Franklin D. Roosevelt

Congress also gave the Federal Trade Commission broad new regulatory powers and provided mortgage relief to millions of farmers and homeowners. Roosevelt expanded a Hoover agency, the Reconstruction Finance Corporation, making it a major source of financing for railroads and industry. Roosevelt made agricultural relief a high priority and set up the first Agricultural Adjustment Administration (AAA). The AAA tried to force higher prices for commodities by paying farmers to take land out of crops and to cut herds.

Reform of the economy was the goal of the National Industrial Recovery Act (NIRA) of 1933. It tried to end cutthroat competition by forcing industries to come up with codes that established the rules of operation for all firms within specific industries, such as minimum prices, agreements not to compete, and production restrictions. Industry leaders negotiated the codes which were then approved by NIRA officials. Industry needed to raise wages as a condition for approval. Provisions encouraged unions and suspended anti-trust laws. The NIRA was found to be unconstitutional by unanimous decision of the U.S. Supreme Court on May 27, 1935. Roosevelt opposed the decision, saying "The fundamental purposes and principles of the NIRA are sound. To abandon them is unthinkable. It would spell the return to industrial and labor chaos."[78] In 1933, major new banking regulations were passed. In 1934, the Securities and Exchange Commission was created to regulate Wall Street, with 1932 campaign fundraiser Joseph P. Kennedy in charge.

Recovery was pursued through "pump-priming" (that is, federal spending). The NIRA included $3.3 billion of spending through the Public Works Administration to stimulate the economy, which was to be handled by Interior Secretary Harold Ickes. Roosevelt worked with Republican Senator George Norris to create the largest government-owned industrial enterprise in American history, the Tennessee Valley Authority (TVA), which built dams and power stations, controlled floods, and modernized agriculture and home conditions in the poverty-stricken Tennessee Valley. The repeal of prohibition also brought in new tax revenues and helped Roosevelt keep a major campaign promise.

Executive Order 6102 made all privately held gold of American citizens was to be sold to the U.S. Treasury and the price raised from $20 to $35 per ounce.[79] Exceptions were made for jewelers, coin collectors and a few others. The goal was to counter the deflation which was paralyzing the economy.[80]

Roosevelt tried to keep his campaign promise by cutting the federal budget, including a reduction in military spending from $752 million in 1932 to $531 million in 1934 and a 40% cuts in spending on veterans' benefits, removed 500,000 veterans and widows from the pension rolls and reduced benefits for the remainder, as well as cutting the salaries of federal employees and reduced spending on research and education.[81] However, this was soon seen to be a mistake and most benefits were restored or increased by 1934.[82] The benefit cuts also did not last. In June 1933 Roosevelt restored $50 million in pension payments, and Congress added another $46 million more.[83] Veterans groups like the American Legion and the Veterans of Foreign Wars won their campaign to transform their benefits from payments due in 1945 to immediate cash when Congress overrode the President's veto and passed the Bonus Act in January 1936.[84]

Roosevelt also kept his promise to push for repeal of Prohibition. In April 1933, he issued an Executive Order redefining 3.2% alcohol as the maximum allowed.[citation needed] That order was preceded by Congressional action in the drafting and passage of the 21st Amendment, which was ratified later that year.

Congress