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Historian Peter Kuznick says that while Truman supported the New Deal, he paved the way for its undoing by fueling the anti-communist, anti-socialist fervor which played into the hands of the right; with host Paul Jay

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PAUL JAY: Welcome back to the Real News Network. I’m Paul Jay. As Donald Trump and the republican controlled congress try to put the final nails in the coffin of The New Deal, we’re discussing the origins of The New Deal and what happened to it. We’re calling this series, The Undoing of the New Deal. As I say, while Trump and gang are trying to more or less end it, they didn’t start this process. We’re telling this story in a series of interviews with historian Peter Kuznick, who joins us from Washington. Peter is a professor of History and director of the Nuclear Studies Institute at American University. He’s the co-writer with Oliver Stone of the Untold History of the United States. Before we pick up the story with the Truman administration, Peter you wanted to add a few things about what the New Deal was. Again, I urge you, go back if you’re watching this segment. Have ’em watch the earlier ones. Really, it’s worth it. Go back to part one and work your way up here. Go ahead Peter.
PETER KUZNICK: We talked about the way people have dismantled the New Deal. Unfortunately, President Roosevelt began the process himself. In 1936, as we were saying, the left was dominant in the United States. The right wing was largely wiped out. You’ve got not only the national scale, but you’ve got Upton Sinclair running for governor in California on the epic ticket, End Poverty in California. You got Huey Long’s Share the Wealth programs in Louisiana. You got Francis Townsend. You’ve got a whole broad array of reformers.
We’ve got the popular front during this time. And the left Democrats dominate. The Republican right wing is decimated after the ’36 elections. Roosevelt makes some blunders. One of those blunders is his attempt to rebalance the budget in 1937. He imposes sharp budget cuts, cuts some of the funding for New Deal programs and the economy plummets into a new recession in 1937. It was called the Roosevelt Depression.
PAUL JAY: Roosevelt was not a Keynesian. He didn’t believe in stimulus and unbalanced budgets.
PETER KUZNICK: I say he was a partial Keynesian. Roosevelt was not very much ideological. He was not deeply philosophical. Roosevelt was somebody who operated based on personal charm, you know? He could say, “My old friend,” in more than a dozen languages. He was a charmer. He charmed Stalin even, but was not deeply ideological and not an intellectual in that sense. It was under some pressure from the right, even though there’s no real right-wing pressure that needed to affect him. And so, he cuts the budget 1937, the economy plummets and then he restores some of the funding. In terms of the real New Deal reform spirit, it’s ended by that point.
And so, as we mentioned earlier, when the Wagner Act is introduced in 1939 for a real National Healthcare program, Roosevelt cuts out the support for that, even though the progressives, the reformers thought that was gonna be the heart of the reform program going forward, to create a real national healthcare program. The idea that healthcare is a fundamental right that everybody deserves from that point on.
As you know, we go forward to the point where we used to be able to say that there were two countries in the world that didn’t have a national healthcare program, two industrial countries. One was the United States, the other was South Africa. South Africa does have a national healthcare program, so now the United States is the only major industrial country that doesn’t have a national healthcare program that covers all of its population. It’s really shameful.
PAUL JAY: Why did Roosevelt not support the Wagner Act? Why didn’t he support a national healthcare plan?
PETER KUZNICK: In some ways it’s baffling. He wanted to run for a third term in 1940. Among the groups that were in the forefront of the opposition to the national healthcare program, was the AMA. Even though progressive physicians-
PAUL JAY: Medical association.
PETER KUZNICK: The American Medical Association. American Medical Association attacked the Wagner Act as communism. They were a small minority and a small voice, but they had a certain influence in the United States. The university professors, led by the faculties at Harvard and Yale, where the leadership of the need for a national healthcare program.
They were supported by academic physicians around the country, but the private practitioners represented by the AMA, led the fight against it. Roosevelt decided, and planning to run again for reelection in 1940, that he didn’t want to take on this kind of challenge and get into a fight with the physicians and some of the other people who were opposed to this kind of sweeping healthcare reform.
The other point that you mentioned before about what was happening during the Clinton time, Clinton does dismantle key elements in the New Deal. It’s Clinton who ends aid to families of dependent children, which is one of the key new deal measures that had lasted from the 1930’s until the 1990’s before it was buried by the Clinton administration. That was an important setback. There was a major fight about that between the conservative Democrats siding with the Republicans and the progressive wing of the Democratic party.
