He assured people that any bank open the next day had the federal government’s stamp of approval. In this initial radio address to the American people, he explained what the bank examiners had been doing over the previous week. On March 12, the day before the banks were set to reopen, Roosevelt held his first “ fireside chat” ( Figure 26.5). By March 15, 70 percent of the banks were declared solvent and allowed to reopen. Between March 11 and March 14, auditors from the Reconstruction Finance Corporation, the Treasury Department, and other federal agencies swept through the country, examining each bank. The law also gave the comptroller of currency the power to reorganize all national banks faced with insolvency, a level of federal oversight seldom seen prior to the Great Depression. Furthermore, dollar bills were no longer redeemable in gold. Treasury for a discounted rate of a little over twenty dollars per ounce. Those who held gold were told to sell it to the U.S. The law officially took the country off the gold standard, a restrictive practice that, although conservative and traditionally viewed as safe, severely limited the circulation of paper money. The resulting Emergency Banking Act of 1933 was signed into law on March 9, 1933, a scant eight hours after Congress first saw it. Within forty-eight hours of his inauguration, Roosevelt proclaimed an official bank holiday and called Congress into a special session to address the crisis. In all, over five thousand banks had been shuttered. New York and Illinois had ordered the closure of their banks in the hopes of avoiding further “bank runs,” which occurred when hundreds (if not thousands) of individuals ran to their banks to withdraw all of their savings. When Roosevelt took office, he faced one of the worst moments in the country’s banking history. At the outset of the First New Deal, specific goals included 1) bank reform 2) job creation 3) economic regulation and 4) regional planning. Most bills could be grouped around issues of relief, recovery, and reform. By the close of 1933, in an effort to stem the crisis, Congress had passed over fifteen significant pieces of legislation-many of the circulated bills allegedly still wet with ink from the printing presses as members voted upon them. What later became known as the “First New Deal” ushered in a wave of legislative activity seldom before seen in the history of the country. Much like a surgeon assessing the condition of an emergency room patient, Roosevelt began his administration with a broad, if not specific, strategy in mind: a combination of relief and recovery programs designed to first save the patient (in this case, the American people), and then to find a long-term cure (reform through federal regulation of the economy).
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