The New Deal

In times of a growing surplus of labor with no work something needs to be done to slow the rise of unemployment. Otherwise, what ends up happening is that capitalism undermines itself, because the necessary consumers to keep the economy chugging along do not have the necessary funds at their disposal.

That is the one thing that the New Deal truly succeeded at. It was a good investment in the public infrastructure. The market will only correct itself as long as there is not a surplus of labor.

Lowering the unemployment rate was not so much the purpose, it was to stop it from continuing to rise. Just because it was only lowered the unemployment rate by a few percentage points does not mean that it wasn't effective. Reversing the trend of rising unemployment in itself was a major achievement at the time. The fact that it lowered unemployment was only a testament to its overall effectiveness.

Franklin D. Roosevelt received much criticism for implementing a more active role of the governments assistance in private enterprise back in the nineteen thirties. The New deal was thought of by others as a form of Fascism, socialism or regimentation. In his fireside chats, he defended his program as a means to rebuild a broken economy and ease the strains of unemployment which at the time, was about twenty five percent. Was it a good idea? My relatives who lived back in those days were in favor of it and held FDR. in high regard. Today, unemployment is high, but not as bad as it was then. Still, it seems that government is leaning towards assisting private enterprise. Are we heading for a new type of a New Deal, or is it practical in todays economic climate?