The New Deal We Didn’t Know

The New Deal, the apogee of liberal political power in American history and a story with a relatively happy ending—the Great Depression vanquished, World War II won—has usually had its history presented, except by conservatives who disapprove of the expansion of central government and taxation in the 1930s and 1940s, as an uplifting, inspiring one. That is not how Ira Katznelson presents it. There is only one very brief personal note in his long, scholarly book—a snip of memory about having to wear military-style dogtags and practice responses to a nuclear attack as a schoolchild in the early 1950s—but all of Fear Itself is suffused with the same sense of pure terror during the Roosevelt and Truman years as, say, Philip Roth’s The Plot Against America. It’s easy to forget not just how dangerous the situation was, at home and abroad, during the New Deal, but how palpable were outcomes far worse than what we got.

Another difference between Fear Itself and most of the familiar histories of the New Deal is that Katznelson thinks like a political scientist. That means that, although he defines the period presidentially, as the twenty years when Franklin Roosevelt and Harry Truman were in the White House, Roosevelt and Truman themselves are spectral presences. They are not the primary determiners of the course of government, and Katznelson has no interest in their personal qualities or their methods of leadership. Instead his focus is on Congress and government agencies, and more broadly on political systems, voting, and interest groups. This gives Fear Itself the feeling of a fresh look at a familiar story; what Katznelson loses in ignoring the inherent force of the hero narrative, he gains in being able to make an argument that largely ignores the presidency.

The argument bears laying out in some detail. Katznelson begins, usefully, by placing the New Deal in a global setting: the severity of the Great Depression presented an existential threat to liberal democracy everywhere, both as an ideal and as a reality. In response to the same economic crisis that confronted the United States, Germany turned to National Socialism, Italy to Fascism, and the Soviet Union already had a form of communism that no liberals except willfully blind ones could believe in. During Roosevelt’s first term, these alternate systems were on the verge of imposing themselves by force on many other countries.

It was not at all clear that democracy would survive here. George Kennan privately came to believe that the United States should become an “authoritarian state.” Walter Lippmann, on a visit to Roosevelt a month before his inauguration as president, advised him that “you may have no alternative but to assume dictatorial powers.” Even in public, all sorts of prominent people praised the undemocratic alternative political systems that were emerging in Europe, especially Italian Fascism. One prominent New Deal official hung a portrait of Benito Mussolini in his office. Nicholas Murray Butler told the Columbia freshman class that the dictatorships were now producing a better class of leaders than the democracies.

When Italo Balbo, Italy’s minister of aviation, barnstormed across the United States in 1933, he was greeted as a hero. At a grand welcoming dinner at a Chicago hotel, Katznelson tells us, “many rose to offer a Fascist salute when Balbo and his squadron entered the ballroom.” Even after the war, it wasn’t considered disqualifying that Iola Nikitchenko, the Soviet judge at the Nuremberg war crimes trials, had presided over Stalin’s worst legal depredations, like the 1937 Moscow show trials, just a few years earlier.

Katznelson wants us to understand how far from assured the final result of the New Deal was. And—since there was no real space separating the Depression from World War II, or the war from the threat of nuclear destruction—he maintains that the national fear that attended Roosevelt’s coming to the presidency did not abate much over the next twenty years. The New Deal took place, he writes, in “an atmosphere of unremitting uncertainty about liberal democracy’s capacity and fate.” This is a very dark picture of the period that also manages to convey how profoundly grateful we should be that things didn’t turn out worse, as they easily could have.

For Katznelson, the central institution in a democracy is the national legislature, so the test of a democracy’s strength is whether the executive takes the legislature’s authority away. What the Italian, German, and Soviet systems had in common was the complete abolition of legislative authority—without, at first, any real public objection. Roosevelt and Truman consistently tried to shift authority from the legislative branch to the executive, but the United States never wound up venturing anywhere near a permanent diminution in Congress’s role. This was, Katznelson says, “a notable, even extraordinary, attainment.”

