Hofstadter on FDR

I’ve been reading Richard Hofstadter’s classic The American Political Tradition and the Men Who Made It. His analysis of Franklin Roosevelt’s handling of the Great Depression is immensely valuable, both for its humanization of the modern progressive hero, and its lessons for progressives today.

Even though Roosevelt’s administration is remembered as a testament to countercyclical Keynesian spending, Roosevelt campaigned as a deficit scold even as the Depression worsened throughout 1932. According to Hofstadter, Roosevelt “called the Hoover administration ‘the greatest spending Administration in peace time in all our history.’” Roosevelt implored the country to “have the courage . . . to stop borrowing to meet continuing deficits.”

Roosevelt was also originally resistant to taking extraordinary measures to rehabilitate the country’s banking system. “In his first press conference,” Hofstadter writes, “he was asked if he favored federal insurance of bank deposits. He said that he did not.” Roosevelt did not want government on the hook for the losses of bad banks. Nonetheless, he soon signed into law the Federal Deposit Insurance Corporation for precisely this purpose—“a concession to a bloc of insistent Western Senators,” Hofstadter explains.

Roosevelt made a slew of conflicting promises to the country about how he would rescue the economy. As Hofstadter put it: “All Roosevelt’s promises—to restore purchasing power and mass employment and relieve the needy and aid the farmer and raise agricultural prices and balance the budget and lower the tariff and continue protection—added up to a very discouraging performance to those who hoped for a coherent liberal program.”

While admiring progressives look back in retrospect at Roosevelt’s economic rescue effort as a dedicated application of government ingenuity and Keynesian economics, his course was hardly deliberate. “The New Deal will never be understood by anyone who looks for a single thread of policy,” Hofstadter argues, calling Roosevelt’s eventual economic program a “series of improvisations.”

John Maynard Keynes himself met with Roosevelt in 1934. FDR was overwhelmed by what he called Keynes’ “rigmarole of figures.” And Keynes came away disheartened, remarking that he had “supposed the President was more literate, economically speaking.”

Hofstadter divides Roosevelt’s economic policy into two distinct ideological approaches. The first New Deal, enacted between 1933 and 1934, tried to spark a supply-side recovery by adopting “the retrogressive idea of recovery through scarcity,” Hofstadter writes. The key recovery efforts during these years were business-friendly initiatives to boost agricultural and business revenues. The Agricultural Adjustment Act, for instance, set farm quotas to withhold supply and boost agricultural prices. “[T]he policy seemed to have solved the paradox of hunger in the midst of plenty only by doing away with plenty,” Hofstadter laments.

The heart of Roosevelt’s initial economic program was the National Recovery Act, which allowed businesses to set price agreements and production quotas in exchange for wage increases and improved working conditions. This idea originated with the Chamber of Commerce. Still, Roosevelt called the NRA the “most important and far-reaching legislation ever enacted by the American Congress . . . a supreme effort to stabilize for all time the many factors which make for the prosperity of the nation.”

The NRA took a decidedly business-friendly approach to economic stimulus. “It is not unfair to say that in essence the NRA embodied the conception of many businessmen that recovery was to be sought through systematic monopolization, high prices, and low production,” Hofstadter writes. Yet it is far from clear that the NRA had a positive impact on the economic recovery—the economy’s best years came in the two years after the Supreme Court ruled the NRA unconstitutional.

Roosevelt’s first New Deal was conceived as a “true concert of interests,” as he put it on the campaign trail—a consensus approach to benefit business, farmers, and workers alike. “Although he had adopted many novel, perhaps risky expedients,” Hofstadter observed, “he had avoided vital disturbances to the interests.” Roosevelt refused calls to resolve the banking crisis by nationalization the country’s banks, for example, and instead relied on government to prop up the private banking system.

Roosevelt’s eventual populist shift was driven by venom from the right and pressure from the left. Conservatives and wealthy interests wielded vehement political opposition against Roosevelt. “His political struggle with the ‘economic royalists’ soon became intensely personal,” Hofstadter writes.

