In the fall of 1966, this small-town boy from central Minnesota arrived on the campus of Dartmouth College as a “pea-green freshman”. I was the twenty-third string quarterback on the freshman football team. Professor Jeffrey Hart spent each hour of freshman English lighting and re-relighting his pipe as he strolled in front of the class, eliciting discussion of Milton’s Paradise Lost. Despite Hart’s political conservatism in an otherwise liberal environment(he was a close associate of Wm. F. Buckley), he was the perfect icon for my introduction to an Ivy League education. To be sure, I was more than a little overwhelmed.
It was then that I first heard the name of Robert Reich. Though small in stature, upperclassman Reich was the biggest man on campus. If my memory serves, Reich was a leading commentator on WDCR, the college radio station, and founder of an unofficial experimental college. Reich’s taped speech on the three slain civil rights workers in Mississippi was used by subsequent speech classes as the model, par excellence. It was clear then that big things were in store for Robert Reich.
Of course, I am speaking of the man who would later serve in the Clinton cabinet and who is currently a frequent commentator on television and in print media. Reich and Nobel-prize-winning Paul Krugman are the two leading economists who advocate for the positive and necessary role of the federal government to stimulate a stagnant economy.
Reich is currently Chancellor’s Professor of Public Policy, University of California at Berkeley. Today he posts an op-ed piece, which challenges President Obama to “Give ‘em hell” in his speech to Congress next week. He hopes the President “goes big” and advocates:
rebuilding the nation’s infrastructure, creating a new WPA and Civilian Conservation Corps, and lending money to cash-starved states and cities.
Republicans will oppose it, of course. They’ll say the stimulus didn’t work the first time (they’re wrong — it saved 3 million jobs but it was way too small given the drop in consumer spending as well as budget cuts by states and cities), and we can’t afford it (wrong again — the yield on 10-year Treasury bills is now 2 percent, meaning this is the best time to borrow. And if growth isn’t restored soon, the debt/GDP ratio will balloon beyond belief). But their real hope is to keep the economy anemic through Election Day 2012 so voters will send Obama home. [emphasis added]
The coming year that will culminate in the 2012 election will be fascinating and frightening. For eighty years, America has functioned on the basis of President Franklin D. Roosevelt’s New Deal—a controlled capitalist economy with social safety nets—that reversed the laissez-faire, “hands-off”, environment that preceded it.
By all accounts, President Herbert Hoover was a brilliant man with an exemplary record of government service prior to the collapse of an unregulated stock market in the fall of ‘29, his first year as President. As history tells us, Hoover’s laissez-faire ideology failed him and the country, and the economy continued to spiral downward into the Great Depression. The election of FDR in ‘32 and his huge, landslide reelection in ‘36 spelled the end of laissez-faire, replaced by the interventionist fiscal policies of economist John Maynard Keynes who provided the intellectual warrant for New Deal macroeconomics. The primary poster child of the New Deal was the Social Security Act, which the current poll-leading Republican presidential candidate refers to as a “Ponzi Scheme”.
For eighty years, this has been the American way, even when the federal government was in the hands of the GOP. Remember the “me-too” Republicans of the Eisenhower years, Nixon’s famous dictum, “I am now a Keynesian in economics”, and the willingness of the icon of conservative Republicanism, Ronald Reagan, to enact economic stimulus when needed.
Will all that change in 2012? For failing to pay attention to history, will we be doomed to repeat it? Will the Tea Party return America to the laissez-faire policies of Herbert Hoover? When leading Republicans flub minor details of American history, it is laughable, but when they forget the “going big” lessons of American macroeconomics, it is downright scary.
For generations, pundits joked that Democrats continued to run against Herbert Hoover though he was long retired at the will of the electorate. Perhaps it’s time to run against Hoover again.
