The New Deal

Rauchway, Why the New Deal Matters, 2021

Broad Arugment

• Suggesting that the New Deal is not just a program of relief, but is a statement in favour of democracy that goes inherently against the traditions of profit and capitalism - it was against the ‘wisdom of bankers and businessmen’ in the aftermath of the Great Depression.

• This is not a perfect system, e.g. the racism within the program, but was overwhelmingly positive and mattered to working people. So positive that there has subsequently been little in the way of serious reform of capitalism, given the faith in New Deal changes to make it a workable system.

• Arguing that this was reform rather than restoration - it was a serious change, FDR - ‘Civilisation cannot go back’.

Chapter 1

• Framing the period before the New Deal as a conservative one, where money was for bank liquidity rather than working people. Referencing the 1932 Bonus Army which was demanding the payment of WW1 bonuses to soldiers, and the poor reaction of Hoover (e.g. drafting orders for martial law.)

  • Suggesting that this movement was partially a recruiting ground for fascism, given the period and ledaership of Waters (fascist leader of the army).

• Violence a metaphor for dissatisfaction with US democracy, which was too fearful of ‘socialists’ to do redistributive policies.

• Roosevelt won election on jobs rather than cash handouts - the hope to restore pride and faith in democracy with dignity. E.g. when similar event under Roosevelt, offered jobs in Civillian Conservation Corps.

Chapter 2

• Discussing the importance of transformation in the New Deal, where Roosevelt (Note Rauchway is framing Roosevelt as the one making decisions, rather than the government) is contrasted with Hoover in his acceptance of public work.

  • Roosevelt understood this state action (e.g. building and setting up the TVA) as a form of ‘liberty’ and modernisation rather than just economic price reduction. Some acceptance of State Planning (compare with T14 Starr).

• Though the internal contradictions - tenant farmers not given remuneration for moving or only 2% employed being black (in line with local makeup), with the idea of future development justifying this.

  • Real development - e.g. 10 million acres facilitated, and a hand in enriching Manhatten Project.

• Broad idea of teaching locals ‘how to govern themselves’ - significant patronising element.

• Future plans ultimately undermined by fear of federal overreach, and judicial action (nearly ruled this illegal)

  • Arguing the plans afterward were moved toward Keynesianism and anti-monopoly.

Chapter 3

• Looking at the response to a continuing issue of the Navajo population, with the state in 1927 seeking to ‘modernise’ the locals away form their poverty and sickness. Democratic New Deal ideals linked in this with Progressivist Republicans, with Republicans like Ikes joining the cabinet on Inidian matters.

  • Formation of Indian Emergency Conservation Work Program, employed 12k Indians and 7m invested in construction of roads and buildings.

• Hope to aid erosion through direct cash payments and proposals to reduce herds.

  • These proposals not taken well, especially since poor weather killed many livestock, and lack of use of corpses taken badly.

• Further investment into national pride - e.g. Navajo art.

• Ultimately, attempt to remove themselves from Indian affairs and had to re-establish Navajo government. New Deal had ‘ruthlessly’ destroyed traditional life even as greater self-rule was allowed.

Chapter 4

• Discussing how the ‘bread and butter’ policies of Roosevelt encouraged many Black Americans to vote against traditional allegiances.

• Hoover had not integrated himself to Black voters - e.g. 1932 project found by the NAACP to be ‘virtually slavery’ in the conditions.

• Initially, New Deal having little focus on race - employing Black Labour Leader to campaign, but no official support - only some black support in 1932.

  • Though the work was largely racially ambiguous, this often de facto hit at black workres - e.g. 1935 Social Security Act excluded protections for agricultural and domestic labourers (where Black Americans largely employed).

  • This developed over time - creation of the Office of the Special Adviser on the Economic Status of the Negroes in 1933. 1933 formation of the ‘black cabinet’ position in each major policy.

    • Or in 1941, a case by the DoJ forced SCOTUS to rule in favour of desegregated Southern Democratic Primaries. established the key foundation that civil rights must not be infringed.

