New Deal

Michael Lind's piece in Salon today expands on his "neoliberals AND 60's liberals suck" theory and suggests that Sen. Obama should pursue a New Deal-esque program that targets the middle class.

Bill Clinton to the contrary, the public clearly does not think that "the era of big government is over." Nor does the public show any interest in the laundry lists of teeny-weeny tax credits for this and that that neoliberals love to propose, to appear compassionate without spending real money. The public wants the middle-class welfare state to be rounded out by a few major additions -- chiefly, healthcare and childcare -- and the public also wants the government to grow the economy by investing in public works and favoring companies that locate their production facilities inside the U.S. There, in a sentence, is a program for a neo-Rooseveltian party that could effect an epochal realignment in American politics.

There are two ways to be for the middle class- to expand it and to make it more prosperous. They aren't mutually exclusive, and both are causes worth fighting for, but Lind does not clarify which one is his. His visceral disdain for "McGovernite" liberalism (a bit of sleight-of-hand- he's in part talking about programs that originated in New Deal-coalition administrations) and opposition to programs for immigrants and African-Americans suggests that he has reinforcing the middle class primarily in mind.

But Lind ought to remember that the New Deal succeeded in both shoring up the middle class and expanding it. Poverty rates dropped like a stone under the New Deal coalition's program. Many folks were left out, but the New Deal programs, as well as many War on Poverty programs, integrated millions of folks into mainstream life. That Lind doesn't recognize either of these facts is troubling.

So while he's right that safety net programs and neoliberal incentives cannot move the country forward on their own, his focus is far too limited. The New Dealers Lind promotes had some common ground with the college-educated, upper middle class liberals he wants to marginalize, and it'd be a shame if an Obama administration didn't recognize that.

Adam Cohen in yesterday's NYT on the 75th anniversary of the National Industrial Recovery Act and the minimum wage:

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This week marks the 75th anniversary of the National Industrial Recovery Act — which Roosevelt signed June 16, 1933, at the end of his famous first 100 days — and of the federal minimum wage. It was a grudging, almost accidental win, and the road since then has been rocky. Advocates for low-income workers have had a hard time keeping the minimum wage at a reasonable level and passing other laws necessary to fulfill the original goal: ensuring that people who work hard can achieve a reasonable standard of living.

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The Supreme Court declared the NIRA unconstitutional, but the idea of a federal minimum wage had taken hold. In 1938, Congress passed the Fair Labor Standards Act — which a more progressive Supreme Court upheld — creating a mandatory federal minimum wage.

The new law was enormously effective: within a year, it brought millions of low-paid workers up to a wage of 30 cents an hour. It also had major weaknesses, notably that it was not indexed to inflation. Congress has to raise it, which leaves low-income workers at the mercy of politics.

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The minimum wage can play a vital role in lifting hard-working families above the poverty line. But as Roosevelt understood, it is also about something larger: what kind of country America wants to be. “A self-supporting and self-respecting democracy,” he said in the Congressional message that accompanied the Fair Labor Standards Act, can plead “no economic reason for chiseling workers’ wages.”

One way to think about the debate over the Wal-Mart economy is in narrow cost-benefit terms: do the benefits of the low prices provided by America's largest private employer exceed the costs of low wages and benefits? But I think the better way to think about it is in Rooseveltian terms: do we want to be a country of low retail prices, low wages, and Gilded Age inequality?

If you're not a Nation subscriber, the April 7th issue, dedicated to commemorating the 75th anniversary of the New Deal, is worth picking up on the news stand.

Seventy-five years ago, facing the catastrophic, worldwide failure of the free market, Franklin Roosevelt launched what is perhaps the greatest democratic experiment of the twentieth century. Touching nearly every aspect of American life, the New Deal transformed banking, business, labor, agriculture, arts and literature, urban and rural landscapes and, of course, the relationship of citizens to government itself. Today, decades of conservative rule have jeopardized much of the New Deal's legacy. Many of its reforms and regulations have been gutted, and much of the infrastructure it built crumbles from neglect. Yet the New Deal endures, not just in institutions like the FDIC and Social Security but in the very idea that where and when there is crisis government should rise to the challenge for the good of the common people. How can a look back help us confront the challenges of the present--from the tangled housing, credit and financial market crises to global warming to the small-mindedness of public policy and debate today? What is the unfinished business of the New Deal? And what can we learn from its failures and limitations? ....

