Renewing the ‘Old Deal’?

Be not thou envious against evil men, neither desire to be with them.

For their heart studieth destruction, and their lips talk of mischief.

Through wisdom is an house builded; and by understanding it is established:

And by knowledge shall the chambers be filled with all precious and pleasant riches.

Proverbs 24:1-4

As America continues to feel its way through a dire economic crisis, our elected leaders in Washington seem determined to repeat the mistakes of the past.

In fact, they fail to even see that they were mistakes, despite the clearest of evidence.

The model for the so-called “economic recovery” plans of 2009 are policies that were tried by President Franklin Roosevelt in the 1930s and failed miserably to pull the country out of the country’s one and only Depression.

Obama himself has held up FDR’s experiments as his inspiration: “He saw a nation conquer fear itself with a new deal, new jobs, a new sense of common purpose.”

But is it really true that Roosevelt’s policies pulled the nation out of the Depression, as every schoolchild in America still learns?

No, it is not true. And no amount of wishful thinking will make it true.

There’s a new book out that seeks to destroy the myth – so that our fate is not cast in repeating the mistakes of the past. It’s called “New Deal or Raw Deal” by Burton Folsom Jr., and I highly recommend to every American, particularly those so eager to go down the same path once again.

Success or failure in economic terms can actually be measured. And there has been plenty of time – nearly 70 years, in fact – to evaluate the cold hard statistics of the Great Depression to learn the truth: Roosevelt’s New Deal policies lengthened the worst economic crisis in American history.

After two complete terms in office in 1939, Roosevelt saw higher unemployment in 1939 than what the nation experienced when he took office – up from 16.3 percent in 1931 to 17.2 percent in 1939. No depression or recession in American history, before or since, ever lasted even half as long.

However, statistics can never tell the whole story.

So Folsom provides the long-forgotten insights of the Roosevelt administration itself to clarify the point that the New Deal was a debacle. It was a mistake. It was a disaster that should never be repeated – not if the goal is economic recovery.

Let’s examine the words, for instance of Henry Morgenthau, one of Roosevelt’s closest friends and confidantes. In 1939, he was serving as FDR’s treasury secretary – and he was growing weary of what he acknowledged were the failures of the administration’s efforts to spend their way out of the Depression.

Please read his words and take them to heart. Share them with your friends who believe the best way out of our recession is for the federal government to spend money it doesn’t have. It’s way past time for Americans to be confronted with the truth. After all, if we don’t learn from the mistakes of the past, we are doomed to repeat them.

“We have tried spending money,” Morgenthau testified before his fellow Democrats on the House Ways and Means Committee. “We are spending more than we have ever spent before, and it does not work. And I have just one interest, and if I am wrong … somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises. … I say after eight years of this administration we have just as much unemployment as when we started. … And an enormous debt to boot!”

I was on an Air America radio program and challenged the host to give me one example of when socialism worked in the history of the world.

He answered: “During the Roosevelt years when it lifted the nation out of the Depression.”

When I confronted him with these facts, it was as if I had just turned his world upside down. It is an article of faith with many today that the New Deal actually worked. It was a complete failure. The verdict has been in for a long time.

The nation only put the Depression behind it with the onset of World War II. Surely we don’t want to have to rely on the deaths of millions to pull us out of our current economic crisis. We need to find a better paradigm

Too many people want to listen to their hearts instead of their heads.

Others, especially those in power, are all-too willing to lead them to destruction for their own empowerment.

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