• Ultimatley an ‘equivocal and ambivalent’ tradition, which had a fragile White Southern support as long as support for the Southern economy.

  • rejects 1932 appeal by the NAACP to coem out in favour of civil rights e.g.

Chapter 5

• Foregrounding the importance of New Deal for future development - e.g. the 600k miles of road for moving products, with the hope to create a ‘more inclusive man-made world’, and ‘ennobling’ ordinary undertakings through the WPA arts project - Laning painted for ‘an Ellis Island building’.

• Suggesting the idea of employment had always been one of Roosevelt, e.g. 20 million dollar program for employment whilst governor of NY.

• Some debt to social movements, e.g. Women in the DNC to spread support in 1932 with 6 million leaflets handed out. In 1935 again expansion into the WPA which was more race conscious and more centralised, but mixed reactions. Policies too complex and piecemeal to ever solve the problems. Though more a statement on democracy than an economic recovery plan.

Cowie and Salvatore, The Long Exception, 2008

Broad Argument

• This is writing in some ways against the other historiography lauding the New Deal, suggesting it was flawed internally and brought down by organised labour, racial burdens, and by religion. The only reason this came about was the Great Depression. A version of liberalism would continue, but this was not the same version as the Depression created New Deal type.

• Writing about the decade of liberal ascendency, and how it was moved and changed over time.

• Suggesting organised labour was inherently split around racial barriers, with little unity between groups. The New Deal did not solve these, but was merely a breif allignment of interest. The decline of the New Deal should therefore be seen as a reaction to initial failings, not a subsequent development.

• Unionism developed as the state recognised it under the NLRA in 1935 and the Supreme Court upheld the Wagner Act along with greater solidarity under mass production and the Depression, but this was brief given the coalition’s divisions were only held together thanks to war.

  • And a focus on the ‘individual’ ethos that was essential to the Americna conception.

• In response to the depression, the State moved under Roosevelt toward a management of the capitalism, with a recognition of industrial power and the ultimate hope of Keynesianism. After 1937, this was no longer radical and more a management of the system for the maximum benefit - e.g. the limitations under Taft-Hartley. No longer seeking to benefit all, but maximise production (which helped some unions but not all people)

• 2 other limitations - race and religion.

  • Race as part of the ‘faustian’ bargain of the Southern Democrats, and the Northern racist electorate - e.g. White Unionists leaving Chicago rather than working with black employees.

  • Catholicism, as opposed to the kind of individualism of the Keynian New Deal and the move away from collective planning. As the New Deal and state moved toward agency through consumption rahter than collective economic ideals of redistribution, the buy in faltered.

    • E.g. the example of Metzgar, a steel worker, seeing his freedom as the freedom to consume rather than anything else.

• Writing this against the suggestions of New Deal supremacy, and with a sense of shame / feeling of loss at the undermined action of liberals.

• Arguing WW2 more sig for redistribution, with the New Deal more maintaining changes after WW2 than causing them. Using data from Economist Pidetty. It was a movement that ‘embraced’ the order rather than challenging it - as it only focused on expanding the wealth to a small number of white men.

  • The Liberal Protestant mainstream failed to see how this movement was failing, and how they were being too slow on key issues for the left and how the right was becoming more populist.

• This is what left the ground open fro a right-wing, dynamic anticommunist and individualist movement. Conservatives getting their hands dirty in moving their party compared to the removed actions of the New Left. (Right wing individualism based in culture and god, New Deal in emotionally hollow consumption and production)

• The Great society as an example of how liberalism failed - a movement focused on individual success through work not collective methods of correction.

  • Though there were improvements, e.g. Medicare and medicaid that relied on the ‘public imagination’ of the New Deal and its clout. The problem was an assumption that the New Deal had succeeded, rather than stemmed the bleeding.

  • Or the tension over Civil Rights - support whilst individual, opposition when collective e.g. Black Power

  • Perception that the individual New Deal made society a zero-sum game - Northern opposition to Civil Rights.

