Hillsdale College history professor Burt Folsom (along with his wife, Anita) have an excellent article in today’s Wall Street Journal, taking issue with the myth that FDR succeeded in ending the Great Depression. The New Deal, a witch’s brew of federal activism made things worse. The Folsoms don’t go into detail on that point, although Burt’s recent book New Deal or Raw Deal? does. The key point is that federal programs obstructed the natural tendency of actors in the market to put resources to their best uses. Instead, FDR’s policies kept down business investment while diverting resources to political grandstanding.

What about World War II? It’s often said that the war jolted the nation of the Depression, but all it really did was to take people’s minds off it. Of course unemployment went down, but the standard of living for most Americans, in and out of the military, went down. Fortunately, Congress said “no” when President Truman tried to put into effect the kind of heavy socialism that FDR thought would be necessary to deal with the post-war economy. Prosperity began to return after Congress repealed many war-time government measures, especially price control, that got in the way of economic efficiency.

FDR’s lofty (and completely undeserved) reputation should take a beating when people realize that if he had gotten his way, the American economy would have been shackled with much the same sort of socialism as the British economy was following the Labour Party victory in 1945.