From the left, influential populist Louisiana Senator Huey Long was clamoring for a more radical economic program and making noise about challenging Roosevelt’s reelection in 1936. Roosevelt’s political operatives thought Long had enough political support to swing the election. Long was also advocating for a “Share Our Wealth” platform that would have capped annual incomes at $1 million to fund a $2,500 annual basic income; provided for an old-age pension and free kindergarten through college; and government-provided automobiles and washing machines for every family.

Roosevelt wished to do something “to steal Long’s thunder” during the latter half of his first term in the White House. “The result,” Hofstadter writes, “was a sharp and sudden turn toward the left, the beginning of the second New Deal.” Roosevelt latched on to the Wagner Act, which had been floating around Congress for some time, to create the National Labor Relations Board. And he even sought a drastic Long-style “wealth tax.” And of course, Roosevelt piggybacked on Long’s old-age pension idea to enact Social Security.

After winning reelection, Roosevelt executed an ill-advised and harmful pivot toward austerity in 1937. Believing the economy to be on better ground, government spending was cut, and the Federal Reserve raised interest rates. This mistake, Hofstadter writes, produced “a sharp downward trend [in the economy], which reached alarming dimensions in early 1938.”

Roosevelt eventually realized his mistake, and sought new government spending that spring, which Congress quickly approved. It was not until 1940, Hofstadter writes, that Roosevelt “finally accepted in theory what he had long been doing in fact, admitted the responsibility of government retrenchment for the recession, credited the revival of spending for the revival in business, and in general discussed the problem of the federal budget in Keynesian terms.”

By 1944, Roosevelt was speaking of a new “economic bill of rights” and guaranteed full employment within the confines of “our democratic system of private enterprise.” “With the economy operating at fall speed under war time conditions,” Hofstadter writes, “it was easy for him to forget the incompleteness of recovery under the New Deal and to refer proudly to the manner in which ‘we . . . fought our way out of the economic crisis.’”

Reading Hofstadter’s then-fresh history (published in 1948) of the Roosevelt administration holds wisdom from our own recent history. Hofstadter’s warts-and-all account of Roosevelt’s handling of Great Depression doesn’t look all that dissimilar from Barack Obama’s economic recovery efforts eighty years later. Obama too gravitated toward consensus reforms, opting for a stimulus package tilted toward tax cuts and money for the states. Obama too resisted calls for bank nationalization, promoting financial liquidity and stress tests instead. Obama favored stabilizing industry rather than bailing out individual homeowners.

Unlike Roosevelt, Obama did not enjoy a pliant Congress willing to cede economic deference to the White House and rubberstamp new recovery legislation. Roosevelt was able to experiment with a wide variety of programs with quick congressional approval—and was even able to course correct after his premature pivot to austerity.

Obama, on the other hand, never got a second bite at the apple for more stimulus because of a polarized Congress exhausted after one round of new government spending in 2009. Obama’s administration was too quick to pronounce economic triumph, seeing “green shoots” around every corner in 2009, with Treasury Security Timothy Geithner declaring “Welcome to the Recovery” in August 2010—years before most Americans felt anything resembling a return to economic normalcy. Obama too spoke of the need for Washington “belt-tightening” as early as April 2009, in the depths of the recession. Obama acceded elite Washington deficit scare mongering and pivoted toward austerity too early in 2011. When he tried to counteract the continuing sluggish economy by proposing a jobs bill in September, Congress never even considered it.

Which is to say that Obama was a fallible and imperfect progressive president—just like Roosevelt. Progressives routinely chastised Obama for falling short of hopes that he’d be the second coming of FDR. But as Jonathan Chait notes in Audacity, liberals have a penchant for perpetual disappointment and despair. Even in Roosevelt’s time, there was a contingent of the political left that incessantly criticized him for enacting policy that was too conservative.

Where Roosevelt differed from Obama was in the external leftward pressure he faced. Roosevelt faced real and imminent electoral pressure to move in a more progressive direction. For all the dismay with Obama from some progressives, the left never mobilized to become a political counterforce.

Since Obama’s administration, the American left has begun mobilizing. Bernie Sanders mounted an insurgent candidacy against Hillary Clinton, and extracted policy concessions that shifted Democratic economic policy decidedly to the left. Sanders remains the country’s most popular politician and a major force in the Democratic Party. And the Democratic Socialists of America have seen an upsurge in enrollment and activism since Donald Trump’s victory.

