it worth it? Did the New Deal achieve it's desired goals? Did it end the depression? These are the questions we must ask.

Economists and historians still argue about just when the depression ended. Some can show charts and graphs to prove it was over by 1937, when substantial gains had been made. Business activity had been cut almost in half. Roosevelt, like Hoover and most other believed that balancing the budget was important. The policies of the first and second New Deals had resulted in enormous government deficits. While this was a price Roosevelt was willing to pay, as soon as signs of improvement appeared in 1937 Roosevelt reduced government spending and programs. As a result another depression (or a continuation of the first) struck in 1937 and 1938. Unemployment rose from 6 million to 10 million and the economy slumped again.

Pointing to the economic problems after 1937, some economists argue that the depression ended in 1940 when business activity again reached the level of early 1937. Still, after seven years of heavy government spending - 20 billion dollars worth - and the creation of an enormous federal bureaucracy that supervised the new programs, millions remained unemployed.

Considering these facts, other economists feel that the depression did not really end until World War II. Only in 1942, with millions of Americans in uniform and many more in factories that produced war materials, did massive unemployment end.

What of Roosevelt himself? Perhaps he did not end the depression. Even so, his years in the White House were so important that his record and his personality remain controversial. For many he was a great leader. He helped millions of needy people. He revolutionized the role of government. His measures pulled the nation out of the worst of the depression and night have finished the job if World War II had not occurred. He provided hope to the hopeless, help to the helpless and courage to a nation desperate for leadership. In the chilling atmosphere of fear that gripped the nation before Roosevelt's first term people seemed eager to follow any leader who promised action and an end to suffering. At a time when dictators around the world were persuading the masses to try fascism, Roosevelt tried to control the abuses of capitalism while preserving the American democratic system. By a combination of relief, recovery and reform, Roosevelt may have prevented a revolution.

Whether FDR did too much or too little, he changed the ways in which Americans viewed their nation. The country had at last accepted the fact that the old theories of laissez faire no longer worked in a modern industrial society men, women and children might starve for lack of work, not unwillingness to work.

In the decades since the New Deal American politicians continue to argue over how much or how little the government should regulate the economy and aid the needy but neither side argues that the federal government should do nothing. Americans have accepted the fact that their national government must play a positive and active role in protecting the equality of opportunity and freedom that they called the American Dream.


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