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Barack Obama has been compared to almost every American President of the last hundred years--favorably to Franklin Delano Roosevelt, John Kennedy, and Ronald Reagan; and unfavorably to Jimmy Carter and George H.W. Bush. I want to put another name in the hat: Herbert Hoover.
It might seem ludicrous, or unfair, to compare Obama to one of the most vilified presidents of the last century, but that’s because Hoover’s reputation is largely, or at least somewhat, undeserved--the product of Democratic attacks and Hoover’s own strident responses to these attacks.
To his contemporaries, Hoover had been the American most suited to be president. He had performed brilliantly as head of the American Relief Administration after World War I. In 1920, The New Republic and Franklin Delano Roosevelt urged him to run for president as a Democrat. Hoover chose not to run. Instead, he became perhaps the greatest of all commerce secretaries. He was responsible, among other things, for persuading industry to reduce overall costs by standardizing industrial parts and tools. Because of Hoover’s innovations, an auto mechanic could repair any American car.
Hoover was also not a conservative Republican like Calvin Coolidge, but a progressive who believed that capital and labor could work together with the encouragement of a beneficent government. In 1928, Hoover won the presidency in a landslide, and might have enjoyed success if the Great Depression had not intervened. Still, Hoover responded to the greatest economic crisis in the nation’s history. He funded what was then the largest peacetime public works expenditure. He signed a labor bill, the Norris-LaGuardia Act, that was the precursor of the Wagner Act. And he established the Reconstruction Finance Corporation to lend money to ailing banks. “The Hoover administration,” biographer Joan Hoff Wilson wrote, “became the first in American history to use the power of the federal government to intervene directly in the economy in time of peace.”
Unlike other Republican conservatives, Hoover didn’t regard unemployment as a passing irregularity that time and patience would remove. In 1921, in the wake of an earlier sharp downturn, Hoover had convened a President’s Conference on Unemployment, which recommended public works as a response to unemployment. When he became president, he renamed it the President’s Committee on Recent Economic Changes. Its path breaking report, published at the end of his presidency, recognized the new problem of “technological unemployment.” Unlike his predecessor, Hoover also tried to do something about the international monetary system that was breaking down under the weight of unpaid loans and reparations from World War I.
But Hoover failed, finally, because he shared the same assumptions about deficit spending and government intervention as most other politicians and economists of his day. He was willing for government to do more to combat the business cycle, but he feared that enlarging the state would lead to Soviet-style socialism, and he thought that in the end the economy would right itself the way it had before. Hoover had the potential to be a very good president, but he was overwhelmed by the unprecedented challenges that he faced.
Obama, of course, is not making the same mistakes as Hoover or facing exactly the same situation. But Hoover’s example shows that a person who is highly qualified to be president and who boasts significant accomplishments in office can still fail because of the enormity of the challenges he faces. Obama could enjoy great success in getting legislation through Congress, including national health care insurance; he could take larger steps than any of his predecessors, including Franklin Roosevelt, to pull the United States out of a slump; but he could still fail and bring his party down with him.
I’ll describe Obama’s formidable challenges in foreign policy in a subsequent column. I want to concentrate here on the domestic and international economy. There are two features of the current downturn that make it different and more dangerous than previous post-World War II recessions. First, it combines a financial crash--and its effects on housing--with the deterioration of that part of private industry that produces tradable goods and services, from cars and machine tools to software and pharmaceuticals. Call this part of industry the productive core of the economy.
COMMENTS (20)
There are a lot of effective and uncomfortable arguments here, but it still seems very much like a retread of Kevin Baker's piece "Barack Hoover Obama" in the July Harper's. At some point the comparison becomes a bit tired and predictable.
There are a lot of effective and uncomfortable arguments here, but it still seems very much like a retread of Kevin Baker's piece "Barack Hoover Obama" in the July Harper's. At some point the comparison becomes a bit tired and predictable.
