FIGHTING THE NEW DEAL: GEORGIA’S STRUGGLE AGAINST FEDERAL AID DURING THE GREAT DEPRESSION

Abstract

This paper examines Georgia during the Great Depression and New Deal. It specifically focuses on the years of 1929 to 1940. First, the paper looks at what Georgia did in response to the Great Depression and New Deal and how this response evolved as Georgia’s political leadership changed. In analyzing this response, the paper found five significant trends that occurred in the state during this time: the adoption of the income tax, investment in state highways, the legalization of alcohol, reallocating the gasoline tax, and the expansion of the state’s welfare program. The second part of the paper switches its focus to the specific economic trends in the state during this time by using regression analysis to study the relationship between per capita income and other factors. This paper used two types of regressions to study this relation: an Ordinary Least Squares (OLS) regression and an OLS regression with Fixed Effects. The purpose of the fixed effects regression is to account for any state specific or year specific shocks or events. The regression analysis found a statistically significant relationship between per capita income and the percentage of a state’s population that submitted tax returns as well as the percentage that had automobile registrations