6.3 The Second New Deal: Social Security, WPA, and Labor

By 1935 the First New Deal’s industrial codes were dying in court, unemployment was still mass, and critics on Roosevelt’s left demanded more than emergency alphabet agencies. Independent OpenExamPrep study of History of the United States II treats the Second New Deal as a turn toward statutory rights at work, federal jobs as a continuing program, and social insurance—a more durable expansion of the federal role than Hundred Days improvisation. The themes to carry into exam essays are work and labor plus the changing responsibilities of Washington.

Why a “Second” New Deal?

Several shocks piled up. Schechter (1935) erased the NRA, including the weak Section 7(a) labor clause. The 1934 midterms strengthened Democrats, but so did strikes, Unemployed Councils, and Long–Townsend–Coughlin pressure from outside the administration (detailed in the next section). Roosevelt’s 1935 program answered with laws that did not depend on industry writing its own codes. Learn three pillars: Wagner/NLRA, WPA, and Social Security, then add FLSA (1938) and the CIO upsurge.

The Wagner Act and the NLRB (1935)

The National Labor Relations Act, signed July 5, 1935, and known as the Wagner Act after Senator Robert Wagner of New York, declared it national policy to encourage collective bargaining. For covered private-sector employees it:

• Protected the right to form unions and to bargain through representatives of their own choosing
• Listed unfair labor practices by employers (firing unionists, company unions, refusing to bargain)
• Created the National Labor Relations Board (NLRB) to run representation elections and to issue cease-and-desist orders

The Act did not cover agricultural laborers, domestic workers, or most public employees—the same kinds of gaps that appear in Social Security. It also did not force a closed shop by itself; it created a federal referee for organizing. After Schechter, Wagner placed labor rights on a commerce-clause theory of industrial peace rather than on NRA codes. The Court would accept that theory in 1937; until then, many employers simply ignored the statute.

WPA: Federal Jobs under Harry Hopkins

The Emergency Relief Appropriation Act of 1935 authorized a huge jobs fund. Roosevelt then created the Works Progress Administration (later Work Projects Administration) by executive order, with Harry Hopkins as administrator. The WPA’s theory differed from Hoover’s RFC and from Harold Ickes’s slower Public Works Administration: put people on a federal payroll quickly for useful work, even if the project was modest. Over its life the WPA employed millions—commonly summarized as more than eight million people at some point—on roads, schools, airports, sewers, and parks.

Federal Project Number One hired writers, artists, musicians, and theater workers (Federal Writers’ Project, Federal Art Project, Federal Theatre Project, Federal Music Project). The Writers’ Project produced state guidebooks and recorded formerly enslaved people’s narratives; the Theatre Project staged living newspapers until conservative Congresses killed it. Exam contrast: PWA (Ickes) = large capital projects, fewer jobs per dollar, slower; WPA (Hopkins) = labor-intensive relief employment, including white-collar and cultural work. WPA wages were meant to be better than the dole but not so high as to drain private hiring—an awkward political compromise.

The National Youth Administration and Rural Electrification Administration (1935) extended the same logic to students, young workers, and farm households still off the grid. REA cooperatives brought electric light to rural rooms the private utilities had skipped—another federal-role example often paired with TVA.

Social Security Act (1935): Insurance, Exclusions, ADC

Signed August 14, 1935, the Social Security Act is the Second New Deal’s welfare-state core. It was not a single check to every American. It was a bundle of titles:

Two exclusions matter on every serious exam item. Agricultural workers and domestic workers were left out of the original old-age insurance coverage (along with many self-employed people and government employees). Those jobs were a large share of African American employment in the South and of women’s paid household labor. Scholars debate how much the exclusion was administrative (hard to collect taxes from casual farm and household jobs) versus how much it reflected Southern Democrats’ desire to keep a cheap, racially ordered labor market. For this exam, know the fact of exclusion and its disproportionate racial and gendered impact; do not reduce the entire Act to a conspiracy, and do not pretend coverage was universal in 1935.

Old-age insurance was also not means-tested for those who earned it, and benefits would not be paid in volume until later in the decade—one reason Townsendites still grumbled. Unemployment insurance was a federal-state hybrid, not a purely national dole. ADC (later AFDC) was the poor-children title that critics would spend decades attacking as “welfare.”

Fair Labor Standards Act (1938)

The Fair Labor Standards Act, signed June 25, 1938, was the last major New Deal labor statute before the war economy. For covered employees engaged in or producing goods for interstate commerce, it:

• Set a federal minimum wage of 25 cents an hour (rising on a schedule)
• Set a maximum regular workweek of 44 hours, then stepping down toward 40, with time-and-a-half overtime
• Banned oppressive child labor in covered interstate employment

Secretary of Labor Frances Perkins had pushed wage-and-hour legislation for years; Schechter and earlier child-labor cases had blocked cruder federal attempts. FLSA still omitted large categories of workers (again including much farm and domestic labor). It applied, in its first years, to a minority of the labor force. Even so, it established the principle that Washington could set a national floor under wages, hours, and child labor without an NRA code system.

CIO, John L. Lewis, and the Flint Sit-Down

The American Federation of Labor had been built around craft unions. Mass-production workers in autos, steel, rubber, and electrical goods were hard to organize that way. In 1935 John L. Lewis of the United Mine Workers and allies formed the Committee for Industrial Organization inside the AFL to unionize whole industries; by 1938 it was the independent Congress of Industrial Organizations (CIO).

The breakthrough strike was the Flint sit-down against General Motors, beginning in late December 1936 and ending in February 1937. Members of the fledgling United Automobile Workers occupied Fisher Body plants, stopping production without a street battle that police could easily club. Michigan Governor Frank Murphy refused to use the National Guard to storm the plants. GM recognized the UAW as the bargaining agent for its sit-down workers—an electrifying CIO victory. U.S. Steel recognized the Steel Workers Organizing Committee in 1937 without a comparably long sit-down; Little Steel firms resisted, and Chicago police killed strikers in the Memorial Day Massacre of 1937.

Sit-downs were legally vulnerable (they occupied private property), and courts and later statutes curbed them. For 1936–37 they were the tactic that made industrial unionism real. Pair Flint with Wagner: the statute supplied a legal theory; the sit-down supplied power before the Supreme Court had fully blessed the NLRB.

Unemployment remained in the mid-teens even in better years, and the 1937–38 recession showed that WPA, Social Security taxes, and incomplete private recovery had not “solved” the Depression. The next section turns to critics, the Court fight, and the coalition that still made Democrats the majority party.

Exam traps: placing Social Security in the Hundred Days; saying SSA covered all workers in 1935; swapping Hopkins’s WPA with Ickes’s PWA; dating FLSA to 1933; and treating the CIO as a pre-1929 craft federation.