New Deal Nemesis

It was star-studded, wealthy, professional…and a flop.


Those who have fought the power of the modern State and attempted to resist the onslaught of modern liberalism have had little time to write or even to read the history of their own struggle. And the literature is often less than adequate or nonexistent.

Almost forgotten today, of all those who have fought against collectivism, is the American Liberty League, which in the midst of the Great Depression dared to attack the whole philosophical basis of the New Deal. It was perhaps the best-financed and the most professionally run and star-studded anti-big-government organization ever to come down the pike.

It was also a gigantic flop.

And that is probably all that most people now know of it. Not much has been written about it since—except pejoratively. Conservatives, who do not usually retrieve their wounded, have shown little interest in its history. But the past—as conservatives, above all others, should acknowledge—is instructive. And we who struggle for liberty today should elicit and pay heed to its lessons.

Liberty League Origins

Who were the men making up this organization? There was, of course, its chairman, Jouett Shouse, a GM executive, former chairman of the Executive Committee of the Democratic Party, and former president of the Association against the Prohibition Amendment. Then there were Alfred E. Smith and John W. Davis, former Democratic presidential candidates; Congressman James W. Wadsworth (who would eventually become the father-in-law of Sen. Stuart Symington); Nathan Miller, a director of U.S. Steel and a one-time governor of New York; John Rascob, another GM executive and former Democratic national chairman; Alfred P. Sloan, Jr., head of General Motors; Ernest T. Weir of Weirton Steel; Dr. Samuel Hardey Church, head of the Carnegie Institute; David A. Reed, former Republican senator from Pennsylvania; Hal Roach, motion picture producer; Sewell Avery of Montgomery Ward; Joseph B. Ely, former Democratic governor of Massachusetts; Howard Pew of Sun Oil; James Beck, constitutional authority; and the Du Pont brothers—Irenee, Lammot, and Pierre.

So this was clearly not some fringe organization. It was wealthly and it was respectable—eminently respectable. At its height it claimed the allegiance of 124,856 members, and it sincerely believed that it could topple the New Deal of Franklin Roosevelt. When the formation of the League was announced on August 23, 1934, its public goals of nonpartisanship and constitutionality were unveiled, without any mention of the New Deal. Yet everyone knew what its eventual goal must be, and the White House and its liberal allies launched a preemptive strike on the League. New Deal congressmen jumped to the attack, and the battle was on.

The League could in part be traced to Shouse's old Association Against the Prohibition Amendment. Raskob and the DuPonts had also been active in it, and its emphasis on local self-government resembled later Liberty League doctrine. The antipathy of this group to Roosevelt was of long standing. Just a few days after Roosevelt's nomination, Raskob wrote to Shouse, "When one thinks of the Democratic Party being headed by such radicals as Roosevelt, Huey Long, Hearst, McAdoo, and Senators Wheeler and Dill, as against the fine, conservative talent in the Party as represented by such men as you, Governor Byrd, Governor Smith, Carter Glas, John W. Davis, Governor Cox, Pierre S. Du Pont, Governor Ely, and others too numerous to mention, it takes all one's courage and faith not to lose faith completely."

The League, according to historian James Patterson, author of Congressional Conservatism and the New Deal, was partially the result of urging for a coalition of conservatives of both parties to defeat Roosevelt. It was reported that such conservative Democratic senators as Glass, Byrd, Gore, Bailey, and Clark were mildly in favor of such action; but partisan politics being what they are, little came of the idea for a formal coalition.

Emphasis on Rights

"The particular business and objects" of the league, said its articles of incorporation, "shall be to defend and uphold the Constitution of the United States and to gather and disseminate information that (1) will teach the necessity of respect for the rights of persons and property as fundamental to every form of government and (2) will teach the duty of government to encourage and protect individual and group initiative and enterprise, to foster the right to work, earn, save and acquire property, and to preserve the ownership and lawful use of property when acquired."

The reason for this emphasis on economic freedom was simple to understand, explained one of the League's pamphlets. "There is one very clear lesson to be learned from history—namely, that governmental disregard for property rights soon leads to disregard for other rights. A bureaucracy or despotism that robs citizens of their property does not like to be haunted by its victims."

Thus the League of necessity found itself in a basic policy of opposition to the New Deal. Although it could support such Roosevelt measures as the Economy Act, his veto of the Bonus bill, or his opposition to Senator Hugo Black's plan for a 30-hour work week, it almost always played a nay-saying role—as in its position on the National Labor Relations Act, which it thought to be based on an improper use of the Constitution's interstate commerce clause and an intrusion on the right of contract; the Guffey-Snyder Bituminous Coal Act; the Potato Control Act of 1935 ("flagrantly unconstitutional…another step toward Socialism"); the Agricultural Adjustment Act, which they termed "economic and political quackery" and which the Supreme Court found unconstitutional; the Public Utility Holding Company Act ("a calamitous blow"); and the Bankhead Farmer's Home Bill (which "would produce a government sustained peasantry").