Concentrating far more intensely on Congress than New Deal histories aimed at a nonacademic audience have usually done naturally leads Katznelson to a concomitant focus on the essential role that the South played in the shaping of the New Deal. Anyone who ever took an American history course is aware that the South was an essential part of the Democratic Party coalition during the New Deal, and that during that period it maintained the Jim Crow system of legal racial segregation. By making this a major theme of Fear Itself and examining it in great detail, Katznelson removes the South’s place in the story from its usual duly noted blandness to an arresting, almost obsessive centrality. The New Deal made two great Faustian bargains with allies Katznelson would not hesitate to call evil, and they frame his idea of the New Deal: the one with Stalin and the one with the Jim Crow South. And it wasn’t just that the New Deal looked away from these systems’ horrors and proceeded on its way; it’s that the new political system the United States devised during the period was profoundly shaped by these unsavory alliances.

The South was of course Democratic because of the Civil War and Reconstruction. In the political bargain that ended Reconstruction, in 1877, the Republicans got the White House (for Rutherford B. Hayes) and the Democrats got the withdrawal of federal troops from the South—which meant that the Fourteenth and Fifteenth Amendments to the Constitution (guaranteeing African-Americans civil rights and voting rights) would no longer be enforced there, since they had been enforceable during Reconstruction only at gunpoint. The South was so profoundly grateful for this that it remained substantially loyal to the Democratic Party until the Democrats strongly reversed their previous position and endorsed the civil rights legislation of the 1960s. Conversely, at the beginning of the New Deal, and for the same reasons, most black voters (who were necessarily outside the South) were still loyally voting Republican.

Katznelson reminds us that for large sections of the period he covers, including at the outset, the Democratic Party was not capable of winning a presidential election without the South (as is true of the Republican Party today). In the 1932 elections, Democratic congressional candidates outside the South, taken together, got only 40 percent of the vote, but 86 percent in the South. When Roosevelt took office, more than half the committee chairs in Congress were southerners.

Katznelson also reminds us that whites as well as blacks were substantially disenfranchised in the South, because of poll taxes. Voter turnout was shockingly low in the South—below 20 percent of eligible (meaning mainly white) voters, for example, in Georgia, Mississippi, Alabama, and South Carolina in the crucial presidential election of 1940. In the 1938 midterm elections, Mississippi, with a population of more than two million, had only 35,000 voters. A tight-knit group of very secure and long-serving southern politicians, for whom the maintenance of Jim Crow was an absolute necessity, used the congressional seniority system to maintain a working veto power over all New Deal policies.

In the narrow sense, the South used its power to create de facto regional exceptions to many New Deal policies, either by exempting domestic and agricultural workers (meaning blacks) from them, or by placing administrative and policy control of them in the hands of state governments. To use the most obvious example, the 1935 law that created the Social Security system had both of these features. In the larger sense, Katznelson argues, it was specifically the South that blocked off the possibility of the New Deal’s moving further left in its policies. The New Deal wound up largely achieving one set of goals—an American welfare state, including retirement security and an empowered labor movement—but stopped far short of another, which would have involved creating, through democratic procedures, a more centrally planned economy, like those of this country’s undemocratic, and evidently successful, competitors during the 1930s and 1940s.

This was not, Katznelson insists, a matter of Roosevelt’s changing his mind, or reacting to the setback of the Supreme Court’s undoing in 1935 of his first major foray into planning, the creation of the National Recovery Administration. Nor was there a national consensus on central planning. The period was too chaotic for any of that to be the case. It was Congress that blocked national planning, for reasons having to do with the southern bloc’s overriding concern with maintaining the regional racial order. The South, in Katznelson’s view, was willing to move left on economic issues as long as that didn’t threaten segregation. When economic policy and race began to seem intertwined, the South opted out on economic policy, and that defined the leftward boundary of the New Deal.

