Vote is referendum on the New Deal

November 2, 2012


We have been told throughout this presidential campaign that the contest is a referendum about two visions of government, one activist, the other passive ‑ like every presidential election since 1980. But that may actually understate the stakes. In a larger context, it is a choice between maintaining the last 80 years of American governance or abruptly ending it.

In fact, this election is really about whether the New Deal and its descendant, the Great Society, will survive or whether they will be dismantled. And that is historic.

What does dismantling the New Deal and Great Society mean? It means converting Medicare from guaranteed medical insurance to a possible privately run system of health procurement. It means Medicaid could be capped, which could strip millions of children of their healthcare. It means scaling back financial regulation. It means poverty programs, like food stamps, may be cut dramatically. It means the Davis-Bacon Act, insuring that workers on government projects receive the prevailing wage, could be revoked. It means the end of subsidies for public transportation, the National Endowment for the Humanities and, of course, the Public Broadcasting System. It even means slashing disaster relief.

All these cuts, and so many more, are enumerated in the Ryan budget. More, they are a systematic program to gut government action – action that has accreted for decades to meet public needs.

This would constitute a gigantic reversal, even in Republicanism. It may be hard to believe, given today’s rancorous political climate, that Republicans never really challenged President Franklin D. Roosevelt’s program to revive the country during the Great Depression. The Social Security Act passed the House of Representatives with 81 Republicans voting yes and only 15 voting no, and the Senate with 16 Republican yeses and only 5 nos. Similarly, despite grumblings from Wall Street, the Securities Exchange Act of 1934 that regulated the financial industry received wide Republican support. The Civilian Conservation Corps, which put the unemployed to work on conservation projects, passed Congress by a voice vote. Even the National Labor Relations Act protecting union rights passed the House by a voice vote and the Senate with just 12 dissenters.

There were, of course, conservatives in the Republican Party, like Senator Robert Taft of Ohio, who hated the New Deal and became increasingly emboldened to take it on after Roosevelt died.

But even then, most Republicans had come to an understanding about the role of government. New Deal initiatives like Social Security, unemployment insurance and financial regulation had become part of the American fabric. When 1952 Republican nominee Dwight D. Eisenhower assumed the presidency after 20 years of Democratic rule, he fully embraced Roosevelt’s programs ‑ so much so that political scientists refer to the 1950s and early 1960s as the era of the “American consensus” or the “liberal consensus.” Republicans and Democrats both accepted the need for government intervention to provide for the social welfare.

When Senator Barry Goldwater ran for president in 1964, explicitly attacking the consensus and threatening to end New Deal programs, he was soundly defeated. A year later, as if to underscore the rebuff, House and Senate Republicans divided evenly on Medicare – the program so many in the party had vilified as “socialized” medicine.

President Richard M. Nixon, a rhetorical conservative if ever there were one, actually expanded the spirit of the consensus. He called for national healthcare and a guaranteed family income, and encouraged laws that set up the Environmental Protection Agency and the Occupational Health and Safety Administration, which oversees workplace regulations. Even President Ronald Reagan, who railed against government with the best of them, advocated a social safety net and didn’t dare touch Medicare or Social Security. He honored what remained of the consensus, which meant honoring FDR’s legacy. This was still FDR’s country.

The Republican Party has come a long way since then. Over the past 30 years the great dream of Republicanism, fed by Goldwater’s wellspring, has been to destroy the New Deal once and for all – to rid the nation of Roosevelt’s programs and return to the laissez-faire policies of the 1920s.

This dream was so fervent that President George W. Bush in 2004 did something none of his predecessors would have tried: He declared that his electoral mandate enabled him to privatize Social Security. Bush failed spectacularly. There is a reason that Social Security and Medicare are called the “third rail” of American politics. Some things you just don’t touch.

At least you didn’t eight years ago. But this election is different. In the 1980s, Reagan’s budget director, David Stockman, admitted, indiscreetly, that the basic reason for tax cutting was to starve government. In effect, Stockman was saying that Reagan was operating a government shell game: Tell folks that you want to stimulate the economy by cutting taxes when what you really want to do is take a meat ax to government.

