Did the New Deal really help?

Today’s liberal politicians seem to be fond of harking back to Roosevelt’s New Deal as a model for the massive spending programs they are promoting today. Perhaps they just don’t know their history, or perhaps they do know their history but also know that the American public mostly doesn’t know its history and lives with comforting, if erroneous, myths about how effective the New Deal was.

Perhaps they don’t recall the 1939 words of Henry Morgenthau, Roosevelt’s Treasury Secretary. He said “We have tried spending money . . . it does not work . . . we have just as much unemployment . . . and an enormous debt to boot.” Perhaps they don’t recall that in 1939 the US unemployment rate was still 19%, despite all the New Deal programs, and that what finally reduced unemployment by 7 million people was putting 8 million people into the army to fight WW II.

George Santayana said it all: ”those who cannot remember the past are doomed to repeat it.” Myths are dangerous if you build policy around them.