Obama, a prisoner of his own (and that of his advisors') ideology? I suppose so, but isn't it ironic that his critics claim he is a socialist. I must take exception to Judis' alarm that, as a result of Obama being hamstrung by ideology, Republicans will return to power and hasten the nation's decline. We all know that Republicans, being masters at politics, often do the opposite of what they say, so balanced budgets become deficits as far as the eye can see, and praises of the private sector become expensive new government entitlements. So Judis may well be right that Obama's ideology will lead to Republican ascent, but don't be surprised if the Republicans, once in power, take the nati ... view full comment
Obama, a prisoner of his own (and that of his advisors') ideology? I suppose so, but isn't it ironic that his critics claim he is a socialist. I must take exception to Judis' alarm that, as a result of Obama being hamstrung by ideology, Republicans will return to power and hasten the nation's decline. We all know that Republicans, being masters at politics, often do the opposite of what they say, so balanced budgets become deficits as far as the eye can see, and praises of the private sector become expensive new government entitlements. So Judis may well be right that Obama's ideology will lead to Republican ascent, but don't be surprised if the Republicans, once in power, take the nation in a direction that saves us from the economic apocalypse feared by Judis and Krugman. Stranger things have happended.
raylward --
I think Judis is not saying that Obama is being hamstrung by his own ideology, but by the professed anti-statist ideology of his opponents.
raylward --
I think Judis is not saying that Obama is being hamstrung by his own ideology, but by the professed anti-statist ideology of his opponents.
Dhurt: I think you're right, which makes Judis' arguments in the penultimate paragraph that much more ridiculous. Hoover failed not only because he did not, in the end, employ the vast resrouces of the US government to help the common man (and woman); his failure was one of imagination: in understanding the potential of government, in connecting with the average voter, in signalling to the American public that he understood and cared.
Republicans, for all their talk of Joe the Plumber and for all their supposted support for that common woman, Palin, essentially don't give a rat's ass for the average Joe's economic and moral (in the global sense of that word) well-being. Nothing they have d ... view full comment
Dhurt: I think you're right, which makes Judis' arguments in the penultimate paragraph that much more ridiculous. Hoover failed not only because he did not, in the end, employ the vast resrouces of the US government to help the common man (and woman); his failure was one of imagination: in understanding the potential of government, in connecting with the average voter, in signalling to the American public that he understood and cared.
Republicans, for all their talk of Joe the Plumber and for all their supposted support for that common woman, Palin, essentially don't give a rat's ass for the average Joe's economic and moral (in the global sense of that word) well-being. Nothing they have done in the past year, and nothing they are likely to do in the next three, no one they have put forward, and no one waiting in the wings, suggests in any way whatever that they understand or that they care.
Historical comparisons are useful, in some measure, but they are also constraining and unreal, and so I agree with Irony that the constant harping on Hoover is a beginning to get tiresome. The America of 2009 was not the America of 1929; the nature of the financial and economic crisis is not the same. And Obama, as Judis puzzlingly reconfirms, is not Hoover; he is not constrained in his OWN head by a tired ideology; he is the best policy salesman the country has; his opponents are a bunch of ninnies and crybabies who have managed to bring Obama down to his election-day support and have made no headway into the imagination of the American people.
Give us some fresh ideas please.
The fine commentators above have already addressed Judis's flawed comparison of Hoover with Obama. I would simply like to add that Judis is exaggerating the extent and effectiveness of Hoover's own response to the Great Depression in pursuit of his point about how Obama's policies may not be sufficient to counteract today's economic problems. Many of Hoover's earlier economic responses to the Depression were straight out of his corporatist ideology in which labor and industry were urged to sit down at the same table and make the necessary concessions to get the economy running again -- things like the National Credit Corporation and the Davis-Bacon Act. Most economists and historians agre ... view full comment
The fine commentators above have already addressed Judis's flawed comparison of Hoover with Obama. I would simply like to add that Judis is exaggerating the extent and effectiveness of Hoover's own response to the Great Depression in pursuit of his point about how Obama's policies may not be sufficient to counteract today's economic problems. Many of Hoover's earlier economic responses to the Depression were straight out of his corporatist ideology in which labor and industry were urged to sit down at the same table and make the necessary concessions to get the economy running again -- things like the National Credit Corporation and the Davis-Bacon Act. Most economists and historians agree that these were dismal failures in reducing unemployment and getting the economy growing again. Later in his term (and thanks to the urging of a newly empowered Democractic congressional delegation), Hoover implemented policies like the Reconstruction Finance Administration and the Emergency Relief and Construction Act that purported to take more direct action to stimulate the economy. However, these programs were heavily bureaucratized and did little to actually disburse money into the economy before the end of Hoover's term in office. They became more effective under Roosevelt who was actually willing to implement spending-heavy programs because he was not constrained by Hoover's ideology. The point with Hoover is that, while the eventually talked the talk of spending to spur economic recovery, he barely walked the walk.