Times have changed, and Republicans today don’t have to resort to subterfuge when it comes to slashing programs. But when it comes to the basics of the New Deal and the Great Society, they promote the same sort of game ‑ only this time the shell is the allegedly dire threat of the deficit. (By the way, conservatives said the same thing about the deficits that the New Deal racked up, that they would ruin the country.)

GOP vice presidential nominee Paul Ryan’s budget, which virtually every Republican has signed onto, is even more indiscreet than Stockman. There is no gainsaying that the basic purpose of the budget is to dismantle New Deal and Great Society programs that assist the poor and gradually remove the juice from the third rail by privatizing Social Security and essentially voucherizing Medicare. To save the country from the flood of debt, they must save us from FDR and LBJ.

We have heard these anti-government screeds before, especially since the rise of the Tea Party movement. But they are no longer just verbal sallies. They are now the stated policy of the Republican Party and its presidential candidate.

When Republican presidential nominee Mitt Romney says deficits are unsustainable, Social Security and Medicare must be changed, regulations prevent economic growth and government programs must be extirpated, he is really saying he is going to turn back the clock to the days before FDR. Given that the Supreme Court this term could overturn affirmative action in higher public education and perhaps find the Voting Rights Act unconstitutional, the next four years could easily undo the last 80.

So make no mistake: Whether you love Roosevelt or hate him, this election is a referendum on him. That is the choice.

President Barack Obama will continue the consensus, or what remains of it. Romney has promised to end the consensus.

Whoever wins, the election has historic implications.

PHOTO: Franklin D. Roosevelt campaigning at Soldier’s Field in Chicago, October 28, 1944.    REUTERS/FDR Library



We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see

An absolutely outstanding article on the underlying issues in this campaign!

This nation is indeed at a fork in the road that will change her destiny forever.

If we believe the neocons, it WILL result in disaster for this nation. They have been steadily gaining power since the massive mistake of Reagan, and now we are about to reap the “rewards” of that disastrous decision.

If we choose sanity and responsibility towards the American people, we have a slight chance to survive this, but no more than that since a lot of damage has been done by these people in the last 30 years.

God help us either way!

Posted by Gordon2352 | Report as abusive

Great comment Gordon2352. I couldn’t agree with you more.

Posted by barryeod | Report as abusive

Your words make clear that “New Deal thinking” over the years has made government today what it is. They do not, however, fully describe a government that has become overly big, overly inefficient, overly unaccountable, and overly expensive.

They seem to suggest that “we, the people” could choose to just keep “doing what we’re doing”. I find that strange considering that both liberals and conservative politicians seem agreed that our government’s present fiscal trajectory is utterly unsustainable, differing only in the changes each propose to remedy the situation.

I see a problem when a “New Deal thinking” government, i.e. “kinder, gentler” government, is increasingly a “nanny state” that feeds more and more from the government teats. I see no evidence of any serious intent by either major party to reduce the SIZE of government. Merely slowing it’s GROWTH brings forth incredible protests and howls of discontentent.

Your description of Davis-Bacon is disingenuous. It no longer “insures that workers on government projects receive the prevailing wage…”. You sound blissfully unaware that Union labor “lives better” at the expense of “the rest of us”!

This predominately unionized minority of workers has a monopoly on bidding for “public works” and receives a wage substantially above that “prevailing” in society as a whole. “We, the people”, are not “at the table” nor are OUR interests even considered when Davis-Bacon wage rates are set or reviewed. That must change!

Posted by OneOfTheSheep | Report as abusive

You forgot the heart. The Republicans are not in favor of mass higher education. That has the longest term effect on America’s competitiveness and if Americans can be all can be.

In health care issue the heart is most non-infectious and non-accident sickness in long term maybe life (like diabetes, heart problems, high blood pressure, allergies, etc.). Therefore private insurance companies will avoid them by excluding preexisting conditions and tell employers to get rid of such workers to reduce premiums. Also the very sick do not work much to have it.

