Posted: April 28, 2005
his book is a little like a traditional mystery with a surprise ending. Its basic thesis through 95% of the text is a fairly standard conservative attack on the economic performance of the New Deal. It is far from a rabid version of this genre, and takes the fairly novel approach of comparisons with the economic performance of Britain and Germany in the 1930s.
The author, a Distinguished Professor of History at Ohio University and one of Harry Truman's premier biographers, ascribes Roosevelt's enduring popularity to political legerdemain, oratorical virtuosity, and a good sense of public relations. The word "charisma" is employed countless times in reference to Roosevelt and others. But apart from its provision of emergency relief, he considers the New Deal a fiasco.
The surprise comes in the last 20 pages, when Hamby presents Roosevelt as a savior of democracy because of his worldwide popularity and his distinction as a dynamic leader who prevented democratic rule in the major countries from seeming irretrievably stuffy, pusillanimous, and boring, in the manner of Chamberlain and Daladier.
It would be hard not to recognize Franklin Roosevelt's popularity, which was obvious almost every time he ventured outside the White House. Three-quarters-of-a-million people came out to greet him when he went to Chicago in 1937 and delivered his "Quarantine" speech. Three million New Yorkers, half the population of the city (with hundreds of thousands of young men absent in the armed forces), stood in a driving rain for up to two hours to see him pass at 20 miles an hour in an open automobile when he campaigned for a fourth term as president in October 1944. Huge and wildly enthusiastic crowds greeted him in December 1936 in Rio de Janeiro, Buenos Aires, and Montevideo, even when, as in Argentina, the regime was not especially friendly. Nonetheless, Hamby goes a bit far when he writes that Germany and the United States both had a "Führerprinzip," a dependency on strong individual leadership.
Hamby rightly debunks the myth of the great German economic miracle, inasmuch as Hitler merely conscripted the whole population into the armed forces and the defense production industries at minimal wages, substituting a shabby command economy and fervent racist jingoism for more traditional encouragements to public morale. He usefully reminds us that Hitler told his economics minister and central banker, Hjalmar Schacht, "that the first cause of the stability of our currency is the concentration camp." With that, Hamby represents the Nazi leadership as more collegial in practice than it was (the ignorant street bully, Rudolf Hess, was a figure "to be reckoned with"). Yet he trivializes Hitler by writing that he only had "probably above average intelligence" and attributes his atrocities merely to "hubris."
Hamby's effort to sell the virtues of Neville Chamberlain, as Stanley Baldwin's Chancellor of the Exchequer, and as prime minister, are not altogether persuasive. Britain clung to the gold standard through the '20s, and never had a boom such as the United States enjoyed in that decade. So its depression in the '30s was less of a shock than in America. Chamberlain got through the '30s with a generally balanced budget and declining unemployment, but with a far less imaginative benefit system than the New Deal's vast workfare projects. Chamberlain's fiscal performance was competent but hardly worthy of the acclaim it receives in this book.
Even more precarious is Hamby's effort to credit Chamberlain with some foreign policy inspiration, not in the outright appeasement of Hitler, much less Mussolini, but because his options were limited due to Roosevelt's (and Stalin's) refusal to render real assistance in resisting Hitler. It is a notorious fact that Britain and France could easily have resisted him themselves if they had acted in the first three or four years of Hitler's regime. Hamby blames Roosevelt for Anthony Eden's resignation as foreign secretary in 1938 and severely accuses Roosevelt of a "vaporous proposal" for a conference (in comparison to Chamberlain's foreign policy of groveling even to Mussolini). This is the more strange for Hamby's recognition that collective security was the "constant refuge of the weak in the twentieth century, that someone else would provide"; a "warm and fuzzy form of denial." Roosevelt early recognized the danger of Hitler, but Hamby doesn't acknowledge that he couldn't mobilize American opinion until the British and French were robust advocates of the containment of Germany.
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Hamby buys into the conventional European line at the time that Roosevelt blew up the 1933 London Economic Conference "petulantly" and fostered isolationism as a result. That conference was essentially a cabal of countries wishing to retain or return to the gold standard, and to pick America's pocket. President Hoover had touted it because he falsely represented that the Depression in America was the result of international factors beyond America's control. Foreign trade represented less than 10% of American GDP and the conference had no chance of achieving anything useful, but Roosevelt could have broken it up more diplomatically.
