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APUSH Ch 23: Managing the Great Depression, Forging the New Deal, 1929-1939

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Harry Jarcho

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Transcript of APUSH Ch 23: Managing the Great Depression, Forging the New Deal, 1929-1939

The New Deal’s greatest legacy was a shift in our understanding of the role of government.

As a result of the New Deal, most Americans came to believe that the federal government has a responsibility to ensure the health of the nation's economy and the welfare of its citizens.
The New Deal did not end the Depression nor did it significantly reduce the gap between the rich and the poor. But it did provide many Americans with new economic security that they had never known before.
New Deal programs that still exist today include:
Unemployment insurance
Social Security – old age insurance & support for the disabled
FDIC – insured bank deposits
The National Labor Relations Act, which reduced violence in labor relations and protected workers’ rights to organize into labor unions
The Securities and Exchange Commission, which protected stock market investments of millions of small investors
The Federal Housing Administration and government guaranteed mortgages enabled many more Americans to become homeowners
In addition to traditional public works, the New Deal also provided jobs to artists, writers, playwrights, musician and other performing artists.
New Deal administrators encouraged the production of projects that would appeal to the entire public, "Art for the Millions," not just cultural elites.
Numerous young artists got their start through these programs:
Saul Bellow
Ralph Ellison
John Cheever
Zora Neale Hurston
Richard Wright
Orson Wells
John Houston
Arthur Miller
By 1940, nearly 25% of the nation’s 12 million blacks lived in the urban North – facing racism and higher unemployment
NAACP battled against segregation lynching, denial of blacks’ right to serve on juries
FDR's dependence on white, Southern Democratic voters limited his efforts on behalf of African Americans
Restricted immigration of Asians continued - the Chinese Exclusion Act was not repealed until 1943
Japanese-Americans continued to face prejudice and land-ownership restrictions in California
Hispanics faced hostility in west and southwest, often losing jobs to displaced white migrants, (e.g., Okies)
Efforts to organize migrant farm workers were unsuccessful
FDR was frustrated that the Supreme Court had struck down a number of his New Deal programs as unconstitutional.
In 1937 FDR proposed a bill to add a new Supreme Court Justice for each one over 70 yrs of age, an obvious attempt to pack the court with liberal judges who would back his New Deal policies
The press and the public reacted sharply to the “court packing” scheme, and after the Senate voted it down, FDR dropped it
Even without adding judges, FDR appointed 4 new Justices, which left a liberal New Deal legacy well beyond his presidency
Wagner Act
and labor-friendly federal policies led to a boom in unionization
Congress of Industrial Organizations
(CIO) formed, which organized workers industry-wide, rather than into craft-based unions, as within the AFL
Had immediate success organizing the steelworkers’ union
Another major success was the formation of the
United Automobile Workers
(UAW) - successfully unionizing anti-union General Motors and Ford
The
Social Security Act
established a mixed federal-state system of:
Old-age retirement pensions,
unemployment insurance,
worker injury compensation benefits,
aid for the disabled and dependent mothers with children

It was funded jointly by employer/employee deductions

Although it excluded farm workers, domestic workers, and the self-employed, it established the precedent of government responsibility for social welfare and laid a foundation for the expanded welfare system of the future
In 1936, FDR moved to the left, adopting parts of the Populist Left's agenda:
He campaigned as a champion of the poor and the working class
Was more overtly class conscious - critical of large corporations and excessive wealth

This
“Second New Deal”
emphasized 6 initiatives, which some historians identify as the birth of the
welfare state
:
expanded public-works programs
assistance to the rural poor
support for organized labor
benefits for retired workers and other at-risk groups
tougher business regulation
heavier taxes on the wealthy
The psychological impact of unemployment, poverty was immense – marriage and birthrates both fell
Women in the workforce faced discrimination and resentment
Women were paid less than men
Married women faced hostility for “taking jobs” from bread-winning men
Unionization benefited women in unionized industry, but many female-dominated industries (e.g., textiles, clerical, sales) were resistant and/or late to unionize
Minorities especially hard hit – last hired and first fired
FDR was reelected in 1936 in the biggest landslide in a century, capturing 61% of the popular vote
Democrats enlarged their Congressional majority even further
Building on their white Southern and urban political machine base, FDR brought newer urban immigrants (Catholics and Jews), farmers, blue-collar union members, people on relief, blacks, and women into the Democratic Party

