The Great Recession vs. The Great Depression

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Americans are in a foul mood. They're unhappy with their economic prospects, convinced the country is headed in the wrong direction, upset with the federal government, and equally annoyed at Congress.

Their attitudes are understandable. After the worst economic downturn since the Depression, who wouldn't be this gloomy?

Folks from the Great Depression, apparently. According to a trove of early Gallup surveys compiled by the Roper Center, Americans in the 1930s were not nearly as down on government as we are today. They wanted more, not less, from Washington in the way of services and protection from the private market. Incredibly, despite their much deeper recession, Americans were more optimistic than we are today.

Optimistic 'Socialists' ...

Between the Great Depression and the Great Recession, the United States underwent dramatic technological changes.  In the 1930s there was the TVA--but no TV, and, of course, no Internet.  More than half of the predominately-male, overwhelmingly-white sample surveyed in a series of polls in 1936-37 by the then-new Gallup organization had average incomes or better. But 46% had no telephone, 43% lacked a car, and 38% still preferred the old black-and-white movie variety to color.

Depression-era Americans shared many of our values, but they were notably more optimistic and open to government spending

Perhaps more relevant are some striking differences in economic outlook and preference.  While unemployment had receded somewhat from its 1933 peak, it lingered at an estimated 17% in 1936 and 14% in 1937, not counting work relief programs. Still, Depression-era Americans remained hopeful. Half expected general business conditions to improve over the next six months. Only 29% expected a worsening. Six in ten thought opportunities for getting ahead were better or at least as good as in their father's day.

Today's public is far gloomier: Only 35% in an October Pew Research survey expected better economic conditions in a year, while 16% expected a still weaker economy.

The relative optimism of 1930s Americans was undergirded by what today would be regarded as "socialistic" tendencies. Even if only a tiny fraction were ready to describe themselves politically as "socialist," those surveyed after the 1936 election said they supported Roosevelt, architect of the New Deal's expansive programs, over his GOP opponent, Alfred Landon, by more than two-to-one. They also felt, by a lopsided margin, that if there were another depression (and fears of one were mounting), the government should repeat the spending pattern FDR had followed before.

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Not only did two-in-three favor the new Social Security program, but also even larger majorities favored the feds providing free medical care for the poor, spending to control venereal diseases, and new loans on easy terms so tenant farmers could  buy the farms they rented. 

Of course, the New Deal had many critics. The WPA, employer of some eight million workers over its lifetime, was a favorite target. Although its workers built La Guardia and Reagan National airports, Grand Coulee Dam, San Francisco's Bay Bridge and New York's Triborough, plus parks, schools, playgrounds, overpasses and airfields, they were featured in many cartoons leaning on their shovels. (The WPA Theatre project produced a play satirizing that common criticism.) In a radio broadcast, the president of the New York Economic Council denounced the New Deal as "nothing but the same old European and Asiatic tyranny from which our ancestors fled Europe in order to establish real freedom." But this was not the majority view. 

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Support for government action extended beyond spending to regulation. Seven in ten favored prohibitions on child labor; nearly 90% endorsed a law preventing misleading food, cosmetic and drug advertising; more than half wanted tighter regulation of industry and agriculture; and close to two-thirds favored federal control of war-time business profits.

pew 2.pngBy two-to-one, Americans even said they would prefer public rather than private ownership of the electric power industry! Even more gave a thumbs-up to a takeover of the war munitions industry.

... But Limited Faith in Government

Trust in government was not boundless. More than half rejected public ownership of railroads and public opinion split on bank takeovers. By a margin of 50%-to-42%, Americans in the mid-1930s rejected the idea of government limiting the size of private fortunes.

Organized labor had even fewer fans than now. Only a third sympathized with strikers in an ongoing General Motors walkout; about six in ten favored making sit-down strikes illegal; and half would have called out the militia in the case of a strike.
 
While supportive of government-aid programs, the public was mindful of their price tag, with the federal debt running close to 40% of GDP. At the time of the 1936 elections, a solid 65%-majority said Washington should balance the budget (sound familiar?). Unlike today, many Depression-era Americans were even willing to raise taxes. Nearly half supported a state sales tax as well as a tax on income from federal bonds, a levy that would, presumably, fall most heavily on well-to-do coupon-clippers.

pew 3.pngOn spending, yesterday's voters were like today's voters: long on ambition and short on specificity. Fully 70% endorsed a cut in "government running expenses," that era's likely equivalent of today's "fraud, waste and abuse." About half opted for unspecified cuts in relief programs. But only about a quarter thought relief workers should be laid off before they found private sector jobs.

What's the upshot? Two big lessons: First, it's worth remembering that the social programs and banking controls from the New Deal era remain in good stead after decades of unprecedented prosperity. Second, Depression-era Americans' faith in the country and its guiding institutions steeled them against the challenges of a double-dip recession and, years later, World War II. Those folks had it worse, but they also expected it to get better, faster.
 


To read a longer version of this article with additional data from the 1930s, click here.  For an accompanying piece on the 1981-82 Reagan recession, click here.


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