Actually, 2009 is much like 1929: concentration of wealth, un(der)regulated financial markets, budensome debt, unstable international markets. And the list could go on and on. As for the analogy with Hoover, Judis isn't clear. On the one hand, he says Obama isn't the victim of ideology but of politics; but on the other hand, he derisively refers to "Obama's half-measures of spending and stimulation". Isn't Judis' criticism of Hoover essentially the same: Hoover was "a progressive who believed that capital and labor could work together with the encouragement of a beneficent government", but "in the end the economy would right itself the way it had before". As with Hoover, Obama is willi ... view full comment
Actually, 2009 is much like 1929: concentration of wealth, un(der)regulated financial markets, budensome debt, unstable international markets. And the list could go on and on. As for the analogy with Hoover, Judis isn't clear. On the one hand, he says Obama isn't the victim of ideology but of politics; but on the other hand, he derisively refers to "Obama's half-measures of spending and stimulation". Isn't Judis' criticism of Hoover essentially the same: Hoover was "a progressive who believed that capital and labor could work together with the encouragement of a beneficent government", but "in the end the economy would right itself the way it had before". As with Hoover, Obama is willing to take some corrective action, but too little and maybe too late (to avert an election defeat).
Obama reminds me of Horst Buchholz in "The Magnificent Seven"--the new kid in town, dreamboat looks, etc. No, wait: he reminds me of Tony Kubek of the 1960 Yankees--hard-luck victim of a bad hop! Um... no, that's not it... I got it! Celebrity chef Martin Yan! Yes! No? Are you sure? Okay, how about Chief Bromden from "Cuckoo's Nest"? No? Kristine Lilly, most capped player on the U.S. women's national soccer team? Abner Hammond, Georgia's Secretary of State from 1811 to 1823? Joyce Dewitt, "Three's Company"'s ever-perky brunette? Soranus of Ephesus, who used lithium to treat mania in the Second Century C.E.?
Okay, so maybe I've missed the mark. But it's a big wall. I keep throwing stuff at it, ... view full comment
Obama reminds me of Horst Buchholz in "The Magnificent Seven"--the new kid in town, dreamboat looks, etc. No, wait: he reminds me of Tony Kubek of the 1960 Yankees--hard-luck victim of a bad hop! Um... no, that's not it... I got it! Celebrity chef Martin Yan! Yes! No? Are you sure? Okay, how about Chief Bromden from "Cuckoo's Nest"? No? Kristine Lilly, most capped player on the U.S. women's national soccer team? Abner Hammond, Georgia's Secretary of State from 1811 to 1823? Joyce Dewitt, "Three's Company"'s ever-perky brunette? Soranus of Ephesus, who used lithium to treat mania in the Second Century C.E.?
Okay, so maybe I've missed the mark. But it's a big wall. I keep throwing stuff at it, something's bound to stick.
Luis, are you referring to this in regard to Iceland?
http://www.nytimes.com/2010/01/06/business/global/06icebank.html?ref=bus...
If so, pending national bankruptcy is not something that people usually cheer about unless they are disciples of Lenin's political tactics.
Luis, are you referring to this in regard to Iceland?
http://www.nytimes.com/2010/01/06/business/global/06icebank.html?ref=bus...
If so, pending national bankruptcy is not something that people usually cheer about unless they are disciples of Lenin's political tactics.
