Boris Johnson sought to co-opt a hero of left-wing politics as he presented his vision for post-coronavirus Britain.
After all, FDR (pictured above) “used the full power of the state to restore American fortunes after the Great Depression”, The Times reports.
What did Johnson announce?
“This is a government that is wholly committed not just to defeating coronavirus but to using this crisis finally to tackle this country’s great unresolved challenges of the last three decades,” the prime minister said this morning in Dudley.
The plan is built around a “£5bn programme of accelerated capital spending on hospitals, roads, rail, prisons, courts, schools and high streets”, says The Times. A national infrastructure plan for transport, power generation, flood defences and waste will follow in the autumn.
Other investments include “£1.5bn for hospital maintenance”, says The Guardian, and “£40m to boost local conservation projects and create 3,000 jobs”.
Johnson said that if it sounded “positively Rooseveltian” that’s because it was meant to. “That is what the times demand,” he said. “A government that is powerful and determined and that puts its arms around people at a time of crisis”
What did FDR’s new deal do?
Having come to power in 1933, shortly after the Great Depression, “Roosevelt faced the enormous task of restoring confidence in a shattered economy,” says the BBC.
He did this first by “building infrastructure across the US and creating millions of jobs”, says The Times. “The later stages of the New Deal established the basis for the US social security system and improved workers’ rights.”
All of this involved huge investment, and marked “the largest, most expensive government programme in the history of the American presidency”, says the BBC.
However, The Atlantic adds, it was not only “a series of big-spending government programmes”. A series of loans and guarantees also encouraged private investment. Roosevelt did not overturn capitalism, says the magazine. Instead his “genius was that he knew he had to get capitalism moving again”.
How does Johnson’s plan compare?
“Labour politicians can be forgiven for rolling their eyes at the appropriation of FDR by figures such as Michael Gove and Boris Johnson,” says The Times, “given their response to the global financial crash.”
John McDonnell, the left-wing former shadow chancellor, needed no invitation, tweeting that “Roosevelt must be turning in his grave at this pathetic damp squib”.
“In certain ways the two recovery plans are comparable,” The Sun argues, pointing out that “both aim to help an economy out of a recession and both focus on increasing employment.
“But after taking office in 1939 Roosevelt rewrote economic rules for the United States, something which the PM is not expected to do,” the paper adds.
In fact, says George Eaton, “Johnson’s spending plan is 200 times less ambitious than the New Deal”. The total investment announced by the PM adds up to just 0.2% of last year’s GDP, he says, where FDR’s economic stimulus amounted to 40% of his country’s pre-depression annual GDP.
However, says Robert Shrimsley in the Financial Times, the FDR line at least “points to a readiness to abandon old nostrums; to borrow and spend, invest in schools and hospitals, put funds into industry”.
“For all the cultural divides,” he adds, “there is almost an economic new consensus and it is not Thatcherite.”
Did the original new deal work?
“Historians do not necessarily agree as to whether the New Deal was a success or a failure,” says the BBC. Unemployment fell, but it “was not conquered” and many of the new jobs created “were only temporary”.
But although it was “no magic bullet”, says The Atlantic, it did bring about rapid change.
“As late as 1935, 90% of rural homes had no electricity,” it says. But thanks to government support for local electric companies, that figure was reduced to 40% five years later and 10% after another ten years.
By then, however, there were other reasons for state intervention. “It was the Second World War that finally put the US economy back on track as government spending soared,” says The Times.
Will Johnson’s new deal work?
“The teensy flaw is that all the speeches in the world will not make the virus go away”, says Shrimsley. And that Johnson’s speech coincided with a new lockdown in Leicester – and threat of more to come – underlines the scale of the challenge.
In any case, says Sherelle Jacobs in The Telegraph, Johnson’s diagnosis is all wrong.
“If ‘Jobsageddon’ is coming to Britain, one would be forgiven for expecting a Conservative government to try and douse its flames with authentically conservative policies,” she says.
“It should be slashing employment red tape, particularly around the hiring of agency workers, and freezing the minimum wage to encourage employers to keep on staff. It should be driving a tank through planning regulations, and aggressively pursuing tax cuts.”
But for Shrimsley, the true struggle “is less over ideas than whether this New Deal rhetoric leads to better lives for those voters. If it does, then Britain will be a better place,” he says.
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