by Jim Powell

Jim Powell, a senior fellow at the Cato Institute, is author of FDR's Folly, How Roosevelt and His New Deal Prolonged the Great Depression, (Crown Forum, 2003).

This article appeared on cato.org on December 2, 2003.

It has been 70 years since Franklin Delano Roosevelt launched his New Deal in an effort to banish the Great Depression of the 1930s -- perhaps the most important economic event in American history. The New Deal was controversial then, and it's still controversial, because it failed to resolve the most important problem of the era: chronic unemployment that averaged 17 percent.

Newsweek columnist Robert Samuelson acknowledged that if World War II hadn't come along, America might have stumbled through many more years of double-digit unemployment. Samuelson, however, is among those who give FDR high marks for handling the political crisis of the 1930s, the worst political crisis this country has faced since the Civil War.

But the political crisis was caused by the double-digit unemployment, and in my new book, FDR's Folly, How Roosevelt and His New Deal Prolonged the Great Depression (Crown Forum, 2003), I report mounting evidence developed by dozens of economists, at Princeton, Brown, Columbia, Stanford, the University of Chicago, University of Virginia, University of California (Berkeley) and other universities, that double-digit unemployment was prolonged by FDR's own New Deal policies.

How can that be? Consider just a few of FDR's policies. The New Deal tripled federal taxes between 1933 and 1940 -- excise taxes, personal income taxes, inheritance taxes, corporate income taxes, dividend taxes, excess profits taxes all went up, and FDR introduced an undistributed profits tax. A number of New Deal laws, including some 700 industrial cartel codes, made it more expensive for employers to hire people, and this discouraged hiring.

Frequent changes in the tax laws plus FDR's anti-business rhetoric ("economic royalists") discouraged people from making investments essential for growth and jobs. New Deal securities laws made it harder for employers to raise capital. FDR issued antitrust lawsuits against some 150 employers and companies, making it harder for them to focus on business. FDR signed a law ordering the break-up of America's strongest banks, with the lowest failure rates. New Deal farm policies destroyed food -- 10 million acres of crops and 6 million farm animals -- thereby wiping out farm jobs and forcing food prices above market levels for 100 million American consumers. FDR's Folly spells out much more in startling, sometimes hilarious detail.

Robert Bartley, who edited the Wall Street Journal for three decades and is now a commentator, called for a fresh debate about the New Deal. Newspaper publisher Conrad Black, author of Franklin Delano Roosevelt, Champion of Freedom, responded by claiming that if "workfare" recipients were included among the "employed," then New Deal unemployment rates were lower than the U.S. Department of Labor has reported for decades. Those tempted to agree with Black might listen to jazz great Louis Armstrong's 1940 tune "The WPA" -- referring to FDR's biggest "workfare" program, the Works Progress Administration. Among the memorable lines: "Sleep while you work, rest while you play, lean on your shovel to pass the time away, at the WPA."

There's a fascinating split between economists and political historians about the New Deal. The idea that FDR cured double-digit unemployment, wrote author and commentator Thomas Sowell in a recent column, "was never pervasive among economists, and even J.M. Keynes -- a liberal icon -- criticized some of FDR's policies as hindering recovery from the depression."

Meanwhile, pro-FDR political historians such as James MacGregor Burns, Arthur M. Schlesinger, Jr., Frank Freidel, William Leuchtenburg, and Kenneth S. Davis, have focused on the personalities, elections, speeches, "Fireside Chats" and other aspects of the New Deal's political story, disregarding evidence about the economic consequences of New Deal policies. This continues to be the case with younger political historians like Alan Brinkley, author of The End of Reform: New Deal Liberalism in Recession and War, who called the New Deal "a bright moment." Disregarding the economic consequences, too, are children's book authors like Joy Hakim, whose recent bestseller Freedom: A History of US includes a glowing account of New Deal heroics.

Aside from FDR's Folly, the only major work mentioning evidence about the economic consequences of the New Deal is by Stanford University political historian David M. Kennedy: his 1999 book Freedom from Fear, winner of a Pulitzer Prize. "Whatever it was," he wrote, the New Deal "was not a recovery program." The New Deal might be gone, but the debate goes on.

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Papal quotes against Communism and Socialism

Pope John Paul II condemned the 'Welfare State'

"My child, you must not have fear at speaking the truth.  It is for the salvation of souls and the recovery of your country. America the beautiful must not fall to communism, My child. America the beautiful shall not be sold into slavery.  Cast out the money changers in your government!  What manner of government is there that condones sin?  Abomination upon abomination--giving monies for the murder of children, giving monies for the murder of the elderly!  Your government, My child, has been infiltrated by men of sin." - Our Lady of the Roses, September 13, 1975

1991 encyclical Centesimus Annus by Pope John Paul II:

“In recent years the range of such intervention has vastly expanded, to the point of creating a new type of state, the so-called ‘Welfare State.’ This has happened in some countries in order to respond better to many needs and demands by remedying forms of poverty and deprivation unworthy of the human person. However, excesses and abuses, especially in recent years, have provoke very harsh criticisms of the Welfare State, dubbed the ‘Social Assistance State.’ Malfunctions and defects in the Social Assistance State are the result of an inadequate understanding of the tasks proper to the State. Here again the principle of subsidiarity must be respected: a community of a higher order should not interfere in the internal life of a community of a lower order, depriving the latter of its functions, but rather should support it in case of need and help to coordinate its activity with the activities of the rest of society, always with a view to the common good. “By intervening directly and depriving society of its responsibility, the Social Assistance State leads to a loss of human energies and an inordinate increase of public agencies, which are dominated more by bureaucratic thinking than by concern for serving their clients, and which are accompanied by an enormous increase in spending, In fact, it would appear that needs are best understood and satisfied by people who are closest to them who act as neighbors to those in need. It should be added that certain kinds of demands often call for a response which is not simply material but which is capable of perceiving the deeper human need.”

