President Calvin Coolidge once famously proclaimed “The business of America is business,” which meant his administration would pursue a “hands off” approach toward the business sector over the interests of the American people. In office from 1923 to 1929 President Coolidge kept to his pro-business principles that, in turn charged the roar into the Roaring Twenties.

By the end of October 1929, six months into the new Hoover Administration, Coolidge’s lax policies came due dropping the Dow Jones Industrial into free fall. This financial catastrophe capped off a decade of easy money made through frenzied and unregulated trades, not only by wealthy holders, but by regular folks taking stock tips from friends or newspapers.

A large portion of these everyday newbies purchased shares “on-margin,” meaning 10% down with 90% on credit, usually borrowed from private banks. The only collateral required was the promise of certain and endless gains. And why not? The market had grown at an astounding rate from $27 billion in the mid-1920’s to $87 billion by 1929. 

Coolidge’s free-market detachment produced a carnival atmosphere with everyday people hot in the market game.

By 1932 the party was over. The now suffering nation had had enough of hands off and predatory money practices. Massive unemployment, thousands of bank failures, hunger, homelessness, and a Dust Bowl in the heartland brought America to its knees, and Democrat Franklin Delano Roosevelt to the White House.

Seeing nothing beneficial for the American people in catering only to the rich, FDR brought an end to GOP policies. His administration instead offered a New Deal for economic revival. Through a massive legislative agenda Roosevelt and Congress intended to not only meet the emergency, but restore economic growth, and eliminate the conduct that led to the Depression in the first place.

One of the most popular New Deal relief programs was the Civilian Conservation Corps. Unemployed young men were put to work throughout the nation building trails and campsites in forests like the Great Smokey Mountain National Park, and urban building projects like the River Walk in San Antonio, Texas. (Consider that idle young men in Germany at the same time donned Black and Brown Shirts and broke heads for Hitler.)

Addressing the chaotic banking system FDR proposed systematic changes. Some 6000 banks had failed between 1930 and 1933 before the new president took office. Panicked depositors waited in long lines to demand their money until banks simply ran out of cash and locked their doors. Confidence collapsed. 

In his first days Mr Roosevelt announced a Bank Holiday where banks closed for four days to stop panic withdrawals. Auditors then inspected banking institutions across the country and surprisingly many banks were deemed solvent and reopened. Not finished with banking, FDR also took to the radio to explain the banking system, and with his cheerful confidence encouraged the public to take cash out of their mattresses, coffee cans, and backyard holes and return deposits to local banks. Thousands did just that. 

In order to prevent another such economic catastrophe the Glass-Steagall Act (1933), was passed by Congress to protect the public from high risk banking practices. One piece of the law was the Federal Deposit Insurance Corporation, FDIC, which is still in effect today. Depositors had the backing of the federal government to protect their funds from any loss. Moreover the Roosevelt Administration was determined to keep people in their homes, many of whom were facing foreclosure. The Home Owners Refinancing Act provided federal assistance to those who had paid their mortgages in good faith, but now faced eviction. 

In the first hundred days of Roosevelt’s New Deal 77 laws in total were passed by Congress, all aimed at restoring the health of the country. To the majority of Americans it felt like this president truly cared about their wellbeing. Roosevelt’s ascendency to the White House, next to Abraham Lincoln’s certainly stands as the most consequential in America’s continuing experiment in self government.

On a side note Franklin Roosevelt suffered from polio and could not walk, though he believed he’d walk again. FDR never gave up. And the truth of the matter is it took a man in a wheelchair to put the United States back on its feet. Franklin Roosevelt, unlike his predecessors knew that the business of America is “We The People.”

Gail Chumbley is a history educator, author, and playwright. Her work includes River of January, River of January: Figure Eight, both available on Kindle, plays Clay on the life of Senator Henry Clay, Wolf By The Ears a study of American slavery, and Peer Review where Donald Trump meets four past presidents.

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