Instructor Bio
Lecture Slides
Nov 27, 2006
OUTLINE
LECTURE NOTES
Commerce and American Society
Part II
I. FDR’s "New Deal"
A. Tools:
1. Experts: the "Brain Trust"
2. Bold experimentation
3. Leadership
II. New Deal Approaches
1. The Visible Hand: Cartels
2. Keynesian Economics
3. New Deal Work Programs
4. New Deal Economic Regulations
III. The Success of the New Deal
1. Short-term
2. Long-term
III. The Impact of the New Deal
IV. Free Market or Government Intervention?
LECTURE NOTES Mr. Smith Goes to Washington will be shown Wednesday and Thursday, November 29th and 30th at 5:00 and 7:30 pm in the JSB Auditorium. On Thursday, there will be a 6:45 am showing in the JSB Auditorium.
Midterm #2 Exams are available for review in the Review Room (173a SWKT) now. They will be available November 27-December 1.
Paper #2 is due in Labs this week.
------
MEDIA CLIP: 1930s LDS welfare program
-mormon leaders are startled to find out that people would rather take a check from the government than work
-church institutes welfare program
-puts 20,000 people to work and takes them off of government help
FDR had a number of tools he used to attack the great depression
-Leadership, magnetic personality, used it to comfort and guide the people
-he was the only president elected to 4 terms
-he used fireside chats to reach out to people through radio
-he was very popular
MEDIA CLIP: FDR wins another election
-FDR was a popular man because he helped people find work
-he change the american political landscape
-FDR was a member of the democratic party
-song "we've got money in our hands"
prohibition got repealed under roosevelt
FDR used experts (science could solve the problems of america)
FDR's "New Deal"
Tools:
-Experts:The "Brain Trust"
-Bold experimentation
-try anything that works
New Deal Approaches
-The Visible Hands: Cartels (cartel another name for a monopoly)
--National Recovery Act (NCA)
--Agricultural Adjustment Administration (AAA)
They said to some of the businesses, collude with other businesses to create jobs
but the business leaders served their own self interests, the NCA was really a failure
AAA set minimum prices for crops, quotas etc. the AAA was more successful than the NRA
more family farmers were prevented from going out of business
9 members of the supreme court were against most of these changes
FDR reacted with a court packing bill
-increase size of supreme court to 15
-the bill failed
The supreme court started to allow some of the his "New Deal" bills
"The shift in time that saved 9"
-Keynesian Economics (John Maynard Keynes)
--keynes looked at recessions
--maybe we need to prime the pump (jumpstart the economy)
--maybe the government should inject money into the economy and get people buying again (deficit spending)
--build up a budget surplus during times of economic growth
--deficit spending during crisis
MEDIA CLIP: Brain Trust
-Washington filled with experts
-statisticians, college professors, psychologists, socialogists, mathematicians
-the country wants bold persisent experimentation so the country will get it
-many people started working for the government building bridges etc
-CCC Civilian Conservation Cores puts them in government camps where there is plenty to do
New Deal Work Programs
-CCC Civilian Conservation Cores
-FERA Federal Emergency Relief Administration
-Public Works Administration (PWA)
-Works Progress Administration (WPA)
These aren't government handouts, these are government created jobs
Ogden High School, built by WPA workers (make-work project)
unemployed novelists, historians employed by government to interview former slaves
New Deal Economic Regulations
------
Securities and Exchange Commission (SEC)
-Regulate Stock Market
-in response to stock market crash 1929
National Labor Relations Board (NLRB)
-Mediate between workers and business
-in response to violent strikes
Federal Deposit Insurance Corporation(FDIC)
-Guarantee Bank deposits
-in response to many banks closing
Fair Labor Standards Act
-set minimum wage
Social Security
-unemployment insurance, retirement benefits
The Success of the New Deal
-------
-Short term relief (especially after start of WWII)
-Long term protections/programs
--Social Security
--SEC (Securities and Exchange Commission)
---9/11 SEC shut down stock market for a week
Impact of the New Deal
----------------------
Increase in government spending
Reliance on deficit spending
Growth of dependency, sense of entitlement, "rights talk"
Federal Budget as a % of Gross National Product GNP
Progressive Era
1880 3%
1910 6%
New Deal Era
1929 11%
1939 22%
Civil rights era to present
1960 28%
1980 33%
Free Markets vs Government Intervention
-The problem of the flat world
Free Market- pure adam smith
Government intervention- government sets quotas etc
MEDIA CLIP: Private vs public housing
-the government wants to help people, always have good intentions
-spending billions on public housing, broken elevators, rundown houses, no security no locks
-governments keep spending money on public housing but the housing was in crappy
-public housing often in high crime areas
-gives a case study of westchester heights (government owned then became private owned)
why are the apartments cleaner and safer
-business owners realize customers won't pay rent unless they get what they pay for
-virtue vs interest
free markets reward innovation and specialization
in a controlled economy the regulations tend to stifle innovation
controlled economies have their appeal- the great depression
-gives people a sense of safety
The problem with markets
-Amoral; the market rewards productivity and nothing else
--markets work according to interest of buyers and sellers
--they don't think about things like who needs it most etc.
