Louis Proyect: The Unrepentant Marxist

November 16, 2008

The Myth of the New Deal

Filed under: economics,Obama,workers — louisproyect @ 5:49 pm

Today one of the sharper subscribers on Doug Henwood’s LBO-Talk mailing list, who goes only by the initial B., wrote:

Just for giggles I set up Google to email me a news article every time it contained the words ‘obama,” “fdr,” and “new deal” in the same piece.

The result is that I have seen a flurry of articles in my inbox everyday — many from mainstream outlets like TIME, Newsweek, NYT, LA Times, Forbes, etc. — all contrasting Obama’s moment to FDR’s moment.

One of Obama’s keywords — “Hope” — certainly seems to be the mantra du jour. This has started a new cycle of blog wars revisiting the New Deal and how effective it really was, a topic that has drawn in many prominent left-bloggers, including Nobel Laureate Paul Krugman. (Jon Stewart stupidly gave an uncritical forum on The Daily Show to the anti-FDR, anti-Krugman blogger Amity Shlaes. Boo!)

Obama wrote a book called _The Audacity of Hope_, but as Paul Krugman (basically) said, when it comes to Obama, we should _Hope for Audacity_.

Krugman’s stance is that where FDR failed, it was not because he was too interventionist, but because he was too cautious. When I saw Naomi Klein speak recently, even she asked people to push, push, push, Obama hard to the left. NY Mag has called for a new WPA: http://nymag.com/arts/architecture/features/52169/

On a personal note, a relative of mine who is an upper echelon-type exec at G.E. has decided to apply via change.gov to, as he put it, “work for Obama.” I was more than shocked to see this. “We do our part.”


I too have been intrigued by the Obama/FDR comparisons to the point where I am seriously considering writing a leftwing critique of the New Deal, if one has not been written already. After spending a fair amount of time in the Columbia library and in Jstor, a database of scholarly journals, it appears that none has been written. About the most substantive item is Ronald Radosh’s “The Myth of the New Deal”, an article that appears in the 1972 collection “A New History of Leviathan: Essays on the Rise of the American Corporate State”. At the time Radosh was a Marxist scholar who along with his comrades David Horowitz and Eugene Genovese had not defected to the right.

I have scanned in Radosh’s article and posted it on the Marxmail website.  I have not had time to vet it completely, but in the course of reading it hurriedly while proofreading the scanned copy I found nothing totally objectionable.

It should be mentioned that Radosh admits to appropriating much of his analysis from G. William Domhoff’s “The Higher Circles: The Governing Class in America”. Domhoff is best known for another book “Who Rules America”. Like Radosh, he has bolted from the left but in a completely different direction. In a 2003 article titled “Which Side are We on” that appeared in the social democratic magazine “In These Times”, Domhoff advised the radical movement:

In trying to bring about egalitarian social change, however, it doesn’t make good political sense to frame this picture of economic concentration and class domination in terms of one social class against another. Defining the “opponents” as “the capitalists” or “the rich” is a strategic mistake.

Well, at least Domhoff still sees himself as part of the left unlike Radosh who mutated from a 60s radical into an apologist for the dictator Franco, Joe McCarthy and other sordid figures. One has to wonder if Radosh’s trajectory might have been anticipated through his choice of a co-editor for “A New History of Leviathan”, one Murray Rothbard who died in 1995 at the age of 69. The wiki on Rothbard reveals:

Murray Newton Rothbard (March 2, 1926 – January 7, 1995) was an American economist of the Austrian School who helped define modern libertarianism and founded a form of free-market anarchism he termed “anarcho-capitalism”. Rothbard took the Austrian School’s emphasis on spontaneous order and condemnation of central planning to an individualist anarchist conclusion.

An individualist anarchist of the Austrian School of economics, Rothbard associated with the Objectivists in his early thirties before allying with the New Left in the 1960s and eventually joining the radical caucus of the Libertarian Party.

Whatever Radosh’s future evolution, it certainly can be said that the major influence on the New Leviathan book was the “revisionist” historian’s movement that was part of the New Left. LBJ’s war in Vietnam led many young academics and activists to question the New Deal legacy since the war in Vietnam was largely being promoted as a liberal war conducted by a politician who not only came up through the ranks of the New Deal but who was trying to keep its legacy alive through the Great Society.