Hofstadter’s honest contemporaneous appraisal of Roosevelt’s administration avoids the sanctification that so many progressives are prone to when lionizing the Democratic Party’s most towering figure of the twentieth century. Roosevelt was a great progressive, but was hardly without missteps and oversights in his economic management, and was made better by a mobilized left.

The lesson of Hofstadter’s take on FDR is that progressives should not be discredited for failing to meet a standard of purity and perfection—and that those same progressives might benefit immensely from being challenged in the policy sphere from an engaged left.


Obama’s middle-class pay raise

President Obama unilaterally raised the pay for millions of Americans this week.  With a proposed minimum wage increase stymied by Republicans in Congress, Obama once again looked to his executive toolkit for ways he could act singlehandedly without legislative action.  And act he did, guaranteeing more workers extra pay for overtime work.

The federal overtime threshold was part of the first minimum wage legislation in 1938.  Before this week, only workers who made up to $23,660 were owed overtime pay by their employees when they work more than forty hours a week.  The threshold has sat at that same level since 2004, slowly eroding from rising costs of living and inflation over the past decade.

Obama more than doubled it.  Beginning in December, salaried workers earning up to $47,476 must be paid time-and-a-half when they work more than 40 hours per week.  The Labor Department estimates that some 4.2 million additional workers will now be eligible for overtime pay, while other researchers predict it could help as many as 13.5 million workers.  The threshold will also now automatically increase every three years, meaning this worker protection will no longer be weakened by long periods of regulatory inaction.

Aside from extending overtime pay to more workers, those earning close to the $47,476 cutoff may also benefit from outright higher salaries.  Employers may give these workers raises in order to avoid the administrative and fiscal costs of recording hours and paying overtime.  In short, it’s a regulatory change that will boost the salaries for some workers while increasing the benefit of overtime work for many others.

It’s also a rule change that could spark economic growth.  One advocate called the change “a minimum wage increase for the middle class.”  And like the minimum wage, raising the overtime threshold could boost consumer demand by giving more workers more disposable income to spend.  As the Center for Equitable Growth explains:

“[I]n an economy that is not operating at full capacity, this policy is likely to put more money into workers’ pockets. A bigger paycheck boosts their ability to buy goods and services—a key economic engine for domestic growth. That is because workers that will benefit from these policies are more likely to spend the extra money they earn.”

This important rule change bolsters Obama’s legacy of turning back the tide of rising inequality.  It also further shifts the country away from the failed trickle-down economics that conservatives have pushed for generations.  In Obama’s view, the economy doesn’t gain from raising the incomes of the wealthy, but rather by making steady progress for the middle class.  When working Americans have more money to spend, everyone prospers.

This was true throughout the three decades of strong, sustained and equitable economic expansion during the mid-twentieth century.  From World War II through the early 1970s, the economy grew at an unprecedented clip and created a broad middle class where families enjoyed rapid and regular gains in their standards of living.

Since that time, broad economic growth in the United States has largely stalled.  Real median household income has stayed virtually flat for decades, as families are working harder for the same pay.  Inequality is growing and costs are mounting, leaving working families hard pressed to keep up.

But the broad prosperity that the economy produced during much of the twentieth century wasn’t just some historical accident.  It was the product of deliberate policy choices utilizing smart economic philosophy.  The Center for Equitable Growth notes that in 1933, President Franklin Roosevelt said:

“I ask that managements give first consideration to the improvement of operating figures by greatly increased sales to be expected from the rising purchasing power of the public. That is good economics and good business. The aim of this whole effort is to restore our rich domestic market by raising its vast consuming capacity.”

FDR understood that the economy thrives off of the purchasing power of working Americans.  Eighty-three years later, President Obama is trying to put that proven method for success back in action.

Weaponizing Obama Derangement Syndrome

Greg Sargent reiterates the dismal conservative calculus weighing down immigration reform in the House of Representatives. “The problem here is not Obama; it’s Republicans. House Republicans are not willing to figure out if there is any set of conditions and terms un[d]er which they can support some form of legal status for the 11 million. [. . .] All the talk about ‘not trusting Obama’ is just a smoke-screen designed to obscure these basics.”