--the example of walmart
---an extremely efficient organization
---walmart an extremely controversial issue
-price is set by demand, the market is efficient
-both demanders and suppliers get what they want
MEDIA CLIP: Jib Jab: Big Boxmart [view clip here]
-what is wrong with walmart?
-sweatshops overseas because they have to make their products to cheap enough to sell at walmart
-"we used to be your customers now we're your employees"
-"your everyday low prices have a price, they aren't free"
what does this jib jab clip say is wrong with walmart
-outsourcing american jobs overseas, american laborers cannot compete at the same wages
-exploit their market power, acting like a monopoly, setting prices for suppliers
-destroys mom and pop shops, and then they go and work at walmart, doesn't add jobs it exchanges jobs
-clip makes fun of consumerism in america, americans buy all their crap
-quality of products everywhere get lower so prices get lower so they can compete with walmart
MEDIA CLIP: candy company that went out of business
-a woman lost her job at the Lifesavers candy plant
-kraft closes her plant, her job moves to canada
-kraft cited the high price of sugar as a reason to move
-kraft can save $90 million opening a plant in canada
-us sugar twice as expensive as foreign sugar
-NAFTA makes it easier to open plants in mexico or canada
Thomas Friedman wrote a book, the world is flat, students encouraged to read it, apparently its very relevant
Midterm #2 Exams are available for review in the Review Room (173a SWKT) now. They will be available November 27-December 1.
Paper #2 is due in Labs this week.
------
MEDIA CLIP: 1930s LDS welfare program
-mormon leaders are startled to find out that people would rather take a check from the government than work
-church institutes welfare program
-puts 20,000 people to work and takes them off of government help
FDR had a number of tools he used to attack the great depression
-Leadership, magnetic personality, used it to comfort and guide the people
-he was the only president elected to 4 terms
-he used fireside chats to reach out to people through radio
-he was very popular
MEDIA CLIP: FDR wins another election
-FDR was a popular man because he helped people find work
-he change the american political landscape
-FDR was a member of the democratic party
-song "we've got money in our hands"
prohibition got repealed under roosevelt
FDR used experts (science could solve the problems of america)
FDR's "New Deal"
Tools:
-Experts:The "Brain Trust"
-Bold experimentation
-try anything that works
New Deal Approaches
-The Visible Hands: Cartels (cartel another name for a monopoly)
--National Recovery Act (NCA)
--Agricultural Adjustment Administration (AAA)
They said to some of the businesses, collude with other businesses to create jobs
but the business leaders served their own self interests, the NCA was really a failure
AAA set minimum prices for crops, quotas etc. the AAA was more successful than the NRA
more family farmers were prevented from going out of business
9 members of the supreme court were against most of these changes
FDR reacted with a court packing bill
-increase size of supreme court to 15
-the bill failed
The supreme court started to allow some of the his "New Deal" bills
"The shift in time that saved 9"
-Keynesian Economics (John Maynard Keynes)
--keynes looked at recessions
--maybe we need to prime the pump (jumpstart the economy)
--maybe the government should inject money into the economy and get people buying again (deficit spending)
--build up a budget surplus during times of economic growth
--deficit spending during crisis
MEDIA CLIP: Brain Trust
-Washington filled with experts
-statisticians, college professors, psychologists, socialogists, mathematicians
-the country wants bold persisent experimentation so the country will get it
-many people started working for the government building bridges etc
-CCC Civilian Conservation Cores puts them in government camps where there is plenty to do
New Deal Work Programs
