Issues & Insights

Biden’s Goal: Another FDR-Style New Deal, But With Trillions, Not Billions

FDR's First Inaugural, 1933. Photo: FDR Presidential Library & Museum, licensed under the Creative Commons Attribution 2.0 Generic license (https://creativecommons.org/licenses/by/2.0/deed.en).

Excerpt provided by the Committee to Unleash Prosperity. Sign up to receive a free subscription to the full weekday Unleash Prosperity Hotline newsletter by clicking here: https://committeetounleashprosperity.com/hotline/

If you are wondering why Joe Biden is acting like a lunatic fiscal serial killer (he now says he wants $4 trillion for the green new deal), it is because he has sought the advice of leftwing historians who have been advising him that if he wants to achieve greatness, he has to “go big” like FDR. These historians say it’s time to break the bank and emulate the New Deal spending blitz of the 1930s.

But as we’ve pointed out before, that strategy didn’t work out so well for the country. The chart below shows the unemployment rate stayed at or above 15% for almost the entire first two terms of FDR’s presidency.

The financial crisis deteriorated into a double-dip Great Depression in 1937 after FDR’s economic team decided to pay for all the Alphabet Soup welfare and make-work programs with a “soak the rich” tax increase that raised the income tax rate to 70% in the name of fairness.

Sound familiar?

By the way, after this blizzard of taxing and spending, instead of a torrent of new jobs, the unemployment rate soared back up to a miserable 18%.  

Arguably, the single greatest historical lie in American history is the myth that has now prevailed for some 80 years that the New Deal worked. Now history seems destined to repeat itself.

UNEMPLOYMENT RATES DURING THE FDR PRESIDENCY 

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