On Tuesday, the Brawler was at a bookstore. Stacked high on a table were copies of "The Forgotten Man," by rightwing think tank hack Amity "Calamity" Shlaes. It's yet another reworking of the hoary conservative myth that FDR and the New Deal somehow made the Great Depression worse than it needed to be.
The Brawler thought to himself, "Wonder when McIlheran will review this book."
Lo and behold, on Wednesday McIlheran saw fit to publish this column under his name. Weird, innit!
It includes this zinger:
People did think the country was broken, Shlaes points out. "It was like God had cursed the country," Shlaes tells me in an interview. Seventy years of perspective and economics now tell us it wasn't a curse but simply the government failing to understand its new control over the money supply.
Calmer heads knew this. The Depression would amount to "a bad quarter of an hour," said Andrew Mellon, ex-treasury secretary. There was no need to remake a society that fundamentally worked.
Here's how our society "fundamentally worked" in 1933, from Daniel Gross via Brad DeLong:
Public confidence in markets reached a nadir in 1933, when half the banks in the country had closed, when Wall Street was essentially out of business, when the Dow stood at its appalling lows, when employment was about 25 percent. In 1933 -- before the New Deal -- there was no securities industry, no banking industry, no mortgage industry, no capital formation or lending of any kind. That year, an estimated 40 percent of home mortgages were in default.
It was only with the passage of New Deal efforts--the SEC, the FDIC, the FSLIC--that the mechanisms of private capital began to kick back into gear. Don't take it from me. Take it from Federal Reserve Chairman Ben Bernanke, who wrote the following in Essays on the Great Depression: "Only with the New Deal's rehabilitation of the financial system in 1933-35 did the economy begin its slow emergence from the Great Depression."...
The argument that the New Deal's efforts "perhaps had prolonged, the Depression," is likewise a canard. One would be very hard-pressed to find a serious professional historian--I mean a serious historian, not a think-tank wanker, not an economist, not a journalist--who believes that the New Deal prolonged the Depression....
The Brawler confesses he has not read her book yet. But if her grasp of history is as solid as her grasp on current events, it stands to be a true humdinger. Here's a sterling Shlaes insight (from September 12, 2005) about Hurricane Katrina (also via DeLong):
The level of preparedness for a giant storm may not have been obvious outside the country. But the US was prepared for Katrina. All the old and new federal offices worked together and confronted the storm early. Nearly two days before Katrina hit New Orleans, the president made millions available to Louisiana by declaring the state an official disaster area. In a press conference on Sunday morning, he instructed the country to listen for any alerts -- and warned straightforwardly that he could not "stress enough the danger this hurricane poses to Gulf coast communities". On Sunday too, Alabama and Mississippi received access to cash when they in turn were declared disaster areas. Citizens of New Orleans with special needs were instructed to go to the Superdome. Sunday also brought a mandatory evacuation order from the mayor of New Orleans. The hurricane made landfall only on Monday morning. And so on, in military fashion. As for troops, 30,000 will be in the south soon -- hardly a shortage. (Brawler's bold)
The level of Shlaes' preparedness to write about the Great Depression based on the above analysis may not be obvious outside the American Enterprise Institute. Is hackery a qualification?
Here's a fine take by Lance Mannion (via DeLong -- a trifecta!) on the longstanding conservative myth that the New Deal -- which had it's shortcomings, all good liberals admit (indeed there's an argument to make that it wasn't expansionary enough -- WWII however was) -- undermined the country.
This comes out of an idea that has been a fundamental of conservative thought forever: Since there is no heaven on earth and no human endeavor is perfect and therefore Utopia is impossible, we might as well not bother trying to solve any problems, particularly if trying means having to spend my tax dollars.
At any rate, whenever I'd make the case that the point from which to begin measuring Roosevelt's success or failure should be 1931 or so, and if you do that you see that things are an awful lot better, on the whole, by 1938.
Yes, would come the insistent rebuttal, but he didn't end the Depression.
The problem I had and anyone with a real knowledge of history has with this argument is that it's true. Roosevelt didn't end the Depression. We don't believe that he did. He saved us from the worst of it, turned the economy around, and set us on a road that led to the great prosperity and stability of the 1950s. It took years for the country to recover. But what you're faced with here is the grade school text book version of history---the Happy Days Are Here Again three paragraph summation of the 1930s and 40s. Roosevelt ended the Depression and won World War II.
So here you've got to be careful. It's very easy to fall victim to the It's all or nothing ploy favored by second rate thinkers and crafty debate club debaters.
I found that the way to get around this was to seem to concede point.
Read the whole thing.
And, what the heck, here's an entire DeLong string on the Great Depression.
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