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1933–1938: The New Deal and the Great De...

Bruner, Robert F.

Case

1933–1938: The New Deal and the Great Depression

Bruner, Robert F.

F-1951 | Published June 30, 2020 | 54 pages Case

Collection: Darden School of Business

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In December 1938, US president Franklin D. Roosevelt (FDR) contemplated recent setbacks that challenged the viability of his program of economic recovery, popularly called the "New Deal." Various achievements and defeats in the first three years of his administration energized his supporters and galvanized a diverse opposition of conservatives, populists, and extremists—who believed FDR had gone too far or not far enough. Critics accused him of overreach of powers beyond his constitutional authority, of inconsistency, of inciting class warfare, and of creating conditions that actually retarded recovery. Would the record of the New Deal sustain the level of popular support that he won in the election of 1936? Had his policies and programs promoted economic recovery? What lessons should he learn from his defeats? What changes should he make in his programs and politics as he entered the election year? Should he double down on his progressive agenda or change course?

(1) Survey FDR's "New Deal" response to the economic, social, and political crisis of the Great Depression. This case affords an introduction to one of the most consequential responses to economic crisis in US history. (2) Critically assess the key economic reforms, with a view to their comprehensiveness and internal consistency. The New Deal reshaped the structure of the financial, mercantile, agricultural, and industrial sectors of the US economy. What were the benefits and costs of New Deal programs? Students are invited to exercise the "4 R's" of policy strategy—reform, rescue, recovery, and relief—to assess policy trade-offs. (3) Reflect on one of the most prominent dilemmas in responding to a financial crisis, the trade-off between rigorous observance of constitutional authorities and limits versus arguments of "necessity" that might justify breaching those authorities and limits. (4) Weigh the New Deal's successes and failures in reacting to the financial crisis.