Of particular note, Eric Schlosser's piece on the minimum wage, Andrea Batista Schlesinger's article contrasting the big ideas of the New Deal with the policy minimalism of DC based groups like The Third Way, and Richard Parker on why the New Deal matters today.

In light of the FDR mentions in recent posts, I'd be remiss if I failed to mention that today is the 75th anniversary of FDR's first Presidential inauguration. In her blog, Katherine Vanden Heuvel reflects on the anniversary and the continued relevance of what FDR said on this day in 1933:

Here are a few words, from that first Inaugural Address, I'd like to hear 2008 variations on this evening: "The money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths, The measure of the restoration lies in the extent to which we apply social values more noble than mere monetary profit....This Nation asks for action, and action now...Our greatest primary task is to put people to work..."

Seventy two-years ago today—May 6, 1935—President Roosevelt signed an executive order establishing the Works Progress Administration. According to Wikipedia:

It was the largest and most comprehensive New Deal agency, employing millions of people and affecting most every locality, especially rural and western mountain populations.

It continued and extended the FERA relief programs started by Herbert Hoover and continued under Franklin D. Roosevelt. Headed by Harry L. Hopkins, the WPA provided jobs and income to the unemployed during the Great Depression in the United States. The program built many public buildings, projects and roads, and operated large arts, drama, media and literacy projects. It fed children, redistributed food, clothing and housing.

Until closed down by Congress and the war boom in 1943, the various programs of the WPA added up to the largest employment base in the country — indeed, the largest cluster of government employment opportunities in most states. Anyone who needed a job could become eligible for most of its jobs. Hourly wages were the prevailing wages in the area ....

For more on the WPA, I highly recommend Bold Relief: Institutional Politics and the Origins of Modern American Social Policy, a 1999 book by NYU sociologist Edwin Amenta. Among other things, Amenta makes the important argument that "New Deal reformers and their contemporaries did not intend to make distinctions, such as those in evidence today, between social security and welfare programs and their respective recipients." See also this article by Amenta and colleagues.

While browsing in a used-book store in Dupont Circle a few months ago, I came across The Age of Roosevelt, a three-volume history of the New Deal, written by historian Arthur Schlesinger. I bought it without thinking much about Schlesinger himself until last week when the news came that he had passed away at the age of 89.

Before reading some of what's been written about Schlesinger in the last few days, I've tended to associate him with contemporary centrism, perhaps because of the title of his 1949 book The Vital Center. But it turns out that the center for Schlesinger was a liberal location—occupying a position between communism and unregulated capitalism—rather than today's centrism of political triangulation, timidity and narrow-minded "swing-voter" targeting a la pollster Mark Penn and The Third Way. The fact that Schlesinger viewed Jimmy Carter as too conservative tells you a lot about his brand of centrism.

In an excellent op-ed on Schlesinger in Friday's WaPo, E.J. Dionne notes how both Schlesinger and John Kenneth Galbraith, who died last year, were public intellectualls who cared deeply about the public interest:

Like John Kenneth Galbraith, his friend and fellow worker in liberalism's vineyards, Schlesinger worried about "the classical condition of private opulence and public squalor." He said of the 1950s: "We have chosen in this decade to invest not in people but in things. We have chosen to allocate our resources to undertakings which bring short-run profits to individuals rather than to those which bring long-run profits to the nation." The new public priorities, Schlesinger said, should include schools, medical care and "energy development." Meet the old agenda; same as the new agenda.

In his op-ed, Dionne draws heavily from Schlesinger's The New Mood in Politics, an essay written in 1960. It's an extraordinary essay with considerable relevance to today's debates. I recommend reading it in full, but here's a taste:

Somehow the wind is beginning to change. People—not everyone by a long way, but enough to disturb the prevailing mood—seem to seek a renewal of conviction, a new sense of national purpose. More and more of us, I think, are looking for a feeling of dedication, for a faith that what we are doing is deeply worthwhile—the kind of inspiration and lift we had for a while in the '30's and again during the Second World War.

