Mises Wire

Bursting the Bubble that Was FDR

FDR Hope Memorial

[FDR: A New Political Life by David T. Beito, Chicago: Open Universe, 2025, 283 pp.]

The president pushed for policies that would confound trade abroad and create economic havoc on the home front. Surrounding himself with inflationists, protectionists, and economic interventionists, the president forced up the costs of production of nearly everything all the while claiming he was saving the economy.

On the legal and political front, he governed by executive order, operating on the assumption that the president should not be challenged. He bullied members of the US Supreme Court and Congress, and as criticism mounted in the media, he threatened the licenses of broadcasters and threatened to shut down newspapers and jail the editors and publishers.

His foreign policies were reckless and often head scratching. He favored a Russian dictator and did everything he could to cover up atrocities that his counterpart committed.

Lest one think I am writing about Donald Trump, think again. The man in question is the president most admired by academic historians and in modern media—Franklin Delano Roosevelt, the president who is still the standard-bearer for the Democratic Party.

Historian David Beito—who has chronicled the 1930s and written about the complexities of the Civil Rights Era—has written what might be his finest piece of work yet, FDR: A Political Life. If the reader expects to find the same kind of hagiographic portrayal of Roosevelt that a Doris Kearns Goodwin or a columnist in the New York Times would write is reading the wrong book. Beito lays waste not only to the more than 12 years of the FDR presidency, but also his earlier years that shaped the man who would attack the US Constitution and the rule of law in a way not seen since the years of Abraham Lincoln.

From his earliest political days when he helped to expand Jim Crow policies in the federal government to the New Deal, which put the “Great” in the Great Depression, to his role in rounding up loyal Japanese Americans and throwing them into what even he admitted were concentration camps, to his mismanagement of the US war effort in World War II, FDR left vast wreckage wherever he went. Lest one believe Beito is exaggerating, he has the receipts.

Judging from the opening section of this review, one might be tempted to think that Beito has written a “hit piece” on Roosevelt, and I suspect that this book—if it is reviewed at all outside of the conservative/libertarian publications—will be treated as a damnable heresy. As Joshua Mawhorter recently wrote, American historians and journalists went along with the political narrative that Herbert Hoover caused the Great Depression by not intervening into the economy after the October 1929 stock market crash. They hardly are going to be willing to accept anything that challenges their narrative.

Moreover, FDR is routinely cited by historians as America’s “greatest” president, and—while historians admit some “flaws” in his presidency—nonetheless, they are glossed over as mere controversies. However, as Beito demonstrates throughout this book, the standard narrative of FDR as the man who led this country out of the Great Depression and skillfully navigated a path to victory in World War II is romantic at best and utterly dishonest at worst. What’s more, Beito outrightly calls it a “failed presidency,” which certainly will not get him a favorable review in The New York Times.

FDR and the New Deal

When Roosevelt moved into the White House in March 1933, the nation’s unemployment rate stood at more than 25 percent. The nation was ready for the president to address the crisis, and FDR, who had promised a “New Deal for the American people,” moved ahead with his plan.

Unlike most historians, Beito chronicles a number of economic interventions from the Herbert Hoover administration, contradicting the standard narrative that Hoover refused to intervene because of his heartfelt belief in the power of free markets. He also points out that FDR’s views on trade were much like Hoover’s, which is significant given Hoover’s signing of the ruinous Smoot-Hawley Tariff of 1930.

While historians are mixed on the question about the economic effectiveness of the New Deal programs, Beito is unequivocal in his view that FDR’s “alphabet soup” approach of empowering the federal government prolonged the Great Depression. First, as he points out, the centerpieces of the First New Deal were the National Recovery Act (NRA) and the Agricultural Adjustment Act (AAA), both of which sought to cartelize most of the US economy and to decrease overall production of goods and foodstuffs, not increase them, which would have been necessary for a robust recovery to occur.

While the National Recovery Administration managed to receive favorable publicity bordering on propaganda, its mission was economic destruction, as the thousands of industry codes pushed up wages beyond market levels and used outright coercion to intimidate producers into not producing anything. He quotes John T. Flynn, who wrote about,

Flying squadrons of those private (code enforcement) coat-and-suit police went through the (New York Garment) district at night, battering down doors with axes looking for men who were committing the crime of sewing a pair of pants at night.

Unfortunately, FDR did not only damage the economy at home by ending the gold standard and creating business cartels enforced by government fiat, but he also did major damage abroad by sabotaging the 1933 London Economic Conference, which was an attempt to regenerate the world trading system. Roosevelt remained committed to policies meant to force up consumer and producer prices, which only exacerbated the unemployment problem, which is why the nation’s rate of unemployment remained in double digits until 1941.

