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2.1 What Made the Old Social Contract Work and Why did It Break Down?

There are conspicuous challenges for today’s economy but, in some ways, we’ve actually been here before! As we stressed last week, it helps to take a historical perspective in order to understand the current state of the economy and the challenges that we collectively face. In the video below, Professor Kochan examines a series of historical events, including rising wealth inequality in the 1920s and the Great Depression, that remain highly relevant today.

Video: The New Deal at Work

Attentiveness Question 1

The video described someone who pressed for legislation to provide unemployment insurance, a national minimum wage, and a program for retirement insurance and disability insurance.

Who was this person?

Explanation

Frances Perkins was brought on as Franklin Delano Roosevelt’s Secretary of Labor and pressed hard for legislation to provide unemployment insurance, a national minimum wage, and a program of retirement insurance and disability insurance.

Exercise 1

 Michael Thompson 

 Marie Curie 

 Frances Perkins 

 Carrie Lynchpin 

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Attentiveness Question 2

Which of the following was NOT part of the New Deal?

Explanation

The fourth part of the New Deal described in the video was the Nation Labor Relations Act, not the Capital Gains Taxation.

Exercise 2

 Unemployment Insurance 

 Fair Labor Standards Act 

 Capital Gains Taxation 

 Social Security 

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Attentiveness Question 3

What did the National Labor Relations Act do?

Explanation

The National Labor Relations Act promised workers the right to organize into unions. Maternity leave was not federally secured for women in the workforce by the New Deal. Unemployment Insurance provided temporary assistance for workers who become unemployed, and the Fair Labor Standards Act established a minimum wage.

Exercise 3

 Secured paid maternity leave for women in the workforce. 

 Established a minimum wage. 

 Provided temporary assistance for workers who become unemployed. 

 Promised workers the right to organize into unions. 

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