idespread. Since the stock market crash of October 1929, the value of common stocks had declined from $89 billion to $15 billion; between 1929 and 1932 GNP declined in constant 1928 dollars from $197.1 billion to $143 billion; real output fell 29 percent, total gross investment fell from 15 percent of GNP to one percent; consumption dropped by more than one third; farm prices fell appreciably after declining in the 1920s; unemployment increased from 3.2 percent in 1929 to 21-25 percent in 1933; and about 13 million Americans were officially out of work (Atack & Passell 583; Galbraith 96-97; and Watkins 55). Leuchtenburg said "no longer did America seem a land bright with promise" (28).
The Hoover administration had lost credibility because it "opposed deficit-financed expenditures and easy monetary policies" (Ferguson 13). The first priority of the new administration was to restore the confidence of Americans in themselves and the economy and to instill hope. As Goldman (1977) put it, "as the depression ground past its third year, an unprecedented fear seeped through the nation" (249). Of the approximately 9,000 banks which failed after 1929, 4,004 closed their doors during the first two months of 1933 (Watkins 55).
In his inaugural address, FDR said that "the only thing we had to fear is fear itself" (Leuchtenburg 41). The first 100 Days were largely spent enacting confidence-building measures, such as the bank holiday, temporary relief and farm subsidy bills, and what Donovan called "a series of rapid fire and ad hoc assaults on a variety of problems strewn across the Depression landscape" (252). Legislation was passed and new agencies were rapidly set up to regulate financial markets and public utilities. The United States went off the gold standard, a sign of FDR's intense domestic focus.
The administration had no coherent plan. FDR said that "the country needs . . . bold, persistent experimentation" (Goldman 251). FDR h...