More Revisionist "History"

In today’s Ledger, one Professor Steven Conn (donations: Obama for America, per FEC) purports to defend the miserable failure known as The New Deal, not on its own terms, but on its purported long-term effects. A professor of "public history" – whatever that is – he resorts to revisionist history and, unsurprisingly, draws the conclusions unsupported by fact or logic.

FDR intended the New Deal to end the Great Depression. As the good professor feels compelled to admit, it failed.

Nonetheless, he justifies the enterprise on the grounds that some of its programs – planting trees, repairing roads – benefitted the country in the long run.

But a prudent government does those things anyway, and they have essentially no stimulative effect upon the economy. So a contention that the New Deal succeeded because it did what governments have always done is rather silly.

Respecting the legacy of the New Deal, Prof Conn notes that Republicans, having been burned by their attempts to usher in some sanity respecting Social Security, are no longer pursuing that avenue. True, that. But political popularity does not mean the program is sustainable; it simply means that people like getting checks and resist cuts to their own benefits. Big surprise, that. Heck, even Obama talks about the necessity for entitlement "reform", although, as we have learned, in liberalspeak, "reform" ALWAYS translates as "more", so the outlook is grim.

Obviously not a logician, the prof claims that the expansion of the middle class after WW II, resulted from governmental involvement in the economy and the "social safety net" created by the New Deal. Beep, sorry, wrong answer, but thanks for playing. This logical fallacy goes under the name post hoc ergo propter hoc, giving the New Deal, and government, wholly undeserved credit for prosperity which happened to follow a particular action. Query whether the good professor would accord W and the Patriot Act credit for preventing further terrorist attacks because nothing untoward happened after the passage thereof?

1950's prosperity owed as little to the New Deal as did to (say) to Joe DiMaggio’s 1941 hitting streak. It followed it, but nothing about the massive expansion of government created or nurtured that prosperity.

Conn blames a "devastating downturn" in the early ‘80's on the gutting or non-enforcement of salutary regulations under Ronald Reagan. Er, problem: that downturn started long before Reagan was president. Contrary to Conn’s assertions, the "nasty recession" of the 1990s was most assuredly not caused by a failure to regulate S & L’s, but by the collapse of the real estate bubble, caused by – you guessed it – governmental policy. Or, in that case, the ping-pong governmental policy of hugely favoring real estate through ACRS, included in the 1981 tax legislation, and its summary reversal in the 1986 tax reform act. Pricking the real estate bubble undercut the S & L’s, whose loan portfolios were almost exclusively based on now devalued real estate.

Alas, like most liberals, Conn appears to be leftist first, scholar second. One look no further the Paul Krugman for the preeminent example of a brilliant man so blinded by socialist ideology that he permits it to guide his conclusions rather than following the actual evidence.

Conn contends that the New Deal somehow provided for economic prosperity in the post war era, despite its patent failure to produce said prosperity in the period directly after its commencement in 1930. (Yes, I said 1930, because the policies Hoover adopted were essentially the same as those FDR employed later on) If this effort failed in the 1930's, as it unquestionably did, how is it that it suddenly succeeded after 1945?

Inconveniently for those who support massive governmental spending and economic involvement, socialism always fails, everywhere, every time it’s tried. The most prosperous economic period in the history of mankind occurred not in the 1950's, but after 1980 – in this case because of Reagan’s policies, not simply postdating them. Never have so many people been so wealthy. For Conn, apparently, because not everyone became a millionaire, because the distribution of wealth was not equal, that prosperity can be discounted. Once again, like most liberals, he apparently prefers a system under which all are equally miserable than one in which talent and drive permit some to excel and prosper.

Contrary to the professor’s assertions, wealth and assets were NOT "transferred" from the middle class to the wealthy after the 1980's. Instead, massive new wealth was created, but not equally shared. To which, the correct response is, "so what"? We could, like the socialist paradises of Europe, expropriate massive amounts of wealth from the talented and industrious, and distribute it to their less gifted or less motivated neighbors, but the result would have been that such wealth would never be created in the first instance.

Typically, when the left engages in counterfactual hypotheticals, it assumes the facts it wishes to assume however divorced from reality they might be. "If taxes had not been cut", they lament, "look at all the revenue we’d have to put to better uses than those to which those who actually earned the money put it". Problem: history demonstrates that if taxes remain high, a substantial portion of the wealth leftists wish to expropriate would never have existed.

Consider a simple, oft repeated example: some years ago, a GOP Member of Congress asked the economic gurus employed by the House what the revenue effects would be in we imposed a tax of 100% on all income over $100,000 (or so). "X hundreds of billions in the first year, and Y hundreds of billions in the following years" came the clueless reply. The correct answer? $0. What idiot would work after making the target salary?

So. The premise upon which the left bases its argument – that redistributing wealth will have little effect upon its creation – is patently silly. The New Deal, and its more statist European counterparts, proved conclusively that governmental programs do not produce prosperity. They didn’t work in 1935, they failed in 1978, and they will fail again today. Because government, while very good at destroying wealth and undermining prosperity, never produces either.