House Republicans have maintained that they don’t trust Obama to enforce any immigration reform that they pass, therefore no reform can be passed. Senator Chuck Schumer quickly called their bluff by proposing that any immigration reform passed today not take effect until after Obama leaves office, exposing the distrust issue for the smoke-screen that it is.

But it may be this exact distrust that could breathe some life into immigration reform in the House. If Republicans truly believe that the president will go it alone and take unitary executive action, then maybe this would propel them to make a serious effort at legislative immigration reform. Obama Derangement Syndrome could jolt Congress out of gridlock.

Obama Derangement Syndrome has many strains and symptoms, but the relevant ailment here is the ardent psychological belief among many conservatives that the president cannot be trusted to enforce the law. They point to regulatory actions that the president has taken to delay Obamacare implementation; to slow the rate of deportations; to regulate pollution; and to stop defending the discriminatory Defense of Marriage Act in court. To conservatives, these acts of executive discretion show a blatant disregard for the letter of the law that comes out of Congress.

This distrust of a go-it-alone executive then becomes a self-fulfilling prophecy. Because Congress cannot pass legislation, the president must pursue executive action to fill the vacuum of basic governance. Because Congress is severely broken on the issue of health care, the president has had to rely on questionable legal interpretations to fix parts of Obamacare and delay the troublesome employer mandate. Because Congress won’t act on climate change, it has fallen on the Environmental Protection Agency to take regulatory action against greenhouse gases.

But heightening Obama Derangement Syndrome – bolstering the conservative fear of unitary executive action – may be exactly what would prod the House to move on immigration reform. Republican Representative Mario Diaz-Balart told the Washington Post, “I’m convinced that if we don’t get it done by the August break, the president, who is feeling a lot of pressure from having not done anything on immigration reform, will feel that he has to act through executive action.”

This changes the calculus for Republicans on immigration reform. Before, the consequence of inaction was just a continuation of the broken status quo system that many congressional Republicans aren’t particularly troubled by. Now, however, in the face of an emboldened executive, the consequence of legislative inaction may be a regulatory solution that is both liberal and crafted without congressional input.

This could be a tremendously useful negotiating chip for the president. And it’s not an empty threat, either. Regulatory agencies get the benefit of the doubt when they stretch the bounds of the law, so long as their interpretation of the statute is reasonable. (This is so-called Chevron deference in legal jargon.) This insulates many agency actions from legal challenges, giving the president a powerful tool as an end-run around Congress to achieve policy goals.

Congress has been stuck in paralysis since 2010. Driven by split party control, political polarization, and perverse Republican incentives pointing toward obstruction as a path to power, the legislative process has ground to a halt. But what might compel obstinate Republicans to actually legislate is fear of a unitary president. So while liberals intuitively scoff at breathless accusations that the president flouts the law, perhaps they ought to be fueling the conspiracy. For when it comes to the gridlock-inducing effects of Obama Derangement Syndrome, the disease might be the cure.

The Civil Rights Act at 50: “a moral issue”

The Civil Rights Act of 1964 became law fifty years ago. Upon introducing the bill into Congress in June of 1963, President Kennedy delivered a striking address calling on Congress to alleviate our “moral crisis” of race discrimination:

“We are confronted primarily with a moral issue. It is as old as the Scriptures and is as clear as the American Constitution. [. ] The heart of the question is whether all Americans are to be afforded equal rights and equal opportunities, whether we are going to treat our fellow Americans as we want to be treated. If an American, because his skin is dark, cannot eat lunch in a restaurant open to the public, if he cannot send his children to the best public school available, if he cannot vote for the public officials who will represent him, if, in short, he cannot enjoy the full and free life which all of us want, then who among us would be content to have the color of his skin changed and stand in his place?”

Kennedy framed the debate around the Civil Rights Act in distinctly moral terms. He invoked equality, freedom, and civic obligation to fellow man, calling on Congress and the American people to act against social, educational, and electoral injustice. Significantly, he appealed to conscience, asking us if whites would be willing to trade races to stand in the place of black Americans. This foreshadowed the Rawlsian idea of a veil of ignorance. This idea – a core liberal conception of justice – tells us that we should create the kind of society and policies that we’d want if we didn’t know what our social status would be – that is, the kind of society we’d want were we born into a disadvantaged minority group. This is essentially a thought experiment of a more famous ethical maxim: “Do unto others as you would have them do to you.” (Hence Kennedy’s appeal to the Scriptures.) Theoretically, such a conception of justice should lead to a more equitable and reciprocally decent society.

