We need another one.
Specifically we need another campaign to put people back to work rebuilding and improving the infrastructure of this country.
Now, there are a legion of idiots out there that believe that the original New Deal, as created and administered by Franklin Delano Roosevelt, was a failure, or that it lengthened the Great Depression, or at least failed to combat the Great Depression.
Not only is this inaccurate, it’s a perfect illustration of the intersection of both intellectual bankruptcy and moral bankruptcy of conservative economic thought.
The idea that the New Deal kept the Great Depression going is my all-time favorite current Right Wing meme and it wins for three reasons: the premise is faulty, the source is discredited, and the entire idea is illogical to begin with.
Let us get this straight: Right Wingers think that government spending with the New Deal didn’t get us out of the depression but government spending to build war equipment did.
Guess what? It’s the same money doing the same things: providing jobs.
Now that we’ve revealed the fact that the inherent concept is self-contradictory, let’s take a look at some associated dynamics. For example, sane economists (in fact, Moody’s, who are not known for their socialistic tendencies) who don’t listen to tools like Milton Friedman and his Austrian School fellow travelers have come up with the following:
Notice that infrastructure building is far more profitable and efficient than any tax cut and in fact most tax cuts yield negative returns.
So we see here that in fact tax cuts are some of the least effective economic stimulus packages (and some of them actually retard economic growth), which is why the Bush tax cuts, which are still in effect and which conservative economists don’t like to mention basically didn’t do anything for the economy. You’ll also note that in fact the best short term spending is extending unemployment insurance benefits and food stamps and the best long term spending is infrastructure improvements.
LOOKING AT UNEMPLOYMENT DATA
Now let’s look at some specific graphs about the New Deal.
Unemployment was nearly 25% when FDR was sworn in as President in March 1933. I mention this because you have to specify when FDR took over as some conservatives have mistakenly and brazenly stated that FDR caused the Great Depression, which is not surprising as they also believe Barack Obama caused the Recession starting in December 2007, over a year before he was actually sworn in as President.
By 1937, he had dropped unemployment to about 10%, which is a drop of 15 percentage points in FIVE YEARS. Show me anywhere else in U.S. history that happened. In only five years.
Another stupidity that conservatives like to trumpet is that FDR prolonged the Great Depression. Well, he certainly didn’t end it overnight, but the economy when he took over was in free fall and there were people talking about the military having to take over. But getting the economic problems under control in five years isn’t too bad, all things considered.
THE RECESSION OF 1937
The same austerity hucksters existed back then too and they convinced FDR that the worse was over in 1937 and that the New Deal should be scaled back. This attempt to reign in spending and to balance the budget, as fiscal conservative wonks want right now, caused the unemployment rate to bounce back up to 13% in 1938. FDR immediately realized these people were fools, and instituted the Second New Deal, which brought the unemployment rate down to 5% when Pearl Harbor took place.
What this also means is that anyone who listens to what the Republicans want when it comes to economics or budgets should be immediately laughed at.
Now, ignorant conservatives will tell you that the original New Deal didn’t work, but they’re obviously wrong when you look at the statistics. The so-called “failure” of the New Deal brought unemployment down from 25% to 5% BEFORE WORLD WAR TWO.
You might also run into an ignoramus who is mystified about the uptick in unemployment. There is no dispute about what caused this: it was austerity-loving budget-balancers.
To quote Wikipedia: “By the spring of 1937, production, profits, and wages had regained their 1929 levels. Unemployment remained high, but it was considerably lower than the 25% rate seen in 1933. In June 1937, some of Roosevelt’s advisors urged spending cuts to balance the budget. WPA rolls were drastically cut and PWA projects were slowed to a standstill. The American economy took a sharp downturn in mid-1937, lasting for 13 months through most of 1938. Industrial production declined almost 30 per cent and production of durable goods fell even faster.”
Bolded text mine. The cause of the downturn was not too much spending, or too much regulation, nor anything else conservative poltroons like to babble on about.
CONSERVATIVE TACTIC #3: LEND-LEASE AND MILITARY BUILDUP
Another conservative tactic is to cite the Lend-Lease program and the military buildup that took place prior to Pearl Harbor. But the Lend-Lease program was a tiny expenditure that mainly involved us loaning existing military equipment to foreign countries and the military building prior to Pearl Harbor was likewise tiny and in any case neither got going until war broke out in Europe in late 1939.
