1934 and 2010 compared


David Greenberg was one of Hillary Clinton’s academic defenders, and he did a more effective job of this than Sean Wilentz. He has an insightful article on Obama’s first year:

One year in, Obama’s approval ratings have slipped, and they’re likely to get worse. He’ll probably muddle through seven more years of partisan acrimony, small-bore achievements, and bitter disappointment. But this is okay. In fact, it’s the definition of success for a modern president.

Greenberg notes that many recent Presidents, who are now considered to have been great successes, struggled to develop a coherent policy focus during their first year. He instances FDR:

No one could say that Franklin Roosevelt began his first year in office hesitantly. His first 100 days were indeed a whirlwind of legislative and executive feats. But FDR geared his first-year efforts almost entirely toward recovery—a necessary but hardly transformative goal. Certain measures—like solving the banking crisis, which had reached catastrophic proportions on the eve of his inauguration—made a palpable difference. But the core elements of FDR’s “First New Deal” turned out to be, on the whole, ineffectual or unconstitutional—or both. The National Recovery Administration, the centerpiece of it all, which relied on industry leaders to agree to production codes, was flawed in both conception and execution, and it failed miserably. When the Supreme Court unanimously ruled it unconstitutional, Roosevelt’s aide Robert Jackson called the decision a blessing in disguise, since it spared the president from having to watch Congress decline to renew the act. The Agricultural Adjustment Act, which regulated farm production through central planning, was also struck down. And then there was Roosevelt’s Economy Act, a misguided effort in budget balancing taken up before Washington discovered the wisdom of deficit spending. Most of the New Deal’s lasting elements didn’t come until 1935. Only after taking a beating on the airwaves from demagogic populists like Senator Huey Long of Louisiana and the radio priest Charles Coughlin did FDR sign on to the Social Security Act, which created unemployment insurance, old-age pensions, and a safety net for the disabled. And not until his second term did his administration embrace a Keynesian strategy of aggressive spending to lift the economy out of crisis. If Roosevelt’s first year was historic for its activist spirit and purposeful intervention, its economic philosophy left little mark.

Yet despite the negligible or negative impact of the National Recovery Administration and the Agricultural Adjustment Administration the Democrats enjoyed a total political ascendancy during 1932-34 and at the Congressional elections of 1934 they gained seats in Congress. The NRA was bad policy (although Peter Temin suggests it make have positively influenced business expectations) but initially struck a chord with public opinion, but how can progressives make good policy popular?  Cartelization, budget surpluses and protectionism are more likely to be popular than free trade, budget deficits and competition policy. This is a complete reversal of the current position where the Democrats are struggling to hold a Senate seat in Massachusetts. Here Obama is performing much worse than FDR, if the Republicans had made major gains in 1934 would the second New Deal have ever occurred?

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