It is interesting to see how Democratic Presidents have had to make up for Republican Presidents’ failed policies, in particular in the case of President Roosevelt and President Obama; both from Democratic Party, following a Republican term and facing a country engulfed in economic crisis with sky rocketing unemployment rates. The American Recovery and Re-investment Act of 2009 as an economic stimulus package was Obama’s “New Deal”, to follow the precedent of introducing economic reform in the first 100 days of his presidency. But he did not follow the precedent blindly. In one of his initial 60 Minutes interviews, on Dec. 16, 2008, President Obama admitted having read about the first hundred days of President Roosevelt in office. Therefore, he did what President Roosevelt could not sufficiently, at least from some critique’s eye such as Keynes’. Facing the greatest economic crisis since the Great Depression of 1930s, President Obama, having or not having read the open letter to President Roosevelt, followed the Keynesian economic tradition and ensured that his economic stimulus package emphasized on government spending as means of covering the gap that is created due to reduced consumer spending leading to recession. His inspiration may have had basis in past initiatives’ failure, but he publicly committed to the implementation.
I find the impact that the New Deal had on the world at large very interesting, whether as a case of success or a failure. It is quite evident from Keynes’ open letter how keenly Roosevelt’s measures were being followed with awareness of their impact on other countries. Keynes offered a number of recommendations based on his observations, which he didn’t want to be taken as criticism, to my surprise. Could it have been due to less harsher culture of criticism in those days or more because of how revered a character Roosevelt as US President was? One obvious reason of Keynes’ interest in the outcome of the New Deal is the impact that it could have on his country and other European nations, but greater than this is his own respect for Roosevelt; he is so in awe of him, that he doesn’t want anything to break into that aura of presidency. The tone of the letter is over humble and ends with his signature as “Your Obedient Servant” which is a very rare in these days, never going beyond “sincerely”, “with my deepest respect” or “with heartfelt and deep concern”. Is this due to the natural language alteration or current/ recent US presidents do not anymore enjoy that level of popularity at the international level?
The end of the Great Depression came with and by the World War II, when military expenses increased, the military industry thrived and unemployment went from 14% in 1940 to only 2% in 1943. Are we up for a solution of that magnitude and impact, definitely not, but the stimulus package for the US Economy ran parallel to the plan of sending over 40,000 US military and security advisors to Afghanistan. War and more war still seem to be there, just that the context and scale is different.
The degree of success or failure of the New Deal is controversial, mainly due to different scales and criteria against which it has been measured. It pretty well managed to keep the American nation fed and clothed; it could not bring back the earlier level of economic stability at once, but it did bring the economy on the recovery path, which was important and worth considering. It initiated a series of reforms, the implementation of which continues to throw light on today’s attempts at solving economic crisis. It surely set a precedence of human brave resistance in the face of the most critical conditions, which if source of nothing, is a source of hope.