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At bottom, perhaps, we are seeking a new articulation of our national values in the belief that this will bring about a new effectiveness in our national action. For national purpose is not something that is enshrined in monuments or preserved in historic documents. It acquires meaning as part of an ongoing process; its certification lies not in rhetoric but in performance. The values of the '50's have been, to a great degree, self-indulgent values. People have been largely absorbed in themselves -- in their own careers, their own lives, their own interests. We tend to cover up our self-absorption by saying that what is good for our own interests is good for the country; but this is a gesture of piety. In fact, we start from our own concerns and work outward, rather than start from the national needs and work inward....

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Now there is little to be gained in denouncing the values of the '50's as meager and mean. It is important rather to understand why we have dallied with such values -- why our nation, in a time of danger, should have lowered its sights, renounced older concepts of high national purpose, and elevated private consumer satisfaction into a controlling national ethic. There is, I believe, no insoluble mystery here. Nor can we properly shift the blame for our condition from ourselves to our leaders. Certainly our leadership has failed in this decade to develop our potentialities of national power and to meet the onward rush of national needs. But it has just as certainly succeeded in expressing the moods and wishes of the electorate.

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If the hallmark of the '50's has been the belief in the sanctity of private interests, the hallmark of the '60's, I suggest, may well be the revival of a sense of the supremacy of the public interest --along with the realization that private interests and the public interest often come into harsh conflict. Theodore Roosevelt once said, "Every man holds his property subject to the general right of the community to regulate its use to whatever degree the public welfare may require." If unlimited private indulgence means that there are not enough resources left for national defense or for education or medical care or decent housing or intelligent community planning, then in a sane society private indulgence can no longer be unlimited.

The new attitude toward the public interest will bring in its wake a host of changes. There will be a change, for example, in the attitude toward government. One of the singular developments of the last decade was the rise of the notion that government was somehow the enemy. This was not George Washington's attitude toward government, nor Alexander Hamilton's, nor Andrew Jackson's, nor Abraham Lincoln's. The great American statesmen have all seen government as one means by which a free people achieves its purposes. But in the '50's we tended to suppose that a man engaged in making money for himself was in nobler work than a man serving the community (and that the more money he made, the greater his wisdom and virtue). That attitude will diminish in the '60's. Young men will go into public service with devotion and hope as they did in the days of T.R., Wilson and F.D.R. Government will gain strength and vitality from these fresh people and new ideas.

Of course, affirmative government per se can no more be a sufficient end for a good society than consumer goods per se. The object of strengthening government is to give force to the idea of public interest and to make possible the allocation of resources to necessary public purposes. ... There is no other way to bring about a higher quality of life and opportunity for ordinary men and women.

This point—the quality of life—suggests the great difference between the politics of the '60's and the politics of the '30's. The New Deal arose in response to economic breakdown. It had to meet immediate problems of subsistence and survival. Its emphasis was essentially quantitative—an emphasis inevitable in an age of scarcity. But the '60's will confront an economy of abundance. There still are pools of poverty which have to be mopped up; but the central problem will be increasingly that of fighting for individual dignity, identity, and fulfillment in an affluent mass society. The issues of the new period will not be those involved with refueling the economic machine, putting floors under wages, and farm prices, establishing systems of social security. The new issues will be rather those of education, health, equal opportunity, community planning—the issues which make the difference between defeat and opportunity, between frustration and fulfillment, in the everyday lives of average persons. These issues will determine the quality of civilization to which our nation aspires in an age of ever-increasing wealth and leisure. A guiding aim, I believe, will be the insistence that every American boy and girl have access to the career proportionate to his or her talents and characters, regardless of birth, fortune, creed, or color.

Much of this could have been written in mid-2006. Perhaps the only thing that would sound off-key if applied to today's concerns is Schlesinger's argument that the "issues of the new period will not be those involved with refueling the economic machine, putting floors under wages ... establishing systems of social security." Schlesinger, like Galbraith back then, underestimated the extent to which prosperity would not be shared in what was and remains an age of affulence. I imagine that Schlesinger, like Galbraith, came to understand this.