This coalition, never united on foreign policy, and divided over race, lasted until the social changes brought on by the Civil Rights movement and the Vietnam/counter-cultural revolutions of the 1960s caused the coalition to disintegrate
Southern whites (especially males), blue-collar workers, and the middle and upper-classes, began to vote on social/racial grounds, rather than New Deal economics, and defected to the Republican Party and its "values-based" appeals
Union membership increased from under 3 million in 1933 to over 8 million in 1941 – but 75% of non-farm labor was still not organized
Ford and other steel companies resisted unionization, using violence against labor leaders, strikers, and sit-downers, but eventually unionized
Early union organizers were far more politically radical than the rank-and-file workers – as unions won economic gains, the appeal of radical ideologies faded
The
Wagner Act
, also known as the NLRA, created the
National Labor Relations Board
(NLRB) to supervise union elections
guaranteed collective-bargaining rights (the right of a union to represent and bargain
permitted closed shops (all workers required to join the union if the shop voted for union)
outlawed blacklisting of union organizers
The NLRA led to a sharp rise in unionization
National Labor Relations Act (1935)
Video: A New Deal for Labor
The Second New Deal
“There is no work. First the gasoline gives out. And without gasoline a man cannot get to a job if he could get one. Then the food goes. And then it rains, with insufficient food, the children develop colds because the ground in the tents is wet. I talked to a man last week who lost two children in ten days with pneumonia. His face was hard and fierce and he didn’t talk much.”
Okies
“My Oklahoma Home”
Lyrics by Bill & Sis Cunningham
Sung by Bruce Springsteen
Falling Farm Prices and Drought:
The Dust Bowl
The New Deal Under Attack
The
National Recovery Act
(NRA), a centerpiece of the early New Deal, soon ran into difficulties and was declared unconstitutional by the Supreme Court. The Court ruled that the NRA was unconstitutional because:
It granted the President regulatory powers that the Constitution reserved for Congress
It regulated intra-state commerce when Constitution only granted Congress authority over inter-state commerce
FDR the Pragmatist
Video: Alphabet Soup: Jobs Programs and Aid for Farmers
The 1st phase of the New Deal focused on relief and recovery:
Emergency relief
– direct aid, e.g., food, clothing, shelter, public-works jobs, to get money and essentials into hands of the unemployed
Industrial recovery
through business-government cooperation, as well as “pump-priming federal spending
Agricultural recovery
through crop reduction
Relief
– Relief programs were intended to make things more tolerable but often did not offer long-term solutions – they provided emergency aid (e.g., food, housing) and jobs.
Recovery
– Recovery programs were designed to stimulate business, to create jobs from the top-down.
Reform
– reform finds the cause of the problem and aims to alter it to prevent the same issue in the future. Programs to regulate risk in the stock market and banks, programs to control farm prices and production are examples of reforms.
Key Terms:
Relief, Recovery & Reform
The New Deal Arrives, 1933-1935
The Hungry & Unemployed
June, 1932 – 10,000 WWI veterans marched on Washington demanding early payment of a promised bonus
Fearing the impact on the deficit, Congress refused
Several thousand soldiers set up camp – Hoover ordered the Army to close the camps, using tear gas, tanks, and machine guns
Public was outraged and Hoover’s credibility destroyed
The People Turn Against Hoover:
The Bonus Army
The Fate of Women and Minorities in the Great Depression
Hoover’s Efforts to Alleviate the Depression Fail
Public Anxiety Rises, Banks Fail, and Spending Plummets
The Statistics of Hard Times
Jazz at Carnegie Hall
Percussionist Gene Krupa played in the Benny Goodman Orchestra, which presented a history-making jazz concert at Carnegie Hall in 1938.
Cartoons Reflecting the Overwhelming Press and Public Opposition to FDR’s “Court Packing” Scheme
The CIO’s industrial unions grew rapidly with passage of the pro-union National Labor Relations Act in 1935. Union membership increased still more as war plants hired workers in the early 1940s.
The Growth of Labor Union Membership, 1933–1946

