The solutions

In 1932 the democrat Franklin Delano Roosevelt became president. His economic thinking was based on Keynes’ ideas.  He had a New Deal with three main aims:

• To spend money to help people get back to work.

• To rebuild American trade and industry.

• To improve the lives of ordinary people.

To achieve this he introduced many new ideas:

• He closed all the weak banks and loaned money to the stronger ones.

• He tried to control the Stock Market.

• He started schemes to feed the poor and help them back to work. A civil works

administration was set up to build roads, bridges, hospitals ...

• To give jobs to young people he started a civilian Conservation Corps, where

people were paid to carry out projects to help others.

• To help farmers he introduced the Agricultural Adjustment Acts: farmers were

paid to produce less food and modernise their businesses.

• He developed the Tennessee Valley: an area of 40.000 square miles and 7

states.

•The Wagner Act: Trade unions were legal to help workers campaign for better

pay and conditions.

• The Social Security Act: workers could pay into a fund and receive benefits

when they were unemployed and pensions when they retired.

European countries such as Germany implemented different policies. We will study it in a further lesson