Monday, June 12, 2017

Harry S. Truman: The Fair Deal, or the Liberal Deal

Initially, after becoming President, Truman followed the FDR domestic agenda. His goals were to lead the U.S. to victory in WWI, and then to lead the nation from a depression-time and war-time to a peace-time economy. He ultimately would set his own agenda by creating what would become "The New Deal." 

In order to get through the depression, and to win the war, FDR used his executive mite, and his New Deal Policies, to create a large central government. You had rations on what people could purchase, and you had the government ordering the transformation of factories to the production of goods and services to the production of war goods. 

So, the government had a scary amount of power over the American people. It was almost totalitarian-like, socialistic-like, fascist-like powers. Okay, it was not good. Truman's role was to transform America away from this type of a system and back to a system that put consumers back in power. He would transform America away from a government run economy to a consumer-run economy. 

So, he decided he needed to sway from the New Deal agenda Or, actually, to build upon the new deal. He decided he had a mandate, and decided to be aggressive with his new agenda. He therefore, in January, 1949, during his State of the Union Speech,  presented 21 points to Congress. It would become known as the Fair Deal.  It essentially involved 21 points, including:
  • An Expansion of Social Security. Passed in 1950. 
  • Full Employment Program. It passed as the Employment Act of 1946, but it failed to gain any traction and was a failed program. 
  • Permanent Fair Employment Practices Act.  He failed. 
  • Public Housing and Slum Clearance. Passed in 1949. 
  • New Public Works Programs.  He failed. 
  • A Higher Minimum Wage.   Passed through Congress. 
  • Extension of the Fair Employment Practices Committee. A wartime committee that worked to prevent against discrimination of African Americans in government and military. He failed to extend it. 
  • National Health Insurance System. He failed. 
  • Liberal immigration policies. He failed
  • Repeal of Taft-Hartley. He failed. 
  • Brannon Plan. Meant to help provide income support for family farmers. Failed. 
As you can see, the Fair Deal was pretty much a failure. Truman didn't have the mandate he thought he did.
This was mainly due to pressure from conservative democrats in the south (who would 35 years later become Reagan democrats), and republicans in the north, did not want any more liberalism. They did not want any more power to be given to the government. They had had enough. 

This is similar to what happened in the election of 1920, where Americans had simply had enough of rules and laws and taxes They wanted smaller government, less government, less regulations, and a simpler approach to government. They wanted more power to the people. They wanted a return of liberties. They wanted a return to a capitalistic economic system.

In 1949, they economy took a step back, and unemployment rose while inflation rose as well. This made people think the post war economic boom had ended. Truman set high post-war taxes, which remained around 90%. This was in an effort to balance the federal budget. This, as economics 101 teaches, does not bode well for a good economy.

He did, however, attempt to limit spending, with any surplus going to pay off the national debt. After several months of worsening economic numbers to begin the year, he gave up on his efforts to balance the budges and allowed for some tax cuts to go through.

This set the stage for Eisenhower to become President in 1952. Although, that was two years away. In the meantime, Truman got the United States involved in another war.