Markets, Planning and the Moral Economy

Markets, Planning and the Moral Economy

Business Cycles in the Progressive Era and New Deal

Donald R. Stabile and Andrew F. Kozak

Markets, Planning and the Moral Economy examines the rise of the Progressive movement in the United States during the early decades of the 20th century, particularly the trend toward increased government intervention in the market system that culminated in the establishment of President Roosevelt’s New Deal programmes. The authors consult writings from politicians, business leaders, and economists of the time, using a variety of historical perspectives to illuminate the conflicting viewpoints that arose as the country struggled to recover from the worst economic downturn in its history.

Chapter 1: Introduction: the moral economy versus the market economy

Donald R. Stabile and Andrew F. Kozak

Subjects: economics and finance, history of economic thought

Extract

For over a century in the US opponents of the market economy have attacked it for the excessively immoral behaviour its stress on individualism has allegedly generated. In this book we shall be concerned with the anti-market ideas of the Progressive movement that emerged in the US in the first three decades of the twentieth century and culminated with the New Deal of President Franklin Delano Roosevelt in the 1930s. The Progressive movement and the New Deal were composed of a diverse set of social interest groups, liberal and elitist and democratic or corporatist. The overarching ideology of the Progressive movement, the glue that held its diverse elements together, we shall argue in this book, was that its members aimed at replacing or at least supplementing the market economy with a moral economy of their own design. In that moral economy, government stewardship and planning became viewed as a necessary component of the economic system in order to ensure a better life for all. The Progressive movement arose in response to a number of economic and political forces that came to the fore in the US at the beginning of the twentieth century, such as the growth of large corporations and labour unions, the development of new technology and the increase in the intensity and pervasiveness of business cycles. Our focus will be on business cycles and how they evoked calls for the government to protect its citizens from the market economy that caused them.