John B. this confirms my suspicions, you are an idiot. Largely credited with causing the Great Depression with his introduction of Smoot Hawley, higher taxes and runaway regulation, You are right in one regard; Hoover is probably the best example of Obama's policies. This certainly doesn't argue in Obama's favor. Check it out... http://unfundedliabilitiesandclasswar.blogspot.com/
John B. this confirms my suspicions, you are an idiot. Largely credited with causing the Great Depression with his introduction of Smoot Hawley, higher taxes and runaway regulation, You are right in one regard; Hoover is probably the best example of Obama's policies. This certainly doesn't argue in Obama's favor. Check it out... http://unfundedliabilitiesandclasswar.blogspot.com/
Pop history exaggerates Hoover's ineptitude and FDR's triumphs, but there remain key differences between them, and those are the same key differences between Hoover and Obama. Indeed, Obama reminds me far more of FDR than Hoover, and Judis's very criticisms -- Obama, hamstrung politically, can't do all he might want -- apply to FDR perfectly, and far better than they do to Hoover, who, as Judis acknowledges, was hamstrung ideologically. Obama, like FDR, is essentially a liberal who sees a government role and duty to ensure access to a minimally decent life for its citizenry, and he seeks out reasonable ways to do that, including selective intervention in the economy. Hence, health care re ... view full comment
Pop history exaggerates Hoover's ineptitude and FDR's triumphs, but there remain key differences between them, and those are the same key differences between Hoover and Obama. Indeed, Obama reminds me far more of FDR than Hoover, and Judis's very criticisms -- Obama, hamstrung politically, can't do all he might want -- apply to FDR perfectly, and far better than they do to Hoover, who, as Judis acknowledges, was hamstrung ideologically. Obama, like FDR, is essentially a liberal who sees a government role and duty to ensure access to a minimally decent life for its citizenry, and he seeks out reasonable ways to do that, including selective intervention in the economy. Hence, health care reform. Obama sees it as a right, and as a moral duty of government. In fact, I'm sure Obama would be inclined to agree in spirit with FDR's speech proposing a "second bill of rights" that would have recognized so-called "positive" rights regarding health, shelter, employment, education, and so on. Hoover, though not a total laissez-faire type, did not share such dispositions. Meanwhile, we too easily forget that, like Obama, FDR was forced to enact half-measures too, that, facing political pressure on the deficit, he backed away on the scope and size of New Deal efforts, to which many attribute the "recession-within-the-Depression," and that "Dr. Win the War," rather than "Dr. New Deal," turned out to be the real economic godsend. Nonetheless, FDR did a lot of major things. He restored confidence, he prevented the worst (thus saving capitalism), he instituted financial regulation and consumer protection, and he began social security -- capital s's and small s's -- the specific program and the concept too. As Judis notes, the stimulus was a big deal, though not as big as he, Krugman, or Obama, probably would have wanted and tilted more toward tax cuts than they would have wanted. Health care reform will be an even bigger deal. History shows that small-s social security measures become entrenched and beloved, and that they are often expaneded and seldom pulled back. But, with today's political and ideological alignments, they are nearly impossible to pass. The fact that it is going to pass now is a small miracle, very FDR-ish, and not Hoover-ish at all. Judis may see health care reform as half a loaf. If it is, it's still a huge hunk of bread, and don't forget that Social Security was humble at its inception.
So, yes, other than the fact that Obama is a liberal and Hoover was a conservative, that Obama will have enacted major social legislation the likes of which Hoover never would have dreamed of, and that Obama will have sponsored large-scale Keynesian intervention into the economy at the beginning of his presidency rather than small-scale, grudging Keynesian intervention at the end, they're exactly alike.
Luis, surely you remember those hoary Leninisms, "The worse, the better" and "Heighten the contradictions of capitalism" -- the notion that economic and political conditions need to get worse so that a revolution can be achieved and a bright new sun burst forth? It seems to me that cheering on the self-defeating behavior of the Icelandic citizenry and its elected leaders in the hope that it produces some kind of better outcome is similarly flawed. Though I will happily grant you that you are not any sort of Leninist in the political sense.
I have no financial dog in the fight between Iceland, the UK and the Netherlands over the Icesave bailout and I certainly appreciate the reluctance of ... view full comment
Luis, surely you remember those hoary Leninisms, "The worse, the better" and "Heighten the contradictions of capitalism" -- the notion that economic and political conditions need to get worse so that a revolution can be achieved and a bright new sun burst forth? It seems to me that cheering on the self-defeating behavior of the Icelandic citizenry and its elected leaders in the hope that it produces some kind of better outcome is similarly flawed. Though I will happily grant you that you are not any sort of Leninist in the political sense.
