A New New Deal

Paul Krugman hits the nail on the head in his column today about the need for a jobs bill, and what such a bill should contain. The good news is that it looks like a jobs bill is forthcoming, but we'll have to wait and see whether it will be targeted enough to have a real effect.

Krugman mentions something similar to a New Deal-era Works Progress Administration as an option, and I've thought the government should have done this last February, but they didn't believe unemployment would climb to 10.2 percent. To me, the WPA is Keynesianism at it's simplest, most effective, and most popular. By popular, I mean popular with the American people, not necessarily with economists. My older relatives still talk about how great Franklin Roosevelt was for the country and how he lifted the nation's spirits at a time when unemployment was at 25 percent(!!!) When they talk about this, they usually refer to two things he did specifically: first, repealing prohibition, and second, creating the WPA.

At its height, the WPA employed millions of people to work on infrastructure projects such as roads, bridges, and dams. Not only did this reduce unemployment, it also brought all parts of the country into the 20th century. Because of the WPA, my great-grandfather and great-grandmother in Texas had electricity for the first time. For some of my great-uncles in New York, it was the first time they were able to bring home a paycheck in months or years. I know many conservatives today would poo-poo this and say they were just on the government dole, but getting paid for doing work and being able to feed their family something other than chicken they got for free from a sympathetic friend down the street gave them pride they hadn't felt in a long time.

I know it's a different world than it was in in the 1930's and, like Krugman, I understand that such a program will be open to a lot of criticism from the right, but we should be looking to the past to see what works. Growing GDP shouldn't be the only priority. Instead of just writing unemployment checks, why not ask people to do something while they're getting government money?