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If you grew up, as I did, in the 1960s and 1970s, your history books taught you one thing about the New Deal: It was the high-water mark of American government, an era when Franklin D. Roosevelt took the country by the reins and led it out of the benighted greed and excess of the 1920s into a new age when the national government put the economy back on track, jump-started progress, and guaranteed its citizens a safe and economically secure future.

It is this classic portrayal of the New Deal that Amity Shlaes, a visiting senior fellow at the Council on Foreign Relations and syndicated columnist, takes on in her new history of the Great Depression out this month, The Forgotten Man (HarperCollins). The standard history, she writes, is that this was "the period in which Americans learned that government spending was important to recoveries" and that "the New Deal is the best model we have for what government must do for weak members of society, in both times of crisis and times of stability."

There's also a standard rebuttal to this history, Shlaes notes: that Roosevelt's predecessor, Herbert Hoover, was merely misunderstood, and Roosevelt himself was evil. Under this version, the New Deal programs Roosevelt created "accustomed Americans to the pernicious dole."

Shlaes sets out to chart a new course between these extremes. In her account, Roosevelt and Hoover aren't antitheses, but exist on a continuum of increasing government power and involvement in the national economy.

Hoover, after all, rose to national prominence -- and eventually, the presidency -- on the strength of his work as Commerce secretary in coordinating the federal response to the massive Mississippi flood of 1927. (Imagine, by comparison, what an especially effective Federal Emergency Management Agency director would have gained from successfully responding to Hurricane Katrina.) One of Hoover's initial reactions to the stock market crash of 1929 was to boost spending on public works projects by $423 million in an effort to jump-start the economy.

"Hoover and Roosevelt were alike in several regards," Shlaes writes. "Both preferred to control events and people. Both underestimated the strength of the American economy." And, she adds, both "overestimated the value of government planning."

Hoover's efforts and Roosevelt's New Deal, Shlaes argues, not only didn't end the Great Depression, they made it worse. The cure wouldn't come until World War II, and the massive drive undertaken by American industry to supply a global war effort.

So what is the New Deal's legacy? First, as Shlaes notes, it changed the definition of "liberal" from a concept centered on individual liberty to one involving support for the activist governmental approach underlying the New Deal and the social programs that have followed it. It also dramatically increased the power of the presidency and the federal government.

But there's another legacy, one only hinted at in Shlaes' book, which ends with the 1940 election. Many of the New Deal's programs and agencies -- with some notable exceptions, such as Social Security and the Tennessee Valley Authority -- went out of existence after America became involved in World War II. At that point, organizations such as the Works Progress Administration and the Civilian Conservation Corps were deemed unnecessary. This happened despite the fact that such programs were viewed in their time as critically important and had developed large constituencies.

That's something today's politicians might remember. In the post-New Deal era, it is difficult to impossible to end federal programs once they have been launched. Instead, programs and agencies that fall out of favor tend to be stripped of staff and resources until they can no longer function effectively, at which point they are cited as evidence of government's ineffectiveness.

As federal agencies continually struggle to meet all of their obligations, the question that the country's political leaders fail to answer effectively is what government should stop doing. That's especially true in an era when the appetite for government solutions to pressing problems -- such as the threat of global terrorism -- continues apace.

In that sense, maybe the New Deal was a golden age after all.

COMMENTS

• Johnnie, While I will grant you that “Big Brother” has more of an influence that many of us wish, Bill is right. We are not there a socialistic state, yet. As is often seen, the difference may be mere semantics. Just as “Communism” was often used to describe a way of government abhorrent to most Americans, it was actually an economic system practiced even by early Christians. We proud Americans live not in a democracy, but a republic. The only difference I see in these terms is their meaning in book, a court of law, and/or the subjective feeling each of us have when using the terms in conversation. Personally, I feel our modern day society is a mixture of many methods and philosophies; our leaders trying to pick and chose the best choices, but often the lesser of two evils. After that it all comes down to degrees. And that ends up being interpreted by the individual speaker and listener, normally at high volumes and sometimes accompanied by hand gestures. On the book, itself, I think that Amity Shlaes, like many authors, had an agenda. Truthfully, and in accordance with most economics both the social work programs, the social care programs, and WWII passed around money; and please remember that every dollar the government spends changes hands 5 times. Even worse, I must admit a better case CAN be made for the impact of WWII, as most professors profess in slightly better terms. The war caused the government to invest (buys products of) in the heavy metals industries. It caused technological advances previously unseen; tanks, aircraft, massive ships. It virtually eliminated unemployment over night. The GI Bill boosted the US housing market and the average educational level; and it shed a new light on the role of women in the economy. It’s all about balance. Like social programs or not, they are designed to address specific ills that individual states can not correct themselves. Schools, crime, industry safety standards, health and welfare are all designed to raise the standards of living. Simply put; you can pay for schools now or jails later. And, please consider, it’s hard to learn when you’re hungry. Your choice, call it. Tip off Posted June 19, 2007 12:03 PM
• Sorry, Bill, but the US is clearly a socialist state at this point in history. While estimates vary widely, combined Federal, state and local government spending account for anywhere from 33-43% of the Gross Domestic Product in the US. A generally accepted benchmark is that when government spending exceeds 30% of GDP, government exerts enough control over the economy to be called socialist. "Control" being the key word in the definition of socialism. The US is clearly over the socialist threshold, even though the US government "fools" the people with deficit spending. An even bigger problem in the US is the reliance of people on government handouts. Hurricane Katrina illustrates just how far downhill the US has gone in this respect. In past disasters, you wouldn't see 100,000 people just sit there, waiting for a government handout and waiting for the government to solve all of their problems. Yet, that was the scene in New Orleans. In the old days, people would just dust themselves off, reassess the situation and move on with their lives. Usually quickly because they were hungry and liked eating. Today, a considerable portion of the US population consists of socialist sheep who are not self-reliant and can't even help themselves. Johnnie Nichols Posted June 19, 2007 11:12 AM
• Socialism: A theory or system of social organization that advocates the ownership and control of industry, capital, land, etc. by the community as a whole. The Random House college Dictionary, c. 1982. Johnny, you should learn the meaning of terms before throwing them about. Because there are elements we use that are common with socialist systems (like the former U.S.S.R. which was a totalitarian socialist government, not communist) doesn't make the U. S. a socialist system. bill Posted June 19, 2007 10:19 AM