The turning point, Katznelson says, was the Fair Labor Standards Act (FLSA) of 1938, the law that established the federal minimum wage and “the last lawmaking victory of the New Deal’s radical moment.” Although the author of the earliest version of the law was Senator (later Justice) Hugo Black of Alabama, by 1937 the South’s support for federal legislation affecting working conditions had begun to crumble, because southern members of Congress no longer felt quite so confident that they could amend any law so that their system would be excluded. The national political power of organized labor, which was interested in enlisting blacks as well as whites, was rising rapidly, and there was now a distinct, though small, black voting bloc within the Democratic Party, located in the northern cities. With the South suddenly (though, it turned out, enduringly) in doubt, the FLSA barely passed, and only after a very long legislative struggle.

As the South was turning away from solidarity with Roosevelt on domestic issues, Roosevelt’s own attention was turning to the coming of World War II—and there, in Katznelson’s telling, the South was completely supportive, far more so than the rest of the country. The dominant strain in the Republican Party in those days was isolationist, and, as Katznelson reminds us, the northern, urban wing of the Democratic Party included many Italian-Americans, German-Americans, and Irish-Americans who were skeptical about the war.

The South has always had a more martial culture than the country as a whole. Still, it isn’t entirely clear why the South was so militantly anti-Nazi—Adolf Hitler was a big fan of Gone With the Wind, and many prominent Nazis assumed that many in the South would find their racial views sympathetic, but they didn’t. The crucial steps before the Pearl Harbor attack that made the United States as prepared for the war as it was—including large increases in military spending, military aid to Great Britain, and the establishment of a draft—would all have been impossible without the enthusiastic backing of southerners in Congress. In return, the South got some assurances that the militarization of the United States would proceed in ways that did not threaten Jim Crow, such as the maintenance of segregated army units.

As with all the positive outcomes in Fear Itself, the United States’ turn away from isolationism came at a price: the embrace, once again determined by the South, of a national security state that operated in secrecy outside the ordinary boundaries of democratic politics. Roosevelt declared a national state of emergency, giving him extraordinary power, six months in advance of the attack on Pearl Harbor. From this followed loyalty oaths for federal employees, the Japanese internment program, and a vast, overaggressive FBI program of surveillance of people who hadn’t been accused of anything (including African-Americans solely on the basis of their race). The program entailed the establishment of a network of 70,000 civilian informants.

The House Un-American Activities Committee was created by John Nance Garner, of Texas, and chaired by Martin Dies, also of Texas. The Alien Registration Act, which wound up registering five million people and designating nearly a million of them as “enemy aliens” with restricted rights, was the work of Howard Smith, of Virginia. This turn by the federal government would come up as a regularly recurring aspect of Washington’s role in the life of the country. It is recurring now in the PRISM program and similar activities launched by George W. Bush and continued by Barack Obama.

Because of the war, the turn toward central economic planning that the country declined to take in the 1930s happened almost overnight in the 1940s, through executive action rather than legislation. The federal government grew tenfold, established control over wages and prices, and was deeply involved in planning the activities of most American industries. As Katznelson puts it, “the country learned to act as if it were one great unified corporation.” World War II proved that the United States could compete successfully with nondemocratic countries, but at the price of becoming significantly less democratic itself.

Like the Great Depression and the ascension of Roosevelt, the end of the war provided an opportunity to remake the American political order. Katznelson places the South at the center of this process. Its influence in Congress had grown because Republican gains in the 1942 and 1946 elections had increased the southern share of Democratic seats. The larger setting for policymaking was fear, as it is throughout Katznelson’s account of the New Deal. The war may have ended, but the fear did not abate.

Roosevelt and Truman, through their choices about how to conduct the war, made the quick onset of the cold war almost inevitable. Roosevelt formed an alliance with a totalitarian state and then allowed it to bear most of the human cost of the war: the Soviet Union’s military death toll during the war was over twenty times that of the United States. This meant that when the war ended, the Soviets were in control of Eastern Europe and had no inclination to give that up. Truman’s decision to deploy two atomic bombs in Japan ensured that a gripping terror would pervade international relations for decades, if not forever. It turned out to be impossible for the United States to contemplate its postwar competition with the Soviets calmly.

