The New Deal

I was born in the 1967, around 30 years after the last of the New Deal legislation went into effect. I grew up enjoying the benefits of the New Deal and the Great Society and as a lifelong Democrat, I’ve always admired the way those programs helped Americans during especially trying times. The past 30 years have seen conservative critiques of those landmark liberal programs and Republican Presidents from Ronald Reagan to George Bush have tried to slowly dismantle the foundations that the New Deal created. Yet in 2008, as I read about progressive politics and learn about the history of social change, I’ve grown to admire the spirit that animated the New Deal in the 1930s, and it made me appreciate the openness of FDR to new ideas to apply to the fundamental problems of our nation. More so than the legislative accomplishments, it is the spirit of experimentation that I most admire about the New Deal.

Franklin Roosevelt said,

“The country needs and, unless I mistake its temper, the country demands bold, persistent experimentation. It is common sense to take a method and try it: if it fails, admit it frankly and try another. But above all, try something.”

Roosevelt said this during the Great Depression, during the time when the capitalist system seemed to be in collapse. The money supply had shrunk one third from 1929 to 1933. Farming and rural areas suffered as crop prices fell by 40 to 60 percent, and a drought created the Dust Bowl in the midwest, displacing hundreds of thousands of people. International trade declined sharply. as did tax revenue, personal income, and profits for business. Banks failures rose as people were unable to pay off their debts, as depositors lost $140 billion in deposits by 1933. Bank failures meant that capital investment and construction slowed considerably. About 25 percent of the nation was unemployed. This information is from wikepedia (http://en.wikipedia.org/wiki/Great_Depression).

The New Dealers came into government fully versed in the progressive and liberal ideas of the time and they were intent on trying them out. The Left at this time was blessed with the mingling of Liberals and Radical, as the combination of the Great Depression and the threat of fascism united portions of the Left that normally view each other as adversaries. Robert C. Cottrell wrote in his book “Izzy: A Biography of I.F. Stone”:

“There was a sense of excitement in the air as the New Dealers devised one program after another that at least harked back to the Progressive movement of the early twentieth century and at times beyond that to the Populist and Socialist platforms as well. Long standing calls by American reformers and radicals for greater government control over business operations, for support of labor unionization, for social welfare measures, for public works projects, for planning, and for a discarding of laissez-faire approaches appeared to be heeded to some degree or another by the Roosevelt Brain Trusters. While it was clear, after a brief spell, that the New Deal was not ushering in a hoped-for revolution of the left or a feared one spearheaded by the right, it was also evident that the influence of progressive intellectual and activists on government policy was greater than ever. This development was possible not simply because the economic collapse had thoroughly discredited conservative panaceas, but also because many radicals had discarded their early insistence on the need for drastic change in the United States. And fearing the growing threat of fascist aggression, the Soviet Union- that ‘model’ socialist state- began, in the middle of the decade, to urge an antifascist alliance of liberal and radical forces. That development, coupled with the apparent New Deal successes at home, made peaceful reform appear increasingly attractive.”

The New Deal incorporated ideas like Social Security and workers’ compensation from the Socialist planks that Norman Thomas and Eugene Debs had been fighting for since the beginning of the twentieth century. Monsignor John A. Ryan influenced the New Deal to adopt some of the ideas of the Bishop’s Program of Social Reconstruction, a progressive Catholic document derived from the papal encyclical Rerum Novarum, ideas like organizing industrial output, providing a minimum wage, and providing some form of worker representation and collective bargaining. Within Roosevelt’s group of advisors that were dubbed “The Brain Trust”, two groups emerged with competing ideas. One group was led by Rexford Tugwell and Adolf Berle, believed in the government planning of the economy and in collectivist ideas to control industry. The other group, led by Felix Frankfurter, Benjamin Cohen, and Thomas Gardiner Corcoran, distrusted central planning and believed more in minimum wages, child labor laws, and other reforms that fit within the American system of checks and balances. Tugwell had admired the Progressive Senator Robert LaFollette and worked as a professor on ideas to help struggling farmers during the 1910s and 1920s. Raymond Moley was influenced by the Populist politics of William Jennings Bryan and was an admirer of Woodrow Wilson’s progressive domestic programs.

Instead of a monolithic idealogy, the New Deal was a melding of several different strains of liberal and progressive thought. I think that was one of the New Deal’s great strengths, the clashing of different ideas and the openness to trying them out. Benjamin Cohen is quoted as saying in the book, “Dealers and Dreamers: A New Look at the New Deal” by Joseph P. Lash,

“Washington was the center of action and most of us wanted to be part of the action… The New Dealers brought to Washington new energies, new ideas, and the fruitful clash of ideas, both new and old.”

