Monday, December 15, 2008

The Importance of Historical Narratives

Salon has a piece on Obama's First 100 Days, bringing to mind the administration of Franklin Delano Roosevelt and the dawn of the New Deal. And meanwhile, many progressive commentators have been more their vocal in their support for a new "New Deal" as centerpiece of President Obama's economic plans. I had planned on doing a post before the election on the importance of historical narratives in politics and got got waylaid, but nonetheless, the concept of historical narratives is still highly relevant.

If you asked the typical knowledgeable American about the New Deal, they'd probably tell you that the New Deal was FDR's plan that saved us from the Great Depression. Progressives will tell you it was the dawning of the era of light, while libertarians will tell you it was the beginning of the end. Truthfully, the immediate results of the New Deal were mixed if not non-existent and it was World War II that really got America out of the Great Depression, but this is far too small a forum for a historical debate of that magnitude. The important thing to note here is that in the long run, the left won the battle of words about the New Deal, as Roosevelt's efforts are painted in a positive light in virtually every historical text book. Even if there is still much to debate, those who would question the New Deal are left with the unenviable task of running smack into the standard historical narrative.

What this means for today is that questions about calls for a new New Deal or similar radical reforms are met with a skepticism directly related to that historical narrative. Those who write the history books are given more leeway to shape the present and the future.

From everything I've ever read it seems clear to me that the New Deal lengthened the Great Depression. Forget about the debate over whether or not the government crushed the market, what happened particularly during the early years of the New Deal was that the government's constant tinkering with the economy left businesses unwilling to make changes or take risks. It was about business not knowing what was coming next, something that I fear has already started with the growth of bailout mania these past few months. The financial system today remains in crisis, at least in part, because no one is willing to take bold steps while the government bides it's time in making decisions ans dolling out cash. These are the lessons I've learned, but it's not part of the standard story. Until it is, I'm terrified at the havoc Obama's new New deal could wreak.


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