Posted by Samrch | Report as abusive

@ OneOfTheSheep —

The “New Deal” has NOTHING WHATSOEVER to do with the growth in US spending since WWII.

ALL of that spending is due the rise of the Military/Industrial Complex, which is the REAL problem and MUST be reduced to the minimum necessary for self-defense.

A military that has the capability of aggressive actions WILL guarantee war, which is what we have had since WWII.

Remember, President Eisenhower himself warned us of this in his final speech. He was arguably the last good Republican president we had — not that the Democrats have been any better.

He fully understood where this country was heading. But we never took the warning seriously, and we have paid the price.

Time to stop the insanity and reduce our military spending!

Posted by Gordon2352 | Report as abusive

There is another article on Reuters that has a great deal of bearing on this issue, on which I made a comment that I want to repeat below.

The name of the article is “The war over entitlements”. 12/11/02/the-war-over-entitlements/


Thank you so very much for telling the truth behind the pejorative propaganda being spread by the wealthy-controlled government.

NOTHING of what the government says about the “entitlement” programs is true.

EVERYTHING that is “wrong” with the programs is due ENTIRELY to government manipulation and criminal mismanagement — this is an accurate charge, since if a fund manager had done what the federal government has done, he would be brought up on a variety of criminal charges — of the Social Security funds.

And now, when the government CANNOT pay back the Social Security funds they have stolen — and used them as a “slush fund” to vastly overspend their normal budgetary constraints for decades — they are attempting to evade having to pay the benefits rightfully owed to those who paid in to Social Security by payroll taxes.

What NO ONE in the wealthy-controlled media will tell you is that the Supreme Court has ruled that Social Security is “property” and thus “imposes constraints on governmental decisions which deprive individuals of “liberty” or “property” interests within the meaning of the Due Process Clause of the Fifth or Fourteenth Amendment.”

(Wikipedia) “Mathews v. Eldridge, 424 U.S. 319 (1976), is a case in which the United States Supreme Court held that individuals have a statutorily granted property right in social security benefits, that the termination of those benefits implicates due process,

That means the government does NOT have the right to deprive Social Security benefits from those entitled to them.

To do so would violate the US Constitution that protects us all from “unlawful seizure” of our private property.

From Cornell Law School: storics/USSC_CR_0424_0319_ZO.html



Procedural due process imposes constraints on governmental decisions which deprive individuals of “liberty” or “property” interests within the meaning of the Due Process Clause of the Fifth or Fourteenth Amendment.

The Secretary does not contend that procedural due process is inapplicable to terminations of Social Security disability benefits.

He recognizes, as has been implicit in our prior decisions, e.g., Richardson v. Belcher, 404 U.S. 78, 80-81 (1971); Richardson v. Perales, 402 U.S. 389, 401-402 (1971); Flemming v. Nestor, 363 U.S. 603, 611 (1960), that the interest of an individual in continued receipt of these benefits is a statutorily created “property” interest protected by the Fifth Amendment. Cf. Arnett v. Kennedy, 416 U.S. 134, 166 (POWELL, J., concurring in part) (1974); Board of Regents v. Roth, 408 U.S. 564, 576-578 (1972); Bell v Burson, 402 U.S. at 539; Goldberg v. Kelly, 397 U.S. at 261-262.

Rather, the Secretary contends that the existing administrative procedures, detailed below, provide all the process [p333] that is constitutionally due before a recipient can be deprived of that interest.

This Court consistently has held that some form of hearing is required before an individual is finally deprived of a property interest.


By “recasting” them as somehow being a scam by those who do not deserve to live out their lives with a minimum safety net of income and health care, the government hopes to set the stage of public opinion to deny paying out the benefits to their rightful recipients altogether.

The real truth is the US government is BROKE, and it CANNOT pay Social Security to the baby boomers!