• Nixon was able to bring back normality though election on the silly issues of race and morality rather than economy, with this being part of ‘simmering’ white discontent at teh New Deal reality, which was exacerbated through the erosion of the New Deal economy at the same time.

  • The left, through identity politics, had no true collective idea and was workable with the ideas of the corporate economy. This then returned to welfare capitalism and corporatism.

• The ‘return’ was differnet, in that it was still a state massively expanded but the question was whose ends tht state was working for. The large state built on class interests had re-moulded to the deeper concerns with individualism within the state.

Gerstle, Rise and Fall of Neoliberal Order, 2022

• New Deal Order facilitated by Northern voters linked with the Southers, which was supported by Unions and Corporations.

• Basis of curbing the destructive elements of capitl, e.g. limits of mrgin trading and the ‘embrace’ through the ‘great compression’, as the society was pushed together into a more cohernet whole. Taxation of up to 91%

  • This based on the idea of public good beating private right, and the government as an instrument of that right.

    • Classic liberal idea of self-acheivmenet, but using government to help them acheive that right.

  • The use of realpolitik to acheive this aim (not talking about religion to avoid conflicts) or race (to keep South onside rather than Black vote)

• The good life delineated by access to marketplace, individual expression through consumption.

  • E.g. the Kitchen Debate in 1959 with this being a serious point of state polic

• This is part of the ‘class compromise’ - there is the Treaty of Detroit as an example, people get a midding strong position in postwar America. E.g. the right of the UAW to get to the Treaty of Detroit in 1950 with the Big 3 automakers, bringing millions into the Middle Class.

• After the war, even though there was abundance, there was a need to provide as the USSR did, e.g. bc workers like Reuther (toolmaker in Virginia) were traveling to the USSR and telling stories about conditions.

  • This meant that - though the left had to move rightward due to anticommunism, the Right also had to move to the right significantly e.g. through considering Taft vs Eisenhower. Real issue is that though Taft considered New Deal as Nazism, it was too popular to seriously position yourself against. Eisenhower instead won nomination in 52, continuing tax regime and expanding welfare - e.g. investment in highways. Eisenhower expsenditure of public works greater than Roosevelt (reflecting larger state budget)

Katznelson, Fear Itself, 2013

Broad Argument

• New Deal in 3 stages - radical movement supported by South, a period where the South limited Social Democracy, and then the South as an independent force.

• The racial discrimination of the New Deal was an active choice, rather than a passive one.

• New Deal see as a solution to the poor economics of the South, and a way to remove their ‘pseudo-colonial’ status to the North. Thought FDR, as someone who noted on the campaign trail he was unequivocably a white supremacist, would not undermine the system of Jim Crow. Expand to foreign market Trade Act 1934

  • This was a way of bringing the ideals of the market in, though one which was mediated by race.

    • White supremacy fitting neatly with broader idea of American nationalism.

• At the start enthusiastic members, legislating the Banking Act of 1933 / Social Security of 1935. This being radical forward movement.

  • Though this was part of a southern emphasis on policies - e.g. by giving authority to locals, recognition of local wage differences, and exclusion of domestic and agricultural labour.

    • Between 1933 and 1936, 96% of votes of Democrats were partisan.

• Tensions break down over lynching Act 1934 and 1935. Initially, Roosevelt refuses to do anything and some anger at Northern Democrats trying to stop it. FDR suggesting if he backed it, South would block other policies.

  • E.g. Roosevelt pursues governance by racially blind data - led by Odum in Chapel Hill it was race blidnd like in the 1938 Report on Economic Conditions of the South. Deeply misleading, and illustrated how race-blind was becoming difficult.

• Also undermined by massive Unionising in the South by the CIO, which pushed for racial equality, up to 1 million members by 1948 and 600k by 1939.

  • This alligned Northern Liberals and Southern African Americans.

  • Alongside greater criticism of Colour line in context of WW2 and DoJ setup of Civil Liberties Union.

