The End of Reform

"It pinpoints an important shift in the liberal outlook on the economy. Brinkley argues that at the beginning of the New Deal the government adopted the notion that it should reorient the economy in a more equitable manner. But, by the middle of World War II, the notion that the structure of the economy should be altered faded away. Brinkley highlights a very important moment in the history of liberalism, a moment that plants the seeds for where we are today. For example, President Obama, whom I admire in many ways, quickly gave up the idea of actually changing the structure of our economy. Obama entered office in the midst of the most serious economic crisis since the Great Depression. He could have said: We gotta rethink things. Or he could have said: We gotta get things back on track. He took the second option. That replays what happen in the Roosevelt administration and what Brinkley is talking about – the abandonment of the notion of structurally changing economic life. Partly because of the resurgence of Republicans and conservative Democrats. Partly because the government had to work hand-in-hand with the corporations to mobilise resources during World War II. During the depths of the Depression, in the early 1930s, the reputation of big business was at its lowest ebb. The war effort re-legitimised big business and created what came to be called a military-industrial complex. Changes in Congress and wartime conditions pushed policy in a different direction. There probably are many other factors as well. For instance, the rise of different views on the economy and particularly the influence late in World War II of Friedrich von Hayek and other critics, arguing that government should not try to direct the economy from the top."