Why the New Deal Matters

Why the New Deal Matters

What was it about the New Deal and Roosevelt that make the man and the era relevant today?


When my mother died last year, at 93, her loss wasn’t just personal in the way a parent’s death always is. After my aunts and uncles and then my father died, she’d been, for the past fifteen years, my last direct family link to Franklin Roosevelt and the New Deal. For me–a cradle Democrat–losing that connection meant a rite of passage all its own.

Mother never met Roosevelt, but to her his achievements defined Democratic politics–American politics, really–for almost half a century. Like Bill Clinton and George W. Bush, I was born in 1946, the year after FDR died, and though my generation has acquired its own (mixed) reputation, all of us know how much we’re the progeny of his generation and his legacy. Our 1960s Presidents, JFK and LBJ, mimicked his triple-initial moniker and were always being measured against him–Kennedy most often for his elegance and eloquence, Johnson for his programs. And when ’60s students began calling themselves the New Left, it may have distinguished them from the Old Left–but perhaps it also evoked the keystone of all postwar American politics, the New Deal.

The power of FDR has always been such that even conservative counterrevolutionaries had to be careful how they disavowed him and his programs. By the 1980s, Ronald Reagan–who’d voted for Roosevelt four times–knew exactly whose jaunty, upbeat style to mimic, even as he played Brutus to Roosevelt’s legacy. After GOP Jacobins captured control of Congress in 1994, their doughy Robespierre, Newt Gingrich, claims he consciously modeled his agenda on FDR’s Hundred Days–and in recent years he unabashedly declared Roosevelt “the greatest President of the twentieth century.”

Under the Bush-Cheney presidency, the Republican revolution’s remaining brightness dimmed significantly for most Americans. One might think these past several months, filled as they have been with heated debates over hope and experience, where Democrats come from and where they’re going, would have yielded more talk and reflection about the New Deal and FDR.

Poll after poll, after all, shows that Americans are ready for more government of the kind the New Deal represents–more caring, more equitable, more willing to counterbalance the private power of corporations and concentrated wealth–and they are, frankly, tired of GOP pieties (and invective) about high taxes, big government and endless deficits. (Quick quiz for your conservative relative: who was the last Republican President to actually balance the budget? Answer: Eisenhower.) By twenty-point margins or more, voters are telling pollsters they trust Democrats over Republicans to tackle the big issues of our time.

This tectonic shift in public opinion today isn’t the only good reason for celebrating what Roosevelt did. Most historians, after all, rank him as the greatest of our modern Presidents. And for Democrats, constantly fretting about “electability,” he is the only President to have been elected four times. So he must have done something right–something we can learn from and use in this new century.

Yet strangely–apart from Bill Clinton’s brief-lived comparison of Hillary to FDR (and of himself to Teddy Roosevelt) late last year–there has been almost no serious reference to, let alone examination of, this most extraordinary of American Presidents, either by the candidates, the mainstream press or the upper reaches of the commentariat. Even the fractious blogging world–never at a loss for words–has largely ignored him and the lessons his victories (and defeats) might teach us.

One simple reason for the silence is age: all the major candidates in this election season (save John McCain) were born–like nearly three out of four voters–after FDR died. (More telling, most major bloggers are post-Nixon babies, with a few prodigies even post-Reagan.)

But age is not the only reason. Andy Stern, the very bright, vocal (and brash) head of the Service Employees International Union, America’s fastest-growing and second-largest public services union, has proposed a second, more powerful one: that the New Deal is no longer relevant. “Anyone who might long wistfully for a return to the New Deal,” he remarked bluntly not long ago, “should consider that America today is as far from the time of FDR as the New Deal was from Abe Lincoln and the Civil War.” As far as Stern is concerned, it’s time for us to move on.

I’m just glad my mother never read that.

Matt Bai, a thirtysomething New York Times Magazine writer and author of The Argument, a tough, controversial look at the Democratic Party and the billionaires, bloggers and other insurgents on the left who want to change it, has pronounced the same conclusion. Until the Democrats–and liberals and progressives generally–figure out a new governing vision “more contemporary than defending the programs of the New Deal,” he concludes, they will remain nothing more than “a slightly dated alternative to the mess that is modern conservatism.”

I’m glad my mother never read that either.

It’s not that she’d have been shocked; she’d heard her share of Roosevelt’s many opponents declaring him and the New Deal seditious, irrelevant, dead (or worse) ever since 1932. Lest we forget, that first election year The Nation–like much of the “sophisticated” left–backed Norman Thomas, while the Communists were unsparing in their disdain for “capitalism’s savior” until Moscow declared a timeout in the mid-1930s for the antifascist Popular Front.