A New Ideology

In summing up the League's philosophy, liberal author George Wolfskill (The Revolt of the Conservatives) outlined a remarkably coherent libertarian position. They believed, he said, that the New Deal was a threat to the Constitution and represented a danger of tyranny via centralization; that it was based on coercion, deceit, and false economic principles; that recovery was in fact retarded by government intervention; that government agricultural controls were "a cure worse than the disease"; that the New Deal combined aspects of socialist and fascist economic systems; that private enterprise was being damaged; that deficit financing and high spending threatened the nation with inflation; and that the banking community was now under the political control of the federal government.

Statements by American Liberty League spokesmen were of a solid anti-statist cast. J. Howard Pew lashed into planned economies, charging that they lead to "lower living standards, national decay and the sacrifice of liberty…whether the dictator is a usurper by force or is elected under the forms of popular government." Journalist Neil Carothers charged: "The materials for a disastrous inflation have been built up, and no one knows when these inflammable materials will be set ablaze. Our currency measures have disorganized foreign trade, cruelly embarrassed the gold standard countries of Europe, deepened the misery of China, and retarded recovery the world over."

As to what this New Deal philosophy was—fascist, socialist, or communist—the Liberty League was unsure, but it clearly sensed that a new and unpleasant ideology was taking hold of America, a philosophy that not even the New Deal's most fervent supporters really fathomed.

"Don't let anyone tell you that President Roosevelt is a Communist," said Al Smith in his last speech of the 1936 campaign against FDR. "That is not so. Or don't let anyone tell you he is a Socialist. That is not so. He is neither a Communist nor a Socialist—any more than I am—but something has taken place in this country—there is a certain kind of foreign 'ism' crawling over this country. What it is I don't know. What its first name will be when it's christened I haven't the slightest idea. But I know it is here, and the sin about it is that [Roosevelt] doesn't seem to know it."

League Activities

The popularity of FDR was formidable, but the Liberty League was well manned to carry on its struggle. Its headquarters occupied 31 rooms in the National Press Building, and its full-time staff exceeded 50. At this time the entire staff of the Republican National Committee numbered but 17 individuals. The League soon had contributing members in all 48 states and most of the territories as well. State organizations of the League were quick in forming. By 1936 there were 20 functioning state branches, and nine more were in the planning stages.

In terms of finances, various studies of the League's operations have shown that in its six-year history it solicited and disbursed almost $1.2 million, most of which was spent in the short period between its founding in August 1934 and the presidential election of 1936. These totals did not include funds handled at the state or local level, and of course it should be borne in mind that these were preinflation dollars. In the calendar year 1935 the American Liberty League raised as much money as the Democratic and Repulican parties combined. Most of it came from a handful of generous contributors—approximately 30 percent from members of the Du Pont family.

How then were these large sums expended? Upkeep of the offices was a large expense, as were salaries. For example, Jouett Shouse, as the League's president, received $54,000 per year in salary and expenses.

George Wolfskill described the League's pamphlet series as "the most effective feature" of their educational campaign. Between August 1934 and September 1936, 135 of these broadsides were issued. According to Wolfskill, they "represented perhaps the most concise and thorough summary of conservative political thought since the Federalist papers." Many of them were reprints of speeches delivered by League spokesmen. Others were prepared by the League's staff of highly trained researchers. Five million copies of this pamphlet series—a staggering total—were eventually distributed to the public. As a matter of general practice, copies were sent to over 350 American newspapers, resulting in 200,000 articles either by or about the League.

Supplementary to the pamphlet series was a more simply written leaflet series, usually of a more popular tone. Only 24 of these were issued. Also published by the League was a monthly bulletin. Of a different nature were the five reports issued by the Lawyer's Committee, which were selectively distributed and which studied the constitutionality of New Deal measures.

Instituted in early 1936 was a special League news service for rural weekly and small daily papers. Before the series was discontinued, it had supplied editorials and new stories to more than 1,600 newspapers. Still another facet of the campaign was radio. Many speeches, such as Al Smith's famous address at Washington's Mayflower Hotel, were sent out over the airwaves.

That speech by Smith was the League's most famous single moment. Over 2,000 members of the League assembled for dinner and heard him denounce the New Deal's usurpation of power from business, state government, and ordinary citizens. Yet many felt, as Postmaster General Jim Farley did, that the dinner was "one of the major tactical blunders of our time" because of the opulence of the affair—opulence that contrasted harshly with the realities of the Great Depression.

Despite what the apologists for the New Deal said of those who attended this gala affair, the words that Al Smith hurled at Franklin Roosevelt still had the ring of truth about them.

"What are these dangers I see?" asked Smith. "The first is the arraignment of class against class. It has been freely predicted that if we were ever to have civil strife again in this country it would come from the appeal to passion and prejudices that comes from demagogues that would incite one class of our people against another.

"In my time I have met some good and bad industrialists; I have met some good and bad financiers, but I have also met some good and bad laborers, and this I know, that permanent prosperity is dependent on capital and labor alike."

Target: Election '36

The League had been gearing up for the election of 1936 since its formation two years earlier. Some of its efforts were directed toward the Democratic Party itself. Attempts were made to secure either uncommitted or anti-New Deal delegations to the 1936 Democratic convention in Philadelphia. For the most part these attempts were unsuccessful.