If there was an international model for the New Deal to follow, it was Benito Mussolini’s Italian Fascism. Calling Mussolini “that admirable Italian gentleman,” Roosevelt and his economic advisers sought to emulate Fascist policies even if they did not abandon democracy, as Italy and other nations had done. (Roosevelt’s enthusiasm for Mussolini, however, would diminish greatly after Italy’s 1935 invasion of Ethiopia and his later alliances with Adolph Hitler’s Germany).

After the US Supreme Court struck down the NRA and AAA, Roosevelt first sought to “pack” the Supreme Court in an attempt to push the court’s majority into giving the New Deal favorable treatment. (It is significant that court packing again is on the agenda of the Democratic Party.) While court packing turned out to be politically radioactive, nonetheless, FDR was able to bully the high Court to look favorably on his Second New Deal initiatives, including vigorous anti-trust legislation and an attempt to force as much of the US workforce as possible into labor unions that would become enmeshed with the Democratic Party.

Roosevelt also launched the Works Progress Administration (WPA), which became a huge patronage tool for the Democrats, as the president turned it into a vote-buying scheme, complete with at least some WPA workers having to contribute money to the Democratic Party just to have jobs. Ultimately, it would be the WPA that FDR would use to build the concentration camps where the government herded people of Japanese descent living on the West Coast.

None of these “alphabet soup” measures brought significant recovery, and, in fact, FDR managed to have a “depression within a depression” as the economy tanked in 1937 and, by 1938, unemployment was close to 20 percent. In fact, despite what academic historians might claim, the failure of the New Deal was not that the government spending necessary to create and maintain the programs was “too little,” but rather that the combination of government spending, regulation, and Roosevelt’s unrelenting hostile attacks on business owners (whom he called “economic royalists”) created what economist Robert Higgs has called “regime uncertainty” that greatly reduced business investment during that decade.

Most historians portray FDR as someone as having to deal with an economy mostly outside his control, a calamity not his making that would not respond to his legitimate attempts to mitigate the damage. The reality is that Roosevelt’s policies took the bad situation he inherited and then blocked the economic recovery that invariably would have come had he allowed free markets to prevail.

FDR’s Attacks on Free Speech, Jews, and Blacks

As noted earlier in this article, FDR ensured that broadcast journalists would serve as mouthpieces for his administration by threatening their Federal Communications Commission licenses. Newspapers, however, were not bound by such regulations and had the First Amendment on their side.

Roosevelt, however, didn’t care about the US Constitution or civil liberties, especially when going after his political enemies, and he had lots of them among newspaper editors and publishers. Long before Richard Nixon brought shame to his presidency by using the Internal Revenue Service as a political weapon, FDR wrote the instruction book.

His worst attack on civil liberties, however, came through the investigations headed by Sen. Hugo Black of Alabama, who had been a member of the Ku Klux Klan, which illegally combed through thousands of private telegrams sent and received by people opposing Roosevelt. While FDR could not control the press as well as he would have hoped, nonetheless, he was able to intimidate and bully his opposition—and get away with breaking the law. After his assault on the law, Black was rewarded by being appointed to the US Supreme Court, thus shedding his white Klan robe for the black robe of “justice.”

While some historians have tried to rehabilitate Roosevelt, claiming that accusations of his being a racist and antisemite are exaggerated, his administration on many occasions demonstrated outright hostility toward both black Americans and Jews. Regarding the Jews, his actions at both denying US entry to Jews trying to flee Europe and his indifference to the slaughter of Jews by Nazi Germany helped to enable the Holocaust.

American blacks fared little better. First, FDR made no attempt to include blacks in New Deal projects such as the WPA, and, by pushing the expansion of labor unions, he knew that racist unions would make sure that blacks could not find work, since many of them did not permit black workers in their trades. When World War II broke out, he did nothing to stop the US Armed Forces from treating black soldiers shamefully, forcing them to live in segregated ramshackle barracks and feeding them food inferior to that served to white servicemen.

FDR and World War II

As Beito notes, Roosevelt claimed to “hate war” while at the same time trying to maneuver the US into the conflict. Once the US was in, whatever organized opposition there was to US entry melted away. Unfortunately, Roosevelt did what he could to prolong the war and to create as much internal damage as possible.