Right-wingers never called a timeout. They attacked Roosevelt far more relentlessly than the left during his lifetime–and have done so ever since. In this, Reagan and Gingrich were exceptions, but in their speeches to bipartisan audiences, not their behavior. Amity Shlaes’s recent history of the Depression, The Forgotten Man–billed by Shlaes as a “fresh look” at FDR–assaults his character and policies so unremittingly that a newcomer to this history might honestly wonder how such an ogre ever won public office [see Kim Phillips-Fein’s review on p. 34]. And in the just-published Liberal Fascism, conservative columnist Jonah Goldberg underscores Roosevelt’s indisputable awfulness by telling us that Hitler and Mussolini once spoke well of him and likened their own programs to the New Deal!

(My mother, a kind and refined woman, taught my brothers and me how FDR had firmly but deftly dealt with such critics. “A conservative,” the crippled President declared, his trademark grin spread across his face, “is a man with two perfectly good legs, who, however, has never learned to walk forward.” She felt that to be comprehensively dispositive.)

But what is it about the New Deal and about Roosevelt that makes the man and the era relevant today?

One frequent shorthand answer I still hear from New Deal supporters rests on policy achievements: Social Security, bank and stock market regulation, government-backed home mortgages, a progressive income tax, a federal minimum wage, guaranteed workers’ rights, aid to higher education, private pensions and healthcare plans and a vast array of public works projects still used today–from giant Western dams and the Tennessee Valley Authority to thousands of bridges, tunnels, roads, sewers, water systems, post offices and airports.

A second legacy is still vitally important, but I hear about it less often–perhaps because it’s become so commonplace or because its importance has been so steadily derided and confused, thanks to the right’s attacks over the past sixty years: the systematic public macromanagement of the economy, through active fiscal, monetary and regulatory policy as well as the steadying effects of government’s one-third share in the GDP.

Republicans, for all their “small government,” have never rolled back that share and indeed have been significant handmaidens in its increase: government’s share of GDP reached its highest post-World War II level under Reagan and is today under Bush larger than it ever was under Clinton–or, for that matter, Truman, JFK, LBJ or Carter (or the New Deal itself). Conservatives may love to hate Keynesian fiscal management, but Alan Greenspan played the part of a monetary Keynesian to their unending delight.

The difference between Democrats and Republicans has been not about government’s size but about spending priorities–defense versus domestic programs, in the most naked terms–and about revenue choices (and their consequences), especially the post-1980 GOP’s willingness to accept swelling deficits and public debt as the price for tax cuts asymmetrically favoring the few over the many. From Truman through Carter, public debt fell dramatically as a fraction of GDP; since 1981, save during Clinton’s second term, it has risen–and now is more than double its 1981 low level, with interest payments on that debt alone costing us far more than all the conservatives’ favorite bêtes noires combined–welfare, foreign aid, funding for the arts, etc.

There’s a third facet to Roosevelt that is vital for Democrats to celebrate today: he was the last Democratic President truly committed to multilateralism and to a nonmilitarized American presence in the world. It was FDR who pushed through–in the form of the United Nations, the IMF and the World Bank–the architecture of internationalism that Woodrow Wilson had dreamed of but failed to achieve. And we know from his wartime politics and diplomacy that he was fully committed, on the one hand, to the decolonization of the world and, on the other, to finding means to engage Moscow after the war, a policy that might have headed off the cold war, or at least its worst excesses.

Yet as I write these words, I also know why people like Stern and Bai can talk about the New Deal as seeming far away and somehow irrelevant.

Young people don’t think Social Security will last another generation–at least in a form that will secure their retirement. Bank and stock market regulation? Aren’t we in the midst of a meltdown that started with subprime mortgages but whose real scope and scale is still scarily unknown? Why do these sorts of financial crises keep recurring? Didn’t a gargantuan stock bubble burst at the start of the century? Wasn’t there an Asian–and then Russian and Latin American–financial collapse in the 1990s? Why is it that, from way back in the Reagan years, the words “savings and loan,” “Rust Belt,” “October ’87,” “downsizing” and “Japan Inc.” recall unhappy memories? The progressive income tax is now much less progressive, the minimum wage in our “world is flat” era looks almost comically ineffectual and neither seems to be doing much about closing the American income and wealth gap.

You see my point. Most of the “New Deal legacy” that people like my mother loved, celebrated and trusted seems to have become fragile, crippled, emaciated, distant–you choose the adjective.

But here’s another important point my mother understood: the appearance of fragility and distance has resulted not from the New Deal’s failures, she and I agreed, but from policies advocated by those so-called New Democrats who emerged thirty years ago, when white Southerners fled the Democratic Party. At first desperate to woo them back, and then, when that failed, at least to woo non-Southern independents and moderate Republicans to their cause, the New Dems became Rockefeller Republicans in Democratic drag.

