But Roosevelt’s efforts also included direct relief.
When he took office, unemployment was well above 20 percent, environmental disaster in the form of drought was sweeping the middle of the country, an upsurge in racial lynching was taking place in the South, and the worst financial collapse in American history was driving a rolling bank crisis, not to mention the looming threat of authoritarianism abroad. The new Roosevelt administration had ambitions to restructure the economy, but it also knew that a key first step was immediate relief to struggling Americans.
Biden faces a similar set of economic, financial, racial and environmental crises — something made even more visible by the dire circumstances that millions face after last week’s storms in Texas and neighboring states. This is the New Deal lesson we need to remember: Relief is the necessary first step toward rebuilding a more resilient economy.
Over the course of his first two terms in office, Roosevelt’s administration sought to rebuild the economy with programs that shifted its structures and increased fairness and resilience. In general, it tended to favor programs that created jobs over ones that provided relief. But upon taking office in 1933, Roosevelt also knew there was an immediate need for relief regardless of whether it was attached to a job.
In 1933, people were desperate. Before Roosevelt’s arrival in the White House, direct aid was not a federal responsibility. Relief for individuals was provided through states, localities and private charities, typically in the form of food or goods rather than cash. Receipt was often contingent on meeting the moral standards of caseworkers — for example, ideas about cleanliness and family structure that discriminated against Black Americans, recent immigrants and single women. In the winter of 1932-1933, the failures of these systems in the face of crisis had left 1.2 million people homeless.
When Roosevelt took office, the Depression had dragged on long enough that these local systems no longer had the funds to offer aid. And so, on May 12, 1933, just over two months into Roosevelt’s first 100 days, Congress established the Federal Emergency Relief Administration (FERA). FERA’s new administrator, Harry Hopkins, was given half a billion dollars in “general relief” funding to “assist all resident persons whose income from other sources was inadequate to meet their needs.” According to one often-repeated story, Hopkins set up a desk in a hallway while he waited for an office and spent $5,000,000 on relief in his first two hours on the job.
Ultimately, FERA would create specialized work-relief programs that gave rise to the better-known Works Progress Administration programs, but in its first few months, all funds were used for direct relief. People needed money to meet basic needs, and FERA made it possible for them to get it.
Hopkins used his program to try to make relief more akin to income support. To do this, FERA distributed money in two streams: Half went to direct federal grants and programs, while the other half was given to state and local relief agencies on a matching basis.
In comparison to its predecessor programs, FERA set standards that were notably generous and free of moral judgments (although local agencies did not always abide by these standards in practice). “FERA regulations stated that relief should be extended to any person whose employment or available resources were inadequate to provide the necessities of life.” Further, FERA pushed relief agencies to switch from in-kind relief (food, etc.) to cash aid.
Despite these improvements, FERA shared the racism and sexism of almost all New Deal programs. The program’s emphasis on using income levels to determine eligibility rather than the individual judgments of caseworkers did open up relief to Black people; because they were poorer overall, a higher proportion of Black people than White people received payments through FERA. But local control allowed many administrators to discriminate against Black applicants in numerous ways. Federal administrators even allowed states to set different relief rates for Black and White applicants, something 10 Southern states did. Further, when FERA did begin to set up work relief programs, it arbitrarily limited women to only 12 percent of the jobs, although they made up 25 percent of the officially unemployed.
FERA ended in 1935 as new legislation institutionalized its roles in agencies that would function beyond the immediate disaster of the Depression. By then, the agency had shifted its focus from direct relief to a variety of work relief programs. The Works Progress Administration took up this work, and cash relief (mostly at a less generous level) was made part of the newly created Social Security system. By FERA’s closing, 16 percent of Americans had received relief through the program.
American lives are still clearly shaped by the programs that replaced FERA, so it is natural that those are the ones we remember. The Social Security Act created the country’s primary social insurance system, making the economy more equitable and Americans’ lives more secure to this day. We still drive on roads, use energy from dams, attend schools and visit libraries, all built by the WPA. But FERA was the first step in creating all of these programs. It prevented unnecessary suffering while the structurally transformative programs we remember were being created.