We know now in a lot of ways, the progressive wing of the Democratic Party is far to the left now than what it was in the 1990’s. For example, in 1994, 52% of Democrats thought that immigration was a good thing. In 2017, 84% of Democrats say immigration is a good thing. Similar kinds of shifts in terms of single payer in the United States from that time to now. We have, in some ways a Democratic party that is hard to the left of what it was back in the 1990’s when Clinton was in control.
PAUL JAY: What other measures then, let’s go back to Truman. In an earlier episode, we talked about Truman. Truman purging Wallace and other of the New Dealers from his administration. That was partly over foreign policy issues with Wallace. To what extent does Truman want to undo the New Deal, in terms of the domestic policies?
PETER KUZNICK: Truman thought he was protecting the New Deal. Truman thought that by eliminating the left wing of the Democratic party, especially those who weren’t any way associated with the communists, that he was protecting the New Deal.
The Republicans had begun running against the New Deal in 1946, when they kept saying that the New Deal was a Communist Program. The idea was that communists had had important positions within the Roosevelt administration, the New Deal administration. You’ve got J. Parnell Thomas beginning the hearings with the House Un-American Activities committee in 1946. The first group who they target was the Atomic Scientists.
They said that E.U. Condon with the head of the National Bureau of Standards and others represented the weakest link in our National Security. They say that there’s atomic espionage and they start warning about that. There is a case in Ottawa of a Soviet linked spy network that was discovered. They were able to play upon this fear of atomic espionage, starting in 1946. Even though they target the scientists as the first group they attack, the first round of hearings is not on the scientists. The first round of hearings is in Hollywood. They wanted to curb the influence of the left in Hollywood.
PAUL JAY: Four years before McCarthy here. Is that right?
PETER KUZNICK: McCarthy is, as we mentioned last time doesn’t come on the scene. His famous speech in Wheeling, West Virginia is February 9th, 1950, where he says, “I’ve got the list of however many communists who work in the State Department. The number keeps changing,” right? Finally, he comes up with a number of 57 and in one famous movie, he’s looking at a Heinz ketchup bottle and then he announces that 57 is the number of communists.
PAUL JAY: We should talk about, the Communist Party in the United States and the people active in the American communist party were essentially fighting for socialist style reforms within the United States. Whatever the Soviet Union was or wasn’t, and that’s another conversation. The American communists were not very different than all kinds of American Socialists, who were fighting for some kind of social Democracy in the US.
PETER KUZNICK: That’s largely true. There’s a big debate among historians, to what extent the Soviet Union exercised control over the American Communist Party. At the top levels of-
PAUL JAY: Even if they did, what they were actually advocating and fighting for wasn’t much different than what other socialists were. I think there’s plenty of evidence. There was lots of …
Peter Kuznick: Yeah.
PAUL JAY: More than the interaction between the Soviet Union and the American communist party.
PETER KUZNICK: I think that translates down to the grassroots level. You look at, for example, Robin Kelley’s got a terrific book about the Communist Party in Alabama, Hammer and Hoe. You see almost no influence in terms of the grassroots organizing the sharecropper’s unions, the Steelworkers. The things that the Communist Party were doing, the Communist party was leading the fight against segregation in the United States.
There’s a debate among historians now, when we trace the beginning of the Civil Rights movement. Where did it start? Historians are not looking at it as a southern movement, that began in 1956 with the Montgomery Bus Boycott of ‘55. They’re not looking at it only in terms of Little Rock Nine in Arkansas, in 1954. They’re looking at in terms of the Civil Rights Movement, the Desegregation Movement in New York City led by communists in the 1940’s and 1950’s. The communist party was out front on that issue. They were very strong on a lot of other kinds of progressive reform. Who is supporting the integration of baseball? It was Paul Robeson and Communists who were doing this first.
There were a lot of things that the communist party was doing, that would later be adopted, support for social security. Norman Thomas and the socialists were also involved in that. Most of the policies that the communists adopted in the United States were not gonna help the Soviet Union in the Cold War, but certain policies were clearly to get the United States to stand down in terms of the Soviet Union.