But that is something they also CANNOT admit for fear of public reaction.

The current strategy — and this is REALLY important — is Congress knows it cannot legally deny paying benefits to those who have already paid in to Social Security, but they CAN manipulate and “restructure” the taxes and payments going forward to the baby boomers so that it has the same net effect of seizing private property, while not seeming to do so.

So, the BIG LIE of “entitlements” is being pushed in an attempt to evade their legal responsibility to the American people.
Posted by Gordon2352 |

Posted by Gordon2352 | Report as abusive

Another article also bears on this issue and I want to include my reply to it also.

“The Consequences of Obama’s debt” 12/11/02/the-consequences-of-obamas-debt  /#comment-65632


I want you all to understand that I am NOT against Social Security reform. I DOES need to be reformed, BUT not the way the government wants to do it.

Cutting benefits and extending the time until Social Security can be collected simply pushes the problem onto our children and grandchildren to deal with.

It would create a significant “gap” between when a person can retire — or more likely needs to retire due to increasing layoffs in this economy or ill health that prevents them from working — which will only serve to exacerbate the social problems we have now.

For example, if a person is forced to retire, but has not yet attained the legal retirement age, how can they survive — especially if all the other social programs are cut, which is a high probability?

Elderly people and not so elderly people (e.g. due to losing one’s job before being able to retire) will cause massive dislocations in the US economy as people begin to lose their homes (or apartments as the case may be) and be forced onto the streets to survive as best they can.

This is NOT a worse-case scenario, but a highly probable scenario if we proceed with cutting what little safety net we have beginning next year.

That will tend to destabilize this government and create social problems of long-term unemployment with no health care at all, thereby creating a best-case scenario of Greece, for example.

That will put EVERYONE in this country at risk.

I propose:

(1) As a precondition to reform, completely remove Social Security, Medicare and Medicaid from government control. The government has been unable to prevent itself from manipulating the Social Security program since it first began in 1927.

THAT record does not bode well for the success of the government’s latest proposal to solve entitlements.

I will guarantee you that in a few years down the road we will be revisiting this problem again if we allow the government to apply its fix, PLUS we get the added bonus of a destabilized nation to deal with, which we do not have now.

(2) REMOVE THE CAP from Social Security so that it functions like the real social insurance it was meant to be. Yes, that means people like Bill Gates would have to pay their “fair share” of Social Security, even if they never need it. The wealthy class needs to recognize its primary responsibility is to THIS COUNTRY, not the global economy and their hidden hoard of wealth they refuse to share.

(3) Once the cap has been removed and the fund legally separated from government control, the real amount of adjustment in terms of taxes and benefits can be made. This CANNOT be done while it is commingled with the general fund.

My guess is that Social Security would immediately produce a surplus IN YEAR ONE after these changes are made. Yes, it has produced surpluses in the past, but those have been destroyed by government meddling.


As a bonus to the American people, once the “red herring” of entitlements is removed, we can then readily identify the REAL excess spending in the government budget.

I think that will be the enormous spending on the Military/Industrial Complex, which is the REAL reason why the government wants to use “entitlements” to confuse the issue of their profligate military spending.
Posted by Gordon2352

Posted by Gordon2352 | Report as abusive

I think you’re all putting far to much importance on current national political rhetoric. Also seems a bit of a conspiracy theory.
Governments change continuously. Generally lagging behind the private sector. It wasn’t as noticeable in the past, but now that we have three and four generations all participating in politics at once, a significantly larger and more diverse population, and a spiffy new global economy with instructions printed in twenty languages, I think we might see changes that to some, particularly the older, are seen as such drastic changes to their “norm” that they believe their own neighbors and the infamous “they” are truly traitors bent on destroying all good things in their narrow view of the world.