LOOKING AT THE GROSS DOMESTIC PRODUCT
Conservatives will also tell you that unemployment is a rotten indicator, never mind the fact that they’ve used it themselves. Nothing like moving the goal posts if you’re a conservative. But let’s look at the Gross Domestic Product. If all FDR did was create government jobs for people, the GDP would not have increased during the New Deal. Oh, but it did:
In March 1933, when FDR was inaugurated, GDP had collapsed from about $825 billion (in 1999 dollars) to down to $600 billion (in 1999 dollars). By 1937, GDP had rebounded and made up all of it’s losses, and by 1940, the GDP had shot up to $1 trillion (in 1999 dollars). All that before World War Two and Pearl Harbor, which just to set the record straight since conservatives love distorting the historical record, took place in December 1941.
LOOKING AT PRIVATE INVESTMENT
Now, maybe we should use private investment as a measurement? If you have massive government spending and taxation, private businesses aren’t going to invest, isn’t that the libertarian/conservative mantra?
The following graph speaks for itself and requires no explanation.
LASTING RESULTS OF THE NEW DEAL
Now, let’s look at how the New Deal had a permanent and lasting effect on improving the nation.
The New Deal was made up of various government programs, such as the Civilian Conservation Corps, which contributed the following:
- Bridges: 46,854
- Lodges and museums: 204
- Historic structures restored: 3,980
- Fire lookout towers: 3,116
- Wells and pumphouses: 8,065
- Forest roads: 2,500 miles
- Roads and truck trails: 7,442 miles
- Large Dams: 197
- Water supply lines: 5,000 miles
- Fences: 27,191 miles
- Fish rearing ponds: 4,622
- Beaches improved: 3,462
- Trees planted: 3 billion
- Fires fought: 6.5 million days
The Civil Works Administration contributed the following:
- New roads: 44,000 miles
- Road repairs: 200,000 miles
- Drainage and irrigation ditches: 9,000 miles
- Levees: 2,000 miles
- New water mains: 1,000 miles
- Sanitary and storm sewers: 2,700 miles
- Bridges: 7,000
- Pumping stations: 400
- Swimming pools: 350
- Athletic fields: 4,000
- Schools, new or improved: 4,000
- Airports, new or improved: 1,000
The famous WPA contributed the following:
- Urban streets 67,000 miles
- New Sidewalks: 24,000 miles
- New street lighting: 838 miles
- New traffic signs erected: 937,000
- Rural roads: 532,000 miles
- New bridges: 78,000
- Tunnels Vehicular: 26 Pedetrian: 193
- Schools New: 5,900 Additions: 2,170 Renovated: 31,300
- Libraries New: 151 Additions: 67 Renovated: 856
- Hospitals New: 226 Additions: 156 Renovated: 2,168
- Office and administrative Buildings: 6,400 New: 1,536 Additions: 323 Renovated: 4,524
- Firehouses: 2,700
- Jails and prisons: 760
- Airports New: 350 Enlarged: 700
I could also cite the Public Works Administration, the SEC, the FHA, or just saving the banks from going out of business as well, but you get the idea.
COMPARATIVE ANALYSIS OF OTHER COUNTRIES
The final conservative tactic is to state (without evidence, naturally) that the global economy got better naturally and that FDR was basically along for the ride and that the New Deal didn’t do anything.
Except that when you look at other countries, you’ll notice that those countries that used mass spending to help people recovered more quickly from the Great Depression and those that didn’t do this really did have to wait for World War Two spending to lift themselves out of economic malaise:
Canada didn’t go anywhere because neither party wanted to impose mass spending:
Australia did get out of the Depression thanks to a program similar to the New Deal instituted by Prime Minister Michael Savage. New Zealand had no program and therefore did not get out of the Depression:
The UK screwed up too, imposing austerity and creating additional hardship:
DISCREDITED CONSERVATIVE SOURCES
Let’s take a look at the discredited sources for conservative lies. Most of this anti-New Deal rhetoric comes from a hack named Amity Shales, demolished here:
And also two UCLA professors who should be immediately fired if they haven’t been already, demolished here:
Along with a faulty premise and implausible source material, the actual assertion is illogical and makes no sense.
Think about it: the argument used is that since WW2 brought us out of the Great Depression, the New Deal was therefore a failure, and therefore government spending is a failure.
How do these “economists” think World War Two was paid for, through private charity?
The argument is so ludicrous it actually goes like this: since government spending during WW2 got us out of the Great Depression and government spending on the New Deal did not get us out of the Great Depression, government spending is evil and wrong-headed.
I’d be charitable and say they cannot understand real economists, but they cannot even make logical arguments. Nor do they fact-check their data, nor do they even stop to think: is what I am saying even making sense? Such is the mark of not someone who wants the best for the country, or even their own party, but someone who is either knowingly arguing disingenuously or is so addled they are basically a member of a non-thinking cult.
Engaging and discrediting these people’s ideas has become a necessity.