American Elephants


“When Big Government Saved America” and Other Lefty Myths by The Elephant's Child

While following a link to an article that turned out not to be of any interest, I ran across an article entitled “When Big Government Saved America.” I do try to keep up with the wandering of leftist minds, but this noxious notion made me curious.

The recent bridge collapse along I-5 north of Seattle was in some ways a freak accident, yet to many Americans it seemed emblematic of a public sector in crisis. As gridlock and dysfunction reign, the U.S. government seems to lack the capacity to adopt even the most popular and necessary measures—even to maintain the physical structures upon which American life depends. In the meantime, this crisis of the public sector is mirrored by—and fed by—Americans’ lack of faith in public institutions.

The recent bridge collapse along I-5 north of Seattle was in some ways a freak accident? No it was a freak accident. a Tractor-trailer with a too-wide load hit a major support on one section of the bridge, and it collapsed. I knew they were trying to make a big deal of it. It was not “emblematic of a public sector in crisis,” and the physical structures “upon which American life depends,” which had been surveyed in the previous 6 months, was replaced in two weeks with a temporary span.

Eighty years ago this month as Franklin D. Roosevelt’s first “hundred days” wound to a close amid the Great Depression, the United States was in far worse shape than it is today. And yet, then, the American government responded to economic catastrophe not by treating public services as extravagancies to be traded off in the name of “belt tightening,” but rather by expanding them dramatically. They not only built what by some measures was the most generous social spending regime in the world, but also a political culture in which public institutions were trusted and esteemed far more than they are today.

There was certainly generous spending. Roosevelt set right off in 1933 with the National Industrial Recovery Act (the NRA), the most revolutionary act ever. It allowed American industrialists to collaborate to set the prices of their products, the wages and hours that went into making them. Antitrust laws were suspended. Leaders of industries were invited to sit down together and write “codes of fair competition” that would be binding on everyone in their industry, and subject to a fine or jail term if he violated the code. So what you had was a conspiracy against the public, and that went well.

FDR never had to work, and always had an allowance from his mother. Everyone who knew him agreed that he had no business sense and no financial sense. He failed in every business venture he undertook, and did not learn from his mistakes. But he was charming.  FDR was quite sure that price-fixing was a good idea, and that competition was a bad thing. As Henry Morgenthau, the Secretary of the Treasury, and one of the architects of the New Deal said:

We have tried spending money. We are spending more than we have ever spent before and it does not work. …We have never made good on our promises. I say after eight years of this administration we have just as much unemployment as when we started…and an enormous debt to boot.

Mason Williams, the author of this piece, and of a new book about New York City, FDR and La Guardia is apparently a newly-minted PhD in History, who will begin his first teaching job in the fall. He is a victim of conventional leftist wisdom that FDR saved America from the Great Depression. He didn’t. FDR’s vast experimentation made things worse, and the depression far longer than it needed to be. Nor did World War II end the depression. The assumption was that all the war work at home, building military equipment that put people back to work ended the downturn. But during the war wages and prices were fixed, goods were rationed, and the war materials the factories turned out were consumed in the course of the war. It took quite a few years after the war for America to recover, as UCLA economist Lee Ohanian and Harold Cole have shown. Price-fixing never, never works.

There was a scene in Anton Myrer’s great novel of World War II, Once an Eagle, of the day Roosevelt died. When they heard the news on the radio, the woman said” The President was carrying everything on his hands. Everything. Now the fat will be in the fire, along with everything else He was so brave,” she murmured.

“FDR? Baloney” said her government insider companion, “He was a power-drunk egocentric and the prince of political manipulators. But he could make them go the way he wanted.”

That was just a novel. The myth of Roosevelt’s deft handling of two of our worst crises — the Great Depression and World War II — has endured, and encouraged the left to always try to emulate his failed policies— to our great misfortune.  That was eighty years ago, and some learn from history, while others never examine their presumptions and prejudices.



FDR and the New Deal Love Fest by The Elephant's Child

Professor Burton J. Folsom Jr. is author of two books on Franklin Delano Roosevelt: New Deal or Raw Deal and with Anita Folsom: FDR Goes to War. Here is a speech he delivered at Hillsdale College on FDR’s energetic experimentation that did so much damage to the economy in the 1930s. The great myth has always been that FDR saved us from the Great Depression, and then it was ended by World War II. Wrong.

I have recommended Amity Schlaes The Forgotten Man.  It is a new history of the Great Depression, and a wonderful book, with a fascinating cast of very real characters, that reads like a novel.

President Obama constantly compares his problems to the Great Depression. To indicate how big the recession he “inherited from George W. Bush” is (not his fault) but he flatters himself. The comparison lies not in the extent of the Depression [ July 1927: Unemployment 3.3%; Sept 1931; Unemployment 17.4%;  Nov. 1933: Unemployment 23.2%;  Nov. 1934: Unemployment 23.2%;  July 1935: Unemployment 21.3%;  Jan. 1938: Unemployment 17.4%; Jan. 1940: Unemployment 14.6%] but in the misguided efforts to make big government heal the economy.

FDR’s plan to make people dependent on government was a clear effort to garner votes for the Democrat party [see approximately minute 35.00 on the video]. Obama is making the same effort to make people dependent on Big Government in his campaign for a second term.  I think most of us would prefer to see a recovering economy and recovering employment.  The video is very worth your time.  A lack of understanding of history may doom us to repeat it.



White House Authoritarianism Has Been Tried Before. Doesn’t Work. by The Elephant's Child

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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