Beito points out that FDR tried to use war policy as a tool for social engineering. Moreover, his administration pursued a regime of price controls and other strict regulatory measures that guaranteed a robust black market both in coupons used to purchase goods and in the regulated goods themselves.

Throughout the war, Roosevelt showed a striking indifference to the fate of Jews in Hitler’s Europe, despite the many credible reports of the daily massacres of Jews and other Nazi “undesirables.” Late in the war, he encouraged the bombings of German cities that were not known for being war materiel production centers with the sole purpose being the killing of as many civilians as possible. The savage bombing of Dresden in February 1945 was the culmination of this ruthless and deadly policy.

Perhaps the worst thing FDR did to prolong the war was to insist that Germany, Japan, and Italy accept terms of unconditional surrender, which guaranteed that the Axis belligerents would be more likely to fight to the bitter end, knowing that their conquerors would likely be ruthless in victory. His insistence on unconditional surrender delayed the Italian surrender with the upshot being that the Germans were able to better fortify their defensive positions, thus making the fighting on Italian soil to be worse than it would have been otherwise.

(The irony about the Japanese surrender in late summer of 1945 was that Japan would have been willing to surrender sooner as long as the nation could retain its emperor, something the US steadfastly refused to accept. In the end, the Japanese were permitted to keep their emperor anyway, but had FDR not been so adamant about unconditional surrender, hundreds of thousands of lives could have been saved. While Roosevelt already was dead during the last of the fighting against Japan, President Harry Truman was simply continuing the policies FDR implemented.)

Roosevelt also endorsed Treasury Secretary Henry Morganthau’s scheme to turn postwar Germany into a land of tiny subsistence farms with no manufacturing capability. When word of the infamous Morganthau Plan reached Germany, it stiffened German resolve to fight, thus undermining the attempts by German insiders to depose Hitler and surrender to the Allies. The president would later abandon that plan, but not before it resulted in hundreds of thousands of unnecessary deaths.

Roosevelt did manage to please one person with his demands, Josef Stalin, whom FDR lovingly called “Uncle Joe.” No administration did more to try to prop up and rehabilitate the Soviet Union at a time when it was the most murderous regime in world history. He also allowed his own administration to be infiltrated by Soviet spies and informants, and it was FDR who signed off on Stalin’s enslavement of Eastern Europe, a tragedy that was not undone until 1989.

Conclusion

In calling the Roosevelt administration a “failed presidency,” Beito is not being casual with his judgment. On the economic front, Roosevelt sabotaged any opportunity of a meaningful recovery and institutionalized the American welfare and regulatory states. The man who swore to “protect and defend” the US Constitution eviscerated the Bill of Rights and unjustly herded innocent people into concentration camps and refused to free them even when it was clear that Japanese Americans had already proven themselves to be loyal to the US war effort.

What about the claim that Roosevelt was a “great leader” who was forced to deal with unfortunate circumstances that were thrust upon him and this nation. While it is true that, when FDR took office, unemployment was at historically high levels, instead of allowing the US economy to recover from the Hoover calamities, Roosevelt chose to intervene even further, with predictable results. Instead of putting out the fire, FDR threw gasoline on it.

As a war leader, he extended the conflict both in Europe and Japan by insisting on unconditional surrender, with the resulting carnage being utterly predictable. While historians might concentrate on his reassuring “fireside chats” over the airwaves, they fail to hold him to the same standards that they would have held other presidents. Yes, both historians and media figures are quick to emphasize rhetoric while they should be looking at results. Beito concludes:

Describing Roosevelt as a failed president does not imply that he lacked talents in the arts of politics and persuasion. To the contrary. By those standards, FDR often excelled as an “effective” chief executive. The basis of failure ran deeper than that. It can best be assessed by studying the consequences of his actions. FDR was a failed president primarily because he put his considerable abilities at the service of far less laudable goals including a ruthless preoccupation with personal and political advancement, self-defeating economic policies, and the erection of a vast and unaccountable centralized federal bureaucracy.

image/svg+xml
Image Source: Adobe Stock
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
What is the Mises Institute?

The Mises Institute is a non-profit organization that exists to promote teaching and research in the Austrian School of economics, individual freedom, honest history, and international peace, in the tradition of Ludwig von Mises and Murray N. Rothbard. 

Non-political, non-partisan, and non-PC, we advocate a radical shift in the intellectual climate, away from statism and toward a private property order. We believe that our foundational ideas are of permanent value, and oppose all efforts at compromise, sellout, and amalgamation of these ideas with fashionable political, cultural, and social doctrines inimical to their spirit.

Become a Member
Mises Institute