Labor Organizing, 1930s-Style
Walter Reuther (left) and Richard Frankensteen of the United Auto Workers, after their beating by Ford Motor Company security guards, Detroit, May 1937.
William Gropper,
Construction of the Dam
This painting by an artist of the social realist school depicts a construction project under the WPA project.
Enacted in 1935, Social Security has been one of the most enduring of all New Deal programs. This poster urges eligible Americans to apply promptly for their Social Security cards.
Social Security poster
AAA production cuts were successful in raising farm prices, but this did not necessarily help farm labor – in fact as production was cut, sharecroppers and tenant farmers lost more jobs

Drought struck Midwest, lasted through 1939, causing the great dustbowl
Ruined farmers streamed west or to cities, further swelling the ranks of the unemployed and driving down wages

“Give a Man a Job”
Providing Jobs to Youth Building Parks and on conservation projects
The Hundred Days
(March-June, 1933) – Congress passed measures that significantly expanded the federal government’s role in the nation’s economic life

Roosevelt’s confidence and communication skills did much to calm the nation
Fireside Chats
Soup Kitchen
The Statistics of Hard Times:
Critique of New Deal Economics
The Statistics of Hard Times
Statistics on the gross national product, personal income, unemployment, the stock market, and business failures all show the Depression’s shattering impact, with gradual and uneven improvement as the 1930s wore on.
1.
Stock Market Crash
ushered in the Great Depression
“Buying on margin”
[borrowing most of the cost of the stock] had led to wild speculation and inflated the price of stocks – when prices fell, investments were wiped out - both citizens and the banks that lent the money lost their investments

2.
Overproduction
in both agriculture and industry caused
prices to fall - farms and industry could not make profits [when Supply > Demand, prices fall]

3.
European depression
led to a drop in U.S. exports.

4. U.S. adherence to the
gold standard and high tariff policies

prevented the U.S. from making adjustments, compounding trade problems.
Efforts to protect U.S. manufacturing by raising import tariffs (
Smoot-Hawley Tariff (1930)
resulted in retaliatory tariffs and even less international trade)

5.
Wages did not keep up with cost of living
a. led to widening gap between rich and poor
b. reduced consumer spending

6. High unemployment, reduced hours, and lower wages led to
reduced consumer spending
, resulting in a spiral of unsold inventory and further cuts [when Supply > Demand, prices fall]
Causes of the Crash
Fearing the growing Nazi threat, in 1935 Stalin called for a worldwide alliance, a Popular Front, against fascism
Russia and U.S. communists now began praising FDR
Numerous left-leaning Americans joined the Popular Front and supported the Spanish in their efforts to fight fascist Francisco Franco’s attempted military take-over of a democratically elected government in Spain
American support for The Popular Front evaporated when Stalin signed a nonaggression pact with Hitler in 1939

