Last week, we x-rayed some countries that went through recession, depression, downturn, austerity, belt-tightening times and learnt how their leaders galvanised the people for dramatic turnarounds. This week, we will continue with our periscope into other climes and see how national problems were solved collectively under a fervent atmosphere of national cohesion and inclusiveness. We have already dealt with Glasnost and Perestroika of Russia and the “Great Leap” of China. We have also touched on “the Great Depression” and the emergence of “the New Deal”. Today, we x-ray how Roosevelt skillfully maneuvered his country out of economic kwashiorkor, with the first and second “New Deals”.
How Roosevelt ignited America with the first New Deal
Both Roosevelt and the Congress of the United States, in trying to reduce unemployment and restore prosperity, endorsed a wide spectrum of new federal programmes and agencies, most popularly identified by acronym titles. Roosevelt, a skillful political leader, helped win support for an unprecedented array of new services, regulations and subsidies. Yet, no single political philosophy or set of coherent goals ever unified these disparate programmes, most of which he developed with the aid of an informal group of advisers known as the “Brain Trust”. These individuals from outside government included professors, lawyers and others who came to Washington to advise Roosevelt, in particular on economic affairs. The central legacy of the New Deal was increased government involvement in the lives of the people.
The Great Depression, which began during Hoover’s administration, destroyed America’s belief in that dream of unlimited prosperity and its faith in the Republican Party. The disastrous economic collapse and extraordinarily high unemployment that followed made a mockery of Republican claims. The slow and limited response of the Hoover administration was ineffective and seemed to indicate too much indifference to the people’s suffering. The Democrats made full use of the depression as an issue, capturing the presidency by a large margin in 1932 and winning the election of 1936 by one of the greatest landslides in history. The New Deal coalition, headed first by Franklin D. Roosevelt and later by Harry S. Truman, remained in power for a generation, with the Republicans losing five presidential elections in a row. So great was the reaction to the depression that the Republican Party controlled Congress for only four of the 48 years between 1932 and 1980. The Republicans did win the presidency four times during that period, in 1952, 1956, 1968, and 1972, when the Democratic Party split or when some unusual combination of circumstances occurred. From the 1930s through the 1970s, however, the Democratic Party was the dominant party in the United States.
In Nigeria, does PMB’s government tolerate or allow a fresh breath of ideas? Does his know-all “kitchen cabinet” tolerate dissent? Was the private sector not abused and securitised as corrupt, like government and PDP? Are intellectuals, professors and intelligent used? Is it not a “winner takes all” government?
Roosevelt and the second New Deal
The hopes of 1933 for early recovery proved illusory. Many of the hastily drafted early bills were declared unconstitutional by the Supreme Court. Roosevelt now exploited developing class divisions, formed closer alliances with organised labour and increasingly castigated the big-business groups that opposed his New Deal programmes.
These reverses, plus increasingly political opposition to Roosevelt, triggered a second flood of legislation, beginning in 1935, which some observers called the Second New Deal. Among the new measures were higher taxes for the rich, strict regulations for private utilities, subsidies for rural electrification (see Rural Electrification Administration), and what amounted to a bill of rights for organised labor. Under the guidance of Secretary of Labour Frances Perkins, the National Labor Relations Act of 1935 gave Federal protection to the bargaining process for workers and established a set of fair employment standards. The National Labor Relations Act, also known as the Wagner Act for its sponsor, Robert Wagner, guaranteed workers the right to organise and bargain through unions. The federal Fair Labour Standards Act of 1938, the last major domestic programme launched by the Roosevelt administration, mandated maximum hours and minimum wages for most categories of workers.
