Filed under: Capitalism, Economy, Law, The Constitution | Tags: Big Government Excess, Franklin Delano Roosevelt, The New Deal
Like many “bookish” people, I usually have a stack of books that I have not yet read. Often they are some that I bought because I wanted to read them, then I get distracted with something else and they sit there waiting patiently. So I’m seldom reading what is hot right now.
I’m currently reading Amity Schlaes’ The Forgotten Man, which is a new history of the Great Depression, and fascinating. And remarkably pertinent to today’s news. FDR, in his First Hundred Days, embarked on a vast experimentation with the economy with the help of his “brain trust” of academics. He, like the current occupant of the White House, determined that he could do just about anything he wanted, and ended up tangling with the Supreme Court, which made a laughingstock of the NRA (The National Recovery Act), and led to further battles between the president and the Supreme Court. So here I was, sitting up in bed at three-o’clock in the morning, giggling about the Schechter case, which was about selling chickens. About that time, Felix Frankfurter moved into the White House, which signaled a shift in Roosevelt’s outlook:
He was tired of utopias, he now decided. They had not necessarily helped the economy. the hope that experiments like the NRA would bring full recovery had not proven valid. Roosevelt had played around with economics, and economics hadn’t served him very well.. He would therefore give up on the discipline and concentrate on an area he knew better, politics.
The president formulated a bet. If he followed his political instincts, furiously converting ephemeral bits of legislation into solid law for specific groups of voters, then we would win reelection. He would focus on farmers, big labor, pensioners, veterans, perhaps women and blacks. He would get through a law for pensioners, and one for organized labor…Rex Tugwell would take care of the poor and homeless of the countryside — Tugwell was to have a staff of more than 5,0-00, $91 million, and options on ten million acres of land, all to try out suburban and urban resettlement. There was also $2.75 million for Dutch elm disease…
Bringing down big enterprises and wealthy families liberated smaller companies and thrivers to thrive…Giving cash to new constituents meant that they would spend and strengthen the economy…Taxing big business might also balance the budget, just as Roosevelt had learned as a young man. The president relished squeezing cash for the poor out of the well-to-do…
But the emphasis remained political. “He illuminated objectives —even fantastically unrealizable objectives. These excited and inspired,” Ray Moley would later write of Roosevelt, only slightly bitterly. “When one set of these objectives — faded, he provided another.” The fact that he shifted did not have to matter.”
There are similarities with Barack Obama, in the disregard for the Constitution, law and tradition, but plenty of differences as well. Obama’s assumption that he “inherited the worst crisis since the Great Depression” is self-aggrandizement. It didn’t have to be this way, but almost every action Obama has taken has continued and worsened the downward spiral. Here is what the Great Depression was like: November, 1933: Unemployment: 23.2 percent, Dow Jones Industrial Average: 90. November 1, 1934, Unemployment 23.2 percent, Dow Jones Industrial Average: 93. July 1935: Unemployment; 21.3 percent Dow Jones Industrial Average: 119. The economy didn’t really recover until well after the war. The assumption that the war ended the Depression is not true. During WWII the country turned to vast manufacturing of war materials, which made for lots of jobs, under wage and price controls. But the war materials were simply used up, leaving the country no more prosperous.
At any rate, the book reads like a novel, following the characters who created the all-too-real story. If you enjoy history, I recommend it highly.
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