Eric Rauchway: In Defense of the New Deal





[Mr. Rauchway is a professor of history at the University of California, Davis, and the author of Murdering McKinley: The Making of Theodore Roosevelt's America.]

Ronald Reagan liked to see himself in the parable of an optimistic boy who, facing a room full of manure, happily set to digging: “With this much manure around, I know there’s a pony in here someplace.”

But today we need a different parable. In this one a boy discovers a well-kept stable with a pony in it, contentedly munching hay. It’s a fine pony, though maybe in need of some brushing. There’s probably also a horse-pat in the bottom of the stall, because hey, it’s a pony. The boy fixates on these aesthetic drawbacks, and begins to complain loudly about them. A friend comes along, gives the pony a brush, grabs a shovel and removes the horse-pat and says, “there you go, son, your pony’s in fine shape.” Incensed that his complaints have been rendered irrelevant, the boy does not choose to enjoy the pony, but instead orders a cartload of manure from the local store and starts shoveling it into the stall, to vindicate his initial criticism. Left unchecked, the boy is not only going to foul the stall, but also to bury the pony.

In the behavior of this boy we see the modern New Deal denialist. The New Deal wasn’t perfect, it’s true, but noting that it takes occasional maintenance and correction isn’t enough for the denialists, they have to bury it in horse manure. And no sooner do their kindly friends clear one load of these misconceptions away than they order up another load and start shoveling it into that poor pony’s stall. Clear away the misconceptions and you find that under the New Deal, GDP was up, unemployment was down, productivity was up. Which, to reiterate, doesn’t mean the New Deal was anything like perfect; it wasn’t. But still, a pony is better than no pony, right?

If someone then comes along and says to you, yes, GDP was up and unemployment was down and productivity was up and the New Deal did lots of good and important things like Social Security and yanking the South out of poverty and bringing transparency to the securities market and saving the banks, “But the facts do not support the perception that FDR’s policies shortened the Depression…. Total hours worked per adult, including government employees, were 18% below their 1929 level between 1930-32, but were 23% lower on average during the New Deal (1933-39)”—well, you should be suspicious. Do you ordinarily judge a recovery by increase of hours worked? When was the last time you heard an economist on the news explaining to a business reporter, “Well, Tallulah Mae, perhaps we’re back to work and our productivity is up and our national wealth is up but we haven’t recovered because we’re not working the same number of hours we used to”?

Let us not even get into this argument—even though, if you do get into this argument, if you do concede the ridiculous starting point that we should pretend NRA=New Deal, you evidently can still show the description of the recovery is wrong; even though, when you strip away the bluster and misdirection, the argument is really, “The New Deal jolly well did save us from the Depression, it just might have saved us faster if it hadn’t been for the NRA”; even though, if you do want to talk about what happened to hours worked, per figure 1A there’s a long-term reduction 1900-2000 and though there was a spike up during World War II, it might have been because there was a total war going—no. Let us not get into these arguments because trying to turn the argument to a discussion of what happened to hours worked is simply letting a new load of manure get shoveled into your pony’s stall, and you don’t want that.

And if it should happen that you walk happily away from your pony’s stall one day, leaving it reasonably clean and cheerful, and when you come back the pony is asphyxiating under a pile of manure, please do not stand sorrowfully, reasoning to yourself, “poor pony, if only it had done a better job of not fouling itself it wouldn’t be stuck under a pile of manure.” Ponies don’t make that much of a mess on their own. The pony chokers have been at work. Get a shovel.

Related Links

  • Eric Rauchway: Introduction to a discussion of his New Deal book at TPMcafe


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    charley danielson - 3/9/2009

    Nice story with no facts.

    Let me ask a question.

    A welfare state, government, that has no money and produces not a thing.

    Takes money from productive people and gives it to unproductive things and people.

    Is to stimulate what? More unproductive things?