New Deals?

FDR's New Deal provided government projects that employed thousands and thousands of unskilled laborers including my father-in-law who worked a time under a CCC project.

The Congress struggled wanting to balance the budget with extremely low revenues. [Note: Until 1942 only the richest 3% paid any income tax.]

Many of FDR's staff including Lewis Douglas, the Director of Budget from 1933-34, who hated the relief programs. He knew the programs reduced business confidence, threatened the government's future credit, and had the "destructive psychological effects of making mendicants of self-respecting American citizens."

There's an article by Jim Powell of the CATO Institute that claims the New Deal harmed poor citizens the worst. It raised billions of $ by increasing excise taxes, personal income taxes, inheritance taxes, corporate income taxes, holding company taxes, and "excess profits" taxes.

The largest piece of revenue came from excise taxes on consumer products, hitting the middle and poor citizens. Excise taxes were imposed on the like of alcohol, cigarettes, matches, chewing gum, margarine, tires, telephone, playing cards, electricity, and radios.

Until 1937, the excise taxes exceeded the revenue of individual income taxes and corporate income taxes. Since only the rich were paying significant income tax, the poor and less affluent were underwriting most of the New Deal deals.

With higher corporate taxes and the additional burden of Social Security tax, employers had less money for growth and jobs.

The National Industrial Recovery Act of 1933 cut back production and forced wages above market levels making it more expensive to hire people. Blacks alone were estimated to have lost over 500,000 jobs. The Agricultural Adjustment Act cut back farm production and devastated black tenant farmers who needed work. The National Labor Relations Act of 1935 gave unions above market wages which triggered layoffs and aided the depression of 1938.

To underwrite the work projects, the government leveled more excise taxes on the consumer who had less $ to spend on food, cars, and things that would have stimulated the economy.

FDR also banned discounting by signing the Anti-Chain Store Act of 1936 and the Retail Price Maintenance Act of 1937. Does this sound like socialism or communism to you?

Good intentions but real damage was done. Can we learn from history? What if WWII hadn't drawn us in and caused us to become producers again?

'til later