Wayne O'Leary

The Turn

Ever since his 2009 inauguration, the key political question about Barack Obama, especially on the Left, has been whether he is FDR redux or a revisitation of some other figure from elections past: Bill Clinton, perhaps, or even (perish the thought) Herbert Hoover.

The first three years of the Obama presidency have not provided a definitive answer to this tantalizing ambiguity. There have been hints, of course, but nothing concrete or bankable. That may be about to change.

The open question of where Barack Obama is on the political spectrum stems from the president himself and his chameleon-like behavior in office. He has been, in Churchill’s memorable phrase, “a riddle wrapped in a mystery inside an enigma.”

To some extent, no doubt, this is a deliberate governing tactic. Many successful politicians, including FDR, have mastered the technique of being all things to all men and of convincing the last person in the room that theirs was the advice most likely to be followed.

In Roosevelt’s case, it prompted one biographer’s dual characterization of him as “the lion and the fox.”

FDR, however, had certain self-evident core beliefs; he did not reach office as a blank slate. From his first years in politics, the Democratic Roosevelt was identified with the progressive wing of his party, and as governor of New York, he pushed through a left-of-center program stressing public power, conservation, and social welfare.

President Obama, on the other hand, was a relative unknown when he became chief executive. His two years in the US Senate were rather uneventful, and his successful campaign for his party’s presidential nomination was largely premised on remarks condemning the Iraq invasion uttered while he was still a state legislator in Illinois. Liberal antiwar Democrats zeroed in on that and took everything else on faith.

Roosevelt and Obama do share in common the fact that their respective political reputations were enhanced by speeches — FDR’s “happy warrior” nomination of Al Smith at the 1924 Democratic convention and Obama’s electrifying red America-blue America keynote address at the party’s 2004 gathering. And there’s something else the two presidents share: an initial two and a half years marked by relatively moderate, in some ways conservative, approaches to policy.

Contemporary historians break Roosevelt’s era domestically into two distinct parts, the first New Deal of 1933-34 and the second New Deal of 1935-38. Basil Rauch, who originally perceived the distinction in his 1944 History of the New Deal, defined the first New Deal as pro-business, bordering on “corporativism,” and focused purely on recovery; the second New Deal he identified as pro-labor, tilted towards progressivism, and focused on reform.

Policywise, the first New Deal aimed at combating depression top-down through higher prices for industry and agriculture, the second bottom-up through increased purchasing power and security for the population as a whole. The differentiation was marked by a political transition away from those (industrialists, merchants, large farmers) most benefitted by the first New Deal and toward those (urban workers, small farmers) most helped by its successor.

Legislatively, the hallmarks of the first New Deal were the National Industrial Recovery Act, which pursued a cooperative joint partnership in industrial planning between government and business, utilizing semi-voluntary production and labor codes for fair competition; and the Agricultural Adjustment Act, which undertook a similar cooperative effort in the farm sector geared to limiting production surpluses through acreage controls, commodity quotas, and price supports.

The keystones of the second New Deal, in sharp contrast, were the National Labor Relations (or Wagner) Act, which established the legitimacy of unions and collective-bargaining rights; and the Social Security Act, which mandated old-age pensions and unemployment insurance.

Arthur M. Schlesinger Jr., who detected the same New Deal divide as Rauch, summed up the first New Deal as an exercise in economic planning that attempted to achieve recovery by saving capitalism from itself, leaving the basic structure of the system and its power relationships untouched in the process. Yet, those saved in 1933-34 turned out to be ungrateful and only grudgingly cooperative. The ultimate response of Wall Street was to create the arch-reactionary Liberty League in late 1934 and campaign thereafter against Roosevelt.

Like the unappreciative corporate reaction to Barack Obama’s business-friendly policies of 2009-10 (saving the big banks with minimal regulatory reform, enacting a health plan that preserved the health-insurance industry, passing an economic stimulus laden with tax cuts and business subsidies), the reaction to the first New Deal amounted to class warfare from the top. FDR drew the appropriate conclusion and turned on the “economic royalists.” The second New Deal became, in essence, a fight against big business and the rich.

But there was more to the political shift than that; Roosevelt, like Obama today, had his base to consider.

By 1935, at about the same point in his presidency that Obama has reached, FDR’s New Deal, as initially formulated, was in trouble.

He faced stubbornly persistent unemployment, his programs had run out of steam, and his popularity was slipping; his liberal supporters, in particular, were discouraged, and there was political thunder on the left in the form of Huey Long and others. All of these factors led FDR to “pivot” and launch the greatest period of liberal reform in American history. Besides passage of the Wagner and Social Security acts, 1935 saw a renewed interest in the plight of the unemployed that manifested itself in the public-jobs programs of the Works Progress Administration (WPA). And (shades of 2011) the second New Deal also spawned the Wealth Tax Act of 1935, which raised taxes substantially on millionaires and corporations, and included imposition of an excess-profits tax.

Obama can’t do anything comparable for now; he doesn’t control Congress. But 2012 could change things if, as seems, he is making his own Rooseveltian turn to the left. For the time being, the president can propose, cajole, agitate — in short, use his rhetorical gifts like FDR in 1936. Since early September, with his American Jobs Act and his tax-the-rich offensive, he appears to be doing exactly that.

Could this be the start of Obama’s version of the second New Deal? Perhaps, because history does, after a fashion, repeat itself. Or, to put it in the vernacular, everything that goes around comes around.

Wayne O’Leary is a writer in Orono, Maine, specializing in political economy. He holds a doctorate in American history and is the author of two prizewinning books.

From The Progressive Populist, December 1, 2011