Published online by Cambridge University Press: 14 October 2011
Particularly in the past decade or so, New Deal scholarship has taken a new turn, and the period after the mid-1950s has received substantial scrutiny and significant rethinking. Standard accounts of Franklin D. Roosevelt's presidency have long held that the New Deal was essentially a product of Roosevelt's first term, of the “First New Deal” of 1933 and the “Second New Deal” of 1935. Legislative stalemate, program consolidation and sometimes reduction, and attention to foreign and military affairs then marked the remainder of Roosevelt's presidency. A new and interdisciplinary literature, however, has demonstrated that the later New Deal of FDR's second and third terms was more distinctive and more important than the established view suggests. There has developed an understanding that from 1937 on the New Deal entered an important new phase, a third stage—that there was a “Third New Deal” crucial to understanding the New Deal and the direction of liberal policy and the American state.
1. In a large literature, see Leuchtenburg, William E., Franklin D. Roosevelt and the New Deal, 1932–1940 (New York, 1963), esp. 231–74Google Scholar; Burns, James MacGregor, Roosevelt: The Lion and the Fox (New York, 1956), esp. 291–380Google Scholar; Conkin, Paul K., FDR and the Origins of the Welfare State (New York, 1967), 82–106Google Scholar; Bernstein, Barton J., “The New Deal: The Conservative Achievements of Liberal Reform,” in Bernstein, , ed., Towards a New Past (New York, 1968), 277Google Scholar; Polenberg, Richard, “The Decline of the New Deal, 1937–1940,” in Braeman, John et al. , eds., The New Deal: The National Level (Columbus, Ohio, 1975), 246–66Google Scholar, and David Brody, “The New Deal and World War II,” in ibid., 267–309. Reflecting the standard view, Davis, Kenneth S., in his recent full-scale examination of Roosevelt's second term, FDR: Into the Storm, 1937–1940 (New York, 1993)Google Scholar, begins with a section entitled “The End of the New Deal.”
2. For statements of the First and Second New Deal framework, see especially Rauch, Basil, The History of the New Deal, 1933–1938 (New York, 1944)Google Scholar, passim, and Schlesinger, Arthur M. Jr., The Coming of the New Deal (Boston, 1959), 179–94Google Scholar, and The Politics of Upheaval (Boston, 1960), 385–423.Google Scholar
3. For analyses of the First and Second New Deal framework, see: Graham, Otis L. Jr., “Historians and the New Deals,” Social Studies 54 (April 1963): 133–40CrossRefGoogle Scholar; Leuchtenburg, FDR and the New Deal, esp. 162–65; Wilson, William H., “The Two New Deals: A Valid Concept?” The Historian 28 (February 1966): 268–88CrossRefGoogle Scholar; Badger, Anthony J., The New Deal: The Depression Years, 1933–1940 (New York, 1989), esp. 94–100.CrossRefGoogle Scholar
4. In addition to literature cited in this essay, see the 1989 issue of Storia Nordamericana (vol. 6, nos. 1–2) devoted to ten essays on “The United States in the Late Thirties.” For a guide to the literature down to 1989, see David E. Kyvig, “The Historiography of the Late New Deal,” in ibid., 5–16; for one summary of accounts of the late New Deal, see Maurizio Vaudagna, “Recent Perspectives on the Late Thirties in the United States,” in ibid., 161–90. The most recent major study of the late New Deal and its significance is Brinkley, Alan, The End of Reform: New Deal Liberalism in Recession and War (New York, 1995).Google Scholar
5. See Graham, Otis L. Jr., “Franklin Roosevelt and the Intended New Deal,” in Beschloss, Michael R. and Cronin, Thomas E., eds., Essays in Honor of James MacGregor Burns (Englewood Cliffs, N.J., 1989), esp. 85–86Google Scholar and n. 21; Graham, Otis L. Jr., “The New Deal,” in Graham, Otis L. Jr., and Wander, Meghan Robinson, eds., Franklin D. Roosevelt: His Life and Times, An Encyclopedic View (Boston, 1985), 286Google Scholar, 289; Karl, Barry D., The Uneasy State: The United States from 1915 to 1945 (Chicago, 1983), esp. 155–81Google Scholar. Paul Conkin had in 1967 suggested that “the Court issue in 1937 and moves toward constitutional changes to effect a more directly responsive democracy could easily be identified as at least an attempt to achieve a third New Deal,” but he did not develop the argument or the framework; see Conkin, FDR and the Origins of the Welfare State, 23.
6. Polenberg, Richard, Reorganizing Roosevelt's Government: The Controversy over Executive Reorganization, 1936–1939 (Cambridge, Mass., 1966)CrossRefGoogle Scholar; Karl, Barry D., Executive Reorganisation and Reform in the New Deal (Cambridge, Mass., 1963).Google Scholar
7. As will be discussed below, Karl also identified the “Third New Deal” as the institutionalization of a struggle between a centralizing (often liberal) executive branch with a national program and a locally oriented and conservative legislative branch.
