WRESTLING WITH THE NEW DEAL BY ZACHARY D. CARTER

Wrestling With the New Deal

The programs Roosevelt put together may not have met a Platonic ideal of modern progress, but they saved American democracy itself.

BY ZACHARY D. CARTER

B O O K S

In 2014, an up-and-coming writer named Ta-Nehisi Coates made a landmark case for reparations in The Atlantic, which took aim at, among other targets, one of the most revered figures in the liberal pantheon: Franklin Delano Roosevelt. Detailing the failures of New Deal housing policy for Black America, Coates told readers that “Roosevelt’s New Deal, much like the democracy that produced it, rested on the foundation of Jim Crow.”

Cardi B was nonplussed. “I love Franklin Delano Roosevelt,” the multi-platinum rapper told GQ four years later. “He helped us get over the Depression, all while he was in a wheelchair … if it wasn’t for him, old people wouldn’t even get Social Security.”

Intellectuals broadly affiliated with the American left have been fighting a quiet culture war over FDR for nearly a decade. Sometimes the battle is between the left and the center, at other times among vying ultraleft fringes. Bernie Sanders admires FDR, even as some of the Vermont senator’s most ardent supporters denounce his hero as a capitalist sellout. Otis Rolley of the Rockefeller Foundation claims the New Deal made racial inequality worse; Marxist scholar Adolph Reed Jr. dismisses such reasoning as specious. Almost every month, a major progressive magazine publishes a take on FDR, and a flurry of responses ensue.

The waters have calmed since President Joe Biden redesigned the Oval Office by placing a massive portrait of FDR above the Resolute Desk. For the next few years at least, Roosevelt will remain Officially Good. Opinion writers are now devoting their energies to explaining the various ways Biden can prove himself as excellent and extraordinary as FDR. But in time, intellectuals will get back to squabbling, and Biden’s admiration for the 32nd president will itself become narrative ammunition for a new slate of arguments.

Fighting over famous dead people is just what intellectuals do, of course. But the hold that FDR maintains on American public discourse is extraordinary, even for an American president. The left does not wage magazine wars with itself over Abraham Lincoln or Martin Van Buren.

American intellectuals obsess over FDR because, as historian Eric Rauchway demonstrates in his admirable new book Why the New Deal Matters, he saved the American project itself, for better and for worse. The Great Depression that Roosevelt ended was not merely a collapse of gross domestic product and employment figures; it was a full-blown political crisis that toppled regimes around the world and called into question the very legitimacy of democratic governance. Under FDR, Rauchway writes, “democracy in the United States, flawed and compromised as it was, proved it could emerge from a severe crisis not only intact but stronger.” When we fight over the New Deal, we are really arguing about the very meaning of America.

WHY THE NEW Deal Matters is Rauchway’s third book on the subject, and at this point in his career as a scholar, he no longer needs to argue for the New Deal’s overall economic effectiveness. But a few numbers culled from his earlier work can aid the uninitiated. In the first three full years of FDR’s presidency, GDP grew by 10.8 percent, 8.9 percent, and 12.9 percent, respectively, a record that has been matched only once in subsequent decades—by FDR, during World War II. This extraordinary growth was not a statistical quirk. Rauchway notes that the unemployment rate fell from over 20 percent to less than 10 percent as 6.6 million people went back to work.

FDR’s success with unemployment was a matter of mathematical dispute for years due to the ideological eccentricities of the official statisticians, who did not count those employed by the federal government as employed. And FDR’s war on unemployment did suffer a setback in 1936 when he changed course and decided to try and balance the

When we fight over the New Deal, we are really arguing about the very meaning of America.

Roosevelt inaugurated a titanic shift in Black voting away from the party of Lincoln and Frederick Douglass.

federal budget. When that backfired, deficits were back, and by the time America had committed to entering World War II, domestic unemployment had essentially ceased to exist. FDR was re-elected again, and again, and again for a reason.

The New Deal worked. The questions that remain for serious minds today are how it worked and who it worked for.

Rauchway seeks to answer these inquiries with deep dives into specific programs, a strategy that allows him to examine the way different regions and communities understood the issues posed by the New Deal at the time. This is a refreshing change of pace for anyone familiar with the comprehensive declarations of justice and injustice that dominate the New Deal Take Complex (The New Deal Was Racist/No, the New Deal Was Not Racist/It’s Time to Stop Talking About the New Deal).

In the process, even seasoned scholars will find much to learn. Rauchway’s discussion of the “Indian New Deal” is particularly insightful. FDR’s Bureau of Indian Affairs canceled debts owed by Indian nations to the federal government, subsidized Indian cattle ranches, and spent millions building hospitals, schools, and sewage treatment facilities for local Indian governments, employing members of relevant tribes to perform the work.

These policies were popular. But New Dealers also often ignored input from tribal leaders about the way particular policies would work. As a result, one of the most wrongheaded New Deal agricultural programs—the mass slaughter of livestock—proved uniquely disruptive to Indian nations.

The New Deal succeeded in raising agricultural prices for distressed farmers and put an end to decades of structural financial strain, an achievement born of both macroeconomic stabilization and the implementation of sector-specific price policy. Killing livestock was part of this program; by reducing supply, prices would rise, making it more profitable to raise sheep, goats, pigs, or whatever else.

The policy was, at best, deeply inhumane. But as Rauchway details, for Navajo farmers the loss of goats, sheep, and other small herding animals “destroyed a traditional source of subsistence … leaving some families hungry and even more desperate.” The slaughter program forced many ranchers and farmers into wage labor, where despite successful New Deal efforts to create more employment, Navajo workers could expect to earn much less than white workers performing similar tasks.

