Was It Only “Fear Itself?”: FDR and Today

“Movement” politics is how the people flex their power, while electoral politics under the corporate duopoly is the domain of the moneyed classes.

— Glen Ford, Black Agenda Report

While it’s myth that after the stock market crash of 1929, brokers pitched themselves off of tall buildings in Lower Manhattan (None did. A real buzz killer), there was an uptick in suicides among moguls by less dramatic means for a few years. Today, amidst the cascading bad economic news, investors seemingly have only two worries. First, that further waves of COVID-19 infections and deaths might sidetrack the economy’s reopening and affect profits. The second is that procrastinators might be left behind — FOMO, the Fear of Missing Out —as the market continues to rise. One thing that they’re not losing any sleep over is that working class consciousness is rising to the radical level of the 1930s when capitalism faced genuine peril.

In 2020, as in the 1930s, the economy is tanking, unemployment is at Great Depression levels with another 1.5 million workers having filed for unemployment last week, Federal regulations (600+) having been dismantled, CEO compensation now at 287 times that of workers and of the 11 Fed financial bailouts, 10 went to Wall Street banks. Further, at the inception of the Covid-19 outbreak, over 70 percent of Americans were already living on the financial edge, with lifetime savings depleted, and home foreclosures multiplying. Now, many of the jobs losses are terminal, millions of stores remain shut down across the country, angry protesters throng the streets, and an exceedingly grim future awaits most of the citizens.

Again, as in 1933, the Federal government is taking bold action. But instead of FDR’s New Deal, this time the decisive action entails a a $4.5 trillion bailout of emergency corporate lending, some pittance payments to workers, and ominous threats about the dire consequences of not returning to their jobs. What accounts for the difference in the government’s response then and now? I suggest that both responses were self-serving actions by the ruling elite and it’s to our peril not to understand that fact.

As I’ve noted previously, big tech companies have proven virtually immune to what’s happening in the economy inhabited by the rest of us. The tech-heavy NASDAQ recently surpassed 10,000 before retreating and Amazon, Alphabet (Google) and Facebook are soaring. Apple and Microsoft recently became the first to reach $1.5 trillion market caps. According to investment strategists, the Fed’s maintaining low interest and inflation rates has been the magic elixir for these big tech companies.

Robert Armstrong, writing in The Financial Times (quoted in NYT, 6/11/2020) notes, in a strikingly nonchalant manner, that all of this is only more “evidence of an inherent and structural tension between the owning class and the working class.” In the United States, where a small percentage owns most of the wealth, they reap the gains from a resurgent stock market. Thus, as Armstrong continues, “Covid-19 has put working-and-middle-class people under severe strain, while the asset-owning class have felt relatively little pain.”

The Great Depression’s Legacy: FDR’s Efforts to Save Capitalism

After the Great Crash of 1929, a broad spectrum of prominent American writers, artists, poets, playwrights, and painters offered enthusiastic support for socialist ideas. Concurrently, ordinary citizens were questioning the precepts of capitalism and the traditional U.S. political system. Breadlines, shantytowns and hunger marches were growing along with the growing appeal of left-wing class politics and labor radicalism. Unaffiliated groups were organizing self-help cooperatives and racially integrated Unemployed Councils, organized by Communists, were springing up. Protests blocking evictions were occurring in major cities, often involving violent confrontation with the police. From 1930-1932, over 700 actions by the unemployed were reported to the Communist party’s newspaper, the Daily Worker. (Note: The CP ultimately followed directives from the CP International in joining the “Popular Front” and supporting the New Deal.)

In an article titled, “How FDR Saved Capitalism,” the late, neoconservative political scientist and sociologist Seymour Martin Lipset lavished effusive praise on President Franklin D. Roosevelt’s conscious effort to blunt widespread anticapitalist sentiments and undercut the appeal of left-wing radicals. [1] At the time, left parties and associated movements emerged in Wisconsin, New York, California, Minnesota, Washington,Nebraska, Oregon, and North Dakota. In Minnesota, Governor Floyd Olson (Farmer-Labor Party) pioneered unemployment insurance, anti-foreclosure laws, public works programs, a pro-worker labor code and public pensions. In one speech, he said “I hope the present system of government goes right to hell” and proposed abolishing capitalism and establishing government control “over all means of production.” [2].

FDR rejected radical politics but the New Deal was deeply influenced by the president’s keen awareness of needing to propose policies that would ween discontented workers away from demanding deep structural changes.The president employed three basic tact’s: First, he was masterful in lifting and incorporating left demands into his rhetoric. Second, he sought to co-opt some leaders by extending patronage to non-Democratic Party state and local officials. Part of this involved setting aside references to the Democratic Party per se and frequently mentioning farmers, women, labor, minorities and liberals. Finally, as part of his expedient and temporary tilt toward the left, FDR was not above disingenuously threatening that to save capitalism from itself it might be necessary to “equalize the distribution of wealth” and “throw to the wolves the forty-six men reputed to have incomes in excess of one million dollars.”

This was all presaged in his FDR’s first presidential inaugural address in 1933. Ira Katznelson, author “Fear Itself,” a book celebrated by mainstream reviewers, wrote “A climate of universal fear deeply affected political understandings and concerns. Nothing was sure.” [2]. In the fifth sentence of his inaugural speech on March 4,1933, President Roosevelt uttered the famous phrase “Let me assert my firm belief that the only thing we have to fear is fear itself.” He then proceeded to blame the depression on “unscrupulous money changers” who lacked any vision. The president blamed “callous and selfish bankers and businessmen who persisted in engaging in the “evils of the old order.”