Anything pertaining to the cold war wound up as a permanently large part of government, likely to be protected from the ordinary legislative processes of a democracy. The reason Susan Rice just became national security adviser rather than secretary of state is that the National Security Council was created after the war outside the sphere of congressional oversight, so her position doesn’t require a confirmation hearing.

The CIA dates from the same period. So does the Department of Defense and its headquarters building, the Pentagon. So does the Air Force and its aggressive branch devoted to planning nuclear war, the Strategic Air Command. Defense spending and the size of the standing military dropped precipitously with the end of the war, but soon soared again, and has ever since. The kind of planning process in which government collaborated with business—which Katznelson calls “corporatist”—became the rule, again permanently, in military and defense matters. The military became the dominant funder of scientific research, including inside private universities. All these changes amounted to the United States’s becoming what Katznelson calls “a crusading state” with “a permanent war economy.” And they were all enthusiastically endorsed, often without recorded votes, by a Congress (especially the committees that oversee military matters) dominated by the South.

Domestically, the process was the opposite: the United States, which might have created a social democratic system like Western Europe’s, instead scaled back. The two pieces of legislation that encapsulate the change from the height of the New Deal to the postwar order are the Wagner Act of 1935, empowering organized labor, and the antilabor Taft-Hartley Act of 1947. Both had the South’s crucial support, and Katznelson attributes the change from one to the other to the South’s growing nervousness about its ability to maintain its racial order. “For southern legislators, labor had become race,” he writes, and Taft-Hartley was, to its southern supporters, a “triumph for the security of Jim Crow.”

Just as important as the shift in labor policy, Katznelson argues, was the idea that the government’s management of the economy should focus on taxation and spending, rather than on economic planning. In 1939, Congress established the National Resources Planning Board and the Bureau of the Budget; after the war, the former died and the latter became an important agency, now called the Office of Management and Budget. Agencies that could have established a larger central government part in the economy were prevented from doing so, for racial reasons, by the South. The United States Employment Service, quite a substantial operation, was taken out of the Department of Labor and put under the sort of local control that the South always favored. Southern offices routinely listed jobs as being for whites or blacks only.

The Fair Employment Practices Commission, created by Roosevelt in 1941 as a small wartime harbinger of the federal government’s commitment to civil rights, was abolished by Congress, against Truman’s wishes, after the war, because the South so deeply disliked it. Katznelson reminds us that the South’s role in the Democratic Party remained so crucial that both of Adlai Stevenson’s running mates in the presidential campaigns of 1952 and 1956 were southern senators, the first staunchly segregationist, the second less so.

Political scientists use the term “pluralist” to describe a system in which interest groups compete incessantly for advantage, and there is no overarching, determinative notion of the public interest. The side that wins gets to define the public interest, and the system’s moral commitment is to the procedure, not the outcomes. The final product of the New Deal, Katznelson argues, was a pluralist, “procedural” state in domestic affairs, and a far more expansive and less democratic state—corporatist, committed to planning in the “national interest”—in military affairs. This amounts to a liberal nightmare (and also demonstrates that one should not be confident that reducing interest-group influence in politics would necessarily produce pleasing results): the aspect of government liberals focus on was constrained, the aspect conservatives focus on was unbridled. And it was the South’s doing.

Ira Katznelson, who is a Columbia colleague of mine, has done something remarkable in Fear Itself in creating a large-scale, densely detailed tableau of the New Deal that feels fresh and unfamiliar. The book’s success comes partly from its insistent focus on material that lies outside the standard confines of the New Deal narrative, and partly from its powerfully tragic consciousness. Rather than seeing the New Deal as entailing a series of compromises, as with all politics, Katznelson presents us with a grand achievement, the preservation of American democracy, attained only through deeply corrupting alliances with Stalin’s Soviet Union and the pre–civil rights American South.

