George Peek - New Deal Career

New Deal Career

When the Republican Party refused to support the legislation, Peek became a Democrat. His support for the McNary-Haugen bill led President Franklin D. Roosevelt to appoint him Administrator of the Agricultural Adjustment Administration (AAA) in 1933. Peek had sought the United States Secretary of Agriculture position, but that had gone to Henry A. Wallace. Instead, Bernard Baruch (who knew Peek from their service on the War Industries Board together) convinced Roosevelt to put Peek in charge of the AAA. Peek fought with Wallace over the administration of the agency. Peek asked Roosevelt to make the AAA an independent agency rather than part of the United States Department of Agriculture; Wallace convinced Roosevelt to deny the request. Peek demanded full authority to run the AAA; Wallace withheld it. Wallace installed Jerome Frank, a liberal young lawyer whom Peek loathed, as the AAA's general counsel. Peek also disagreed with one of the three fundamental programs created by the Agricultural Adjustment Act. The Act created three programs designed to boost farm prices: 1) It established marketing programs designed to increase the purchase of American agricultural products overseas; 2) It established a system of price supports; and 3) It established a system of incentives to discourage overproduction. In order for farmers to participate in the price support program, they must agree to cut production. Peek was adamantly opposed to the production quotas, which he saw as a form of socialism. Instead, Peek preferred to promote informal cartels of large producers and large food processing companies, which together would collude to boost prices. Wallace repeatedly denied Peek the authority to institute such cartels, however. When the Commodity Credit Corporation was established in the early fall of 1933, Roosevelt refused to make it part of the AAA out of concern for Peek's attitudes. On November 15, 1933, and again on November 25, Peek demanded that Wallace fire Frank for insubordination; Wallace refused and threatened to have one of Peek's most trusted aides fired instead. In early December 1933, while Wallace was out of town, Peek announced a marketing program designed to sell American butter in Europe at rates below the national domestic price. Rexford Tugwell, Acting Secretary of Agriculture in Wallace's absence, rescinded the program. Wallace quickly convinced many of Roosevelt's top advisors to ask for Peek's resignation. Tugwell himself threatened to resign if Peek were not fired.

Faced with a united front, Peek resigned from the AAA on December 11, 1933. One reporter called the forced resignation "the coolest political murder that has been committed since Roosevelt came into office." The same day, President Roosevelt named Peek his Special Advisor on Foreign Trade.

President Roosevelt created the Export-Import Bank of Washington by executive order on February 2, 1934, and named Peek president of the bank. Roosevelt created a Second Export-Import Bank of Washington via executive order on March 9, 1934, and named Peek president of the second bank as well. Peek's tenure at the Export-Import Bank was also short-lived. He clashed repeatedly with United States Secretary of State Cordell Hull over a series of reciprocal trade agreements in 1935, and resigned from the bank on December 2, 1935.

In 1936, he published a book on economic matters entitled, Why Quit Our Own, which he co-authored with Samuel Crowther.