Successes and Failures of The New Deal

The 32nd President of the United States and serving the longest in American history, Franklin Delano Roosevelt (FDR) has been called a great leader, humanitarian, skilled politician, and self-confident. The American people were looking for help, hope and reaffirmation that the country would right itself again with jobs and financial security. Roosevelt had promised a “new deal for the American people” and upon taking office during the Great Depression, FDR immediately took steps toward a series of economic policies, programs and projects known as the New Deal. FDR’s upbringing, education and political experience allowed him to articulate well, while his polio taught him the value of struggling, failing and persevering, of which Americans viewed him as empathetic to their suffering. He had a great advantage with the use of the radio to talk and explain things to so many people in the comfort of their own home. His “fireside chats” with the hearthside box were welcomed, comforting, inspiring and made people feel as if they were being included in an after-dinner conversation. During his second fireside chat of 1934 he spoke of capitalism: “We count, in the future as in the past, on the driving power of individual initiative and the incentive of fair profit, strengthened with the acceptance of those obligations to the public interest which rests upon us all.” FDR’s New Deal accomplishments were viewed differently by three historians which leads to debate of whether it was an effective recovery effort. Although Franklin Delano Roosevelt’s New Deal did not end the Great Depression, it did help to preserve capitalism.

According to Barton Bernstein, FDR’s New Deal was designed to protect and maintain the American system, not transform it, as it “protected American corporate capitalism.” Bernstein is a leftist and argued that Roosevelt’s goals were too conservative, narrow and safe because the New Deal failed in challenging big businesses to be more responsible in helping the social welfare of our country, as well as the organization of the economy. As explained by Barton Bernstein, Huey Long, a leftwing politician and Governor of Louisiana during FDR’s presidency, believed in a “Share Our Wealth” program and “soak-the-rich” tax program. Roosevelt did feel the current tax laws were “an unjust concentration of wealth and power” and Long replied “amen” to FDR’s thinking. However, in the end Roosevelt did not support the bill and its tax measures did not “soak the rich” from higher-income brackets as corporate and individual levies were reduced and inheritance taxes were removed. California Democrat Governor Sinclair was a go getter for blue-collar working-class America, farmers and factory labor, as he pushed for the unemployed and “production-for-use”. Roosevelt was challenged by this leftwing thinking. Although none were radicals who wanted complete political or social change of the system, they did seek to preserve capitalism. Leftwing politicians like Long, Sinclair and Governor Flog Olson were willing to make strong and powerful moves to change the economic climate, even if it meant spending huge sums of money, however, FDR was not as willing to go that big with commitment, as politically he probably sat more toward the middle. According to Bernstein, Roosevelt’s early conservative recovery approach could have been more radical and changed American capitalism.

Barton Bernstein felt the New Deal was a reform that actually excluded many Americans like blacks, females and the poor. For example, African-Americans received less help under the National Recovery Administration (NRA) as wages were often below legal minimum wage, segregation still happened and lynching still occurred. First Lady Eleanor Roosevelt was an advocate for black rights, and she lobbied to seek federal action against lynching, however, the anti-lynching bill was not endorsed by President Roosevelt. Roosevelt refused civil rights legislation like the previous mentioned as well as African-American voting rights in the south because his policies depended on certain support and he did not want to risk anything by challenging segregation. FDR’s Social Security Act guaranted income to the elderly by having workers contribute and pay for their old-age insurance, but unfortunately it excluded farm laborers and domestic workers, of which most were black. The Agricultural Adjustment Administration (AAA) was meant to increase farmers income by having them decrease production and raise their prices, however, these government checks were not passed on to black sharecroppers and tenant farmers. Later, the NRA and AAA were declared unconstitutional by the Supreme Court.