 

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Vladimir Lenin (in the early 1920s):

"First we will take Eastern Europe, then the masses of Asia. We will encircle the last bastion of capitalism, the United States of America. We will not need to fight. It will fall as a ripe fruit into our hands."

And, "We must practice coexistence with other nations, until we are strong enough to take over by means of world revolution.... We are not pacifists. Conflict is inevitable. Great political questions can be solved only through violence.... It is inconceivable that Communism and capitalism can exist side by side. Inevitably one must perish.''
 

Rykov, Lenin's successor in the Council of Soviet Commissars:

Rykov, Lenin's successor in the Council of Soviet Commissars, corroborated: "It is our duty to inculcate in the minds of nations the theories of international friendship, pacifism, and disarmament, encouraging their resistance to military appropriations and training, without ever relaxing our own efforts in building our military equipment.''

Khrushchev:

"We cannot expect Americans to jump from capitalism to Communism, but we can assist their elected leaders in giving Americans doses of socialism until they suddenly awake to find out they have Communism.''
 

Dimitry Z. Manuilsky, Chairman of United Nations Security Council, 1949:

The quote below is a summation of Manuilsky's views as cited by Joseph Z. Kornfeder, a former communist and a student of the Lenin School of Political Warfare in 1930 (American Mercury, July 1963.)

"War to the hilt between communism and capitalism is inevitable. Today, of course, we are not strong enough to attack. Our time will come in 20 to 30 years. To win, we shall need the element of surprise. The bourgeoisie will have to be put to sleep. So we shall begin by launching the most spectacular peace movement on record. There will be electrifying overtures and unheard-of concessions. The capitalist countries, stupid and decadent, will rejoice to cooperate in their own destruction. They will leap at another chance to be friends. As soon as their guard is down, we shall smash them with our clenched fist."
 

MIKHAIL GORBACHEV's speech at the 70th anniversary of the Bolshevik Revolution (1987):  

"... In October 1917, we parted with the old world, rejecting it once and for all. We are moving toward a new world, a world of Communism. We shall never turn off that road."

And from his speech to the Soviet Politburo, November 1987:
     "Gentlemen, comrades, do not be concerned about all you hear about Glasnost and Perestroika and democracy in the coming years. These are primarily for outward consumption. There will be no significant internal changes in the Soviet Union, other than for cosmetic purposes. Our purpose is to disarm the Americans and let them fall asleep. We want to accomplish three things: One, we want the Americans to withdraw conventional forces from Europe. Two, we want them to withdraw nuclear forces from Europe. Three, we want the Americans to stop proceeding with Strategic Defense Initiative."

NORMAN THOMAS, for many years the U.S. Socialist Presidential candidate proclaimed:

"The American people will never knowingly adopt Socialism. But under the name of 'liberalism' they will adopt every fragment of the Socialist program, until one day America will be a Socialist nation, without knowing how it happened."

"O My children of the United States, do you not understand what is ahead for you?  Your country, the United States, has not known what it is to suffer through destructive forces.  My children, you shall not escape the destruction that the Bear of communism has set upon many countries in Europe and the world.  You cannot compromise your Faith to save what there is left, for everything upon earth shall fall as rubble with the Chastisement.  A ball of fire, a chastisement, a baptism of fire, is heading for mankind.  Can you not understand?" - Our Lady, November 20, 1978

"As in the past Lenin, as in the past Stalin, and Khrushchev; and many others had tried to deceive the United States. They all felt that by trying to ensnare you with delusions of casting aside their communistic aspirations, that they had become as you, a free nation for all.
     "I assure you, My children, there is no freedom in Russia. It is all a delusion.
     "They seek the monies of the world from the nations of the world. And why do you not learn a lesson? It happened in the time of Lenin; it happened in the time of Stalin. And there you are all on the same road, ready to give billions of monies that should be given to those of your nation and the free nations of the world.
     "Do not be deceived, My children, Russia is not free. It is a cosmetic act to delude you. Lenin and Stalin used the same tactics, My children. Why do you not learn from your errors?"
Veronica - Our Lady now, Our Lady is crying. Now She is looking up and She says:
Our Lady - "My tears fall on you, My children. And I must give you also the conclusion to what I have spoken to you of. Lenin and Stalin are not with Us. They were cast off to meet with their god, the prince of darkness, satan.
     "It behooves Me to say, and it tears My heart in anguish, that they did not seek to be saved." - Our Lady of the Roses, June 18, 1992

Directives

D10 - Consecrate Russia   PDF
D103 - Communism   PDF
D134 - U.S. Government Leaders  PDF
D158 - America the Beautiful  PDF
D224 - Restore America to One Nation Under God  PDF
D349 - Socialism  PDF
 

Articles

Franklin Roosevelt and the New Deal
RooseveltAndTheNewDeal.htm

 

Videos online:

Vatican II Watch here...	World Monetary Crash Watch here...	Deception of the Century Watch here...	Third Secret Fabrication Watch here...
The Miraculous Story of Bayside Watch here...	A Pilgrimage to Our Lady of the Roses Shrine Watch here...	Jacinta's Third Secret vision: She saw Pope Paul VI Watch here...	Consecrate Russia Watch here (Part 1) (Part 2)