Posted by tmc | Report as abusive

As usual, liberals miss the most important facts in the discussion. And those facts are that these massive government programs will, eventually, bankrupt the nation. The Soviet Union’s economy was “just fine” for a few decades…then it lagged for a few decades…and eventually it collapsed in epic-fail fashion. Just because these socialize programs haven’t gone bankrupt yet doesn’t mean they won’t. In a few decades, our social “obligations”, like SS, medicare etc, will cost the federal government more than it brings in via taxes. Additionally, sometime between now and then borrowing money will be more expensive than it is now, causing our interest costs (aka “debt servicing”) will explode. Those two things combined will annihilate the federal budget. There won’t be any money left for courts, the military, federal LEOs, sending kids to college or anything else. We’ll be Greece….but a thousand times worse, because no one in the world is big enough to bail the US out. A majority of the population understands this looming debt bomb for the very real threat that it is. The democrat response to the crisis? Spend more money! Buy more votes! Pay no attention to the man behind the curtain, nothing is wrong! No worries! XP

The GOP response, which is far from radical, is to bend the cost curves down via privatization so that these programs still exist in some form or another in the future. No one under the age of 30 will get social security or medicare if we don’t…and they KNOW IT. So, the alternatives are not “maintain the status quo” vs “reform the system”. The alternatives are “super-Greece” or “reform the system.”

Lastly, I do agree that this is a pivotal election, but lets not kid outselves. Congress is full of spineless wheelers and dealers…and anyone who actually believes that Romney/Ryan could, even if they wanted to, ram bills through Congress that abolished SS and Medicare hasn’t been following DC politics for more than 5 minutes.

Posted by jekbrown | Report as abusive

So do Paul Ryan and Mitt Romney believe in the stimulus…. or oppose it? Simple question. Any republicans out there have an answer that is not seven paragraphs long?

For or against?

Posted by AlkalineState | Report as abusive

Hello? Crickets? Good luck tomorrow with all that :)

Posted by AlkalineState | Report as abusive

@AlkalineState: I’m neither Republican nor Democrat, but my answer about stimulus (and I think an answer both Republicans and Democrats might support) is this: it depends on the situation, and it depends on how/where you are going to spend the “stimulus” money.

#1. If you are in a deep CYCLICAL recession, Keynesian stimulus is exactly what you need. This works best if you’ve been making hay while the Sun shone brightest on the American economy in years past (something Gingrich & Clinton did, but Bush II did not).

#2. If you are in a deep DEFICIT/DEBT/CONFIDENCE crisis, Keynesian deficit-stimulus isn’t going to work — it will only make matters worse.

We have tried multiple rounds of stimulus, and it isn’t working. It’s becoming increasingly clear that we’re experiencing #1, not #2. The Federal Reserve is now talking about throwing caution to the wind (perhaps wise in monetary terms, when governed by strict principles matching the money supply to the supply of real goods; but when matched with political patronage in Congress and the White House, such policies are bound to end in disaster). We’d better change course…

Posted by matthewslyman | Report as abusive

CORRECTION: PREVIOUS COMMENT SHOULD READ: “It’s becoming increasingly clear that we’re experiencing #2, not #1.” Got the numbers mixed up… (Someone in Congress & The White House must have done the same thing…)

Posted by matthewslyman | Report as abusive

More evidence/ second supporting opinion for what I have stated above: 12/11/02/the-unequal-reality-of-fridays- jobs-report/#comment-65972
— “…There is zero evidence that the current situation is simply a cyclical response to a difficult time that will magically dissipate if government does things differently or stops doing things at all…” — I might add that there is increasing evidence that the current crisis/ economic transition is nothing of the sort (not cyclical at all, but part of something bigger). Karabell hints at it here:
“As economists have come to realize, the models that correlate growth to employment have broken down largely because of technology and globalization.” — You’re not going to secure America’s place in the coming World economy by deficit-stimulus beyond four years, and beyond 100%GDP! We have to confront reality…

Posted by matthewslyman | Report as abusive

satellite internet

You can unquestionably see your skills inside the perform you create. The world hopes for much more passionate writers like you that are not afraid to mention how they believe. On a regular basis observe your heart.

Posted by Satellite Internet | Report as abusive