In a John Ashbrook-like attempt to change the course of his party's leftward slant, Henry Breckinridge, under-secretary of war in the Wilson administration, actually entered the New Jersey, Ohio, Pennsylvania, and Maryland primaries against Roosevelt but was soundly trounced in each challenge. A telegram sent to the Philadelphia convention by Smith, Colby, James A. Reed, Ely, and Joseph E. Cohalan asking it to reject Roosevelt had no perceptible effect on the gathering.

Some rumors floated about that the League was behind the third-party effort of the Union Party of Father Coughlin, William Lemke, Francis Townsend, and Gerald L.K. Smith, but in point of fact their ideologies were strikingly dissimilar, and no evidence was ever actually produced to prove such an allegation.

The main thrust of the League in 1936 was to back the presidential candidacy of Republican Governor Alf Landon. A half million dollars of League money was earmarked for his campaign. An organization entitling itself the National Jeffersonian Democrats was formed in early August to administer a "disciplinary defeat of Franklin Roosevelt." They estimated they would divert three million Democratic votes from Roosevelt. Besides these efforts, Liberty League members made large contributions individually to Landon. "Without Liberty League money," Republican National Chairman John D. Hamilton would later admit, "we wouldn't have had a national headquarters."

As a guiding force behind the GOP, however, it did open up the Landon candidacy to some spirited Democratic criticism. Even the supposedly conservative Senator Pat Harrison of Mississippi called the League "a group of griping and disgruntled politicians…masquerading as patriots but who are in reality apostles of greed." Most New Deal advocates followed the same sophisticated drum-beat, and the constant din was beginning to take its toll.

"The strategy was simple (and as it turned out surprisingly successful)," wrote George Wolfskill and John A. Hudson in All But the People: Franklin D. Roosevelt and His Critics, 1933-1939: "Make the Liberty League synonymous with social and economic privilege, associate it closely with the Republican Party, then attack the Republicans by attacking the League. Once synonymity between the Liberty League and predatory wealth was established, the League could be attacked both directly by name and indirectly by attacking 'economic royalists.'"

Al Smith's prophecy of New Deal tactics had come true, but it was of small comfort. The effectiveness of the Liberty League was fast dissolving. By September, it was beginning to show signs of internal dissension. Thoughts of discontinuing the League surfaced, and when the returns came in in November and a conservative rout had become apparent, the die was cast against the American Liberty League.

After that the League closed down all of its public operations and became a mere research office, analyzing legislation for members of Congress. It lingered on the Washington scene until 1940, when the Du Ponts withdrew funding and it died.

Why the League Failed

The League expired in large part because of the high and false hopes that it could administer one solid knockout blow to Franklin Roosevelt in the election of 1936. When it failed to do this—and failed by an incredibly large margin—its members gave up. In all their planning they had failed to realize what a large impact the Depression had had on the American people and the immense popularity of Roosevelt's relief measures.

Beyond this overwhelming factor, however, other things went against the League. Their National Lawyer's Committee was tarred and feathered, charged with inciting to violate the law when it advised that some New Deal legislation was unconstitutional. General Smedley Darlington Butler, in secret—but leaked—testimony, tied together the Liberty League, the American Legion, and a coterie of native fascists in a bizarre plot to march on Washington and make a puppet out of Roosevelt. This absurd tale—unbelievable as it was—nevertheless did little to bolster the organization's reputation. Nor did the successful guilt-by-association tactic of linking the group to certain racist Southern States' Rights groups via the connection of mutual contributors.

All in all, though, nothing was as powerful as the emotional issue of the Great Depression. Typical of the highly charged sentiments turned on the League were these of Senator Joseph T. Robinson: "I think you people read of the accounts of the severe winter through which we have just passed. As the Liberty League implies, think how demoralizing it must have been, with the thermometer ten degrees below zero, to have Uncle Sam supplying funds to repair the damaged shoes of children who were forced to trudge back and forth to school. The Du Pont brothers must have been shocked when Shouse showed them that classic example of undermining the moral fiber of children on relief."

As the chairman of the Republican National Committee, John D. Hamilton, said after the Landon debacle: "The Lord himself couldn't have beaten Roosevelt in 1936, much less the Liberty League." Had the organization itself realized that in advance and not fallen prey to believing its own press releases and Literary Digest polls, it could have survived, setting itself up as a continuing educational organization in an era in which one of its stature was badly needed.

But although the League was lampooned as simply a rich man's club for the protection of corporate wealth, its philosophical underpinnings were in fact not that meager. Its organizers and members saw a threat to American liberty, and not only to their own prestige or wealth.

Its evident sincerity has prompted liberal yet knowledgeable students of it grudgingly to admit that there was more to the American Liberty League than economic royalism. Robert Comerford, in an unpublished doctoral dissertation, put it quite well: "Theirs was the message of old—that man needed more than material comfort in order to survive and mature as a free agent. The questions they raised were those of an ultimate character. They reflected more than the mere self-interest of the moment."

An associate of New Guard and a contributor to New American Review, Mr. Pietrusza has written widely for magazines and newspapers. He holds a master's in history from the State University of New York at Albany.