The New Dealer responsible for these outrages, Commissioner of Indian Affairs John Collier, was also, paradoxically, a staunch defender of Native American political autonomy. After hearing demands at a conference of Indian activists in Washington, D.C., in 1934 to halt the privatization of Indian lands and return them, to whatever extent possible, to tribal authority, Collier put the policy into practice in federal legislation.

A majority of American Indians and American Indian tribes supported Collier’s law, but the enthusiasm was far from uniform. Joe Irving of the Crow denounced the program’s end to privatization as “socialist,” while Navajo leader Jacob Morgan argued it would hamper Indian assimilation into American society. The Indian New Deal, as it was called, was popular with American Indians. It was also tremendously controversial.

Not every New Deal program is so riddled with nuanced conflict. Coates, for instance, is unambiguously correct to note that the New Deal’s affordable-housing provisions reinforced segregation. The Federal Housing Administration and the Home Owners Loan Corporation declared Black neighborhoods a serious credit risk, relied on racist banks to issue new government-backed low-interest mortgages to low-income home buyers, and required loans in white neighborhoods to include “restrictive covenants” banning the sale of the home to a Black family. The Black homeownership rate doubled between 1930 and 1960 to 40 percent—but 70 percent of white families owned their homes in 1960, and they owned homes that were more valuable, precisely because Black families had been excluded from their neighborhoods.

But the New Deal meant more to Black America than housing policy. Had it not, Roosevelt would not have inaugurated the titanic shift in Black voting away from the party of Lincoln and Frederick Douglass. Even after President Herbert Hoover’s disastrous navigation of the Depression, Roosevelt lost the Black vote by roughly 2-to-1 in 1932. After four years of the New Deal, he won the Black vote by nearly 3-to-1 in 1936. This was the beginning of a political realignment that persists to this day.

Roosevelt achieved this by improving the overall economic picture and easing the legal landscape for labor unions, which allowed the Congress of Industrial Organizations to bargain effectively on behalf of Black workers in the high-wage manufacturing sector of the upper Midwest. By the 1940s, Roosevelt’s Fair Employment Practice Committee— established to enforce his Executive Order 8802 banning racial discrimination in the defense industry—was successfully pressuring Northern manufacturers into hiring more Black workers and raising their pay.

These victories largely excluded the South, where the overwhelming majority of Black adults were disenfranchised, and where the FEPC’s efforts were effectively nullified by local white leaders. Rauchway examines the New Deal in the South through the Tennessee Valley Authority, a smashing success for rural infrastructure and public-works spending that brought an entire region into the 20th century by generating and distributing electricity.

The TVA also proved reluctant to hire Black workers and eager to assign those Black men it did bring on board to the lowest-status and lowest-wage positions available. As Rauchway details, J. Max Bond, a Black TVA administrator specifically charged with overseeing Black employment, was so frustrated by the situation that he surreptitiously encouraged an NAACP investigation of the entire TVA project. Black literary scholar J. Saunders Redding took his own tour of the TVA and concluded, “Democracy’s taking an awful beating on the TVA,” but ultimately decided he was “not discouraged” because even under these discriminatory conditions, what was offered to Black TVA workers proved better than what he’d seen for other Black working-class communities.

Rauchway seems ambivalent about Redding’s assessment. It is included not to prove an ultimate moral summation of the TVA’s sins and virtues, but to demonstrate the controversy that even the New Deal’s most obviously objectionable elements engendered among the very peoples it wronged. After centuries of oppression and years of depression, the way forward for Black and Native leaders was not obvious in the 1930s. Knowing when to fight and when to leave well enough alone was not an easy calculation. Often people did not even agree on the direction in which progress lay.

Progress is by its very nature unsatisfying. When Germany surrendered in 1945, America did not speak of progress against Nazism, it declared victory. The New Deal’s triumph over domestic fascism proved so comprehensive that we have all but forgotten the threat ever existed. But had the New Deal emerged victorious over domestic injustice, we would feel no need to fight over it.

Rauchway’s most engaging chapter is devoted to the harrowing tale of the Bonus Army—a group of frustrated, unemployed World War I veterans led by an admirer of fascist Prime Minister Benito Mussolini who marched on Washington for weeks in 1932, only to be purged from the nation’s capital by another scion of authoritarian violence, Gen. Douglas MacArthur. Blatantly disobeying orders from President Hoover, MacArthur rolled tanks to disperse the veterans, an act of military defiance against civilian authority.

When Roosevelt was elected, his swift rejuvenation of American democracy rendered this showdown between rival would-be fascists a historical footnote. When a similar bonus army arrived to greet his administration, FDR responded not with tanks, but with economic relief, and a visit from his wife Eleanor.

American democracy at its best is only a shadow of the Platonic ideal. But however we might critique individual decisions or programs, as Rauchway emphasizes, the threat of a far-right takeover in the 1930s was very real. The New Deal beat it back by reinventing American government, from the electrical grid to the course of rivers to Social Security to farm support to the buildings where we go to work and our children attend school. And in the process, it established a new democratic promise for the country: a commitment that the American government would and could be an expression of peaceful common purpose for all Americans. This promise was not fulfilled in the 1930s, but the world we live in today would be unrecognizable without it.

“The New Deal matters,” Rauchway writes, “because we all live in it; it gives structure to our lives in ways we do not ordinarily bother to count or catalog. When we imagine the end of the world as we know it, the world we are thinking might end is the one the New Deal built.” n

WHY THE NEW DEAL MATTERS

BY ERIC RAUCHWAY Yale University Press

Zachary D. Carter is a writer-inresidence with the Omidyar Network and the Hewlett Foundation. He is the author of The Price of Peace: Money, Democracy, and the Life of John Maynard Keynes.