Jason - I like 2 and 3 - just work on clarifying the grammar and the tenses.
Mises Review 14, No. Nevertheless, even those already familiar with such books as John T. Folsom advances new and important arguments. His anti—New Deal verdict is hard to dispute: When he spoke, unemployment exceeded 20 percent.
True enough, unemployment ended; but this was only because of the draft. Absent this military slavery, there is every reason to think that Roosevelt would have continued to struggle with unemployment.
A diehard defender of Roosevelt might essay two replies to this indictment.
He might argue that Roosevelt was insufficiently far-reaching: Roosevelt did indeed spend a great deal on government programs; but this must be balanced against his tax increases. When the two are taken together, the stimulus that New Deal outlays provided the economy was less than needed to restore prosperity.
William Leuchtenburg, one of the most influential historians of the New Deal, favors this approach. Spending by the government does not add to employment, since taxes displace private spending and investing.
Folsom aptly quotes Hazlitt in this connection: They will say that investors, owing to pessimism about the future, would not have spent on their own the money the government takes in taxes.
Instead, they would have hoarded it; had the money remained in private hands, the increase in employment would have been less than what occurred under the beneficent auspices of Washington.
Folsom ably dispatches this Keynesian canard. If businessmen were reluctant to invest, precisely the antibusiness attitude of the Roosevelt administration was in large part responsible.
Roosevelt supported confiscatory rates of taxation; small wonder, then, that investors were reluctant to embark on new projects. They had good reason to think that if they were to be successful, Roosevelt would grab their profits for his own dubious schemes.
Polls of businessmen taken in make evident this reluctance. In Marchfor example, AIPO [American Institute of Public Opinion] asked a national sample, "Do you think the attitude of the Roosevelt administration toward business is delaying business recovery?
His argument, as so far presented, is sound; but what if the government simply increases the money supply? In that case, defenders of interventionism will claim, the new jobs created by the government generate a net increase in employment. To refute this, one needs the Austrian theory of the business cycle.
Government spending, if it takes place through the expansion of bank credit, will, if "successful," result in another artificially created boom.
The recovery thus generated will result in the long run in even worse economic distress, once that new boom in turn collapses. Nor can a policy of further monetary expansion indefinitely postpone disaster. Folsom, though not blind to the danger of inflation, ignores Austrian theory.
In his own account of the continued severity of the depression that began inhe rightly stresses the malign effects of the Smoot-Hawley tariff. Its extraordinarily high rates greatly restricted trade, not only through restricting imports but also because of retaliatory tariffs imposed by other nations.
But he says nothing at all about the Austrian view, i. The fact that Robbins wrongly repudiated his own book should not make one reluctant to benefit from its analysis.
But I come not to bury Folsom, but, mostly, to praise him. One of his best insights is that the New Deal programs were financed in large part by the poor.
I do not think it right, though, to call excise taxes "regressive," as Folsom does. Everyone paid the same rate; the poor were not charged more. This was far from the only way in which New Deal programs hurt the poor.Some New Deal historians of the s, s, and s — loosely called the "constraints school" — argue that the New Deal did promote many needed changes, but that Roosevelt was constrained in what he could accomplish and therefore he did as much reform as circumstances would permit.4/4(26).
Get this from a library! New deal or. Race and politics have played an important part in shaping the history of the United States, from the first arrival of African slaves in the early seventeenth century to the election of an African-American president in New Deal or Raw Deal?
How FDR’s Economic Legacy Has Damaged America Author: Burton W. Folsom, Jr. “The New Deal has been the greatest political force in America during the last one Roosevelt latched onto the thesis and made it the linchpin of his economic program.
As the first incarnation of the New Deal progressed, African Americans continued to experience prejudice, segregation, unfair wages, and generally a “raw deal.” But what was more, African-American women and men were not given a fair opportunity to ensure for themselves better political, social, and economic standing in the future.
Mises Review 14, No. 4 (Winter ) NEW DEAL OR RAW DEAL? HOW FDR'S ECONOMIC LEGACY HAS DAMAGED AMERICA Burton Folsom, Jr. Threshold Editions, , xvi + pgs.
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