PAUL JAY: Let’s not forget that the United States had just, not long ago, bombed Hiroshima and Nagasaki with atomic weapons and many historians, I think including you, think it was mostly a shout across the bow of the Soviet Union, not something needed to end the war with Japan. The espionage that was certainly going on in the United States was about dealing with a country that’s threatening the Soviet Union with nuclear weapons. It’s a whole big conversation about the relationship of the Soviet Union to the American Communist Party. A lot of people think it damaged the efforts of the American Communist Party …
PAUL JAY: In many ways. But I think just the boogie man of the word, communist. There’s so many years of Cold War here. You can’t even mention the word, without it bringing up such demonization.
PETER KUZNICK: The Communist Party, the Soviet Union, although in the early 1930’s, the American communists were able to point to the Soviet Union as the example of the one country that was not hurt by The Depression. In fact, when there were rumors that the Soviets wanted to hire American workers, to work in Soviet industry, there were riots at the offices, the trade offices, the Soviet trade offices in the United States because American workers were so desperate to get jobs in the Soviet Union. The image of the Soviet Union as a country that had been, not affected by the…
You see this being written about in the New York Times, in Business Week, in Christian Science Monitor, in American Conservative publications is that the Soviet Union had not been affected by the depression, that the Soviet Five Year plan was working, that the Soviet Union was committed to science and technology, and growth and progress, that the Soviet Union had socialized medicine and programs for women. I mean, there was a certain very positive image of the Soviets for a while.
Then later in the decade, the image of the Soviets begin to change with the purges. We find out more about Stalinist repression and the image of the Soviet Union declines. During World War II, the image of the Soviet Union again is very positive as a reporter in the New York Times says, “We owe our future as a Democratic society to the Soviet victory over fascism.”
The Americans appreciated the fact that the Soviets were the ones who were doing the fighting against fascism and defeating fascism. There were second front rallies all across the United States. Roosevelt promised to open up a second front in Western Europe in May of 1942. Molotov comes over, Roosevelt meets with him and says that we’ll open up a second front before the end of 1942. And then Churchill backs out.
The United States doesn’t end up opening up the second front until June of 1946. It’s during that time that the Soviets turned the tide of the war against the Nazis and the Soviets move and push the Germans back that are occupying Eastern and Central Europe. Roosevelt doesn’t give up anything at Yalta that the Soviets didn’t already control at that point. The image of the Soviet Union was a much more positive one during that time which is why Truman has to make such a great effort to turn the American people against the Soviets because we’ve got to undermine that heroic image that they had occupied from 1942 until 1945 really, during that period.
PAUL JAY: When the workers come back from Europe, the soldiers come back from Europe and are workers again, my understanding, I think it’s in ‘44, ‘45, certainly after the war is the year with the most strikes in the history of the country, before or since.
PETER KUZNICK: Yes. Absolutely.
PAUL JAY: It’s a height of working class militancy. The Soviet Union, at least looks like it’s a model of an alternative which explains also part of why so many of the elite supported the New Deal. The promise that capitalism can provide everything socialism does. In other words, full long-term employment for all and such. That was going to be the promise. Capitalism could achieve more than socialism could offer. You don’t need that as the alternative.
PETER KUZNICK: The tragedy really, of the 20th century, is that the Soviet revolution, the Communist revolution was such a bust. I mean, Marx had warned about this, right? Marx says that communist revolutions should not occur first in Russia, because Russia’s too economically and culturally backward. Marx envisioned the communist revolution occurring in an advanced industrial country like Germany, or the United States. That was his vision. The Soviet Union sadly lives down to Marx’s expectations. That’s held up as what socialism is. That’s a tragedy, because we don’t have a positive image of a socialist alternative.
PAUL JAY: My Uncle had a line that was sort of funny. Socialism in a backward country is backward socialism.
PAUL JAY: There’s some truth to that. All right. We got a little bit more time in this segment. Let’s go the broad strokes. There’s a big post war expansion now. The United States emerges as the “Great Power.” The Soviet Union lies in ruins with, what is it, almost 30 million people dead. Europe is in ruins. The United States has enormous expansion of the economy. There’s not such a need for these kinds of direct workfare programs. I mean, direct federally funded programs and such. Much of the social safety net still exists. How does this undoing of the New Deal unfold from Truman on? Let’s do sort of broad strokes.