The other inspiration for the “revisionist” school was a group of historians associated with William Appleman Williams, a long-time faculty member of the University of Wisconsin where progressivist traditions remained strong. Progressivism as a movement predates FDR’s New Deal and was associated especially with the presidential bid of Robert LaFollette in 1924. The main historian of this political current was Charles Beard who can best be described as an economic determinist rather than a Marxist. As you probably are aware, Beard had no use for FDR and wrote a book that basically argued that the attack on Pearl Harbor was precipitated by American economic and military pressures on Japan. Besides Williams, Beard also had a strong influence on Gabriel Kolko and James Weinstein who would eventually launch the aforementioned “In these Times”.

To a large extent the “revisionists” were taking on either implicitly or explicitly a leftwing current in the U.S. that had embraced FDR in more or less the same fashion that it embraces Obama today, namely the Communist Party. The New Left had come to the realization that both the Democrats and the Republicans were enemies of working people, a position that not only echoed that of the Progressives but of Eugene V. Debs’s Socialist Party.

With the collapse of the 1960s radicalization, it is not that surprising that the pendulum has swung back in the direction of the pro-Democratic Party left. While this was originally the turf of the Communist Party, it has broadened out to include a number of groups and individuals associated with the Maoist-influenced New Communist Movement of the 1970s. While it has roots in SDS and the New Left, the New Communist Movement made a turn toward supporting Democrats in the 1980s as history plied its dreary path. If there was a general absence of powerful insurgent movements in the trade unions and campus, it was understandable why some would be seduced by Jesse Jackson’s presidential bids which created the same kinds of illusions that the Obama campaign has generated now.

Here are the opening paragraphs of Radosh’s essay that can be read in full here:

Great Depression, labor unrest, massive unemployment, growing consciousness among the working classes, bitter hostility toward the multimillion-dollar corporations, failure of the reigning Republican Administration to quiet the brewing explosion-and then the New Deal. The social revolution, which many expected and others feared, failed to materialize. Why? Was it because the New Deal, in its own special way, was indeed a third American Revolution? From the perspective of the 1970s, with the stark realization that the United States had failed to deal with the race question, or to eradicate poverty, or even to begin to deal with the urban crisis, or to handle the general malaise and cultural poverty, or to adapt itself to the growing realization that revolutions abroad would have to be accepted and dealt with on their own terms, all of these events of the past ten years seemingly provided living evidence that a revolution had not occurred.

The new generation of New Left historians have asserted cogently that the New Deal instituted changes that only buttressed the corporate-capitalist order; that the vaunted Welfare State reforms hardly addressed themselves to the existing social needs of the 1930s, not to speak of working to end poverty, racism, and war. Historians Howard Zinn and Barton J. Bernstein have already written critical essays seeking to evaluate the New Deal from a radical perspective,1 and this essay shall not seek to repeat the critique advanced therein. The essence of their critical view has been best expressed by Bernstein:

The liberal reforms of the New Deal did not transform the American system; they conserved and protected American corporate capitalism, occasionally by absorbing parts of threatening programs. There was no significant redistribution of power in American society, only limited recognition of other organized groups. . . . The New Deal failed to solve the problem of depression, it failed to raise the impoverished, it failed to redistribute income, it failed to extend equality and generally countenanced racial discrimination and segregation.2

Once having presented this argument, however, the radical critic has in effect merely chastised the New Deal for what it failed to achieve. This does not work to answer the counterargument that Franklin D. Roosevelt and the New Dealers wanted more, but were stopped short because of the power of the congressional conservative bloc and other impenetrable obstacles.


  1. I think it would not be un-apropos to remember in this connection the inventor of the “welfare state”, one Otto von Bismarck. The good-natured flimflam style of the New Dealers is a piece of Americana we would do well to remember in the face of rightist “trash culture”, but the reality of being sold watered-down and corporate-friendly “entitlements” in place of socially democratic systems for delivering necessary social services is not intrinsically a “leftist” project either. The Obama administration can work for the left (that is, the real populace) to a certain extent but only if the left makes it work for us; a “New New Deal” is what we make of it.

