Do We Need Another "New Deal?"

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Before one can properly answer whether a "new" New Deal of government intervention and control of the economy is a necessary response to today's financial crisis, one should first ask if the original New Deal did a good job mitigating the financial crisis of its era. The answer is a resounding no: rather than help end the Great Depression, the programs of the Franklin Delano Roosevelt's New Deal only served to exacerbate and prolong America's economic crisis.

Why? Because at root, the New Deal was little more than a series of programs aimed at the coerced redistribution of wealth from those who produce it to those who do not. Minimum wage laws, laws that unfairly biased labor negotiations in favor of trade unions, massive public works programs that allocated resources based on politics rather than economic merit, laws that encouraged farmers to restrict production, intrusive regulation of finance and currency and a literal Ponzi scheme to pay for workers' retirements (just to name a few of the New Deal's many mandates) each violated economic freedoms and created a series of perverse incentives that hampered production, throttled employment and punished thrift.

As such, the New Deal was a devastating impediment to economic recovery; one cannot shackle the engines of production while simultaneously expecting gains in production and wealth. Furthermore, the New Deal was judged to be largely unconstitutional; prior to Roosevelt's threatened court-packing scheme, the New Deal's programs were being thrown out left and right. To enact his programs, Roosevelt had to attack the very fabric of the American constitutional order.

Thus the idea that America should revisit this era represents a chilling threat and would be a giant leap backwards in time to one of the worst eras in American history.