• Southerners wary of New Deal ending Jim Crow - e.g. CCC employing 200k AAs.

  • In this period, late 30s Southern loyalty declined by 2x especially on things that looked like Social Democracy (check for example).

• War was the real push - labour massively empowered and Black Americans pushed into the North, along with the Double V movement and Smith v AAllwright. / Randolf EO.

  • Led to literal violence - reformation of the Klan, along with greater voting alongside conservative Republicans. Calls of Fair Employment Commissions Communistic

    • Threat of 1946 legislation that would enforce Fair Employment for those employing more than 6 individuals.

• South becomes the ‘arbiter’ for what can pass congress - e.g. national security but not social reform.

Selgin, False Dawn, 2025

Broad Argument

• New Deal is not Keynesian in nature, and was broadly done relatively badly.

• New Deal recovery in the early period dominated by the AAA and the NRAA - NRA to raise worker rated by reducing competition, and AAA to raise farmer wages, which did not work.

• AAA was - according to commerce secretary the ‘single greatest experiment in economic planning under capitalist conditions’ - idea was to pay farmers to make less and increase their purchasing power. Benefits to farmers by taxing food processors, who made food more expensive.

  • In turn, farmers get 2bn more earnings, and agri product prices increase 30%.

  • But this is essentially taken from Northeastern livestock farmers, and goes to the South.

  • Sharecroppers (largely black) were let go, and added 2 million to the unemployed.

• Policies toward recovery were minimal and often contradictory, unemployment still in the double digitis at the end of the 1930s.

  • It was the terms of employment rather than the volume of employment that changed.

• NRA for instance reduced antitrust for those with strong employment codes, but this makes cartelisation. It was a relative increase in worker wages not the amount of moeny in the economy, so no Keynesian increased demand.

  • increased wages went to fewer people.

  • And cartelisation leads to higher prices which undermines small businessmen - Borah (idaho senator) recieved in 1934 14k letters on this.

• Only the very end was Keynesian, but small (only 3bn), and the Roosevelt Recession key to undermine support for him to do Keynesian - pushed against 1939 spending bill. By 1939 economy still in the depression, with 12% unemployed. Only the war changed.

Kennedy, What the New Deal Did, 1999

Broad Argument

• Noting that the impact of the New Deal was more that of ‘security’ than recovery or reform, with this largely being done by the World War.

• 1938 as the end of reform, and start of recovery though the reforms continued to be important for hte postwar era.

  • Though this did not change national income distribution, with the Depression ‘lowering’ all boats, though retaining their relative position. The ‘compression’ was from a decline in investment returns not redistribution.

• The unifying theme of the New Deal as Security for various groups (investors, workers, etc) and acheived through 'delicate hand’ - often through regulation not taxpayer money.

  • E.g. Banking - Glass Steagall Banking Aact 1933 - ringfenced investment from commercial banks and created FDIC, with low cost to banks.

  • Or E.g. The SEC which makes rules n stock changes, which took power away from JP Morgan and those with information. One of only 4 regulatory bodies.

    • This is a strikingly capitalist / rational response - allowing Markets to work as meant to (compare with Gerstle classical liberal

• Or Housing, which wasa ‘perhaps the best example’ with the HOLC or FHA, which provided capital for buyers, giving more investment into places, and showed the ‘liberation’ of the private market. Lowered interest rates as securied loans, and allowed broad home ownership with only 1% in public housing.

  • Note: relatively little on race here when discussing homeownership.

• Competition is compraatively crude - e.g. ‘blunt’ with Agriculture payed not to farm, or old people not to work under Social Security. Created broad-base Regulatory Commissions like NLRB which allows discussion.

  • Or e.g. Robinson-Patman Act which allows chain stores to undercut mom and pop shops. Note: Comparae to Selgin.

• arguing against Economic Historians who see as a point of recovery, instead about reform so inconsistencies is legitimate with reform not recovery - e.g. 1932 address at Commonwealth Club - this as a ‘charter’ - about expanding market and players.