    Comment by Jeff Rubard — November 16, 2008 @ 6:08 pm

  2. I just read this on Amity Shlaes


    if that’s the best the right can do then they really should sneak out the back door and be quiet for a while

    Comment by keefer — November 16, 2008 @ 11:02 pm

  3. Interesting how sparse the literature on the left is against the New Deal. On the other hand, consider how many of them are Dems.

    Comment by Renegade Eye — November 17, 2008 @ 6:20 am

  4. From across the pond I was always under the impression that the New Deal saved US capitalism – and yet therefater quite a few capitalists and their political chums have bitched about FDR, ungrateful swine.

    Interesting interview on Colbert with the editor of the Wall Street Journal. According to him, FDR caused the Great Depression – interesting chronology there. The editor of the house journal of US finance capital really ought to know his history a bit better. You could almost think these people are actually quite thick (stupid)!

    Comment by Doug — November 17, 2008 @ 2:31 pm

  5. I can’t remember quite what book it was, but Sweezy and Magdoff argue at length in one of their collections of essays that the New Deal failed to revive the moribund US economy (It was the military mobilization, stupid!). Certainly a perspective worth considering in a review of leftist critiques of the New Deal (whatever one thinks of the stagnationist view of Monopoly Capital).

    Comment by Nik Barry-Shaw — November 17, 2008 @ 10:08 pm

  6. Didn’t FDR junk the “New Deal” for the “War Deal” in the latter half of the 1930s, which is really what got US capitalism back on its feet again?

    Besides, most of its measures, which fell far short of what West European (or even Canadian) “welfare state” capitalism came to be associated with, were the result of the unionization struggles of the CIO, ie, factory take-overs, sit-downs and general strikes, and the fear that they would go beyond what leaders like Lewis and Hillman had in mind.

    So, whatever else the New Dealers may have had in mind, say, national health care, it’s not as if they were going to do anything that was incompatable with the continued existence of capitalism. After all, the post-WWII Labor Party government in England carried out extensive nationalizations without threatening the power of the British capitalist class as a whole any more than FDR’s far limited reforms did or would have.

    Comment by MN Roy — November 17, 2008 @ 10:29 pm

  7. Insofar as Marxists have written on the New Deal, check out George Novack, “The Function of the New Deal” from 1936 and “Autopsy of the New Deal” from 1940 on MIA for the SWP’s perspective. Hardly the last word by a Marxist on the subject but head and shoulders above the Stalinists swooning over FDR…as well their “echoes from the progressive” of today. I’m sure the “Cochranites” (especially Braverman) have some excellent analysis in their magazine from the 1950s which Louis is rightly so fond of. The same probably applies to Hal Draper and Kim Moody from the International Socialism tradition.

    Comment by MN Roy — November 18, 2008 @ 12:27 am

  8. I rather liked the book, From the Great Depression to the New Deal by David Milton. The book is about the trajectories of organized labor in the New Deal system by FDR.

    Comment by Doug — November 21, 2008 @ 8:47 pm

  9. “but Sweezy and Magdoff argue at length in one of their collections of essays that the New Deal failed to revive the moribund US economy (It was the military mobilization, stupid!).”

    But in a way the military mobilization was just the New Deal on steroids. At last they were able to do some real deficit spending, and it had the desired effect 🙂

    Comment by Feeder of Felines — December 1, 2008 @ 2:33 am

  10. so, yeah, wow, long post….

    wasn’t all that needs to be said is that FDR didn’t do enough? maybe the right man for the job, or less opposition?, would have provided better results?

    essentially: the bureaucracy isn’t big enough and we need more of it to regulate capitalist pigs.

    Comment by Jesse — December 30, 2008 @ 6:05 pm

  11. “One has to wonder if Radosh’s trajectory might have been anticipated through his choice of a co-editor …, one Murray Rothbard.”

    I know this thread has moved way, way on, but you should really rethink this.

    Radosh’s current neoconservative incarnation is the very sort of thing that Old Rightists like Rothbard and New Leftists like Radosh were united in hating. These days, Radosh the neocon is probably more ashamed of his association with Rothbard than of having been a libertarian communist. Rothbard’s and Radosh’s Old Right/New Left project was a critique of the corporate state. Radosh today is an ideological mouthpiece for that corporate state. Rothbardian anarcho-caps are death on the sorts of people at FrontPage Radosh plays footsie with these days, and vice versa.

    Comment by Kevin Carson — April 9, 2009 @ 4:52 am

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