The New Deal: Prosperity or Failure


Monday, November 12, 2018

The Great Depression is commonly seen as the worst economic event in the history of the United States. Starting in October 1929 with the crash of the stock market, The Great Depression plagued the United States and countries across the world with incomprehensible economic damage. On March 4th, 1933, Franklin Delano Roosevelt was inaugurated as President, inheriting the horrid state of the U.S. economy. Trying to solve this economic collapse proved to be an incredibly difficult task, and FDR attempted to fix America’s economy with a set of measures known as the New Deal.

Supported by mostly liberal Democrats, the New Deal was a series of new government programs aimed at spurring economic growth. Essentially, it was a massive increase in government spending in hopes of creating a proper economic recovery. Despite its common perception as a success, it is worth questioning the truth behind The New Deal, and if it helped the economy at all.

During the implementation of the New Deal, the government became far too large, overstepping constitutional limitations and creating unaccountability throughout. FDR himself became power hungry. When the Supreme Court called him out for the unconstitutionality of the New Deal, President Roosevelt threatened to pack the Supreme Court with Justices who would help further his agenda.

The New Deal created a plethora of new government programs like the Civilian Conservation Corps (CCC), the Civil Works Administration (CWA), the Farm Security Administration (FSA), the National Industrial Recovery Act of 1933 (NIRA) and the Social Security Administration (SSA). These various government-funded programs created a bloated federal government, suffocating individual liberty. Furthermore, a large reason for the extended depression was due to anti-competition and pro-labor measures that resulted in the artificial rise in wages and salaries across the nation.  Harold L. Cole and Lee E. Ohanian, two economists from UCLA, completed a study regarding the New Deal, citing FDR’s big government policies for the extension of The Great Depression:

“High wages and high prices in an economic slump run contrary to everything we know about market forces in economic downturns,” Ohanian said. “As we’ve seen in the past several years, salaries and prices fall when unemployment is high. By artificially inflating both, the New Deal policies short-circuited the market’s self-correcting forces.”

I believe that in an advanced market like ours, self-correcting forces would likely have cured the economic sickness a few years earlier than The Great Depression ended. In a video for PragerU, UCLA economist Lee Ohanian expands on this point, citing that, if FDR’s policies weren’t implemented, the market would have returned to normal operation in 1936, instead of 1939, when the depression ended. The artificial wage increases inflated the labor costs as a result, preventing business from hiring as many workers as they usually would. This, in turn, created monopolies, which the government is supposed to prevent.

The New Deal, as stated above, created a constitutional crisis. In an excerpt from his book, Liberty and Tyranny, conservative talk show host Mark Levin noticed the unmissable violation of our Constitution, “President Franklin Roosevelt and an overwhelmingly Democratic Congress, through an array of federal projects, entitlements, taxes, and regulations known as the New Deal, breached the Constitution’s firewalls. At first, the Supreme Court fought back, striking down New Deal programs as exceeding the limits of federal constitutional authority, violating state sovereignty, and trampling on private property rights.”

FDR’s intentions were righteous. Like any other politician who could have been put into his situation, he wanted to make things better. But his New Deal policies, including new regulations, taxes, and the artificial inflation of wages, prolonged suffering for Americans in the early to mid-1930’s. Drawing harsh criticism from the Supreme Court wasn’t enough for FDR to reconsider his actions, as he continued his staunch support of a mountainous federal government.

The Founding Fathers, when tweaking the intricate details of the Constitution, realized that, at a certain point, the government could potentially grow so big to the point of stomping on citizens basic rights. The violation and overall disregard of the Constitution during FDR’s presidency was one of many failures during his term, and FDR’s signature economic program, the New Deal, was no exception to the rule.

Lou Scataglia is a senior at Waynesburg University studying accounting and finance. His hobbies include bowling and workout out. When he's not doing those, he is talking NFL football and enjoys watching his beloved Denver Broncos.

The views expressed in this article are the opinion of the author and do not necessarily reflect those of Lone Conservative staff.

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About Lou Scataglia

Waynesburg University

Lou Scataglia is a senior at Waynesburg University studying accounting and finance. His hobbies include bowling and workout out. When he's not doing those, he is talking NFL football and enjoys watching his beloved Denver Broncos.

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