8. Karl, Uneasy State, 157.
9. In addition to their works cited above, see also Karl, Barry D., “Constitution and Central Planning: The Third New Deal Revisited,” The Supreme Court Review, 1988 (Chicago, 1989), 163–201Google Scholar, and Graham, Otis L. Jr., Toward a Planned Society: From Roosevelt to Nixon (New York, 1976), 1–68Google Scholar. And see Arnold, Peri E., Making the Managerial Presidency: Comprehensive Reorganization Planning, 1905–1980 (Princeton, 1986), esp. 81–117.Google Scholar
10. See Karl, Uneasy State, 142–54, and Karl, “Third New Deal Revisited,” 192–98.
11. Graham, “Intended New Deal,” 85–86.
12. Milkis, Sidney M., The President and the Parties: The Transformation of the American Party System since the New Deal (New York, 1993)Google Scholar. Milkis's larger purpose is to connect the Third New Deal and the rise of the administrative state and presidential power to the decline of parties and the traditional party system in modern American politics and government. His book was prefigured by a series of important essays, in particular: Milkis, Sidney M., “New Deal Party Politics, Administrative Reform, and the Transformation of the American Constitution,” in Eden, Robert, ed., The New Deal and Its Legacy: Critique and Reappraisal (New York, 1989), 123–54Google Scholar; Milkis, Sidney M., “The New Deal, Administrative Reform, and the Transcendence of Partisan Politics,” Administration & Society 18 (February 1987): 433–72CrossRefGoogle Scholar; Milkis, Sidney M., “Franklin D. Roosevelt and the Transcendence of Partisan Politics, Political Science Quarterly 100 (Fall 1985): 479–504CrossRefGoogle Scholar; Milkis, Sidney M., “Presidents and Party Purges: With Special Emphasis on the Lessons of 1938,” in Harmel, Robert, ed., Presidents and Their Parties: Leadership or Neglect? (New York, 1984), 151–75Google Scholar. Quotes are from President and the Parties, 102 and 47, and “New Deal Party Politics,” 139.
13. Graham, Otis L. Jr., “Comment,” in Graham, , ed., Soviet-American Dialogue on the New Deal (Columbia, Mo., 1989), 288.Google Scholar
14. Ellis W. Hawley, “The New Deal State and the Anti-Bureaucratic Tradition,” in Eden, ed., The New Deal and Its Legacy, 83. Milkis also does not view FDR as wanting to go so far toward a “European-style state bureaucratic apparatus” as does Karl; see Milkis, President and the Parties, 101–4, 129. More generally on FDR and his approach, see Burns, The Lion and the Fox; Leuchtenburg, FDR and the New Deal; Badger, The New Deal; Freidel, Frank, Franklin D. Roosevelt: A Rendezvous with Destiny (Boston, 1990).Google Scholar
15. See Graham, “Intended New Deal,” 85: “But the heart of the real New Deal in the mind of this president, who was now a veteran of four years of struggle, was not economic but governmental reform. … He was shifting the reform focus from substance toward process.”
16. See Milkis, President and the Parties, 132: “…administrative reform was not conceived as a program to strengthen the presidency for its own sake. Rather the modern presidency that emerged from the executive Reorganization Act was created to chart the course for and direct the voyage to a more liberal America.”
17. Roosevelt's much-noted 1932 campaign address at San Francisco's Commonwealth Club helps to understand the issues of means and ends and of continuities in the New Deal. Suggesting that the era of growth and expansion of the American economy had come to an end, FDR declared that the time had arrived for “enlightened administration,” of “…administering resources and plants already in hand …, of adjusting production to consumption, of distributing wealth and products more equitably ….” Clearly those words support the view that beginning with the NRA the New Deal sought to achieve an administrative state with powers of planning and control to manage and bring balance and equity to a substantially fully-developed economy.
But in 1932 and subsequently, Roosevelt seemed committed more to the ends of jobs, security, and equity than to any particular means or role of government. At the Commonwealth Club, indeed, he said that government should assume the functions of economic regulation only as a last resort. As Robert Eden and Sidney Milkis have suggested, moreover, the Commonwealth Club speech can be read also as a statement of Roosevelt's enduring aim that the government work toward “the development of an economic declaration of rights” encompassing especially the rights of everyone “to make a comfortable living” and “to be assured, to the fullest extent attainable, in the safety of his savings.” That concern about jobs, security, and adequate living standards was perhaps the most consistent aspect of Roosevelt's presidency from 1933 to 1945 and was at the heart of FDR's final campaign address of 1944 embracing the postwar Keynesian program and calling for a new “Economic Bill of Rights” and a full-employment economy with abundance and security for all. For the Commonwealth Club speech, see The Public Papers and Addresses of Franklin D. Roosevelt, vol. 1, 1928–32 (New York, 1938), 742–56Google Scholar. For the most extensive recent analysis, see Eden, Robert, “On the Origins of the Regime of Pragmatic Liberalism: John Dewey, Adolf A. Berle, and FDR's Commonwealth Club Address of 1932,” Studies in American Political Development 7 (Spring 1993): 74–150CrossRefGoogle Scholar. See also Milkis, esp. President and the Parties, 8–9, 39–43, 48, 129–32, and “New Deal Party Politics.”