  • belief the fronteir was ‘over’ and had to mature and distribute more fairly. Goal was only marginal national income growth. Belief in the economy as largely done.

  • Also faith in the state to bolster structurally inadequate capital. Perminent governmetn expensiture needed (Hansen, Harvard 1938).

  • Idea of self-sufficient national economy, but tension with ideas of the South.

• Stability essential for postwar economy, with stability ‘figure largely’. Though this stability created through insecurity for business as FDR did not want them to take advantage - e.g. NY Fed 1937 head - business was unsure. Only at War, when end of reforms, did people take advantage. Compare with Gerstle - he saying New Deal changes what people think state should do, Gerstle says is cold war.

• Most important legacy being the inclusion of people in the economy

Jeffreis, A ‘Third New Deal’?, 1996

Broad argument

• The New Deal traditionally seen in 2 waves (first 1933 with stabilisation and second 1935 with reform) but there should be a third. Though this can exaggerate differences, and flatten the staate of play. Similar issues with third - was it Keynesian, was it social welfare, was it new?

  • Arguing the third has variously been seen as compensatory state of Keynesianism, expanded social welfare, and the effort to build an administrative state through executive organisataion, though limited by constraints on reform.

On admin state

• First aruged by Karl: attmept to create aplanning state, by a president ‘committed intellectually and programmatically’ to enhancing the presidency - e.g. the 1937 Executive Reorganisation Bill - abandoning independent regulatory commissions, establishing Executive Office of the President. Or 1937 Court Packing Bill - attempt to undermine the courts that made NRAA unconstitution.

• Jeffries argues this suggests a sustained idea by FDR rather than a means to an end, which gives it a ‘larger constancy’ and did not happen. E.g. Savage argues he consistently tried to make the dems the majority, which undermines the idea he wanted to transcend partisan politics.

On Compensatory State

• This is (in Jeffery’s mind) the main legacy of the movement, asa a goal to acheive abundnace. By late 30s 2 choices - Compensated Economy or Directed Economy, with Compensated coming out on top - though this cames out earlier in 2nd ND per Lippman 1934.

  • PiThis from the 1938 Roosevelt Recession, where Keynesians (e.g. Hansen) come out on top, and was easier as less involvement in the economy. Pipeline from Hansen at Harvard into government. War cemented them in there. Can be tracked through NRPB.

• Questions as to when it was won over, e.g. by Pearl Harbour or during war? Compliments Kennedy - internal disputes over this between planners and keynesians.

On Expanded Welfare

• Expansion of welfare - e.g. NRPB 1943 suggestion of ‘economic bill of rights’, shifted from initial limited report in 1940 to full keynesianism in 1943. Initially had been pushed by women progressive-era reformers, then superceded by male Keynesians.

  • Greater professionalisation of the institutions. Shift from reformers to economists. Link with Southern reading - pushed into data not moral positions.

• Good to see this sa limited by extenral constraints - reaction against central power increasing, reflecting individualism - E.g. Keyneisan full-employment bill left Congress only as limited 1946 Employment Act - Congress undermined. Racial constrant shaped which model (compensatory) would be accepted. Right has to accept Commercial aKeynesianism.

  • The war turning this into military keynesianism rather than social reform. THis is Jooks.

• Compare to Cowie - this sees liberal limitations as external.

• The end point is the result of competing attmepts at Keyneisanism and Socia lWElfare.

Cohen, Making a New Deal, 1990

Broad Argument

• Cohen arguing that the New Deal was important for letting out the social and political changes that was rooted in Worker exeriences.

• Comparing the realities of the 30s to the 1919 attempt at broad Unionism in the Great Steel Strike etc, the change was significant with most people being united aunder the Democratic and Welfare systems of the New Deal.

  • Mass culture (radio), political and economic identities had brought together workers into a single, lasting, idea.

• Though ethnicities had a position - e.g. Polish Democratic Club in Chicago should how ethnic ideas were a parallel rather than replaced ideas. New Deal reached people through those ethnic identities. Identity becomes ‘sensibility rather than a support system’ Compare with Cowie / Kennedy - ethnicity still exists and is importnat.