These are powerful ideas. Yet too often, contemporary liberals show discomfort making the case for their vision in explicitly moral terms. In our recent politics, conservatives claim the mantle of the “values party” on issues from abortion to marriage to even the federal debt, unflinchingly making their policy pitches through moral terms. Liberals instinctively debate with one hand behind their backs, ceding moral territory to make dry technocratic justifications for their policy proposals.

Consider our extended national debate over health care reform from 2009 to 2010. Reflecting on the substance of the debate, we heard far too much from the reform’s advocates about “bending the cost curve” of health care and making insurance more affordable for the middle-class. These are certainly worthy goals, but hardly the stuff of moral inspiration. While conservatives raged against the law as an assault on freedom, liberals largely failed to present the ways that reform makes us freer and more just, instead relying on comfortably sterile economic arguments – arguments that should be ancillary to the goal of universal health coverage. It’s as if Kennedy had advocated for the Civil Rights Act based on the economic gains from integrating restaurants and public accommodations.

In part, I think liberals neglected to make a strong moral argument on the behalf of health care reform because they took it for granted that the moral imperative was well understood. In President Obama’s 2009 address to Congress, he said: “Everyone understands the extraordinary hardships that are placed on the uninsured, who live every day just one accident or illness away from bankruptcy.” Because liberals assumed that the moral crisis was well known, it became an afterthought to their arguments when it needed to be front and center.

Toward the end of his speech, Obama reflected on the memory of the late Senator Ted Kennedy who – echoing the words of his brother – reminded us that health care presented “a moral issue; at stake are not just the details of policy, but fundamental principles of social justice and the character of our country.” To Obama, Kennedy’s “large-heartedness – that concern and regard for the plight of others – is not a partisan feeling. [. . .] Our ability to stand in other people’s shoes. A recognition that we are all in this together; that when fortune turns against one of us, others are there to lend a helping hand.”

This appeal to community, social solidarity, and Golden Rule empathy lie at the heart of the liberal vision of society. They also happen to be the strongest arguments in favor of it. Writers like George Packer and public philosopher Michael Sandel have long urged liberals to abandon bloodless technocratic arguments in favor of appeals grounded in moral principles. For it is these types of arguments that can move the country to do big things. They are arguments that have the force to build momentum toward liberal projects like immigration reform, LGBT rights, gun control, and protection against climate change. For the liberal vision is fundamentally one of community, and that requires asking us to stand in one another’s shoes; to rest in one another’s skin.

Birth pangs

Fresh off his debate on race and poverty with Ta-Nehisi Coates (which I wrote about here), Jonathan Chait published a piece that attempts to reconcile our collective racial anxiety during the Obama presidency. To Chait, this anxiety has been both subterranean and omnipresent, unleashing crisscrossing resentments from all sides. Chait ultimately attributes this “racial obsession” to our unique historical moment, tipping from one demographic norm to a new and different one. “We are living through the angry pangs of a new nation not yet fully born,” he contends.

It’s a complex terrain, one laden with mutual senses of suspicion and aggrievement. Liberals stand guard against efforts to delegitimize our first black president. They see racial distrust (or worse) as central to the ferocity of opposition against President Obama and his policies. Conservatives lash out against liberals too eager to characterize principled opposition as racism. They feel stifled by dishonest efforts to marginalize conservative ideas and to silence dissent.

Wary of dog whistle tactics to undermine Obama, liberals have not hesitated to point out suspected conservative racial appeals. While some liberal objections have been unavoidable (think of the McCain-Palin campaign’s efforts to paint Obama as the exotic “other,” “paling around with terrorists”), liberals have also grasped for more nuanced cries of race. Chait himself is not immune. In 2012, he claimed to identify the real reason that Romney ads blasting Obama’s “you didn’t build that” comments were effective:

“The key thing is that Obama is angry, and he’s talking not in his normal voice but in a “black dialect.” This strikes at the core of Obama’s entire political identity: a soft-spoken, reasonable African-American with a Kansas accent. From the moment he stepped onto the national stage, Obama’s deepest political fear was being seen as a “traditional” black politician, one who was demanding redistribution from white America on behalf of his fellow African-Americans.”

