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 13: The New Deal and planning

Donald R. Stabile and Andrew F. Kozak

Subjects: economics and finance, history of economic thought


For three decades before the New Deal, Progressives promoted the idea that government intervention in the economy was needed because the market economy could not solve the problems associated with the business cycle. Among those Progressives, the advocates of planning as a way to eliminate depressions thought they had their chance when the New Deal was put in place. The NIRA provided the potential for national economic planning, but it was never used to plan the economy. On that our economists, pundits, politicians and business leaders agreed. In this chapter we look at how some of our proponents of planning and the moral economy interpreted the New Deal as a culmination of their ideas. How had it fallen short of their goals and where it was going were questions they asked. We also present the views of one advocate for the market economy. The persons whose ideas are reviewed in this chapter will be familiar to the reader by now and we start with the most familiar one of all, President Roosevelt. By all accounts Franklin D. Roosevelt was a polished public speaker. Throughout his years as president he put his speaking abilities to use in a series of radio broadcasts to the people of the US called the ‘Fireside Chats.’ In those Fireside Chats the president explained the basis for many of his policies from the NIRA to the strategy for fighting World War II. Among those explanations he included occasional comments on his overall policy, answering the questions about what he believed had caused the Great Depression

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