Emergency Relief Appropriation Act of 1935

views updated

EMERGENCY RELIEF APPROPRIATION ACT OF 1935

The Emergency Relief Appropriation Act of 1935 was the New Deal's effort to end the "dole" and replace it with public employment. The act appropriated approximately $4.8 billion to finance the last months of the Federal Emergency Relief Administration (FERA) and initiate what became the Works Progress Administration (WPA).

The administration's decision to replace relief with the WPA reflected the values of Franklin D. Roosevelt and his relief administrator, Harry Hopkins. Both believed that relief demoralized the unemployed and produced a condition of dependency. Furthermore, most unemployed workers preferred work relief to the direct "dole." The end of the Civil Works Administration (CWA) in the spring of 1934 had produced a mass protest movement that demanded work instead of a return to direct relief, and protest organizations proliferated under the "work program" of the FERA, which replaced the CWA. But work relief was enormously expensive and was opposed by influential New Dealers who feared that it would unbalance the federal budget. Roosevelt, despite his clear preference for public employment, shared this concern and terminated the CWA. The end of civil works produced a debate within the administration between "spenders," who favored public employment, and fiscal conservatives who opposed it.

In the end, Roosevelt came to support public employment because he feared that the high federal relief caseload, which by the end of 1934 approached five million, would create a permanent federal "dole." In October he began meeting with key advisers to plan a new work program to replace relief. By the end of December the administration had determined to ask Congress for $4.8 billion, approximately two-thirds of which to finance work relief and the rest to draw down the FERA. The program would not be administratively linked to the Social Security Act, the administration's proposed "permanent program" to deal with "economic insecurity." Public employment would be a temporary policy to deal with the Depression crisis, not a permanent public employment program.

The administration's proposal to Congress at first appeared to be adequately funded and have broad-based political support. Eight hundred million dollars would be sufficient to phase out the relief program during the summer of 1935, leaving $4 billion to employ approximately 3.5 million former relief recipients (70 percent of the FERA caseload). The remaining relief recipients, termed "unemployables," would be returned to the states, which would receive some federal relief aid under the Social Security Act.

But the transition from relief to public employment in 1935 encountered political and administrative obstacles that seriously undermined the policy. First, the appropriation bill was delayed in Congress by demands from organized labor that the program pay prevailing wage rates. Then congressional leaders insisted on allocating the portions of the appropriation to specific employment categories and federal agencies, making it much more difficult to implement a smooth transition from the existing relief program. When the bill finally passed in the late spring, a battle erupted between the FERA's Harry Hopkins and Harold Ickes, the interior secretary and director of the PWA, over control of the program. The conflict between Hopkins and Ickes was not only a power struggle; it was a debate over whether the new program should resemble public works, with capital intensive projects employing relatively little relief labor, or work relief, which employed more recipients but often seemed to be "made work."

By September 1935 the administration's new program appeared on the verge of collapse. Less than one-quarter of the projected 3.5 million workers had been employed and barely $1 billion of the original appropriation remained unallocated. To meet the crisis, Roosevelt handed the remaining funds to Harry Hopkins, who quickly began to transfer work relief projects to the program that came to be known as the WPA. By the end of December, nearly three million workers were on the WPA payrolls and the administration declared its program "99 7/8% successful." But the smaller than expected WPA employment levels left a large relief burden for the states, generating an on-going crisis in the emerging state public welfare system of the late 1930s. The WPA, by contrast, proved enormously popular and contributed to Roosevelt's resounding victory in the 1936 election.

See Also: FEDERAL EMERGENCY RELIEF ADMINISTRATION (FERA); HOPKINS, HARRY; WORKS PROGRESS ADMINISTRATION (WPA).