I have no financial dog in the fight between Iceland, the UK and the Netherlands over the Icesave bailout and I certainly appreciate the reluctance of Iceland's citizens to cut back on the welfare state that is the fruit of their hard-won labor. Iceland, like Norway, was a rather poor country just 60 years ago and its progress since that time is quite impressive. But the fact remains that, when the financially reckless overseas tactics of Iceland's banking sector caught up with it in late 2008, the democratically elected governments of Britain and the Netherlands had to use their own taxpayer money to save the deposits of their own citizens who had money in Icelandic institutions. For this, it is entirely appropriate for Iceland and its own citizens to take a haircut and compensate the British and Dutch citizens whose tax dollars were used to effectively bail out Iceland's banks. If Iceland's citizenry refuses to face this and rejects countries that are now their creditors, then they should be prepared to face national insolvency and much worse financial conditions than they are currently facing. Not something to celebrate in my view.
"...“The Hoover administration,” biographer Joan Hoff Wilson wrote, “became the first in American history to use the power of the federal government to intervene directly in the economy in time of peace...."
Huh? The first counterexample that came to mind was Theodore Roosevelt and trust busting.
"...“The Hoover administration,” biographer Joan Hoff Wilson wrote, “became the first in American history to use the power of the federal government to intervene directly in the economy in time of peace...."
Huh? The first counterexample that came to mind was Theodore Roosevelt and trust busting.
"In your version, UK and Netherlands "citizens" had money in Iceland and were expecting to be paid back. In my version (which I think is more realistic) speculators had money in Iceland and were pretending to get their interests (not just their capital, by far!) out of extorsion..."
Luis, assertion is not a form of proof, and asserting your version is more realistic is setting yourself up. As Senator Daniel Patrick Moynihan (one of my heroes) once observed, "You are entitled to your own opinion, but you are not entitled to your own facts".
"In your version, UK and Netherlands "citizens" had money in Iceland and were expecting to be paid back. In my version (which I think is more realistic) speculators had money in Iceland and were pretending to get their interests (not just their capital, by far!) out of extorsion..."
Luis, assertion is not a form of proof, and asserting your version is more realistic is setting yourself up. As Senator Daniel Patrick Moynihan (one of my heroes) once observed, "You are entitled to your own opinion, but you are not entitled to your own facts".
With respect, I suggest you do some basic reading on capitalism, money, banking and credit.
With respect, I suggest you do some basic reading on capitalism, money, banking and credit.
Sorry, Luis, but I'm not buying it. There were over 400,000 British and Dutch investors in Icesave and similar accounts. Many of these were small investors and entities like municipal police and fire department operating funds that were attracted by higher interest rates paid on their deposits through Icesave - if they were "speculators", they were no more in the category of speculators than most people in the first world who were looking for higher-yield investments in the past decade. Their governments felt they had to take steps to save their principal and at least some of their interest from default, in the same way that the US government has taken steps to prop up large failing banki ... view full comment
Sorry, Luis, but I'm not buying it. There were over 400,000 British and Dutch investors in Icesave and similar accounts. Many of these were small investors and entities like municipal police and fire department operating funds that were attracted by higher interest rates paid on their deposits through Icesave - if they were "speculators", they were no more in the category of speculators than most people in the first world who were looking for higher-yield investments in the past decade. Their governments felt they had to take steps to save their principal and at least some of their interest from default, in the same way that the US government has taken steps to prop up large failing banking institutions, auto and insurance companies and mortgage borrowers -- because letting them all fail precipitously would unleash a cascade of defaults throughout the broader economy and make it next to impossible to stop the avalanche until it hit such a bottom that no mere bailout would be sufficient (like in 1929-32). As for Iceland, it is a first-world economy with a (supposedly) regulated banking sector and (supposed) investor and depositor protections. If it wants to make money by playing in wider financial markets, the country and its citizens need to bear some of that risk. Read Simon Johnson about this crisis -- he is as much of a critic of the bailout mentality and IMF practices as anyone, and he has supported the effort to get Iceland to pay back the British and Dutch governments.
I respectfully repeat my suggestion. For starters, I recommend that you closely read wildboy's comments.
I respectfully repeat my suggestion. For starters, I recommend that you closely read wildboy's comments.
Luis reminds me of that student of mine who said, "I took your course so that I could argue against you. But I actually learned something."
Kind of. At least the first part.
