Custom «The New Deal Policy» Essay Paper Sample
The New Deal policy of the 1933, during the reign of President Franklin D. Roosevelt, was a series of economic policies put forward and implemented by the federal government in frantic efforts to revivify the economy from the great depression (Edsforth 127). The economy was undergoing deflation which hit the elderly, the disabled and unemployed population more than anyone else. Worse still the depression pushed unemployment rate higher, which further exacerbated the vulnerability of the aged since they were more likely to be retrenched and less likely to be rehired (Stien 29-31).
It is for this reason that the federal government focused more on creating a safety net for the elderly, unemployed and disabled through the signing and implementation of the Social Security Act of the 1935 (Edsforth 134). The act encompassed several programs meant to offer relief for the worst affected victims of the depression as well as enable the economy to recover back to normal cash flow levels. Some long-term reforms incorporated in the deal aimed at cushioning the economy from any future depression (Edsforth 145).
The Social Security Act created several entitlements for various vulnerable groups in the society. These entitlements guaranteed financial and social economical privilees stipulated by the law to individuals and social organizations that met the criteria for accessing them. Initially the act covered barely a small section of population but afterwards revisions of the act made it more inclusive, streamlined, and practical (Stien 56).
The cash meltdown led to reduced spending ability, which resulted to diminishing consumers thus weakening demand. The weak demand was the underlying problem that pushed deflation higher. The entitlements turned the non-consumers to consumer. The elderly people, the unemployed, and the disabled in the society lived in some kind of economic reliance. They did not have sufficient income for self-sustenance and lacked any cash generating undertaking (Edsforth 155-158). This made them passive participants in economic growth since they were neither producing nor consuming.
These entitlements gave them a financial spring back creating a robust consumer population pushing demand high thus restoring back higher prices for commodities hence reducing deflation. They were very necessary in assuring economic sufficiency to these vulnerable groups as well as giving them financial independence. As a result, production went high leading to more job creation among other factors that played a great role in stimulating the economy out of the ggreat depression (Stein 101).
Today, social security has greatly improved in terms the number of individuals who receive social security benefits as the amount received since President Obama signed a new Social Security, Medicare, and Medicaid bill into law in 2009 (Yang 11). This offered a greater population health care insurance that ever before in the USA. However, it has resulted to a bloated federal government spending and made estimating fiscal budgetary allocation almost impossible nearly crippling the program (Yang 19). There is therefore a need for reforms in programs to make them more self-sustaining by shifting a fraction of the cost to the beneficiaries.
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Despite the fact that the Obama administration put into place measures to revamp the economy, unemployment has continued to rise, biting more hard on the disabled persons. The economic stimulus packages have led to creation of over three million jobs but this has not solved the problem. The programs need re-adjustments corresponding with the economic growth failure to which a collapse is inevitable. This is because the current beneficiaries are dependent on a large pool of contributors and with time, the reverse will happen. It is also important to slow down the growth of these programs to pace that is sustainable (Yang 22-25).
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