"Great Society," Amity Schlaes

 Sydney M. Williams

www.swtotd.blogspot.com

 

Burrowing into Books

“Great Society,” Amity Schlaes

October 21, 2020

 

“Economies, it turned out, were like humans. They made choices.

The U.S. economy was choosing to stay away from high-cost cities like St. Louis.”

                                                                                                                                Amity Schlaes

                                                                                                                                Great Society

 

By the time John Kennedy became President, The Depression was a distant memory and World War II had been over for over fifteen years. Americans were prospering. Theys felt good about themselves. They were admired by friends and feared by enemies. But, as happens once prosperity becomes common, people don’t seem to care or understand the role capitalism plays in eliminating poverty and making lives comfortable and happy. They don’t understand that nothing moves in straight lines – GDP growth, stock market performance, human emotions, or views of liberty. In the 1960s, the compounded rate for the Dow Jones Industrial Averages (DJIA) was 4.9% – all in the first half of the decade – and in the ensuing decade, the DJIA lost eight percent. What happened in the ‘60s, and its effect on subsequent decades, is the subject of this well-researched history of the period from the summer of 1960 to the summer of 1972. 

 

On January 20, 1961, a 43-year-old John F. Kennedy became the youngest U.S. President since Theodore Roosevelt. In his inaugural he focused on the Country’s strength and the meaning of freedom: “Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe to assure the survival and success of liberty.” Americans were confident. In May of that same year, Kennedy announced a goal of putting a man on the moon by the end of the decade. Yet the Cold War persisted, poverty had not been vanquished and civil rights were not equally shared. Convinced of a need to stop the spread of Communism got us entangled in Vietnam. Concern for those living in penury led to the War on Poverty. Disquiet about equality and fairness were behind the Civil Rights Act of 1964 and the Voting Rights Act of 1965. A decade that began on a high note, exemplified in Kennedy’s inaugural, ended with Nixon taking the nation off the gold standard on August 15, 1971. The years between witnessed a growth in national debt, a declining Dollar, student riots, and the assassination of a President, a civil rights leader and a U.S. Senator and Presidential candidate.

 

Ms. Schlaes begins each of the twelve chapters with three statistics: Guns and butter, as a percent of GDP, and the DJIA price. Despite Vietnam, guns as a percent declined from 9% to 7%, while butter rose from 4.5% to 7.1%. The DJIA began at 679 and ended at 898. (However, the DJIA finished 1965 at 969, and it would be 1982 before the Averages closed consistently above 1000.) President Johnson told students at Swarthmore College in May 1964, a scaled-up government was the answer to problems of the ‘60s. Ms. Schlaes quotes him: “The truth is, far from crushing the individual, government at its best liberates him from the enslaving forces of his environment.” Twenty-two years later, President Reagan gave us the other side, in his nine scariest words: “I’m from the government, and I’m here to help.”

 

We are introduced to some of the main characters of the period, “the best and the brightest on the home front:” William McChesney Martin, Arthur Burns, Pat Moynihan, Sargent Shriver, George Romney and Walter Reuther. “Fending off incursions of the federal government…wittingly or unwittingly” were mayors like Sam Yorty of Los Angeles and John Daley of Chicago and governors like Ronald Reagan of California and John Connally of Texas. We spend time with Martin Luther King, Andrew Goodman, James Chaney and Michael Schwerner, all of whom died for the cause of civil rights. And we get to know Tom Haydn, the radical activist who founded Students for a Democratic Society (SDS) and who later married Jane Fonda. About Haydn, Ms. Schlaes writes: “Socialism was a goal, Haydn saw, that attracted many people, even – especially – when they knew little about it.” We meet businessmen, like Lemuel Boulware of General Electric who worked to curtail the influence of unions, and Gordon Moore of Fairchild Semiconductor, about whom she wrote: “The rule that nothing could proceed without a government client seemed immutable to the maverick engineers.” We witness the Gulf of Tonkin attack and ensuing Resolution and the passage of the Economic Opportunity Act, signed into law in August 1964.

 

We learn of well-intentioned programs like the Fair Housing Act, which had the unintended consequence of destroying neighborhoods and splitting up families. When Robert Moses wanted to tear up Hudson Street in lower Manhattan, he ran into resident Jane Jacobs: “Hudson Street enchanted her…the street was always busy. Locals emerged from their doorways, shopped in the dime stores, and, most important, looked after one another.” High rises and highways destroy a neighborhood’s sense of camaraderie.

 

Like much of what government does, final costs bore no relationship to original estimates: The Vietnam war cost $843.6 Billion, equal to 1967’s total GDP. Medicaid cost three times its estimate. By the end of the decade, New York’s welfare payments alone, at $2 billion, were double the “once huge-sounding budget for the War on Poverty.” The Office of Economic Opportunity began, in 1964, with 400 lawyers and a budget of $4 million, by 1970 had 2,000 lawyers and a budget of $58 million. The author quotes British socialist Beatrice Webb, that automatically distributed money was likely “to encourage malingering and a disinclination to work.” The Courts were changing. “In 1970, the courts were supplanting the legislative bodies, with judges themselves ‘legislating’ via constitutional fiat.”

 

There were those like Governor Reagan of California who foresaw the problem of government largesse: In December 1970, Reagan told the press: “I believe government is supposed to promote the general welfare. I don’t believe it is supposed to provide it.”

 

Government is necessary, else anarchy reigns, for men are not angels, as James Madison wrote in Federalist 51. But government cannot answer all problems. It does not have X-ray vision to see around corners or into men’s souls. The “invisible hand” of free markets has always been more efficient than the planned economy of Socialism. That is the lesson of Amity Schlaes book. It is a lesson for today. People in government in the 1960s were, for the most part, good and well intentioned. They wanted to prevent the spread of Communism. They wanted to eradicate poverty. They wanted to integrate society. They wanted a “great society.” But they did not listen to people on the ground. Most important, they lacked wisdom. They could not (or would not) see the consequences of what they did. They did not foresee Kent State, It was not their plan to destroy neighborhoods or break up families, yet, that is what happened. Impersonal, high-rise apartments destroyed neighborhoods and distanced people from neighbors. Children brought up in father-less homes suffered the consequences of fragmented families. In this age of COVID-19, when once again many want to see government’s role increase, this is a timely book that shows the folly that can happen when Washington’s elite ignore the people’s voice.