The greatest failing of this book is its exaggerated disparagement of the New Deal. Roosevelt gets virtually no credit for saving the banking system. The guaranty of bank deposits, an inspired and absolutely necessary measure (which Roosevelt was initially reluctant to take), is barely mentioned. Hamby passes completely over the fact that the New Deal saved from risk of seizure the homes of nearly half the entire population by refinancing their mortgages.
Hamby claims in various places that Roosevelt uttered "blanket attacks on bankers" when he was in fact careful not to play that card, and in his first Fireside Chat, on banking, in March 1933, emphasized that all but a few bankers were trustworthy and reasonable people. Hamby claims throughout the book that Roosevelt disliked business and businessmen (his "deepest feelings"), that he indebted his party and himself to extreme labor leaders such as John L. Lewis (whom he was glad to have as an opponent in the late '30s), that he made war on the rich, and that the early Brains Trust had a Mephistophelean influence (they were basically only speech-writers, and they didn't last long at that). Hamby states in various places, implausibly, that the New Deal was "a humanitarian success; a political triumph; and an economic failure"; that by July 1933, "the economy was beginning to sputter"; that the New Deal was "about taming capitalism and humbling capitalists"; that Huey Long and other rabble-rousers were used by Roosevelt as a pretext to "pull the (Democratic) Party farther left"; and that Alf Landon, of all people (the very unsuccessful Republican presidential candidate in 1936), was "on the mark" when he claimed FDR had retarded the economic recovery by two years.
The author credits the United Auto Workers for moving millions of U.S. workers into the middle class, when the New Deal and particularly Roosevelt's 1944 G.I. Bill of Rights were chiefly responsible. He also claims that Roosevelt wanted higher wages but steady prices (his reflation program sought an increase in both), and that Roosevelt had "vast aspirations" to greater and excessive government powers. Hamby asserts generally that Roosevelt tried to blame the Crash and the Depression on corporate greed and Wall Street monopolists, which is "not to put too fine a point on it, poppycock." Of course it is, and no one knew that better than Roosevelt. He had no idea what really caused the Depression and didn't claim to, any more than the community of economists does, but he sensed that the Hoover formula of higher taxes, higher tariffs, and a shrinking money supply was not the answer. He raised the money supply dramatically, reflated, and provided immense stimulus with imaginative workfare programs that Hamby acknowledges gave the country excellent value for money, both in public works and relief for the necessitous.
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Roosevelt unleashed in the National Recovery Administration a number of different and often conflicting policy options, to determine which would work best. The second New Deal—based on Social Security, the Securities and Exchange Commission, reforming the Federal Reserve, curbing utility holding companies, legislation for the working conditions of the coal industry, and for collective bargaining generally, and a portentously styled but fairly toothless wealth tax—was designed to protect the political center from the depredations of Huey Long, Father Coughlin, Dr. Townsend, and the militant farmers. Hamby takes a good deal of Roosevelt's posturing and tactical political maneuvering too seriously, and doesn't recognize it for the manipulative dexterity that it was. He seems to think that Roosevelt was possessed of an almost demonic urge for power (he claims he "seized" the nomination for governor of New York in 1928, when he was in fact a very reluctant candidate).
Roosevelt was flippant about economic matters, because he was distrustful of the dogmatists, including John Maynard Keynes, who somewhat condescended to him—to Hamby's delight. But there is no evidence that Roosevelt really thought that moving the gold price around or pursuing a "commodity dollar," or monetizing silver, or moving, as he did from 1935 to 1938, toward a balanced budget, would achieve anything except the placation of the noisy faction then clamoring for those policies. Nor did Roosevelt have much use for labor leaders, although he did have considerable sympathy for the working class. But he still cut relief expenditures in the summer and breezily declared: "No one starves in this country in the summer." He was no bleeding heart.