The Later 1930s: Opposing Fascism
The mood of the nation was more upbeat and patriotic by the end of the 1930s – the American people had beaten the Depression.
John Steinbeck’s The Grapes of Wrath
, although critical of the economic system that plagued depression-era farmers, was upbeat and optimistic in its view of the strength, endurance, and humanity of the common man.
Aid to Farmers
The
Resettlement Administration
, established in 1935, was authorized to resettle destitute farm families from areas of soil erosion, flooding, and stream pollution to better, farmable land.
Poster by Ben Shahn: “Years of Dust”
Socialists and communists attacked the New Deal for not going far enough – they urged public ownership of industry
The
Townsend Plan
would have given a pension to all retired people provided they spend it within 30 days
Townsend ridiculed Social Security as too little
had fleeting support, but its cost would have bankrupted nation
Companies that cooperated with the National Recovery Administration displayed this banner.
The
National Recovery Administration
was passed to stimulate industrial recovery during the First One Hundred Days. The goal was to eliminate "cut-throat competition" by bringing industry, labor and government together to create codes of "fair practices" and set prices. The NRA was created by the National Industrial Recovery Act (NIRA) and allowed industries to get together and write "codes of fair competition."
“We Do Our Part”
The Tennessee Valley Authority
To control flooding and to generate electricity, the Tennessee Valley Authority constructed dams along the Tennessee River and its tributaries from Paducah, Kentucky, to Knoxville, Tennessee.
“The country needs and, unless I mistake its temper, the country demands bold, persistent experimentation. It is common sense to take a method and try it: If it fails, admit it frankly and try another. But above all, try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach."
Franklin Delano Roosevelt
Calling for a “new deal for the American people,” “bold experimentation,” and compassion for the “forgotten man at the bottom of the economic pyramid,” NY Governor
Franklin Delano Roosevelt
was swept into office in a landslide, and with heavy majorities in both houses of Congress
The Election of 1932
Burning Shanties of Bonus Marchers, July 1932
When President Herbert Hoover ordered the army to evict jobless veterans who had come to Washington seeking early payment of promised bonuses, it reinforced his public image as aloof and uncaring amid a worsening depression.
Bonus Army
They received neither gratitude nor the bonus. Instead, Hoover commented:
"Thank God we still have a government that knows how to deal with a mob."
A lampooned President Hoover looks smug and fat as Bonus Marchers parade by
Hoover and the Bonus Marchers
Video: Domestic and International Causes of the Great Depression
Video: Introduction to the Great Depression
Video: Dorothea Lange -
New Deal Photographer
Student Video on Great Depression
Sample Web Videos:
Great Depression and the New Deal
The Big Idea:
The scope and expectations for the role of government changed radically as the Roosevelt administration attempted to cope with the Great Depression in its program, the New Deal. Your goal is to understand those new expectations, and to develop an opinion as to the wisdom and consequences of the growth of federal government.

The Big Question:
Does the government have a responsibility to safeguard the health and well-being of the people, or does "big government" pose a threat to individual freedom and undermine individual responsibility?
Period 7: Chapter 23: Managing the Great Depression, Forging the New Deal, 1929-1939
Video: Europe Moves Toward War
Video: The Legacy of the New Deal
1930s:
The Golden Age
of Movies
Works Progress Administration
Formed to provide jobs for the unemployed through public-works projects, the WPA also sponsored arts projects for writers, artists, performers
Long’s plan would guarantee every family an annual income of $2,000 – enough for a home, car, and a radio; free college education; old-age pensions; a 30-hour work week; and a four week vacation for every worker
Louisiana Governor Huey Long
promoted his
“Share Our Wealth”
program, which imposed a 100% tax on all income above $1 million, and would confiscate all wealth above $5 million
Growing unemployment, bread lines, home and farm foreclosures led to anger, labor protests, and farmers withholding or destroying their crops to force up the prices
The People Turn Against Hoover
Agriculture During the Great Depression
The depression hit rural America with brutal ferocity, as the statistics on commodity prices and farm mortgages show.
Click to play “Dust Bowl Refugee,”
by Woody Guthrie
Oklahoma Dustbowl Refugees
Video: Hoovervilles
Hoover opposed government intervention
Hoover believed that the depression was temporary and that prosperity was “just around the corner.”
He supported using private, local, voluntary action to help the needy.
He believed that government "hand-outs" and intervention would diminish individual responsibility - that they were morally wrong
Hoover eventually agreed to federal funding of public-works projects (1931), and to providing loans to try to help businesses, but his efforts were too little, too late
Hoover’s Response
Speech on Sharing the Wealth
“Corrupted by wealth and power, your government is like a restaurant with only one dish. They’ve got a set of Republican waiters on one side and a set of Democratic waiters on the other side. But no matter which set of waiters brings out the dish, the legislative grub is all prepared in the same Wall Street kitchen.”
Although Huey Long was slandered as a crackpot, his program was very popular among the poor, and Long set his sights on a possible challenge to FDR in the 1936 Presidential election. But an assassin murdered Huey Long in 1935.
Social and Psychological Impact of the Great Depression
The Fate of Women and Minorities in the Great Depression
Bread Lines
The New Deal Arrives, 1933-1935
Civilian Conservation Corps:
Using Mass Media to Promote the NRA
Problems and Controversies Plague the Early New Deal:
Agriculture
The Second New Deal and the Redefining of Liberalism, 1935-1938
The Social Security Act of 1935
The CIO:
Industrial Workers Organize
Union Membership Grows
FDR and the New Democratic Coalition
FDR Battles the Supreme Court:
Left Out of the New Deal?
Minorities Face Racism and Exploitation
The New Deal and the Arts
New Deal Entertainment
The Later 1930s:
Reaffirming Traditional Values
The Depression Abroad:
The U.S. is Drawn into War
Evaluating the New Deal
"I Believe We Live in a Great Country"
Al Jolson -
Brother, Can You Spare a Dime
Legacy of the New Deal
The Popular Front
Video: The Great Depression: Introduction
I. Early Responses to the Depression,
1929-1932
A. Enter Herbert Hoover
B. Rising Discontent
C. The 1932 Election