Jimmy Carter’s early-stage deregulation of the airlines, telecoms, rail, trucking, energy, banking and Wall Street set the stage for Reagan–and, in certain areas, surpassed him. Mike Dukakis and Walter Mondale both championed technocratic efficiency, but that platform lacked the larger vision or community that FDR Democrats had championed for decades. Bill Clinton, confident that “the era of big government is over,” pushed NAFTA and the WTO on his resistant party as models of trade deregulation; accelerated telecom, energy, and food and drug deregulation; and, under Robert Rubin’s tutelage, rolled back the enormously successful financial market firewalls that Roosevelt had put in place.

What are the achievements of these deregulated markets and government reinventions? Airlines? Cable TV? Banks? Savings and loans? Electricity (remember Enron and California)? Wall Street (take your pick: LBOs in the 1980s, with Boesky and Milken; then in the 1990s the tech-stock bubble, AOL/Time-Warner, analysts-as-stock touts; the Asian, Russian and Latin American crises; the housing bubble-subprime-CDO fiasco today–which is or isn’t over)?

How about the decreasing oversight of food and drug safety? Toys from China, anyone? Cooked books at Fannie Mae? The government student loan mess? Blackwater as the model of a deregulated, outsourced military in Iraq? The growth rate of the American economy? The distribution of income and wealth? You get the point.

In 2008 the sudden surging support for Barack Obama’s “audacity of hope” politics–especially among the young–seems to arise from the same impulses that set the political stage in 1932, 1960 and 1980: a profound sense of the need to end what has gone before and to try something new.

My mother never much described her then similarly young generation (she was 19 when FDR took office) as committed to any explicit “Rooseveltian” agenda in 1932 or thereafter. What they were committed to was their belief that Roosevelt cared about them and their future–and the nation’s future as a just and equitable society. They didn’t know the language of economists or of technocrats (Hoover had spoken that dialect); they knew instead the terms of family and neighborhood and community, and Roosevelt used those terms and talked to them in their language. They didn’t much care where FDR got his ideas but rather whether they worked and seemed somehow fair and gave people a sense of their worth and dignity.

Few historians today think FDR had a finely tuned policy agenda in the back of his mind at any point during his twelve years in the White House. What he did have, though, was worth far more. Eliot Janeway, looking at FDR’s oft-criticized record in preparing the nation for war–and for what became the swiftest, most enormous and most complex expansion of the economy and the government in America’s history–named what was essential.

Roosevelt’s critics have said–and say–he organized Washington into…a comptroller’s hell, into a jungle of confusion…. They are right. He did. And yet this irresponsibility–so disastrous on the face of it–did not result in disaster…. To Roosevelt, the important question was the participation of the nation in its own defense, not the administrative planning for this participation…. So long as the home front was big at the base, Roosevelt was willing to bet he could let it be confused at the top–and he and he alone had the power, the genius, the dramatic instinct, and above all the daring to make it as big outside Washington and as amorphous inside Washington as he pleased.

It’s those qualities–his ability to project a sense of trust in people’s ability to rise to common needs and dreams, plus his capacity as democratic leader to help them find the means needed to triumph–that defined Roosevelt’s genius. And it’s crucial for us to recognize why his style of “democratic leadership” was and is more challenging than “leadership of a democracy” or of business leadership or military leadership or most kinds of political leadership touted as “what we need today.” Crucial among the gifts of a true democratic leader, as FDR clearly was, is the ability to share not so much policies but stories, parables that incorporate moral and ethical vision, narratives of who we are and where we came from, and why we are together and where we can go, and what we can achieve if we work together.

March 4 marked the seventy-fifth anniversary of FDR’s inauguration as President–and more than likely, you heard his famous line about “nothing to fear but fear itself” trotted out for beneficent, bipartisan approval. It deserves to be quoted–but take a moment and go online to read the whole speech (like the Gettysburg Address or JFK’s inaugural, it is not long) and read down until you come to his description of how America will recover and grow once more. This is what he said about the reasons we’d been made afraid:

Our distress comes from no failure of substance…. 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 failures and abdicated.

Faced by failure of credit, they have proposed only the lending of more money. Stripped of the lure of profit…they have resorted to exhortations, pleading tearfully for restored conditions. They know only the rules of a generation of self-seekers.

The money changers have fled their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of the 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. These dark days 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 and to our fellow-men.

In the roughly ninety seconds it took FDR to deliver those words on a bleak and unpromising day in Washington at the tail end of winter seventy-five years ago, he described a politics, an economics and a morality at once–and thereby told Americans how they could and should make change, that he would lead them in doing so and who would oppose them.

He didn’t cut to the middle or appeal to an interest group; he didn’t divide the country into friends and enemies (though he named those he intended to struggle against); and he held out the promise that all could work together, though he knew in truth they never would.

And then together, the Americans who knew his story–and knew it was their own–set about the work ahead of them.

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