Distributing codes of cartelism and collective bargaining were supposed to raise prices and wages, profits and incomes. The codes were a shambles, but there was some tangible success and an immense public relations and psychological boost as a temporary result of them. Roosevelt knew that a great deal of economics was psychology and showmanship, and as Hamby elsewhere acknowledges, FDR was a genius at this aspect of his job, rivaled in this skill only by Hitler among world leaders (until the rise of Churchill).
Roosevelt's greatest achievement in this period was that he channeled almost all the anger and frustration generated by the Depression against categories of nameless and fictitious wrongdoers: monopolists, speculators, war profiteers, corrupt lenders, and exploiters. He knew this to be nonsense. If he had shouted to one of his huge meetings that the Rockefellers and Mellons and Fords would pay for the nation's distress, as Huey Long and others did, mobs would have burned down their homes. He preserved the moral integrality of the country to be focused on real enemies: the external threat posed by Nazi Germany and Imperial Japan.
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The New Deal was good politics, as Hamby states, and passable economics, which he denies, and a masterpiece of catastrophe avoidance, which he only grudgingly and partially admits. The greatest fallacy in the school of anti-New Deal comment, and very evident in this book, is that there is no good reason why German, Japanese, and ultimately French and British job creation in the armed forces and defense production industries should count as reductions of unemployment and Roosevelt's millions of jobs in conservation, public works, and a range of activities from live theater to saving the whooping crane, should not. (Pro-Roosevelt historians have generally not contradicted this anomaly, thus facilitating invidious comparisons of the New Deal with policies in other countries, such as Britain as in this book.)
The New Deal programs employed over 15 million people; constructed 550,000 miles of roads; 75,000 bridges and viaducts (including New York's immense Triborough Bridge complex, as well as its Lincoln Tunnel); 23,000 miles of sewers; 880 sewage treatment plants; 3.6 million feet of airport runways; 2,500 hospitals; over 20,000 public buildings (including 4,000 schools and the Cathedral of Learning in Pittsburgh); and over 13,000 parks, athletic fields, and playgrounds. It also planted hundreds of millions of trees; stocked one billion fish; employed 3,000 artists and writers and 50,000 teachers; taught more than 1.5 million children how to read and write; and built the aircraft carriers Enterprise and Yorktown, which would contribute as much as any two ships to victory in the Pacific in World War II.
A great deal of the New Deal was nonsense, and Hamby is right to dismiss much of it, especially some of Roosevelt's foolish ideas about taxes, even allowing for his concern that extremists not be allowed to whip up too much sentiment against the wealthy. The advantages of a low-tax policy had not been demonstrated by the tax cuts of the Republican Treasury secretary in the '20s, Andrew Mellon, and the wealth gap was a politically sensitive issue in the '30s. Hamby's assertions that Roosevelt had "failed at his fundamental task" and that in 1939, the United States was "stagnant, shabby, and wary of the future," are evidently false.
Roosevelt was already moving to the fourth phase of the New Deal (the third having been the massive return to workfare and the Fair Labor Standards Act in 1938), in which, like the European powers and Japan, he transferred his main job creation effort from public works and conservation to defense production. In doing so, he put the progressive isolationists who had been New Deal allies over the side, and joined forces with the big defense budget, pro- British, Southern leaders in the Congress. By this method, unemployment came into single digits before the 1940 elections (it stood at about 6% with relief workers counted as employed), and was eliminated completely by Pearl Harbor a year later.
The half of Hamby's thesis that holds that the New Deal was an economic failure is mistaken and not particularly well-argued. There is no explanation for how Roosevelt retained his immense popularity despite the alleged debacle of his domestic programs and tentativeness of his foreign policy. The other half of the thesis, that Roosevelt and the U.S. were "bearers of hope in an imperiled world," is accurate and is well presented when it makes its surprise appearance at the very end of the book.
Despite its unevenness, this book is an interesting read. As in many books that rely heavily on contemporary newspaper accounts, many forgotten or unknown little facts emerge, such as that Goebbels resurrected the idea of the Olympic torch being carried in relays from Greece, for the Berlin Olympics of 1936. Of the anti-New Deal books, while less rigorous than some, this is one of the most original and good-natured, has many rewards for partisans on all sides of the issues it discusses, is generally pleasingly written, and comes from a substantial and respected author.