Though the New Dealers represented different ideas, they were united in trying to increase the purchasing power of the average American and in the need for a massive public works program. This confluence of ideas produced Social Security, bank and stock regulation, a progressive income tax, a minimum wage, aid to higher education, and public works that are still used today. The New Deal was imperfect. It didn’t do enough to help tenant farmers, farm laborers, migrants or the poorest of the poor, and it didn’t challenge the institutional racism of our country, in spite of efforts by liberals like Eleanor Roosevelt. In spite of this, it did touch upon millions of Americans lives and it helped them to survive the Great Depression with a measure of dignity.

The New Deal was the result of the agitation of millions of poor people railing against a system that badly needed fixing. Howard Zinn wrote in the April 7, 2008 issue of the Nation that was dedicated to the 75th anniversary of the New Deal:

“The innovations of the New Deal were fueled by the militant demands for change that swept the country as FDR began his presidency: the tenants’ groups; the Unemployed Councils; the millions on strike on the West Coast, in the Midwest and the South; the disruptive actions of desperate people seeking food, housing, jobs- the turmoil threatening the foundations of American capitalism. We will need a similar mobilization of citizens today, to unmoor from corporate control whoever becomes Presidents.”

The New Deal openness to new ideas and the willingness to incorporate ideas from various segments of the Left is something that Democrats can emulate as they possibly could win the executive and legislative branches in this year’s elections. The environmental movement has generated ideas on how our society can live within its means, using more local produce to cut on transportation costs, on using alternative energy sources. The Congressional Progressive Caucus champion universal access to health insurance, fair trade agreements, living wage laws and other progressive ideas. The Green Party platform includes ideas for grassroots democracy, demilitarization and nonviolent ideas for resolving international problems, and community based economics. In a similar vein, more radical sources have formulated a post capitalist economic system that eliminates the concentration of power in corporations and makes a less hierarchical system. Though I dislike the authoritarian leanings of Hugo Chavez, his use of community groups to empower marginalized groups could be something that could be tried here. Democrats could use progressive ideas to deal with the problems caused by our dependence on oil, problems of a large segment who are not covered by adequate health insurance, the concentration of power in corporations, prevailing poverty.

The New Deal still provides a model that progressives could use to enact effective social change within the government. It’s still the most effective argument for evolutionary change rather revolutionary change, as it was during the 1930s, when the New Deal was an alternative to the communism of Stalin’s Soviet Union and Hitler’s fascism. The New Deal used progressive ideas to save capitalism and take the edge off of its inherent flaws. I read in a book that the New Deal philosophy was based on the idea that the federal government has a responsibility to protect it's most vulnerable citizens from the worst effects of a market economy. It's a philosophy that I embrace. I end this post with an excerpt from FDRs first inaugural address. It enunciates values that all progressives would approve of. FDR said:

“This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great Nation will endure, as it has endured, will revive and will prosper.

So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. In every dark hour of our national life, a leadership of frankness and of vigor has met with that understanding and support of the people themselves which is essential to victory. And I am convinced that you will again give that support to leadership in these critical days.

In such a spirit on my part and on yours we face our common difficulties. They concern, thank God, only material things. Values have shrunk to fantastic levels; taxes have risen; our ability to pay has fallen; government of all kinds is faced by serious curtailment of income; the means of exchange are frozen in the currents of trade; the withered leaves of industrial enterprise lie on every side; farmers find no markets for their produce; and the savings of many years in thousands of families are gone. More important, a host of unemployed citizens face the grim problem of existence, and an equally great number toil with little return. Only a foolish optimist can deny the dark realities of the moment.

And yet our distress comes from no failure of substance. We are stricken by no plague of locusts. Compared with the perils which our forefathers conquered, because they believed and were not afraid, we have still much to be thankful for. Nature still offers her bounty and human efforts have multiplied it. Plenty is at our doorstep, but a generous use of it languishes in the very sight of the supply.

Primarily, this is because the rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence, have admitted their failure, and have abdicated. Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men.

True, they have tried. But their efforts have been cast in the pattern of an outworn tradition. Faced by failure of credit, they have proposed only the lending of more money. Stripped of the lure of profit by which to induce our people to follow their false leadership, they have resorted to exhortations, pleading tearfully for restored confidence. They only know the rules of a generation of self-seekers. They have no vision, and when there is no vision the people perish.

Yes, the money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of that restoration lies in the extent to which we apply social values more noble than mere monetary profit.

Happiness lies not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort. The joy, the moral stimulation of work no longer must be forgotten in the mad chase of evanescent profits. These dark days, my friends, will be worth all they cost us if they teach us that our true destiny is not to be ministered unto but to minister to ourselves, to our fellow men.

Recognition of that falsity of material wealth as the standard of success goes hand in hand with the abandonment of the false belief that public office and high political position are to be valued only by the standards of pride of place and personal profit; and there must be an end to a conduct in banking and in business which too often has given to a sacred trust the likeness of callous and selfish wrongdoing. Small wonder that confidence languishes, for it thrives only on honesty, on honor, on the sacredness of obligations, on faithful protection, and on unselfish performance; without them it cannot live.”