• For Black Americans, this movement was more from the Republicans to the Democrats not from local to national identity. This was a significant gamble - abandoned the Republican support they had, and this was in the end undermining them - continued discrimination.

• 1920s had not created homogenous middle class, as consumption was limited to ethnic shops in local areas. Depression eliminated these competitors which brought cultural homogenisation. Workers were working along ethnic, racial, and skill lines. New Deal brought solidarityon top of forming cultural common ground.

• During Depression, ethnic/racial supprot networks were weakened, and came together to the Democrats against the failing Republican Prohibition. Felt they had earned the benefit of Democrats through campaigning.

  • Those allowed a smaller number of large institutions to be mobilised for solidarity, CIO was the political form that made use of this. This is saying convergence was genuine and done by workers.

• American workers therefore used the New Deal and Union with larger Welfare system for their benefit rather than pushing for radicalism. It was innovative in unionism but fundamentally conservative. This was a desire for moral capitalism.

  • This locked them into the mainstream which, in WW2 and Cold War, was limited to caring about growth rather than taming capitalist excesses, a collaboration with Taft-Hartley, and a greater beurocratic centralisation of power.

• Though this is limited, we should not read this in light of the 1940s, it was a genuine acheivement at the time. E.g. Oral history of Jim Cole - ‘greatest thing in the world’.

Sklaroff, Black Culture and the New Deal: Ambivalent Inclusion, 2009

• Arguing that the New Deal had, in many cases, a real desire to help Black communities - e.g. deeply transformative in aid given to people, and 1939 Royal visit FDR highlighting back culture.

• Afforded them the ‘recognition’ government had denied - e.g. Pittsburgh Courier arguing Roosevelts demonstrated an interest in the problems of Coloured Americans - aided by reformers like Ikes in the NACP.

• Initially, in 1934, Black Democrats angry about discrimintaion (since programs done through local officials), e.g. in the NAACP spoke about the eroded high morals of the project, which informed increasing attention by 1936.

  • This shown by E Roosevelt, e.g. ‘lobbying’ for cause of racial justice - such as anti-lynching bill or Icked in PWA ensuring employment had to tally with 1930 census. 1936 E becoming active in the anti-poll tax campaign and pushing for federal anti-lynching bill.

  • WPA (directed by Hopkins activist) supported 1 million black families or the NYA extending work on student aid to historically black colleges, to improve the differnce in wealth.

• Arguing push of Black figures in the black cabinet and cultural instittuions e.g. Bethune and Weaver, and popular response to fascism brought leftward turn at the end of the New Deal. Individuals moved between Popular Front and New Deal institutions, pushing it leftwards.

  • Despite this, Congressional opposition prevented this move really materialising, e.g. 1933 anti-lynching bill not being supported despite a denunciation.

    • E.g. though White (NAACP) and E pushed FDR into supporting anti-lynching did not bring this support to Congress, and only wrote letters in support.

    • Only made up with this in terms of appointments to the Bench.’

• On art and Governance - New Deal created a new ‘national self-exporation’ through the FERA to help white-collar employees and create a sense of cultural construction e.g. through teh PWAP in 1933 which allwed for black visions to come through.

  • This was run by social reformers and artists Biddle who had met Roosevelt aat Harvard, and was inspired by Rivera. This allowed the formation of Balck cultural autonomy.

• On the American Guide Series

  • This was given to Brown, black activist, to run. Important in handing black Americans to the tools to their own history - e.g. this gave newfound opportunity for Agrican Americans.

  • able to designate how the black American culture would be delineated and created some bottom-up histories of black culture.

  • Somewaht limited by sttae administration - e.g. North Carolina did not employee any black people given segregation.

  • Some success though - e.g. ‘Negro in Virginia’ as a first FWP focused directly on black experience. change to the childlike interpretations of blck Americans. challenged some narratives of southern history.