-CCC Civilian Conservation Cores
-FERA Federal Emergency Relief Administration
-Public Works Administration (PWA)
-Works Progress Administration (WPA)
These aren't government handouts, these are government created jobs
Ogden High School, built by WPA workers (make-work project)
unemployed novelists, historians employed by government to interview former slaves
New Deal Economic Regulations
------
Securities and Exchange Commission (SEC)
-Regulate Stock Market
-in response to stock market crash 1929
National Labor Relations Board (NLRB)
-Mediate between workers and business
-in response to violent strikes
Federal Deposit Insurance Corporation(FDIC)
-Guarantee Bank deposits
-in response to many banks closing
Fair Labor Standards Act
-set minimum wage
Social Security
-unemployment insurance, retirement benefits
The Success of the New Deal
-------
-Short term relief (especially after start of WWII)
-Long term protections/programs
--Social Security
--SEC (Securities and Exchange Commission)
---9/11 SEC shut down stock market for a week
Impact of the New Deal
----------------------
Increase in government spending
Reliance on deficit spending
Growth of dependency, sense of entitlement, "rights talk"
Federal Budget as a % of Gross National Product GNP
Progressive Era
1880 3%
1910 6%
New Deal Era
1929 11%
1939 22%
Civil rights era to present
1960 28%
1980 33%
Free Markets vs Government Intervention
-The problem of the flat world
Free Market- pure adam smith
Government intervention- government sets quotas etc
MEDIA CLIP: Private vs public housing
-the government wants to help people, always have good intentions
-spending billions on public housing, broken elevators, rundown houses, no security no locks
-governments keep spending money on public housing but the housing was in crappy
-public housing often in high crime areas
-gives a case study of westchester heights (government owned then became private owned)
why are the apartments cleaner and safer
-business owners realize customers won't pay rent unless they get what they pay for
-virtue vs interest
free markets reward innovation and specialization
in a controlled economy the regulations tend to stifle innovation
controlled economies have their appeal- the great depression
-gives people a sense of safety
The problem with markets
-Amoral; the market rewards productivity and nothing else
--markets work according to interest of buyers and sellers
--they don't think about things like who needs it most etc.
--the example of walmart
---an extremely efficient organization
---walmart an extremely controversial issue
-price is set by demand, the market is efficient
-both demanders and suppliers get what they want
MEDIA CLIP: Jib Jab: Big Boxmart [view clip here]
-what is wrong with walmart?
-sweatshops overseas because they have to make their products to cheap enough to sell at walmart
-"we used to be your customers now we're your employees"
-"your everyday low prices have a price, they aren't free"
what does this jib jab clip say is wrong with walmart
-outsourcing american jobs overseas, american laborers cannot compete at the same wages
-exploit their market power, acting like a monopoly, setting prices for suppliers
-destroys mom and pop shops, and then they go and work at walmart, doesn't add jobs it exchanges jobs
-clip makes fun of consumerism in america, americans buy all their crap
-quality of products everywhere get lower so prices get lower so they can compete with walmart
MEDIA CLIP: candy company that went out of business
-a woman lost her job at the Lifesavers candy plant
-kraft closes her plant, her job moves to canada
-kraft cited the high price of sugar as a reason to move
-kraft can save $90 million opening a plant in canada
-us sugar twice as expensive as foreign sugar
-NAFTA makes it easier to open plants in mexico or canada
Thomas Friedman wrote a book, the world is flat, students encouraged to read it, apparently its very relevant
posted by marker | 8:45 AM
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