PETER KUZNICK: There was a lot of concern at the end of the war, that the United States was gonna plunge back into a depression. The real fundamental structural problems in capitalism had not been solved by the New Deal, as we saw in 1937. They do get solved temporarily by a massive increase in defense spending. The United States is loth to really cut defense spending as rapidly as people had hoped it would after the war in order to actually rebuild the domestic economy.
As you were saying, the United States is the only country in the world, that comes out of World War II looking good. It’s the only economy that’s thriving. Everybody else had been decimated. European economies had gone back decades. The unemployment was rampant. The housing was destroyed. You had massive refugee populations. We didn’t know what was gonna happen.
It looked like the Communist party was quite strong in countries like Italy and France, it probably could have seized power. That’s one of the things we have to recognize about Stalin. The accusation about Stalin is that Stalin had some mass, or plan for global conquest. That’s what the right wingers claimed in the United States and elsewhere in the early Cold War years.
Stalin did not have a master plan. Stalin was very, very defensive and in some ways very conservative. Stalin’s hope was to rebuild the Soviet Union and to gain security. His vision for security, unlike Roosevelt, Roosevelt wanted an institutional response. He set up the United Nations. He thought that through the United Nations we could achieve world peace. Stalin wanted a buffer zone. He’d been invaded twice by Germany through Eastern Europe. He didn’t trust Germany, of course. He didn’t trust Eastern Europe.
He wanted a buffer zone. He didn’t want lockstep governments. What he wanted were friendly governments in Eastern Europe. He allows a measure of democracy in Eastern Europe that lasts really until 1947 to 1948. It’s not until the Truman Doctrine until the US takes over for the British in Iran, in Greece, in Turkey, that Stalin clamps down and puts in the Dictatorial regimes in Eastern Europe that were so odious for decades.
There was a period, that was a period from ‘41 until ‘47, where we could have had a very different relationship with the Soviet Union. That’s what Wallace understood. That’s what Roosevelt understood. In 1942, May of 42, Roosevelt calls for four policemen. He says the United States, the Soviets, the Chinese, and the British, have gotta police the post-war world, create a world of peace and prosperity and stability. He always envisioned the US and the Soviet’s working together as did Wallace.
That was the vision that Wallace runs on in ‘48, when he runs on his third party campaign as opposed to Truman who red baits Wallace and accuses him of Communist ties and sympathies. Wallace was not anti-communist but was not pro-communist. What Wallace wanted always, was a peaceful competition between the American system and the Soviet system to show to the world which could better serve the needs of mankind. That was Wallace’s vision. That vision was attacked and denounced by Truman, as well as by the Republicans at that point.
PAUL JAY: Let me correct you on one thing. There was another country that emerged pretty well after the Second World War. Canada also didn’t get destroyed, and got to ride the American train as American hegemony develops. We’re gonna have to end this segment and we’ll pick up again in the next. I think something you just said, we need to pick up on more. Truman didn’t demobilize after World War II. There’s a massive increase, continuing increase in military expenditure.
Of course, Kennedy, I think raises the level of military expenditure to a whole new stratospheric level. To do all that, you need the Cold War. You need an existential enemy. Part of the way, as you just said, they deal with the issue of the capitalist crisis is through massive military expenditure. You need a massive enemy to justify the whole thing. We’ll pick this up in the next segment. Thanks for joining us again Peter. Did you wanna add anything before we finish this?
PETER KUZNICK: Just my apologies to the Canadians for leaving them out. I think they’ll let me get away with that Paul.
PAUL JAY: It’s okay. I’m also Canadian.
PAUL JAY: I’m sensitive on these issues. Thanks for joining us, Peter.
PAUL JAY: We’re in our winter fundraising campaign. We have a 200,000 dollar matching grant, so we’re trying to raise a total of 400,000 dollars before the year is over. Hopefully, we can raise more than that. You need content like Undoing the New Deal. I don’t think you see it anywhere else, this kind of a conversation. I mean, where else do you find on American anywhere, a real legitimate, honest conversation about the New Deal, the political forces at play.
For example, the role of the American communist party. You know, we can talk about that on the Real News without worrying about Cold War demons and all the crazy prejudice about it. You can agree or disagree with what I said or Peter Kuznick’s interpretation. We’re not afraid to talk about real stuff. We’re not gonna talk about it with fear of pressure.
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Peter Kuznick is Professor of History and Director of the Nuclear Studies Institute at American University in Washington, DC. He and Oliver Stone co-authored The Untold History of the United States.