Don’t we need a new WPA?
ASK THIS | February 19, 2008
The author of a new book on FDR’s Works Progress Administration writes that a jobs program would give more bang for the buck than a tax rebate –- and could also address the nation's serious infrastructure problems.
By Nick Taylor
One of the first things people ask me when they learn I've written a book about the Works Progress Administration is, “Don't we need a new WPA?” There are a lot of reasons for the question: a paucity of public funding for the arts, a sense that the economy is treating many people badly, a deteriorating infrastructure, growing unemployment. Right now it's the potential of public jobs as economic stimulus to cope with a looming recession.
The WPA and its predecessor, the Civil Works Administration, were created both to repair a broken infrastructure and relieve the suffering that came with widespread joblessness. At the same time, they were models of Keynesian thought. The people who had these jobs put their money back into the economy immediately, buying food and badly needed clothing. There were reports during the winter of 1933-34 that CWA workers bought so many new pairs of boots with their paychecks that factories reopened to meet the demand. And when the WPA's rolls were cut by two-thirds in 1937, the money taken out of the economy helped produce a downturn that was called “the Roosevelt recession.”
It's hard to imagine a political scenario today allowing for a large jobs program directly funded by the federal government, as the WPA was. But the prospect of a recession makes some version of public works jobs worth considering as stimulus.
An alternate form of stimulus, the already-enacted tax rebates, is “found money” for most people. It may go back into the economy, but it is just as likely to be used to pay off back debts, since the whole reason the economy is sinking is that people are overextended. Extended unemployment benefits would trickle money back into the economy when a flood is what's required.
A jobs program would give more bang for the buck. It is the only alternative that could - if properly designed - both boost the economy and address serious infrastructure problems that have a coalition of governors and mayors including Arnold Schwarzenegger and Mike Bloomberg pleading for $1.6 trillion in federal aid over the next five years.
All forms of domestic spending are vulnerable in the last Bush budget, given the costs of war, tax cuts, and entitlements. It would take a wholesale reordering of national priorities for the federal government to initiate a program to repair the nation's roads and bridges and the other systems vital to our health and commerce. Yet the widely acknowledged necessity of just such an initiative requires journalists to ask questions like these of the presidential candidates --- and House and Senate candidates as well:
Q. Why not attack the infrastructure's deficits and the need for economic stimulus at the same time in one concerted program?
Q. Why has nobody thought of this as a solution?
Q. What are the consequences of failing to address the infrastructure deficit? (We know some of them already - falling bridges, exploding steam pipes, and crumbling levees, but we should also think of things like traffic jams, airport delays, and power outages as infrastructure problems.)
Q. And what if tax rebates don't rev up the economy? Are we then prepared to suggest a change in policy that would allow the vital modernization of our country to go forward, as it did in the Depression by way of the WPA?
Government work programs = more inflation
Neal Fitzgerald -
02/19/2008, 05:08 PM
Creating new government jobs and new government agencies is not the answer. All we'll get is more inefficient bureaucracy, and a stronger and more vicious cycle of dependency on government.
Who will pay for these new jobs and new agencies? The rest of us, through tax increases or, more likely, through inflation. This will only delay the inevitable and make our long-term outlook much worse.
We need to recognize that politicians do not have the ability to fix the economy. We need to fix the government, the government doesn't need to fix us.
We should start by changing our disastrous foreign policies, and using the money we spend blowing up and rebuilding bridges and roads overseas to rebuild our own infrastructure.
Then stop empowering a government which believes it can spend itself out of any problem.