18. Savage, Sean J., Roosevelt: The Party Leader, 1932–1945 (Lexington, Ky., 1991)Google Scholar. It should be emphasized that Milkis's argument is a nuanced and complex one that acknowledges FDR's efforts both to reshape and to work through the Democratic party.
19. Karl, Uneasy State, 167; Graham, “Intended New Deal.” Milkis (with other scholars) gives Roosevelt significant credit for enhancing the power of the presidency and the administrative state; but as noted he also does tiot believe that FDR sought as great an expansion of administrative and managerial power as Karl suggests. In any event, while the combination of New Deal programs, the 1939 Executive Reorganization Act, and FDR's conduct of the presidency surely did substantially increase the managerial scope and power of the presidency, the administrative state envisioned in the original Executive Reorganization Bill of 1937 did not materialize.
20. For a succinct summary of the possible directions of New Deal economic policy in FDR's second term, see Baskerville, Stephen W., “Post–New Deal Economic Thought, Government and Society, 1937–1941, Storia Nordamericana 6, nos. 1–2 (1989): 57–68Google Scholar; for a sharply focused account of the planning-spending options by the late 1930s, see Brinkley, Alan, “The New Deal and the Idea of the State,” in Fraser, Steve and Gerstle, Gary, eds., The Rise and Fall of the New Deal Order, 1930–1980 (Princeton, 1989), 85–121Google Scholar; for what remains the most thorough analysis of New Deal economic policy in the 1930s, see Hawley, Ellis W., The New Deal and the Problem of Monopoly (Princeton, 1966).CrossRefGoogle Scholar
21. The variant of planning urged in the late New Deal debates on economic policy focused especially on economic reform and antitrust and/or regulatory policy rather than on the administrative reforms to enhance executive capacity developed by the Brownlow Committee and proposed in the 1937 Executive Reorganization Bill. But both versions of a more powerful managerial state included administrative and economic dimensions.
22. See Schlesinger, Politics of Upheaval, 399–400.
23. Amos Pinchot identified a third New Deal in a letter to Roosevelt, 17 May 1938, PPF 1677, FDR Library, as reported in Baskerville, Stephen W., “Cutting Loose from Prejudice: Economists and the Great Depression,” in Baskerville, and Willett, Ralph, eds., Nothing Else to Fear: New Perspectives on America in the Thirties (Manchester, England, 1985), 278–79Google Scholar; Kenneth Crawford used the term “new New Deal” in “From Pump-Priming to Pumping,” Nation, 27 May 1939, 607.
24. Arthur M. Schlesinger Jr. holds that the “Second New Deal was not fully defined until the battle over spending in 1937–38.” See Schlesinger, Politics of Upheaval, 398ff. Similarly, Alonzo Hamby finds the Second New Deal emphasis on fiscal policy and antitrust regulation at the heart of liberal policy during World War II. See Hamby, Alonzo L., “Sixty Million Jobs and the People's Revolution: The Liberals, the New Deal, and World War II,” The Historian 30 (August 1968): 578–98.CrossRefGoogle Scholar
25. May, Dean L., From New Deal to New Economics: The American Liberal Response to the Recession of 1937 (New York, 1981).Google Scholar
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27. Such overlap involved both analysis and prescription. The important “stagnationist” version of the compensatory state in the later New Deal, for example, was predicated on much the same understanding of a mature economy adumbrated in FDR's 1932 Commonwealth Club address and connected then and afterward to structural reform and the managerial state. Executive planning and coordination, moreover, were (in different ways) important to policymaking for both planners and spenders. As Richard Adelstein has noted, the managerial state was during World War Illinked to Keynesian policy. (Adelstein, Richard P., “‘The Nation as an Economic Unit’: Keynes, Roosevelt, and the Managerial Idea,” Journal of American History 78 [June 1991]: 160–87.)CrossRefGoogle Scholar
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30. Currie to Roosevelt, 3/18/40, Official File 264, Franklin D. Roosevelt Library.
31. See, e.g., Milkis, President and the Parties, 129–32.
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34. See, for example, the different views of Katznelson and Pietrykowski, “Rebuilding the American State,” and Brown, “State Capacity and Political Choice,” and the exchange between them in Studies in American Political Development 9 (Spring 1995): 213–28.CrossRefGoogle Scholar
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37. Jordan Schwarz's identification of the “New Dealers” as those who wanted the government to help develop and expand the American economy by means of “state capitalism” seems broadly consistent with this analysis. In Schwarz's terms, “state capitalism” as “public investment”—as “massive governmental recapitalization for purposes of economic development”— was more central to the New Deal and especially the later New Deal than state capitalism as “state cartelism, government organization of industries in order to build a threshold under prices.” The Keynesian compensatory state was closer in aims and means with the growth-oriented state capitalism of public investment than with the administrative state capitalism of managed and non-growth-oriented cartelism. See Schwarz, Jordan A., The New Dealers: Power Politics in the Age of Roosevelt (New York, 1993)Google Scholar, xi and passim.
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62. Jeffries, “‘New’ New Deal,” 398, 416–17.
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