Reconsidering Franklin Roosevelt

Historian Jim Powell has been conducting a very interesting debate with publishing magnate and FDR biographer Conrad Black over at National Review. Black argues that Roosevelt got the U.S. out of the Great Depression. Powell disagrees:

High unemployment is the main reason that period is referred to as the Great Depression, and Black claims that FDR eliminated unemployment by putting as many people as possible in government jobs. (FDR probably emphasized government jobs over outright welfare to make recipients feel better about themselves, and to make taxpayers feel less resentful that welfare spending was a key reason that the New Deal tripled taxes.)

Hence all the time Black spends arguing that the Federal Emergency Relief Act, the Civil Works Administration, the Public Works Administration, the Works Progress Administration, and other New Deal agencies gave citizens "real" jobs; by Black's definition, that term means simply that people did work and were paid.

Call those government jobs whatever you want, but they were line items in the federal budget, paid for by current taxes, by borrowing (repaid from future taxes), or by inflation (a tax that works by devaluing dollar-denominated earnings and assets). When the FERA, CWA, PWA, WPA, etc., line items went away, those government jobs went away.

However impressive some of the government work might have been, it didn't involve things that people were willing and able to pay for. New Deal government jobs weren't self-sustaining. They weren't part of the ongoing private sector that involves people basically exchanging things they produce or services they provide for products and services they want from other people.

Read the rest here. Earlier this month at Reason.com, Powell explained why the Tennessee Valley Authority failed to help with the Great Depression. In 2004, I reviewed Powell's FDR's Folly and chronicled how the New Deal made life worse for African Americans.