Robert Higgs states he is in more agreement with a 1936 author who felt FDR “took charge of our government when it was comparatively simple, and for the most part confined to the essential functions of government, and transformed it into a highly complex, bungling agency for throttling business and bedeviling the private lives of free people.” Robert Higgs is a conservative and thought President Roosevelt was an opportunist as he took advantage of the failed economy that President Hoover could not rectify. The handsome and charming FDR, as Higgs described him, was a born politician; meaning Higgs felt Roosevelt was devious, dishonest and manipulative. According to Higgs, FDR really did not know what to do and so he tried one thing and if that did not work, he tried another. Robert Higgs believed the New Deal actually prolonged the Great Depression and if Roosevelt would have just balanced the budget, cut federal spending, maintained a sound currency, stopped bureaucratic centralization in Washington, not consulted with outside advisors called “Brains Trust”, and had not abandoned the gold standard, the economy would have righted itself. Bernstein and Higgs were on opposite sides of the political spectrum, with Bernstein on the left and Higgs on the right. But like Bernstein, Higgs found flaws in FDR’s New Deal for different reasons. Higgs is critical about its effect the New Deal had on a free-market system, causing the U.S. economy to be less productive than it could be. There was too much taxing and spending. He felt it created much confusion and uncertainty with business investors, that private investors and their activity did not allow a normal economic growth; it never reached its potential height of production and employment. The private economy should have been left alone by the federal government to self-correct. According to Higgs, liberals began to diminish because of the New Deal as everyone looked to the intrusive federal government for help and solutions. He believes New Deal legacies have crushed everyone’s liberties in today’s time.

A final historian, David Kennedy, was an advocate for President Roosevelt and the New Deal. His essay seemed to walk down the middle of the road while wearing rose tinted glasses, and at the end of the picture he had painted, one should be able to hear triumphant music from a super heroes movie playing in your mind. His thinking is more along the lines of ‘if you can’t say something nice, then don’t say anything at all’. Kennedy and Bernstein are of similar thinking, as Kennedy made it a point to quote one of FRD’s “Brains Trust” advisors, Raymond Moley; when the New Deal was signed into law he said, “Capitalism, was saved in eight days”. It is worth noting that the banking and financial industry was President Roosevelt’s first priority to save the capitalist system. FDR did assign the first woman to a Cabinet post as the U.S. Secretary of Labor, Francis Perkins. She assembled the Committee on Economic Security (CES) to discuss social security legislation and hoped to draft a bill that was constitutional, while keeping in mind that it considered the needs, prejudices and legislative habits of the people. Kennedy pointed out FDR’s vision to Frances Perkins as he stated, “We are going to make a country in which no one is left out.” Kennedy believed the New Deal upheld American principles under the U.S. Constitution to give our diverse Americans a feeling of security, inclusion and respect. Unfortunately, President Roosevelt’s shortcomings for this statement was pointed out by Bernstein in his essay, that New Deal programs excluded too many people and not enough economic relief. It is true the New Deal offered jobs with the Civilian Conservation Corps (CCC), Works Project Administration (WPA), Public Works Administration (PWA) and the Tennessee Valley Authority (TVA), but reality and history exposed the discrimination against African-Americans and women since the traditional view of a ‘worker’ was seen as a white male breadwinner.

President Roosevelt’s New Deal legislation saved capitalism as it provided relieffa and reform, although it did not end the Great Depression. In reviewing the New Deal, many believe the federal government did not spend enough money to adequately boost the American economy and social security taxes were shown to have impeded recovery. Economic change from the New Deal was considered to be moderate (New Deal Lecture Video, part 2). Today, some New Deal programs are still in effect and they include social security, minimum wage, unemployment insurance, the Securities and Exchange Commission, the Federal Deposit Insurance Corporation, the Federal Crop Insurance Corporation, and the Federal Housing Administration. Legacies from the New Deal have prevented another major depression from happening since safeguards on banking failures are in place. The New Deal’s greatest legacy has come to include a shift in the way Americans view the government, as many feel it is the responsibility of the federal government to keep the nation’s economy healthy and to watch over its citizens welfare.