To some, this kind of reasoning back to find racial motive is so attenuated and abstract as to suggest cynical bad faith on the part of accusers like Chait. But to others, the Obama years (and the corresponding digital media environment) have been valuable moments to smoke out discreet racial appeals in our politics that had gone undetected and unchallenged for too long. As Chait says, “[o]ne of the greatest triumphs of liberal politics over the past 50 years has been to completely stigmatize open racial discrimination in public life.” Many liberals now want to chase discrimination from its private spaces too – to attack the ways that submerged animus and subconscious bias can shape our public discourse.

Consider a parallel movement happening on college campuses: the exposure of so-called “microaggressions.” This movement wants to educate victims and perpetrators alike about the unintentional slights and invalidations that minorities face in daily interactions. The theory’s author, Columbia University psychologist Derald Wing Sue, describes racial microaggressions as “everyday insults, indignities and demeaning messages sent to people of color by well-intentioned white people who are unaware of the hidden messages being sent to them.”

This all-encompassing definition includes everything from outright slurs (i.e. implying a minority got accepted into college because of affirmative action), to ill-conceived qualified compliments (“You’re pretty for a dark-skinned girl,” or our own Vice President’s characterization of candidate Obama as “articulate” and “clean”), to unintended reminders of foreignness through oblivious ethnic inquiries (“Where in Asia are you from?”).

To its advocates, the microaggression movement is a valuable tool to force white people to confront the degrading effects of unconsidered assumptions and linguistic goofs that they’d otherwise find de minimis.

To critics, however, the theory aims to unfairly malign well-intentioned whites. Writing for the conservative National Review, Alec Torres warns that, “without a ‘multicultural’ education for the young and a thorough reeducation for the rest, all in the ‘empowered’ class may be interminably consigned to unknowingly making racist remarks or unintentionally engaging in sexist and homophobic behaviors. For all they know, they already are.” Another skeptic argued that the idea of microaggressions “exaggerate[s] the meaning of such encounters in the interest of perpetually seeing oneself as a victim.”

As in our modern politics, an attempt to redefine the sphere of what constitutes discrimination and to expose covert bias is met with objections against unfair overreach. Such is our racial politics in 2014.

As a liberal, I have no doubt much of the conservative opposition to Obama comes from honest policy disputes, yet I also suspect that race contributes to the intensity of the right’s instantaneous hostility to Obama’s presidency. The effort to delegitimize a cautious center-left pragmatist who was twice elected by majority vote has been relentless: he’s a socialist tyrant, he’s a Kenyan, he’s a terrorist. There can be little doubt that race fuels these delusions.

I understand the conservative frustration with liberals seeing racism lurking around every corner. But these suspicions are not exactly unwarranted. Throughout still recent history, conservatives have been all too willing to dip into murky waters; all too comfortable exploiting racial divisions for electoral gain.

As Chait writes, race and politics are bound up by our growing polarization. For instance, have Red States declined to expand Medicaid because safety net programs are anathema to conservatism, or because the benefits would flow disproportionately to Other People? Is there any difference between the two? We know that racial pluralism has hampered the American welfare state project – is this project anathema to conservatism because it benefits Other People? And what of the fact that the Other People also vote for the Other Party?

In the American story, race is inseparable from how we construct our political coalitions. Our appeals, our language, and our policy choices matter – for who we appeal to and who we appeal against, for who our policy proposals benefit and who they disinherit.

So perhaps this is all a political Rorschach test. In The Audacity of Hope, Obama compared himself to a blank screen for self-projection. Maybe our complicated racial discourse under his presidency is such a blank screen. If so, the debate tells us more about ourselves, our political futures, and our racial anxieties than anything else. Conservatives, seeing the power of their narrow coalition already jeopardized by demographic shifts, fear deliberate and hastened marginalization from public debate by undue charges of racism. Liberals, observing an ascendant class of young people and minorities asserting their claim to power, seek to blunt any attempt – subtle or blatant, hidden or public – to delegitimize this group’s political rise. Birth pangs of a new nation, indeed.