<$BlogRSDUrl$>

Saturday, January 24, 2009

The book to read 

By TigerHawk at 1/24/2009 08:17:00 AM


Last night, while waiting in the Market Fair Barnes & Noble for the TH Daughter to emerge from the movies, I finished Amity Shlaes' outstanding book, The Forgotten Man: A New History of the Great Depression. It really is very good. There is something in it to irritate both the left and right, which is usually a good sign in a political history, but it makes two points that seem to bear on the current crisis. First, too much open-ended economic experimentation, which FDR loved to do, creates entirely new risks for private capital and therefore deters investors from committing new money. Capital went "on strike," as FDR was given to say, but the New Dealers and their tinkering were the reason. Second, FDR demonized business, initiating one prosecution after another not to much to deter genuine wrongdoing but to break American business as a political power and social class. That strategy helped the Democrats for three elections (before the lawyer and utility Wendell Willkie called him out), but it scared the hell out of the people who would create permanent economic growth rather than the temporary "infrastructure" jobs that were the hallmark of the WPA and so forth. In today's political terms, too much change can destroy hope, and pretty quickly, too.


Permalink - - Main

5 Comments:

By Blogger JPMcT, at Sat Jan 24, 09:20:00 AM:

The problem, as I see it, is threefold:

1. The number of people who really have a grasp on what history has to teach us about the Depression are a tiny, tiny group. They DO NOT have an influential role in policy.

2. The public has had little or no civic or economic education for over two generations (either by happenstance of by plan, who knows?). What is ovious to the few is opaque to the majority.

3. The political philosophy of the administration and the congressional majority is not "capital-friendly". IF they heeded the warnings of the predious few who really understand what is going on, they commit political suicide with the bulk of the electorate.

Batten the hatches....  

By Blogger Anthony, at Sat Jan 24, 10:35:00 AM:

This is a great book, indeed, and I think it should be on the must-read list for anyone trying to make economic policy. On top of what you mention, TH, I found the portrayal of Hoover to be eyeopening. The History I was taught from grammar school through college portrayed him as a slavish laissez-faire capitalist who made things worse through his unwillingness to intervene. Shlaes makes clear that quite the opposite was true: he made things worse by being an interventionist, and that FDR, rather than being a break from Hoover, continued some of his errors and created his own. Mellon, on the other hand, appears as someone unfairly forgotten. After readin Shlaes' book, I've paged Mellon's on tax policy from our university library.

I'm curious, however. What did you find in here that might irritate the Right? Offhand, I can't think of anything, unless it's the sympathetic portrayal of the Progressive idealists who visited the USSR?  

By Blogger TigerHawk, at Sat Jan 24, 11:50:00 AM:

What did you find in here that might irritate the Right?

Shlaes recognizes that FDR changed the psychological of the country even as he continued Hoover's policies. The facts are that things started to improve dramatically in FDR's first term, and a lot of what he did was enormously stimulative. She clearly does not indict the entire New Deal or suggest that sheer 20's-style laissez-faire would have pulled us out any more quickly. So I think that people who believe that FDR was the source of all of our ills will be disappointed in her balanced conclusion.  

By Blogger TOF, at Sun Jan 25, 12:37:00 AM:

Shales book suggests to me that Karl Marx was right: history repeats itself, the first time as tragedy the second time as farce.

I had the uneasy feeling during the presidential campaign that Obama fancied himself to be another FDR. His relentless references to things being "the worst since the Great Depression."

TH, I read Shales differently than you. She gives points to FDR for being a politician and being adept at using the radio to convey his message and for instilling a measure of confidence in some part of the populace. Unfortunately, FDR's erratic and contradictory policies didn't encourage private investment in the least. Also remember Shlaes' description of FDR engaged in the divisiveness of class warfare and demonizing the wealth. FDR surrounded himself with would-be commissars who already had seen the wonder of the Soviet Union and bought it hook, line, and sinker.

Shales' book, more than anything, points out the follies of central planning, especially Tugwell trying to create his utopia in Arizona. It was a miserable failure.

I'm wondering just how farcical the Obama administration will be. Picking Joe Biden to be vice president was certainly a master stroke of farce. Hillary at State is a page right out of Lyndon Johnson's playbook: Obama wants her inside the tent pissing out. Unfortunately, this is the real world and not a play being produced for the amusement of some great audience.  

By Blogger RPD, at Mon Jan 26, 10:47:00 AM:

I haven't read "The Forgotten Man" yet, though it is in my queue.

I'd also recommend Jim Powell's "FDR's Folly."

He's pretty hard on FDR and his policies, as the title might suggest.  

Post a Comment


This page is powered by Blogger. Isn't yours?