By 1935, several Roosevelt advisers welcomed massive new federal expenditures to induce more private demand, even at the price of budget deficits. A huge relief appropriation of almost $5 billion reinvigorated several programmes and funded a new federalised work relief programme administered by the Works Progress Administration (WPA; see Work Projects Administration). Perhaps of greatest enduring significance, Congress, in 1935, enacted the Social Security Act (see Social Security), which contained three major programmes. a retirement fund, unemployment insurance, and welfare grants for local distribution (including aid for dependent children). These programmes, coupled with a new subsidised public housing programme, began what some now refer to as a welfare state. Social security was developed in the United States later than in many European countries, which had developed social security programmes before World War I (1914-1918).
In 1937, after a resounding victory in the 1936 election, Roosevelt sought to increase support for his ideas on the Supreme Court. He proposed legislation that would add more judges to the Supreme Court, but Congress rejected this “court-packing” attempt. The pressures for new legislation abated after 1937, and opposition to extending the New Deal mounted rapidly, especially in the South. By 1939 public attention focused increasingly on foreign policy and national defense. The New Deal was over, but it had permanently expanded the role of the federal government, particularly in economic regulation, resource development, and income maintenance. Although in itself the New Deal failed to stimulate full economic recovery, it provided the federal government not only with increased controls over money supply and Federal Reserve policies but also with increased understanding of the economic consequences of its own taxing, borrowing, and spending, thus helping government to limit the impact of later recessions. In addition, the New Deal coalition dominated the electorate and the nation for years thereafter. The New Deal changed the relationship between the government and the people of the United States. In addition to increasing the involvement of government in people’s lives, the New Deal created a number of agencies that still exist, and it stimulated the growth of America internationally.
PMB and his cabinet have great historical lessons to draw from this.
Britain: The Victorian Era
Queen Victoria ruled Britain from 1837 to 1901. Her reign was the longest of any monarch in British history and came to be known as the “Victorian Era”. As embodied by the monarchy, this era was represented by such 19th-century ideals as devotion to family life, public and private responsibility, and obedience to the law. Under Victoria, the British Empire expanded, and Britain became an increasingly powerful nation. As the country grew into an industrialised nation, the length and stability of Victoria’s reign gave an impression of continuity to what was actually a period of dynamic change.
As the social consequences of industrialisation became more apparent, so did the need for government oversight of working and living conditions in the mushrooming industrial cities. Many social reformers believed that government should restrict the influence of powerful individuals. Others believed in the philosophy of self-help. Self Help was also the title of a mid-century best-seller by social reformer, Samuel Smiles. In his 1859 work, Smiles presented short, inspirational biographies of famous men and urged his readers to improve their own lives by following these examples.
The underlying belief of Victorian society was that things were better than ever before and could be made better still. This belief was the impetus for thousands of voluntary associations that worked to improve the lives of the poor both at home and abroad. It also underlay the charitable foundations created by wealthy benefactors and the public philanthropies of some of the greatest industrialists. Social experiments were conducted by individuals such as factory owner Robert Owen, who founded utopian communities in which wealth was held in common. Novelists such as Charles Dickens were ardent social reformers who brought the intolerable conditions of the workhouses and the factories to the attention of the public in their books. Dickens’s novels Oliver Twist (1837-1839) and Hard Times (1854) are examples of this kind of literature.
Let us now turn to the East, away from the West.
Soviet Union: “The Great Turn,” The Five-year Plan
After coming to power in 1928, Soviet leader, Joseph Stalin, introduced the “Five-year Plan”, a massive programme intended to transform the Soviet Union into a major industrial power.
Each five-year plan dealt with all aspects of development: capital goods (those used to produce other goods, like factories and machinery), consumer goods (e.g. chairs, carpets, and irons), agriculture, transportation, communications, health, education, and welfare. However, the emphasis varied from plan to plan, although generally the emphasis was on power (electricity), capital goods, and agriculture. There were base and optimum targets. Efforts were made, especially in the third plan, to move industry eastward to make it safer from attack during World War II. Because meeting the goals of the five-year plans had top priority as a measure of progress toward a communist utopia, official lying about productivity became part of the economic system.
You cannot afford to miss next week’s tranche of revivalist and redemptive strategies adopted by historical leaders in times of their national crisis.