I like the fact that UK and Dutck "citizens" are put in scare quotes. In fact, Luis appears to like scare quotes a lot - the mark of a weak mind and a strained education, in my humble opinion - not that I'm judging, as some of my best friends have weak minds and weaker bladders. And then there the repeated use of "capital" and "interest" as if one were talking about electric shocks in Siberian gulags ....
"Capital", invested in a bank or with an investment firm, is nothing but savings - savings of people like me who wor ... view full comment
Luis reminds me of that student of mine who said, "I took your course so that I could argue against you. But I actually learned something."
Kind of. At least the first part.
I like the fact that UK and Dutck "citizens" are put in scare quotes. In fact, Luis appears to like scare quotes a lot - the mark of a weak mind and a strained education, in my humble opinion - not that I'm judging, as some of my best friends have weak minds and weaker bladders. And then there the repeated use of "capital" and "interest" as if one were talking about electric shocks in Siberian gulags ....
"Capital", invested in a bank or with an investment firm, is nothing but savings - savings of people like me who work and pay taxes and put away a little each paycheque to be able to afford a dwelling of their own. In the old days, I would be tied to the bank around the corner and captive to its shenanigans. Now, we have more choice. Those of us who bother to save and who have a sense of the market and the importance of circulating money (instead of putting it in the freezer), will naturally invest, looking for the least risk for the highest return. There is nothing either immoral or wrong about it. Some will risk more, some less; we collectively agree that certain risks should be collectively insured (FDIC), others should be collectively regulated (the SEC, even if weakly) and still others (derivatives), up to now, less so.
True, some people, some firms, some cities, some funds made bad choices. They are no better, but no worse, than the people and communities that enabled the risk-taking in the first place. Iceland, if you have bothered to look into what is going on there at all, simply turned its eyes away from supervising its banks. The Icelanders were giddy with the money pouring in and simply decided not to bother to look at how three banks managed to have assets three times the size of Iceland's GDP. I was in Iceland when they were doing well, and let me tell you, paying $200 for a taxi ride from the airport to the hotel was not fun; nor was the $50 pizza or the $12 coke. They loved it and loved milking me, though.
They made wrong choices. No one suggests putting them in a pillory or indentured servitude; but to applaud them appears, to these eyes, somewhat exaggerated.
Huh - which part of the rest of my argument is "bullshit"? The part about my savings? About the cost of Icelandic cab rides? About the exposure of Icelandic banks? About people making bad choices? About people looking around for best returns on their money?
I mean, if you are going to insult, be creative in your insults; and if you are going to respond, respond to the points raised. Merely stating that a set of arguments is bullshit is little better than my six year-old cousin's "nya nya nya" replies.
I don't think anyone in their right mind is looking for a 20% return (on what? over how long a period? invested in what form? how calculated?).
"I'm glad Americans are not being made to pay ... view full comment
Huh - which part of the rest of my argument is "bullshit"? The part about my savings? About the cost of Icelandic cab rides? About the exposure of Icelandic banks? About people making bad choices? About people looking around for best returns on their money?
I mean, if you are going to insult, be creative in your insults; and if you are going to respond, respond to the points raised. Merely stating that a set of arguments is bullshit is little better than my six year-old cousin's "nya nya nya" replies.
I don't think anyone in their right mind is looking for a 20% return (on what? over how long a period? invested in what form? how calculated?).
"I'm glad Americans are not being made to pay remotely on the same proportion." Well, not to the same proportion, but US financial institutions did not collect $38 trillion in overseas assets and then go bankrupt. The US taxpayer is on the hook, so far this year, for about $1.4 trillion dollars in one sort or another; plus, nearly $10 and perhaps up to $30 trillion in US asset values have been wiped out over the past two years. So, in some way, Americans are "paying".
Instead of snarky comments and idiotic insults, and getting into pseudo-intellectual discussions about "substantives ... that translate[] one's view on the subject", just stick to the substance and address the points raised. Right now, you're just sounding like George Walton.
I assumed that George Walton was off hiking the Appalachian Trail.
I assumed that George Walton was off hiking the Appalachian Trail.
George left the scene so suddenly and completely that one wonders if something bad happened to him. A bit of circumspection is probably in order.
George left the scene so suddenly and completely that one wonders if something bad happened to him. A bit of circumspection is probably in order.