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| Franklin D. Roosevelt signs the Gold Reserve Act, January 30, 1934. Wikimedia Commons. |
America May Never Have Another New Deal. By Jefferson Cowie. The New Republic, March 15, 2016.
Cowie:
Why FDR’s massive reforms probably won’t be repeated.
Spilled
across the pages of journals of opinion are demands for a new New Deal, a
global New Deal, a New and improved Deal, to reNew the Deal, and even New Deal
2.0. The excitement following Barack Obama’s first election, just after the
nation slipped into the abyss of a massive financial crisis, generated further
New Deal analogies. Otherwise sober commentators began speaking of “Franklin
Delano Obama.” Meanwhile, among union watchers, minor twists of the labor
movement seem to generate unrestrained proclamations of the second coming of
the union movement that swept across the nation during the Great Depression.
Even before the coming of the financial crisis of 2007–2008, the New Deal has
been metaphor, analogy, political principle, and guiding light for all that
must be returned to the progressive side of American politics.
Then,
inevitably, comes the shock: the new Gilded Age seems to have a lot more
traction in American political culture than did the hope of a new New Deal. The
return of nineteenth-century-style plutocracy, crony capitalism, and shocking
levels of inequality—disparities that continued even after the excitement of
Obama’s presidency—suggest a conscious, confident, and powerful ruling class
that has largely separated itself from the concerns of the nation’s working
people.
The New
Deal and the postwar order it sustained once gave the illusion of
permanence—for many, the inevitable domestication of capitalism. Marbled
throughout its very creation, however, were a series of social and political
fissures that help to explain its ultimate fall in the 1970s and beyond.
Beneath the surface of the “fragile juggernaut” of America’s social democratic
moment were a series of exceptions to U.S. history that are difficult to
imagine being repeated: the massive but temporary transformation of the role of
the state; the Faustian exclusion of African American occupations that kept the
white South in the Democratic Party; the one-time leap forward in power of
organized labor; the single period in American history in which immigration
(and thus the politics of division) were closed off; and the temporary eclipse
of the politics of culture and religion. Wrapping around all of these issues
were the complex ideologies of a Jeffersonian individualism, which were muted
but never resolved even as the New Dealers waded cautiously into collective
waters.
Today’s politics are a regression to the
norm. The fractious polity has chosen deeply rooted quarrels over
individual rights, ethnic and racial hostility, immigrant versus native, and
crusades over moralism and piety in lieu of a politics of collective economic
security.
The
Obama administration ultimately offered precious little in terms of the
politics of material security. Part of that was President Obama’s unwillingness
to make a bold, decisive break from previous decades and make the case to the
American people that the state could help build economic security and
opportunity for all. The first two years of the Obama administration was a lost
opportunity for the American reform tradition—not just on policy grounds but in
making the argument that government had a role in helping regular people.
Seemingly insecure in his position, the new president appointed economic
insiders, many of whom had played a role in creating the crisis, while shying
away from larger stimulus packages or initiatives that would halt the
decades-long growth in inequality and wage stagnation. Banking, finance, and
important industries like auto were saved. Meanwhile, working people continued
to inhabit the exact same economy they had in the decades leading up to the
crisis.
While
Obama might have made more of his moment, I do not believe he could come close
to delivering the “next” New Deal. The remarkable differences between the
politics of the crisis of 2008 and that of 1929 were too vast. When FDR was
inaugurated in March of 1933, the Depression was already three and one-half
years old. The mood of the country was a peculiar combination of resignation
and depression, anger and calls to action. Focusing his 1932 campaign against incumbent
Herbert Hoover’s inept handling of the crisis—ultimately refusing to even meet
with Hoover to discuss plans during the four months before he took office—FDR
gathered around him a coalition that demanded change. One-quarter of the
population was out of work, and there was no unemployment insurance, no social
security, no deposit insurance, and what state and private charities existed
had either collapsed or were teetering on the brink of bankruptcy. For three
winters, the nation suffered untold misery, and major industrial cities had
populations on the edge of starvation. Homelessness was rampant.
While
horrific, the Great Recession of 2008 fell short of the full devastation of the
Great Depression. Both the sense of panic and the unemployment rate were only a
fraction of what they were in the 1930s. Although Obama entered office not long
after the crash, he inherited a bailout engineered by the previous
administration, a trillion-dollar deficit, and a set of unpopular wars that
proved to be the economic and political opposite of the stimulus of World War
II. Because of Obama’s almost militant commitment to economic centrism and his
unwillingness to confront the political power of Wall Street, he immediately
elected to continue the policies (and even many of the players) from the
previous administration. That clouded the contrast with the Republican he
succeeded—a dramatic contrast that FDR had used to superb effect. As compared
to the era when government hardly existed in the daily lives of regular people,
a safety net, under attack since 1981, still did exist in 2008: Social
Security, unemployment insurance, the Federal Deposit Insurance Corporation,
Medicare, and Medicaid all helped cushion the blows of the financial crisis.
