Upon taking control of the U.S. House of Representatives
the first thing America’s Marxist Party did was to propose a Soviet-style,
communistic destruction of American capitalism labeled a “Green New
Deal.” The Party chose as its spokesperson for this totalitarian
venture a young woman named Sandy Ocasio who grew up in one of the wealthiest
enclaves in America, Westchester County, New York, but who decided to lie
about this to get into politics by calling herself “Alex from the
Bronx.” Sandy sounds like a poorly-educated-but-well-indoctrinated
young communist with a ninth-grade mentality. She proudly labels
herself a “democratic socialist” but as Ludwig von Mises explained, there
really is no difference between communism and socialism: they are both
attacks on private property and economic freedom. She seems clueless
about just about everything she talks about in public, whether it is the
Constitution, especially the economy, the structure of government, history,
etc. This is the person the American Marxist Party has chosen as its
front person in its proposal to destroy American capitalism, prosperity, and
the American dream forever—and to give itself totalitarian control
over virtually all aspects of American life.
The first thing to understand about the proposed “Green
New Deal” is that the first New Deal not only failed to end the Great
Depression but made it more severe and longer-lasting. Its only
“success” was in creating endless patronage opportunities and levers of
political bribery and extortion for the Democratic Party, opportunities that
the Republican Party happily embraced whenever it could to expand its own
power and wealth in the succeeding decades. The proposed Green New Deal
would do the same, only many orders of magnitude worse.
. 
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Failure of the First New Deal
At the outset of the Great Depression, 1929, the
unemployment rate in America was 2.9% according to U.S. Dept. of Commerce
statistics. Unemployment reached its peak in 1933 at 24.9%. There
was a bit of a recovery as mal-investments were liquidated, but it only dropped
the unemployment rate to 14.3% by 1939. It rose to 19.0% in 1938 and
was still 14.6% in 1940, on the eve of American entry into World War
II. Personal consumption expenditures were still lower in 1940 ($71.9
billion) than in 1929 ($78.9 billion). All of this despite eight years
of unprecedented New Deal “stimulus spending,” regulating, controlling,
subsidizing, lending, inflating, price-controlling, and taxing. The New
Deal was an utter failure to the American people. Economists Richard
Vedder and Lowell Gallaway estimated in their book, Out of Work,
that the unemployment rate was eight percentage points higher in 1940 than it
otherwise would have been without New Deal minimum-wage and pro-union
legislation alone.
Nor did World War II end the Great Depression. It
ended high unemployment only because some 16 million men were sent overseas
during the war. Sending a man to die in a foxhole in Germany is not the
same as that man going to work in his own country and returning home to have
dinner with his family every evening, contrary to Keynesian folklore about
how the war supposedly “ended the Great Depression.” The average
American family back at home was even worse off because of the massive
diversion of resources from the consumer and business side of the economy to
the government’s military infrastructure. The production of new
automobiles and other products was made illegal, food was rationed, and
everyone sacrificed even more.
The Great Depression did not really end until after
the war was over and the army was demobilized, returning billions of
dollars of resources to the private sector. Federal government expenditures fell
from $98.4 billion in 1945 to $33 billion in 1948. As a result, the
year 1946 was the most prosperous year in all of American history in terms of
the growth of the private components of GDP: private consumption and
investment spending increased by 30% in that one year; no other year has ever
been remotely close to that growth rate. Keynesian economists predicted another
Great Depression because of the two-thirds reduction in federal spending
while the exact opposite happened. That should have discredited
Keynesianism forever, but the Washington establishment just ignored or lied
about this fact, as it does to this very day.
It took some seventy years, but the “mainstream” of the
economics profession finally caught on to this truth, a truth that was
recognized by Austrian School economists all along. In an August 2004
article in the prestigious Journal of Political Economy by Harold
Cole and Lee Ohanian entitled “New Deal Policies and the Persistence of the
Great Depression” the authors concluded that “New Deal . . . policies did not
lift the economy out of the Depression . . . the abandonment of
these policies coincided with the strong economic recovery of the 1940s”
(emphasis added).
Nevertheless, the New Deal was a political power bonanza
for FDR and his fellow Democrats. According to a 1938 Official Report
of the U.S. Senate Committee on Campaign Expenditures it was routine for the
Roosevelt administration to demand that recipients of government make-work
jobs, of which there were millions, register and vote as Democrats. As
Jim Couch and William Shughart wrote in The Political Economy of the New
Deal, “The distribution of the billions of dollars appropriated by
Congress to prime the economic pump was guided less by considerations of
economic need than by the forces of ordinary politics.” For example,
the nation’s number one economic problem was the South, but since the South
was solidly Democratic it received relatively little New Deal spending
compared to other regions where FDR needed the votes. And, “The states
that gave Franklin Roosevelt larger percentages of the popular vote in 1932
were rewarded with significantly more federal aid than less-supportive
constituencies.” What else would anyone expect?
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American socialists have always searched for deceptive
euphemisms for socialism with which to disguise their totalitarian plans for
the rest of us. “Liberal,” “progressive,” “economic democracy,”
“liberation theology,” “social justice,” and “industrial policy” are just a
few examples. “Green New Deal” is the latest manifestation of this
political con game.
What has been proposed is nothing less than the
destruction of the fossil-fuel-based energy industries which have long been
the lifeblood of capitalism. All houses and businesses are to be
“upgraded” in terms of their energy use by thousands, or tens of thousands, of
government bureaucrats who would presumably go door to door to enforce the
state’s energy-use mandates. There are vague promises of replacing the
entire power grid with “renewable energy sources” such as windmills and solar
panels. It all sounds very much like a middle-school paper assignment
for an “environmental ethics” class. I would not be surprised to learn
that Sandy Ocasio took such a class and wrote such a paper in the Westchester
County public schools.
The entire U.S. economy would be “planned” by a fifteen-member
congressional committee, Soviet style. There is no acknowledgment at
all of the failures of socialist planning everywhere else in the
world; of the well-known economic reasons for these inherent
failures; or of the fact that all the countries of the world that touted
“planning” in the twentieth century have abandoned it, and for good
reason. It is a recipe for turning America into a Third World economic
hellhole, in other words, to be completed “in ten years” according to the
published plan. Free-lunch economics pervades the plan, promising
everyone a job and a “living wage” and of course, an end to economic
inequality through ever more income redistribution schemes. But not to
worry, say the Marxist planners, it will all be paid for by the Fed, a new
system of “government banks,” and higher taxes. Simple.
