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Conservatives Just Can't Get Over the New Deal

Jan. 23, 2008 (Updated May 18, 2008)

It’s been seventy-five years, and conservatives still can’t get over the New Deal. Just the other day, an on-air commentator named Glenn Beck, who has a show on CNN, said he wanted to slap his grandfather “across the face for liking FDR.” He went on to call Roosevelt “one evil son-of-a-bitch” who “nationalized health care, and energy, and everything else” and made the depression “go on and on and on for a decade.”

“He certainly left us the bills,” chimed in his guest and ideological kinsman on the split screen, Stephen Moore of The Wall Street Journal’s editorial board. “He was the first president to say deficits are good, let’s run up the deficit, let’s live high on the hog, then we’ll let future generations, our kids pay for it.”

One wonders how much attention to give such statements. Not much, ordinarily. Except these are not ordinary times, and this kind of talk is everywhere. There’s a conservative economist and author named Amity Shlaes who published a revisionist history of the New Deal last year. Like Beck, she claimed Roosevelt’s policies prolonged the depression. More lately, she had a piece on the Journal’s OpEd page that charged that New Deal public works projects were less efficient than work done by the private sector.

But that was the point. The Works Progress Administration, the program that almost single-handedly rebuilt the country during the depression, was commanded to spend 90 percent of its project budgets on labor. WPA crews could have built roads more efficiently if they had used more steam shovels and graders and fewer pickaxes and wheelbarrows. But the idea was to put money in the hands of consumers who would spend it right away. That’s called economic stimulus, precisely what the current administration is proposing, to the tune of $150 billion, to ward off the looming recession brought on by the subprime mortgage crisis. (Which was in turn brought on by the fiction, being peddled like gospel again, that the markets work perfectly free of regulation.)

Spending for labor also meant scrimping on materials and administration. The WPA under Harry Hopkins ran without a huge bureaucracy – he didn’t believe in organizational charts. Perhaps this did not figure into Shlae’s calculations of efficiency. The lack of money for materials, however, had unexpected benefits. WPA builders often had no choice but to use what was at hand, with the result that many WPA structures were made of hand-quarried native stones rather than concrete blocks or bricks, and logs rather than milled lumber. Of course, the conservative equation does not count beauty as a plus.

As for Beck and Moore, where to begin? Roosevelt certainly did give the poorest Americans a semblance of health care, originally through doctors, dentists, nurses, and home health aides hired by the WPA. These workers did things like innoculate youngsters against typhoid after natural disasters like the Ohio River flood of 1937, which left over a million people homeless. The WPA also started the practice of serving hot school lunches to poor children, arguably a public health initiative since state health departments across the country noted increases in children’s weights and drops in malnutrition as soon as the program started. Roosevelt indeed launched the Tennessee Valley Authority, a public authority which built a system of hydro-electric dams in six states and electrified much of the rural South, allowing, among other things, people to preserve food with refrigeration. It also allowed new business development. Nosiree, it doesn’t get much eviler than that.

Did Roosevelt make the depression go on and on and on for a decade? This is also one of Shlae’s contentions, that the private sector in its wisdom should have been left to sort things out. Well, why not? It had done so well between the October crash of 1929 and March, 1933, when Roosevelt took office, that one worker in four had no job and no prospect of finding one. That was certainly a formula worth following. What Roosevelt did with federal relief and then federal jobs programs was alleviate the effects of the depression for millions who had no other resource. In the process, he rescued the private sector from itself. His most significant misstep came in 1937, after the unemployment rate dropped to 14 percent and WPA spending was a third of what it had been two years earler. He pushed to balance the budget with further spending cuts and reduced the money supply by increasing bank reserve requirements. This tipped the nation into a renewed recession that in turn required new and greater spending. It was the attempt to balance the budget prematurely that prolonged the depression.

Did Roosevelt say “deficits are good,” a la Moore? Obviously not. It is equally obvious, to anyone who has even a passing acquaintance with conditions in the 1930s, that “living high on the hog” was not part of the picture. Living high on the hog is what we’re doing now, under an administration that has perfected deficit spending and suggests that we forget our various national woes by going shopping. And the current deficit will increase still more under the stimulus package proposed under the same Keynesian thinking that motivated Roosevelt.

Here’s what I think. I think Glenn Beck’s grandfather should deliver him a good smack across the face, and swat his ilk like Stephen Moore while he is at it. The old man apparently knows first hand why economics ought to be leavened with humanity, and why Roosevelt is to be admired rather than defamed.

I give Amity Shlaes a pass in the smack department. I like her and think she's serious if a bit misguided. She's not a shouter like Beck or an ideologue like Moore. Truth is, I'd like to get on a stage with her and debate the merits of FDR's policies versus those favored by the private sector. Maybe we can make that happen.

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