Yesterday I suggested that Fareed Zakaria would benefit from reading Mises? description of the ways in which government interference disrupts capitalism?s vital market processes.
Today I offer a different reading assignment. Kenneth T. Walsh of U.S. News would profit from a perusal of Amity Shlaes? recent history of the Great Depression, The Forgotten Man.
Armed with the facts Shlaes assembles, Walsh would not perpetuate the myth that an activist FDR saved the country from the heartless hands-off policies of Herbert Hoover:
Historian Robert Dallek sees some parallels to the failure of President Herbert Hoover to adequately address the economic meltdown of the late 1920s and early 1930s. Dallek points out that Hoover ?couldn?t let go of his ideology? ? notably his belief that the markets would eventually correct themselves. That didn?t happen, and Hoover became a figure of ridicule for generations.
Well, no, that?s not true. Hoover, ?The Great Engineer,? loved to fiddle with government policies designed to fix problems government couldn?t fix. That?s one reason predecessor Calvin Coolidge, who did believe in a laissez faire policy, derisively referred to Hoover as ?Wonder Boy.? One of the key figures of FDR?s brain trust admitted that much of Roosevelt?s initial program consisted of a continuation or expansion of Hoover?s ideas.
Armed with the information provided in Shlaes? book, Walsh might also avoid concluding future articles this way:
FDR also found that flexibility was key. ?Roosevelt was experimental,? Dallek says. ?If something didn?t work, he moved on to something else.? That may have to be the guiding philosophy of whoever is elected November 4.
No, not exactly. FDR liked flexibility. The rest of the country paid the price for that flexibility, as Carolina Journal Radio listeners learned in 2007:
Kokai: You don?t paint [Roosevelt] as a villain, but you do point to some of the things that he did that just built upon other mistakes. You get the sense in reading this book that if he had just stopped at some point and let his various ?reforms? stand, we would have been better off.
Shlaes: Politicians have their reasons, that they like reform for the sake of reform. But as we know here in the marketplace or when we are citizens that reform for the sake of reform is very costly in terms of uncertainty. If your child?s school is reformed six times from first grade to sixth grade, you know he doesn?t have a pleasant experience in that school and a lot of us know that, right? So we know No Child Left behind. We know stuff that changes sounds good, but change itself can be trouble.
And that was the New Deal. Roosevelt would do a reform. One day he loved big business. The next day he is suing them. Then he loves them again, breathing spell, then he is back at them. And even Keynes, the famous U.K. economist who was so important in that period, didn?t like it. He said to Roosevelt about utilities: either nationalize them or leave them alone. What?s the use of chasing them around the lot every other week? That?s the politician, and that?s what Roosevelt did. It?s the dark side of his famous phrase ?bold, persistent experimentation.? People don?t like bold, persistent experimentation too much because they can?t get their bearings, and that?s a little bit of what happened in the ?30s ? especially the latter half.