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The new deal


            The 1920s seemed like a time of prosperity for the United States. More Americans enjoyed a life of material abundance and leisure than ever before. Many moved from the countryside to cities. The advent of the assembly line caused enabled goods to be made in large quantities cheaply. The mass consumerism of the 20's benefited many by giving them jobs and a hope for a better future, but the wealthy controlled the economy. By 1929 200 corporations controlled over half of all American Industry and the bottom 80 percent of all income earners were jobless. The richest 1% owned 40% of the nations wealth. Recession began in August 1929 when prices started to go sky high and production declined. The stock market crashed on October 24th 1929. This was the beginning of the Great Depression. Between 1929 and 1933 over 13 million Americans lost their jobs. President Franklin Delano Roosevelt entered office on March 4th 1933 and began to lead the country out of economic depression. The New Deal was a successful piece of legislation.
             Roosevelt's New Deal sought to repair the economy. The Emergency Banking Relief bill attacked the banking crisis. It outlawed hoarding and exporting gold and arranged for the reopening of solvent banks and the reorganization of failed banks under the Treasury Department. The Economy Act cut the federal spending by $400 million and balanced the budget. Federal excise tax was also raised. The Agricultural Adjustment Act was meant to raise farm income by raising commodity prices. It paid farmers to produce less and reduce their acreage. This was an example of scarcity economics where overproduction was eliminated to increase profit. Farm income rose for the first time since WWI. Congress enacted the National Industrial Recovery Act to establish a commitment to economic planning and business-government cooperation. This would end the extreme price competition in industry. The Federal Securities Act gave the Federal Trade Commission the power to supervise securities issues, require each new stock to be accompanied by a financial report of the company its from and to make misrepresentation a crime.


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