If Morrison earned the title of the "Good Roads Governor," his successor, Angus Wilton McLean of Robeson County, deserved that of the "Businessman's Governor," for he modernized the administration of state government by creating new agencies, abolishing old ones, and reallocating functions of others. His most significant accomplishments were the establishment of the Budget Bureau, which assisted the governor in preparing a more realistic balanced budget for presentation to the General Assembly, and the creation of study commissions whose findings and recommendations were of value when the Great Depression occurred.
In 1928 the nomination of Alfred Emanuel Smith for the presidency split the Democratic party. Big-city bred, a wet, and a Catholic, Smith was on all three counts unacceptable to many Southerners, including Senator Simmons, whose defection contributed to his own defeat by Josiah William Bailey two years later. Herbert Hoover became the first Republican to win the state's electoral votes since 1872; two Republicans--Charles Andrew Jonas and George Moore Pritchard--were elected to the Congress; and a larger than normal delegation of Republicans was sent to the legislature. Oliver Max Gardner, however, remained loyal to the party and won the governorship by a comfortable margin.
The governor resisted the temptation to panic; instead of calling a special session of the legislature he commissioned the Brookings Institution to make a comprehensive study of state and local governments and to propose changes to improve efficiency. The institution's proposals were far-reaching, and not all of them were acceptable to Gardner. At his urging, however, the General Assembly of 1931 supported four fundamental changes in the operation of government: the state took over from the counties the responsibility for constructing and maintaining roads and for the operation of the six-month school term; a greater University of North Carolina was created by the consolidation of Woman's College at Greensboro, State College of Agriculture and Engineering at Raleigh, and the University of North Carolina at Chapel Hill, and the Local Government Commission was given supervision over the borrowing practices of county and municipal governments. The state left ad valorem taxes to the use of local governments, while corporation taxes were increased at the state level. Finally, economies were adopted, including the reduction of salaries of state employees and teachers.
These bold actions, however, failed to halt the economic downturn, and John Christoph Blucher Ehringhaus of Elizabeth City assumed the governorship in 1933 in the midst of the nation's worst economic crisis. Employment, wages, prices, and profits were at rock-bottom, and thousands of North Carolinians were delinquent in their taxes. State and local governments also were on the verge of bankruptcy; together they owed more than a half billion dollars.
Franklin Delano Roosevelt, who had carried North Carolina and won the presidency on a platform of economy in government, shelved his rhetoric and launched the federal government on the radical economic course to which the term "New Deal" was applied. By exercising unprecedented powers granted him by the Congress, he moved boldly to restore confidence in the banking system, then pushed through the Congress a long list of costly programs, many of them overlapping, some of them unclear in objective, most of them designed to put money into the hands of the poor as quickly as possible, and all of them known by acronyms. The Federal Emergency Relief Administration (FERA), for instance, had relief as its main objective through a variety of productive jobs, make-work activities, and adult education classes. Nearly seventy-five thousand young North Carolinians--black and white--were enrolled in the Civilian Conservation Corps (CCC), given drab uniforms, sent to one of sixty-six camps in the state, provided subsistence and a small salary, and put to work encouraging farmers to plant leguminous crops, build strong fences, and control erosion by contour terracing of hillsides and constructing meadow strips. Among the legacies of the CCC was kudzu, an Asiatic vine imported to fight erosion but which showed some of the attributes of the mythical Jack's beanstalk. The National Youth Administration (NYA) employed thousands of high school and college youngsters in nearly 500 projects, many of them clerical in nature.
Of the dozens of such agencies, the ones that left the most tangible accomplishments in North Carolina were the three "works" programs--the Civil Works Administration (CWA), the Public Works Administration (PWA), and the Works Progress Administration (WPA ). The WPA spent nearly $175 million in North Carolina and employed thousands in building roads, airfields, outdoor privies (63,311 of them in three years), hospitals, schools, and other permanent improvements. It also hired artists to decorate public buildings and paint pictures, musicians to teach and conduct concerts, actors to produce dramatic performances, and historians and clerical workers to inventory the records of public agencies. Under the WPA the Federal Writers Project conducted interviews, compiled folk tales, and published guides to institutions, cities, and states. In the first five years of the New Deal these and scores of other federally funded projects brought into the state nearly a half billion dollars, although this was the lowest per capita allocation of all the states.
These New Deal programs were rife with politics, and whether they accounted for the improvement in the economy was a question of legitimate debate. Nevertheless, conditions did improve, whether owing to the New Deal or to the stimulation of war-preparatio n policies, and by the outbreak of World War II the economy appeared to be in better condition than it had been prior to the Depression. Critics of the New Deal, of course, pointed to the high federal debt contracted under an administration first elected on a platform of economy in government.