The pundits were quick to evaluate Barack Obama’s election in light of African-American political traditions going back to the civil rights movement and even Reconstruction, but they have turned increasingly to lessons from the history of the New Deal.
Obama invoked that legacy repeatedly during the campaign, from the account of how his grandfather benefited from the GI Bill to his proposals to create jobs and economic growth through federal investment in education, industrial innovation and infrastructure. Such rhetoric allowed him to claim the legacy of the most popular and successful government programs in American history, but it also displayed some of the limitations of New Deal policies, particularly in their ability to address racial inequality. We can thus turn to the history of those programs for an indication of how the Obama administration will confront the interrelated problems of economic and racial inequality in the twenty-first-century United States.
Despite conservatives’ alarm about “the slippery slope to socialism,” Franklin Roosevelt displayed a strong aversion to direct control over the economy. Instead, his administration relied on civil society groups to implement and enforce government policies. Rather than impose wage and price regulations to stabilize the economy, for example, the National Recovery Administration allowed business associations to establish standards and then empowered unions to enforce them. That unprecedented mobilization of civil society sowed the seeds for the industrial union movement, which proved critical to Roosevelt’s re-election in 1936 and deepened his commitment to social democratic reform in the late 1930s and early ’40s.
It was this synergy between federal policy and popular mobilization that created the “greatest generation” that, as Obama stated in June, “conquered fear itself, and liberated a continent from tyranny, and made this country home to untold opportunity and prosperity.” Increased protection under the National Labor Relations Act allowed unions to raise wages and benefits steadily in the 1940s and ’50s, while the GI Bill and other programs helped workers invest those gains in new homes, college education, health insurance and pensions. By 1951 even Fortune magazine had to admit that the expansion of organized labor had made the worker “to an amazing degree a middle class member of a middle class society.”
But there is a more troubling side to the New Deal’s legacy, which will not be resolved through populist appeals to the struggling middle class. A growing body of scholarly literature has shown that the same reliance on civil society that inspired the labor movement also prevented the Roosevelt administration from addressing deeply ingrained racial inequalities. While unions improved wages and conditions for industrial workers, they had little impact on the agricultural and service sectors, where the vast majority of blacks and Latinos labored for low wages without collective bargaining rights, health insurance or even Social Security. The GI Bill offered mortgage assistance and scholarships to all veterans but did nothing to ensure that African-Americans could use those benefits to attend segregated colleges or buy homes in segregated neighborhoods. Indeed, had Obama’s paternal grandparents lived in the United States it is unlikely they would have shared the sepia-toned vision of the New Deal era that was so pervasive in his campaign material.