Yet there was also tremendous political activity, built up since the 1970s, to roll back existing government activity
that did not simply serve business’s interests. The Solid South that FDR needed
for his legislative successes had turned largely Republican—and militantly so.
The “modern” Republicanism of the postwar era, which had made its peace with
the New Deal, had already become a distant memory.
All of
this is not to say that Obama’s presidency, especially his first two years, was
a failure. It was not; it just was not a new New Deal. The failure rests more
squarely in analysts’ insistence in using the Depression Era analogy where it
was not helpful. He did help dig the country out of the worst economic disaster
in eighty years, pulled the United States back from a disastrous foreign
policy, and renewed federal effectiveness in health and safety, immigration,
and the environment.
The
fundamental difference between the two eras was the place of the forgotten man
and woman. FDR took office explaining that the “money changers had fled the
temple” and that “the measure of the restoration lies in the extent to which we
apply social values more noble than mere monetary profit.” The unspoken mantra
of the Obama administration, in contrast, was “Save Wall Street first,” a
symptom of, not a solution to, what political scientists Hacker and Pierson
rightly call “the winner take all society.” In the politics of the recovery
after 2008, FDR’s forgotten man remained trapped in the dustbin of history. In
the politics of rage, however, he was the folk hero to conservative pundits and
talk news shows that constructed a pot-boiling industry exploiting the
mythology of the hijacking of the nation by various others—be they cultural
elites, secular humanists, immigrants, or blacks. As conservative Fox News
commentator Glenn Beck co-opted the discourse of the 1930s, “What happened to
the country that loved the underdog and stood up for the little guy? What
happened to the for- gotten man? The forgotten man is you.”
Caught up in the whirlwind of our present, we overestimate how radically new the rate
of change is in the global-digital age. The sense of standing at the abyss of a
new world feels unprecedented. Yet when Henry Adams made his prayer to the
electric dynamo in 1900, he said that the pace of technological change was so
great that if left “his historical neck broken by the sudden irruption of
forces totally new.” In the creation of electric power, he saw the emergence of
a religious faith in the rational, sterile, and technological future, which he
regarded as “the break of continuity,” an “abysmal fracture” in everything he
understood and trusted. Many would say the same about our own time. This is not
to say that history has started over or is the same, but that our challenges
are not unprecedented. The arguments made here do not mean that politics is the
same as it was generations ago, only that the same issues that are deeply
ingrained in American history and culture remain challenges for the past and
the future.
Too
often, political changes are seen as simple vacillating “cycles” of partisan
history. While this might have some explanatory power when it comes to changes
in what party is in charge, it fails to explain the underlying currents,
coalitions, fractures, and agendas that run for longer periods. What replaces
this generation of conservative, individualistic, “free-market” ideology,
however, will not be some simple cycle back to a New Deal revival but will most
likely be a much more chastened or radically different form of change that
takes its cues from well outside of the New Deal paradigm.
To
reframe the New Deal order as a great exception, I must emphasize, is not to
take a jaundiced view of American history, but rather urges a more thorough and
realistic understanding of our recent past in the hope that it can provide a
more stable intellectual foundation for discussions of present and future
politics. I recognize the contested nature of American politics and social life
that have informed a wide variety of dissenting movements that reshape our
politics and discourse, but I also understand that the most powerful aspects of
American political culture have often proved resistant to these protests. My
aim is also not to diminish the vision or values of those dissenters, but
rather to resituate and rethink the New Deal Era in the broader terrain of U.S.
history. Our founding mythos of individualism has structured our collective
life, created much of value, and become so intimately intertwined with the very
essence of the nation itself that its limitations become most difficult to
perceive and discuss. If this argument is correct, then conservative victories
are more understand- able and progressive victories all the more precious.
Despite
the New Deal’s many flaws and fissures, the programs of the 1930s represent the
best of what the United States can be as a nation—caring, sharing, secure, and
occasionally visionary. Few issues seem more important today than the need to
bring the concerns of working people out of the shadows and into the political
and economic light.
But bad
history makes for weak political strategy. While it is useful and hopeful to
imagine that the United States can take the issue of collective economic rights
as seriously as it did in the 1930s and 1940s, our present politics ought not
be misled by freewheeling historical analogies based on an extraordinarily
unique period in American history.
Excepted from The
Great Exception: The New Deal and the Limits of American Politics by Jefferson Cowie. Copyright © 2015 by Princeton
University Press.