In Roth’s The Plot Against America, a relentlessly escalating series of horrors culminates in the Roth family of Newark being ordered to relocate to Kentucky (merely a border state!), where, we are made to understand, at any moment one of them could simply disappear. A similar feeling of utter horror about the South suffuses Fear Itself. The irony of Katznelson’s accomplishment here is that it has come, in part, through a Faustian bargain of his own: he has made the New Deal much more complex and interesting by oversimplifying one of its major actors.

Katznelson’s South has no black organizations of political consequence, no white racial liberals, no native union movement—indeed, very little internal variation on any issue, even though it’s a large region, because its focus on maintaining the Jim Crow system is so overwhelming. Although his account makes one appreciate how long the odds against the success of the civil rights movement were, it’s hard to imagine how, just a couple of years after Fear Itself ends, the Southern Christian Leadership Conference could have mounted its successful boycott of the municipal bus system in Montgomery; the elements underlying a nonquixotic act of resistance of that kind don’t seem to be in place.

More specifically, Katznelson’s treatment of race as the trump card in southern politics, though generally justified, leads him to treat the South’s views on economic issues as having been far less internally contentious and farther to the left than they actually were. Race could have been overwhelmingly important to the South and there could still have been—and was—room for differences on economic and other issues that had lasting regional and national effects.

On March 25, 1965, when Martin Luther King spoke from the steps of the Alabama state capitol building at the conclusion of the Selma-to-Montgomery march—a more dramatic civil rights moment, and a better speech, than “I Have a Dream” during the 1963 March on Washington—he devoted a significant part of his time at the podium to summarizing the work of historian C. Vann Woodward on economic strategies. It was an important intellectual event when the South began to produce prominent scholars—like Woodward (born in Vanndale, Arkansas, in 1908) and the political scientist V.O. Key (born in Austin, Texas, the same year)—who were not inclined to celebrate the Jim Crow system, as their predecessors going back to Woodrow Wilson had been.

Woodward and Key were pro–New Deal economic populists who spun out an alternate history of the South in which racism, rather than being the inevitable controlling factor in southern politics, had been put front and center by prosperous white conservatives so as to distract the poor majority from making common cause across racial lines and demanding economic justice. Here is King’s version, as delivered in Montgomery:

Racial segregation as a way of life did not come about as a natural result of hatred between the races immediately after the Civil War. There were no laws segregating the races then. And as the noted historian, C. Vann Woodward, in his book, The Strange Career of Jim Crow, clearly points out, the segregation of the races was really a political stratagem employed by the emerging Bourbon interests in the South to keep the southern masses divided and southern labor the cheapest in the land.

You see, it was a simple thing to keep the poor white masses working for near-starvation wages in the years that followed the Civil War. Why, if the poor white plantation or mill worker became dissatisfied with his low wages, the plantation or mill owner would merely threaten to fire him and hire former Negro slaves and pay him even less. Thus, the southern wage level was kept almost unbearably low.

It’s hard to think of academic work with more direct and immediate political consequences than Woodward’s mid-twentieth century conjuring up of a version of southern history in which Jim Crow had been avoidable in the first instance, and therefore was reversible in the present. Only a few months after King’s speech, Congress passed the Voting Rights Act (which the Supreme Court has just substantially negated) and liberal democracy in a recognizable if imperfect form came to the South.

Today Woodward’s view of southern history seems overoptimistic. The economically populist strain that he believed could have become dominant after Reconstruction seems retrospectively faint in comparison to white racism at the time. (Many more blacks were murdered in the late 1860s and early 1870s by white terrorists who were trying to overturn Reconstruction than were ever lynched.)

Even if Katznelson is essentially right, though, it’s a real stretch for him to present southern Bourbons like Harry Byrd of Virginia or James Eastland of Mississippi and bank-hating populists like Wright Patman of Texas or Theodore Bilbo of Mississippi as not having been meaningfully different politically. “Most of the region’s political leaders almost giddily propelled the New Deal’s radical economic policies,” Katznelson writes; these policies, he says elsewhere, “simply would have been impossible without the willing audacity of the segregated South.” But this is too dismissive of the importance of business-oriented “New South” conservatives who were active throughout the New Deal and became dominant afterward, and who were inclined to become a little less extreme on race, especially when they felt that doing so would bring economic rewards, and were anything but radical on nonracial domestic issues.