While offering to work with legislators, FDR made clear that if Congress failed to act there would be a need for a “temporary departure from the normal balance of public procedure.” The president would seek “broad Executive power to wage a war against the emergency, as great as the power that would be given to me if if we were in fact invaded by a foreign foe.” Robert Morley, a law professor at Columbia, had created the original “Brain Trust” to advise Roosevelt during the 1932 presidential campaign. He was also responsible for writing FDR’s inaugural address although the latter never acknowledged it. Later, Morley said that because of the speech, “Capitalism was saved in eight days.” Hyperbole aside, the critical point is that Katznelson and many other liberal historians agree that saving capitalism was a major objective of the New Deal and that some form of “liberal democracy” was the preferred means of accomplishing that end.

W.E.B. DuBois had hoped the incipient New Deal would be the opening, the first step toward socialism. However, by 1938, Roosevelt, perhaps concluding the threat had past, slowed his reforms and even proposed a traditional balanced budget. Tellingly, when the Recession of 1937-38 resulted in Republicans defeating several third party incumbents, FDR responded “We have on the positive side eliminated Phil La Follete and the Farmer-Labor people in the Northwest as a standing Third Party threat.”

I trust that others, far better versed in the New Deal period will comment and I’ll only suggest a line of inquiry that needs fleshing out: Unlike today’s predator class, who’ve little to worry about, their counterparts in the 1930s had more to fear than “fear itself” — and acted accordingly. That is, “…the spectre that haunted the New Deal years …was the fear of the dominant class of a renewed populist alliance — this time strengthened by a more combative and a more mature industrial proletariat than had existed in the 1890s. [ 3 ]. Liberal historian Arthur Schlesinger wrote of the moment, “It was now a matter of seeing whether a representative democracy could conquer economic collapse. It was a matter of staving off violence — even some thought — revolution,” 4].

Many people now understand that spending on World World II was what “saved capitalism” but I suspect the myth that benevolent motives dominated New Deal thinking is still believed by many. Shedding further light on this matter should prove useful in clarifying and responding to both the diversions and opportunities awaiting us in the near future.

What About today? Not “A few bad police apples,” but a Rotten Capitalist Tree

If polls are to be believed, a majority of the public agrees with the core positions put forth by Black LIves Matter and support the protests against police brutality. I’ve been encouraged by the fact that hundreds of thousands of young, white Millennials have been in the streets, often outnumbering black participants. For example, between 60-65 percent of the demonstrators in New York and Washington were white youth under age 34.

We are at a propitious moment and the critical question is whether the momentum of the protests will transition to a wider and deeper critique that extends beyond the police. We can be certain that efforts are forthcoming to co-opt BLM supporters with cosmetic, liberal palliatives and to divert protests into the cul-de-sac of identity politics, the most insidiously effective weapon in corporatocracy’s toolbox. Resisting these maneuvers will require a politically astute, creative, and sustained response.

Can we go further and explicitly explain that the police under capitalism can never be reformed to take the side of Black, Brown and working class people? All available evidence suggests that from their inception, the foremost function of the police has been to safeguard the capitalist private property of those who own and rule the country. As Chris Hedges recently pointed out, “The crisis we face is not, as the ruling elites want us to believe, limited to police violence. It is a class and generational revolt. It will not be solved by new police reforms. The problem is an economic and political system that has by design created a nation of serfs and obscenely rich masters.” [5].

A new mass political formation of people prepared to engage in widespread civil disobedience and face arrest, remains our only hope for salvation, much depends upon how we creatively reimagine making our case. It’s a daunting challenge and not the first time we’ve needed to take inspiration from Antonio Gramsci’s invocation: pessimism of the intellect; optimism of the will.


[1 ] Unless otherwise specified, quotes in the next three paragraph are from Seymour Martin Lipset and Gary Hart, “How FDR Saved Capitalism,” HOOVER DIGEST, January 1, 2001. It’s fitting that the article is associated with the Hoover Institute. Housed at Stanford University, it’s named for Herbert Hoover and its mission is to promote private enterprise in the United States. Candoleeza Rice will assume its directorship on September 1, 2020. Stanford University, was founded by the railroad Robber Baron Leland Stanford who amassed his fortune by exploiting Chinese labor. Seymour Martin Lipset (1922-2006), a prominent American sociologist and political scientist, was a neoconservative, noted for championing the idea of American exceptionalism. I’m chagrined to acknowledge that Lipset was once President of the American Political Science Association.

[2] Ira Katznelson, Fear Itself: The New Deal and the Origin of Our Times. (New York: Simon and Schuster, 2013), p.720. Next quotes also from Katznelson.

[3] Dylan Riley, “Southern Questions,” New Left Review, Jan/Feb. 2014, p.159.

[4] Arthur Schlesinger, Jr. The Coming of the New Deal: 1933-1935. (New York: Houghton, Mifflin and Harcourt, 1958), p.3.

[5] Chris Hedges, “Gaslighted By the Ruling Class,” https://scheercast.wpcomstaging/.com/ June 15, 2020, p.3. Also, Carmin Maffea, “The Fight to Abolish the Police is the Fight to Abolish Capitalism, LeftVoice, June 10, 2020.