Daniel Henninger of the Wall Street Journal is a brilliant columnist, I almost always agree with him, and regret that I could not have written the same opinions as well as he. But I am stirred to respectful dissent by his column of April 19, which effectively announced his adherence to the heresy that Franklin D. Roosevelt did not really alleviate the Great Depression in his first presidential term, but used his vast public charm and buoyant optimism to put it over on the voters that he had.
The unspeakable rubbish that Roosevelt had given Eastern Europe to Stalin at the Tehran and Yalta Conferences had just been laid to rest when a new hobgoblin arose and was introduced about in respectable company by my esteemed friend Amity Shlaes and others: that Roosevelt didn’t really make much progress against the Depression until the onset of World War II.
Mr. Henninger wrote that FDR’s 1936 reelection campaign took place as the country “was mired in the Great Depression,” and that he “kicked off” his campaign on October 30 of that year at Madison Square Garden in New York with a speech that presaged President Obama’s address on April 3 to the American Society of Newspaper Editors, in which he reviled “social Darwinism.” The columnist concluded that “the Obama campaign can borrow Roosevelt’s content,” but “can’t teach Obama . . . a pretty grim guy . . . how to be FDR.”
No and yes. Everyone, including most Democrats, agrees that this president can’t run on his record, but that is exactly what FDR did in 1936. There are fewer employed people in the United States now than there were when this administration entered office, despite its racking up cumulative federal budget deficits equal to six times the country’s money supply in January 2009.
“Let’s look at the record,” as Roosevelt’s distinguished predecessor as governor of New York and Democratic presidential nominee, Alfred E. Smith, used to say. The economic problems that greeted the incoming administration in 2009 were risible compared with the crisis that awaited Roosevelt in 1933. The unemployment rate was then about 30 percent, not the still-shocking 25 percent that Amity and her claque try to confine it to, and there was no direct relief for the unemployed. They could beg, steal, or starve.
From 1929 to Roosevelt’s inauguration in 1933, the volume of check and stock-market transactions had declined by 60 percent, industrial production by 50 percent, the stock market by almost 90 percent, new building by 75 percent, manufacturing output by 65 percent (in dollar value), farm production (though physical volumes were almost the same) by almost 70 per cent (in dollar value),and the money supply by 25 percent; and taxes and tariffs had been raised. The banking and stock- and commodity-exchange systems had collapsed. The exchanges had closed; 5,000 banks had failed, wiping out nine million individual savings accounts (not then guaranteed, until Roosevelt did that), and 98 percent of the country’s banks were closed indefinitely. About 1,400 residential mortgages were being foreclosed every day, and about 45 percent of the country’s family homes were under some level of foreclosure threat. On inauguration day, there were machine-gun nests at the corners of the main federal buildings in Washington for the first time since the Civil War.
Flippant comparisons of that horrifying debacle to the serious but scarcely equivalent problems of 2008–9 are, to say the least, unrigorous. In Roosevelt’s first four years, his programs reduced unemployment from approximately 14 million to about eight million in a labor force that had grown by two million. Nearly 70 percent of the unemployed were engaged in workfare projects building what would today be called infrastructure. And the remaining unemployed, about 2.4 million people, received unemployment insurance from the Social Security system Roosevelt established, on a two-payer basis, so future reactionary regimes would not be able to abolish it, and it would not become an open artery like America’s current health-care system.
In his first term, Roosevelt also completed the repeal of Prohibition, the country’s most unrelievedly bad legislative initiative until the War on Drugs; successfully restructured the banking system, including the guarantee of bank deposits; refinanced 4.5 million residential mortgages; instituted a farmer-approved plan of agricultural-production rollbacks to ensure an ample food supply at sustainable farm-income levels; shortened the work week; raised wages; and made great progress in flood and drought control and rural electrification. Farm income quadrupled in four years, and corporate America, which had lost $2 billion in 1933, recorded profits of $5 billion in 1936. Detroit had twice as many employed people in 1934 as in 1932. In 1936, the New York Times Business Index regained the 100 mark that it had pierced in free fall in early 1930, and in June 1936, a Fortune magazine poll showed that 53 percent of Americans thought the Depression was over. All polls showed the president’s approval rating above 60 percent, which is where he came in on Election Day (about 61.5), in one of the greatest landslides in American history.