II. The New Deal Arrives, 1933-1935
A. Roosevelt and the First Hundred Days
Banking Reform
Agriculture and Manufacturing
Unemployment Relief
Housing Crisis
B. The New Deal Under Attack
Crisis on the Right
Critics on the Populist Left

III. The Second New Deal and the Redefining
of Liberalism, 1935-1938
A. The Welfare State Comes into Being
The Wagner Act and Social Security
New Deal Liberalism
B. From Reform to Stalemate
The 1936 Election
Court Battle and Economic Recession

IV. The New Deal's Impact on Society
A. A People's Democracy
Organized Labor
Women and the New Deal
African Americans Under the New Deal
Indian Policy
Struggles in the West
B. Reshaping the Environment
The Dust Bowl
Tennessee Valley Authority
Grand Coulee
C. The New Deal and the Arts
D. The Legacies of the New Deal
Chapter Outline
The First Hundred Days
Early Responses to the Depression, 1929-1932
Enter Herbert Hoover:
Rising Discontent
"We have come to collect the gratitude that was promised us for participating in the World War."
Farmers dumping milk into the road and blocking traffic to protest below-production cost milk and farm produce prices
Police and National Guardsmen were called in to break up labor strikes, such as the 1932 "Hunger March" at the River Rouge factory of the Ford Motor Company, which left 5 workers dead and 50 wounded.
Video: The Banking Crisis, Fireside Chats & the End of Prohibition, Bottom-Up Relief
Banking Reform
Emergency Banking Act
– closed nation’s banks to prevent withdrawals, then allowed solvent banks to reopen
Federal Deposit Insurance Corporation (FDIC)
created to insure deposits up to $5000
Laws passed to provide relief to homeowners and farmers facing foreclosure or already having lost homes and farms
FDR removed the U.S. from the gold standard, allowing the Federal Reserve to lower interest rates
Agricultural Adjustment Act
(AAA) provided federal subsidies to farmers to cut production of key agricultural commodities
National Industrial Recovery Act
(NIRA) financed large-scale public works projects through the
Public Works Administration
(PWA)
created the very controversial
National Recovery Administration
(NRA) which brought business leaders together to set production limits, wages, prices, and to regulate unfair business practices
Banned child labor
Federal Emergency Relief Administration (FERA)
provided federal funds for state-run relief programs (federal money, but local control)
Public Works Administration (PWA)
funded construction jobs such as highways, bridges, and public buildings
Civilian Conservation Corps
(CCC) provided jobs to youths in conservation projects
Critics on the Right


Republicans opposed the passage of the
Securities and Exchange Commission (1934)
, established to regulate the stock market
the
Liberty League
organized to fight the "reckless deficit spending" of the New Deal and its "socialist" reforms
The
National Association of Manufacturers (NAM)
organized to oppose FDR's "antibusiness policies" and to promote free enterprise and "unfettered capitalism"
In
Schechter v. United States (1935)
, the Supreme Court ruled the NIRA to be an unconstitutional expansion of the executive branch into Congress's authority over commerce

Despite this, due to the public relations expertise of FDR and his “fireside chats,” Democrats actually increased their Congressional majorities in the 1934 elections.
Critics on the Populist Left
The Townsend Plan
Share Our Wealth
The Dust Bowl
New Deal Liberalism
The New Deal changed the definition of Liberalism:

Classical Liberalism
was based on individual liberty - government was to be limited so as to protect individual rights from government intrusion

New Deal Liberalism
was based on the belief that, to preserve individual liberty, government must actively assist the needy and guarantee the basic welfare of citizens.

