United States

Roosevelt’s loss of power became evident in 1938, when his attempts to defeat conservative congressional Democrats in the primaries failed. In the fall Republicans gained 80 seats in the House and seven in the Senate. The Democratic Party retained nominal control of Congress, but conservative Democrats and Republicans voting together defeated many of Roosevelt’s proposals. A few last bills slipped through. The U.S. Housing Authority was created in 1937 to provide low-cost public housing. In 1938 the Fair Labor Standards Act established a minimum wage and a maximum work week. Otherwise, the president seldom got what he asked for.

Apart from the New Deal itself, no development in the 1930s was more important than the rise of organized labour. This too had negative, or at least mixed, effects upon Roosevelt’s political power. When the depression struck, only 5 percent of the work force was unionized, compared to 12 percent in 1920. The great change began in 1935 when the American Federation of Labor’s Committee for Industrial Organization broke away from its timid parent and, as the Congress of Industrial Organizations (after 1938), began unionizing the mass production industries. The CIO had a unique tool, the sit-down strike. Instead of picketing a plant, CIO strikers closed it down from inside, taking the factory hostage and preventing management from operating with nonunion workers. This, together with the new reluctance of authorities, many of them Roosevelt Democrats, to act against labour, made sit-down strikes highly successful. On February 11, 1937, after a long sit-down strike, General Motors, the country’s mightiest corporation, recognized the United Auto Workers. The United States Steel Corporation caved in less than a month later, and by 1941 some 10,500,000 workers were unionized, three times as many as a decade before. The CIO became a mainstay of the New Deal coalition, yet it also aroused great resentment among middle-class Americans, who opposed strikes in general but the CIO’s tactics especially. This further narrowed Roosevelt’s political base.

An assessment of the New Deal

The New Deal established federal responsibility for the welfare of the economy and the American people. At the time, conservative critics charged it was bringing statism or even socialism. Left-wing critics of a later generation charged just the reverse—that it bolstered the old order and prevented significant reform. Others suggested that the New Deal was no more than the extension and culmination of progressivism. In its early stages, the New Deal did perhaps begin where progressivism left off and built upon the Hoover program for fighting the depression. But Roosevelt soon took the New Deal well beyond Hoover and progressivism, establishing a precedent for large-scale social programs and for government participation in economic activities. Despite the importance of this growth of federal responsibility, the New Deal’s greatest achievement was to restore faith in American democracy at a time when many people believed that the only choice left was between communism and fascism. Its greatest failure was its inability to bring about complete economic recovery. Some economists, notably John Maynard Keynes of Great Britain, were calling for massive deficit spending to promote recovery; and by 1937 the New Deal’s own experience proved that pump priming worked, whereas spending cutbacks only hurt the economy. Roosevelt remained unpersuaded, however, and the depression lingered on until U.S. entry into World War II brought full employment.

World War II

The road to war

After World War I most Americans concluded that participating in international affairs had been a mistake. They sought peace through isolation and throughout the 1920s advocated a policy of disarmament and nonintervention. As a result, relations with Latin-American nations improved substantially under Hoover, an anti-imperialist. This enabled Roosevelt to establish what became known as the Good Neighbor Policy, which repudiated altogether the right of intervention in Latin America. By exercising restraint in the region as a whole and by withdrawing American occupation forces from the Caribbean, Roosevelt increased the prestige of the United States in Latin America to its highest level in memory.