The people who created the South’s garment- and furniture-making industries, for example, had reasons to be anti-union that were more direct and immediate than the fear that unionization would undermine the racial order. They wanted to pay lower wages than their northern competitors. When Katznelson writes, by way of explaining southern opposition to pro-labor legislation in the late 1940s, that “a truly national labor system threatened to erode the ability of plantations to hold on to low-paid field-workers,” he is missing the South’s fundamental shift, already well underway, from Cotton Belt to Sunbelt (to borrow the title of an excellent 1994 book by Bruce Schulman).

The same political logic applies to the South’s oil, chemical, banking, and military-contracting industries, which were quite powerful by the end of the period Katznelson covers. They did not want their congressional representatives to push for radical economic policies. But neither did they want them to be focused on the maintenance of segregation to the exclusion of attending to their business interests. Whether or not Woodward (and King) were right that southern Bourbons had consciously used racism as a kind of ruse to get what they wanted economically, one can also make a reverse argument: southern business has tended to play down race if that seemed to serve economic development, for example in wooing northern companies to relocate to the South. And southern business has for many years reflexively turned to government for help, without having any populist inclinations. It practices what Katznelson calls “corporatism,” but as a matter just between government and business, without a substantial role for unions.

This isn’t a small matter. Katznelson argues persuasively that the basic political order of the United States was remade during the New Deal: government’s role expanded, but only up to a point, domestically, and expanded almost without limit militarily. But the variations within the South on nonracial issues also became nationally consequential.

Beginning with Strom Thurmond’s Dixiecrat defection from the Democratic Party in 1948, the South became less solidly Democratic—rapidly so after the height of the civil rights era. That was about race. Also, beginning with Jimmy Carter in 1976, the South began to demonstrate that it could produce successful presidential candidates (I’m not counting Lyndon Johnson because he was elevated from the vice-presidency), something that had not been possible during most of the Jim Crow era, when congressional leadership positions were the most that even the most talented southern politicians could aspire to. Carter, Bill Clinton, Al Gore, George H.W. Bush, and George W. Bush all became major-party nominees, and although they did not all come from the same party, they all ran as more or less moderate, pro-business politicians who were sensitive to middle-class voters’ needs and did not openly appeal to white racial prejudice. This set of views, which dominated presidential politics for years, emerged from a tradition of business-oriented politics in the South—going back at least to the 1880s, when Henry Grady of The Atlanta Constitution began using the phrase “The New South” to express the hope of a move beyond dependence on agriculture—which Katznelson doesn’t mention.

That period of high southern influence on national politics may now be over. Hillary Clinton lost to Barack Obama in 2008 in part because she attended too closely during the Democratic primary season to the lessons she had learned in becoming a southern moderate during her years in Arkansas. The Democratic Leadership Council, the moderate-to-conservative group that both Clinton and Gore chaired, has gone out of business. The Democrats have found a way to win presidential elections that largely bypasses the South (but not Florida), and the Republicans are dominated by a libertarian strain in the party that doesn’t have much room for blacks but also doesn’t have roots in traditional southern politics.

Still, even in the Obama administration, a moderate, pro-market, anti-regulation, less than wholeheartedly pro-union politics dominates. So does the idea that military and “security” affairs can be legitimately conducted in secret by the executive branch. This is partly a legacy of a long-standing congeries of southern views that can’t be completely understood in racial terms. Conversely, one lesson of the Obama presidency thus far is that even the immense effort the president obviously makes to take overt considerations of race out of politics—the passion and eloquence of his brief remarks about the verdict in the Trayvon Martin case gave some sense of how much he is usually suppressing—does not produce the benefits in other areas that liberals have dreamed of for many years. It has not led to the undoing of the frustrating aspects of the legacy of the New Deal, as Katznelson persuasively sets them forth.