New Deal Liberalism can be seen as an outgrowth of Progressivism's reaction to the challenges posed by the Industrial Revolution
From Reform to Stalemate
Keynesian Economics and
the "Roosevelt Recession" of 1937
British economist
John Maynard Keynes
had revolutionized economic thinking in capitalist states, arguing that governments could smooth the highs and lows of the business cycle through
deficit spending
and
manipulating interest rates
. The idea was that when unemployment and business failures caused demand to drop, government would stimulate the economy by increasing its spending - "priming the pump."

From 1933 to 1937 production was recovering and unemployment dropped from 25% to 14%. To ease the massive New Deal deficits and quiet Republican critics, FDR slashed federal spending and Congress cut WPA funding in half
Unemployment jumped back up to 19% and the stock market plunged
FDR reversed course again, restoring WPA and other public works funding, a move that was sharply criticized by conservatives and Republicans.
A coalition of anti-New Deal Republicans and southern Democrats gained power and made significant gains in the 1938 congressional elections – the New Deal was over
Reshaping the Environment
Tennessee Valley Authority, the Grand Coulee Dam and the New Deal's Legacy of Recreation Coexisting with Nature
The Tennessee Valley Authority
(TVA) was a massive government environmental public works project with multiple goals:
to bring electricity to rural areas to keep farmers on the land
to modernize the South
to build a series of dams and hydroelectric plants for electricity and flood control
to bring jobs, electricity, and recreational opportunities to rural areas through a series of hydroelectric plants and reservoirs
Grand Coulee Dam
The PWA constructed the Grand Coulee Dam on Washington State's Columbia River
Completed in 1941, it was the largest electicity-producing structure in the world
Its 150-mile lake provided irrigation for Washington agriculture as well as recreational opportunities and jobs

Avenues of Escape: Radio and the Movies
The standardization of American culture via mass media continued in the 1930s
escapist themes dominated to counter the grimness of daily life
Radio soap operas were very popular
In 1939 65% of Americans went to the movies at least weekly – movies had sound and color by the 1930s
Movies reinforced racial stereotypes of blacks
Women were portrayed with more complexity – Mae West, Katharine Hepburn were strong and independent – but most women's roles continued to reinforce and reflect traditional gender stereotypes
Escaping Through Popular Entertainment
Click to watch video
Click to watch video
The Works Progress Administration
Click to watch video
Depression Era Entertainment:
Click to view video
Click to watch video
The Second New Deal
Conservatives attacked the New Deal as too expensive, socialistic, and a dangerous, undemocratic expansion of the scope of federal government; but public support remained strong.
Problems and Controversies Plague the Early New Deal: The NRA
The Court Packing Scandal
Unemployment Relief Programs
Agriculture and Manufacturing
The stock market crash of 1929 and the resulting depression burst the inflated economic bubble of the 1920s and plunged many Americans into an uncertain future. The thousands of distressed letters that Eleanor Roosevelt received from Americans recounting their tragic circumstances hint at the despair the economic crisis caused. When Franklin Roosevelt entered the White House in 1933, replacing Herbert Hoover’s fiscally conservative approach, he launched a “new deal” program of reforms demonstrating the active engagement of the federal government. Critics complained he did not go far enough, while others described him as dictatorial in his control of the economy. To the broad coalition of American voters, however, FDR inspired hope that “happy days” were fast approaching. From his initial efforts to shore up financial institutions, Roosevelt’s New Deal broadened in response to labor and working-class concerns to embrace public programs providing basic necessities and creating “safety net” guarantees that came to define a liberal consensus regarding government’s role and responsibility in the twentieth century.
Chapter Overview from the Text
Herbert Hoover’s efforts in war-ravaged Belgium as head of the U.S. Food Administration earned him international acclaim as a humanitarian, a reputation that did not survive his presidency. When the stock market crashed, President Hoover’s conservative economic principles restrained government action based on the idea that the market was self-correcting and the tide would soon turn. His “too little too late” approach disillusioned many Americans and led to Roosevelt’s victory in the election of 1932.
Story of Migrant Mother
Vintage newsreel on the life of Huey Long:
Link to Video Excerpts from the Address:
http://www.history.com/topics/us-presidents/franklin-d-roosevelt/videos/inaugural-address-franklin-d-roosevelt
Full transcript