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Book Review: Forgotten Lessons

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Forgotten Lessons: Selected Essays of John T. Flynn
edited by Gregory P. Pavlik (Irvington-on-Hudson, N.Y.: The Foundation for Economic Education, 1995); 199 pages; $14.95.

Most histories about Franklin Roosevelt’s New Deal administration leave the impression that except for the ignorant and the reactionary, practically no one opposed the growth of government in the 1930s and 1940s.

Nothing could be further from the truth. For many years I have made a point of looking in used-book stores for anti-New Deal books written in the 1930s or 1940s. I have found quite a few. Many of them are well written and insightful. The authors were critical of FDR’s administration precisely because they saw that the New Deal was undermining the traditional foundations of American freedom: economic liberty and private property, and the federal system of powers belonging to the states and the people in opposition to central authority in Washington. Few of the authors I’ve read advocated strict laissez-faire, but many of their defenses of individual freedom and free enterprise would put even the most conservative of today’s conservative Republicans to shame.

For these anti-New Dealers of the 1930s, Social Security and TVA were just plain socialism; the National Recovery Administration (NRA) was something akin to Mussolini’s fascist corporativism; and expanded executive power at the expense of the Congress and the courts had the smell of dictatorship. Ordinary businessmen around the country wrote accounts of how the New Deal was destroying their enterprises and about the corruption of the Democratic Party New Deal political machine. (If you didn’t cough up a contribution to FDR’s party, you were threatened with regulatory and legal retaliation.)

Though a few of these anti-New Dealers continued their criticisms of the Roosevelt administration into the 1940s, with the coming of America’s participation in World War II many lined up behind FDR in the name of foreign-policy bipartisanship. One of those few who never became one of FDR’s global New Dealers was John T. Flynn. Many of the younger readers of Freedom Daily may not recognize John T. Flynn’s name, but among the older subscribers who have long followed conservative and libertarian political currents, some should be able to recall him as the author of such works as Country Squire in the White House (1940); As We Go Marching (1944); The Roosevelt Myth (1948; revised edition, 1956); The Road Ahead: America’s Creeping Revolution (1949); While You Slept: Our Tragedy in Asia and Who Made It (1951); and The Decline of the American Republic (1955).

Now, thanks to Gregory Pavlik of The Foundation for Economic Education, readers have an opportunity to rediscover John T. Flynn and his anti-New Deal, anti-big government insights. Mr. Pavlik has edited Forgotten Lessons, a collection of some of Flynn’s best essays that were written in the 1930s, 1940s, and 1950s on a variety of both domestic and foreign policy topics.

Like many of the conservatives of his generation, Flynn was not opposed to all economic intervention in the 1930s. He believed that there had been private-sector abuses in financial markets, for the correction of which some forms of government regulation might be necessary. But Franklin Roosevelt’s New Deal was something on a scale and with a purpose far different than the minor and marginal regulations that Flynn viewed as useful or required to improve the “rules of the game” so that the private enterprise system could “do its job” of securing both liberty and prosperity.The National Recovery Act of 1933 threatened the very existence of free enterprise in America. Industry was to be straightjacketed into government-mandated cartels given the authority to set prices, determine production levels, and regulate the workplace. But rather than see this as an “antibusiness” policy, Flynn argued that the NRA was FDR’s collaboration with segments of the “big business” community that wished to control and limit market competition for their own monopolistic purposes. Indeed, in 1937, Flynn wrote an article for The Yale Review entitled “Mr. Hopkins and Mr. Roosevelt” in which he argued that FDR’s appointing of his confidant, Harry Hopkins, to the post of secretary of commerce was part of the policy of cementing a network of government-business relationships and partnerships; as a result, Roosevelt tried to have Flynn blacklisted from being published in a wide circle of popular magazines and journals.

Flynn argued that there were few things exceptionally “new” in Roosevelt’s New Deal. Since the time of the ancient Greeks and Romans, government had attempted to win popular favor and prevent social unrest by running budget deficits, creating money, and producing the illusion of prosperity on the rising price curve of inflation. What was new with the New Deal was the grand scale with which FDR ran up the federal debt — tens upon tens of billions of dollars, figures unique in the entire fiscal history of the United States.

But even with massive deficit spending, by the late 1930s, unemployment in the U.S. economy was still in the double-digit range. So Roosevelt turned to that other great historical device to which governments have resorted to “create jobs”: defense spending. The wars in Europe and Asia gave FDR the rationale for bipartisan support for even greater deficits in the name of military preparedness. But once nations begin down the path of big spending for war preparedness, actual wars often are not far behind. With war comes militarism and the grand expansion of state power, with the freedoms of the people taken away or suspended in the name of the national emergency. This is exactly the road down which FDR took America, a road that finally led to the Japanese attack on Pearl Harbor.

In the postwar period, John Flynn was a die-hard anticommunist. But he believed that America’s Cold War strategy of big military spending and numerous military commitments around the world were mainly Keynesian-type pump-priming tools to keep government deficit spending going to maintain an inflationary prosperity. In a manuscript rejected by National Review in 1956, and now included in Forgotten Lessons , Flynn declared:

“The gaudiest of these job-making boondoggles is militarism. The American taxpayer perhaps doesn’t realize that this evil institution was used in Germany, France, Italy, and other countries not primarily for purposes of defense, war or conquest, but to bolster the economic system with jobs for soldiers and jobs and profits in the munitions plants. When the war in Europe roared up out of the muck, disorder and bankruptcy of that unhappy continent, Roosevelt spotted the thing he loved best [big government spending]. He turned eagerly to it and showed what a boom could really be with the soldiers and military industry.”

This “racket,” for political power and control, Flynn argued, was what most of America’s cold war military spending was all about.

Now in this post-Cold War era, the U.S. military and defense-related industries are searching for a new rationale to keep the spending and their jobs going. Maybe this is a large part of what Somalia, Haiti, and Bosnia are really all about. This is what makes John T. Flynn’s essays as relevant today as when he penned them several decades ago.

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    Richard M. Ebeling is a professor of economics at Northwood University. He was formerly president of The Foundation for Economic Education (2003–2008), was the Ludwig von Mises Professor of Economics at Hillsdale College (1988–2003) in Hillsdale, Michigan, and served as vice president of academic affairs for The Future of Freedom Foundation (1989–2003).