Robert D. Leighninger, Jr. is the author of Long-Range Public Investment: The Forgotten Legacy of the New Deal. This opinion piece was intended to run in the NYTimes, but when it didn't, it was posted at Dirigo Blue:
The Public Works Mosaic: Stimulus Now, Dividends Later
Many are looking at Franklin Roosevelt's New Deal for inspiration in responding to the new Great Depression, e.g. David Brooks, 10/11/08 and Paul Krugman, 11/10/08 and 12/1/08 in these pages. Most attention is being directed at its many and varied public works programs. But few realize how many and varied they were. There were at least twelve separate building initiatives, with different organizational structures, leadership, and goals all deserve closer inspection because all had notable successes and equally important limitations. In the current debate, there are several different expectations of public works. Some want immediate economic stimulus; others want long range investment. The New Deal provided both, and a lot of other things as well, but not all from the same program.
Make the jump:
The New Deal's best known building agency was the Works Progress Administration (WPA). Unfortunately, it has subsumed all the others in public memory. It's time to unpack. Before the WPA was the Public Works Administration (PWA), whose job was large scale projects like the Lincoln Tunnel, Brooklyn College, and the Triborough Bridge. Such things took time, planning, and skilled labor. Its stimulation of the economy through reviving the production of building materials like cement and steel was not apparent for several years, as current critics point out. But there were also programs with immediate results. The Civil Works Administration (CWA) put four million people to work in a few weeks. It did labor-intensive projects like sidewalks, as well as white collar work like staffing libraries and clinics. It even employed artists. The economic stimulus was immediate and large enough to be noticed by the Wall Street Journal. Moreover, lack of stimulus was apparent soon after the CWA was terminated four and a half months later.
The effects of the Civilian Conservation Corps (CCC) were also immediate. It took idle young men off the streets and rails; gave them nourishment, skills, and education; put them to work planting trees, stopping soil erosion, and fighting forest fires; and sent $25 a month home to their struggling families. The WPA did not arrive until 1935. It continued CWA's specialization on small to medium, labor-intensive projects.
In addition to economic stimulus, short and long-term, all these programs built things of lasting value. Roads and bridges, schools and university buildings, hospitals and courthouses, national and state parks blossomed across the country and are still in use today, more than three quarters of a century later. They are the furniture of our daily life. We take them for granted; few of us know where they came from. They are the living evidence in support of current policy proposals, they show what long-range investment can provide.
Krugman has noted that the recession of 1937 was ignited when Roosevelt cut back all these programs and tried to balance the budget. However, he does not add that, as Columbia Historian Alan Brinkley has argued, the recession was turned around when the public works programs were restored. It did take WWII to end the Depression, but the numbers were going back in the right direction. It is also true that the New Deal included policies that retarded recovery while other policies were aiding it. The important thing to remember is that the New Deal was not a monolithic program. There are lots of lessons, good and bad, to be learned from it.
The two most important lessons, I think, are these:
First, public jobs can provide economic stimulus if they go to the people who will spend their salaries immediately. That was no problem during the New Deal; millions were desperate for basic food and clothing. Today we need more careful targeting; those known as the "working poor" should be high on the list.
Second, we can't be certain if tax rebates or salaries from public jobs will be spent. But if the money goes to public works, at least we have something to show for the expenditure, something that will pay dividends for decades.