New Deal Liberalism

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New Deal Liberalism – Destabilizing Corporate Power or Reviving Capitalism?

Introduction: The Beginning Stages of the New Deal Movement

Between 1933 and 1936, Franklin Delano Roosevelt created a series of policies that eventually inspired innovation and economic growth in the United States. His former interpretation of the New Deal Movement, however, was not likely a planned response to a serious economic downturn, one which affected America’s past and caused one of the most horrible economic depressions in United States history. Before it became a more structured idea, it existed as a hasty movement fueled by frantic desperation (Auerbach, 1969). In his text, Auerbach likens this historical movement to a bandaid used after emergency surgery, as a means of depicting how rushed this movement truly was. While this movement was vaguely inspired by the age of enlightenment, it was based very loosely on individualistic principles of free speech, and the notions of unalienable rights. But conceptually speaking, it could not be easily defined.

Working class individuals were grappling greater levels of power in both their professional lives and in the political realm. As noted by Cohen, they formed the New Democratic Coalition, “To promote a notion of government that protected the well-being of ordinary Americans,”ensuring a more “activist federal government” (Cohen, Making a New Deal, pg 3). The new role of government now entailed supporting the welfare state (Cohen, Making a New Deal, pg 3). There was a transference in goals from the concept of capitalism, to that of the welfare state. (Cohen, Making a New Deal, 8). Mass consumption became an ordinary fixture in American life, and was most notably observed during the post war era of America, as well (Cohen, Making a New Deal,113).

It was based on a few, central beliefs, such as the goals of relief, recovery and reform (Berkin, 2011). Relief for impoverished and unemployed citizens, recovery of the ailing economy, and the reform of the country’s checkered financial infrastructure. As noted by Cohen, there were numerous religious and ethnic organizations that catered to the poor and homeless, exhausting their financial esources with free soup kitchens (Cohen, p 220). The power of the Democratic party increased (Cohen, p 3), and they exercised a frontal assault on previously touted corporate and capitalistic norms. Once again, the working class population unionized, demanded more rights, and gained more political power in the Democratic party (Cohen, Making a New Deal, pg. 3). Careworn skeptics were against this movement in its earliest stages, etching a major division throughout the nation, dividing conservative Republicans and liberals.

Liberals were forced to change beliefs and convictions once firmly held by society. The original ideas that gave rise to the New Deal Liberalism were gradually changed, along with the societal landscape of the time. These ideas, which sprouted from the very depths of the Great Depression and World War II, were eventually replaced by more fitting ones, ones which were more adapted to the growing bureaucracy of the time. Hence, a consumer-centric economy became the principal focus of the “New Deal Liberalism” economy created by FDR and Congress at the time. As expressed in Cohen’s introduction of making a New Deal, mass production became very common as well. While entrepreneurs and businesses had initially achieved prominence in the nation, consumers began to gain more power and mass production became more common. Furthermore, the working class became militant in their efforts to reclaim control, which is a concept frequently highlighted by Cohen.

The Elusive Meaning of New Deal Liberalism

Many contenders battered this principle with ridicule, deeming it awash of substance and an identifiable concept. Lacking organization, it left many baffled and unable to truly define and grasp what New Deal Liberalism truly was. While the notion of New Deal Liberalism remains fairly unclear for some, it once conveyed the lessening of corporate and capitalistic control, and the deference of power and influence to the consumer and governmental agencies (Alexander Hicks). This differs markedly from its initial definition, as it now promoted the enactment of infrastructure and social welfare programs. The welfare state was now growing in increasing popularity (Cohen, 3). The dispersion of economic power became the primary concern in latter models of the New Deal Liberalism movement. While the New Deal Liberalism movement developed into a vaguely delineated program, it burgeoned idealistically into a more tangible concept, one that would ultimately be defined as a consumer focused society predicated on the beliefs of social equality. For example, Cohen discusses how an idea sprouted into unions, welfare programs, political protests, and cooperation among working class individuals of all ethnicities.

Utilizing the tools of an operative, state apparatus, liberals were able to fine tune the principal role of the government, as an entity responsible for the social welfare of its peoples. In the context of the New Deal Movement, the federal government gained more control, and Democratic, working class liberals advocate welfare programs, which benefited the impoverished (Cohen 3, 220). Many of the nation’s greatest struggles were attributed to capitalism, and the government’s preeminent role was to revise any flaws perpetuated by this capitalistic structure. They envisioned a redistribution of wealth and income that would stabilize in the nation. Even staunch proponents of corporatist ideals wished to buffer the control exercised by capitalists and corporations at this time

The Evolution of New Deal Liberalism

Towards the end of 1937, New Deal Liberalism as movement began to wane, and it gradually and decisively evolved into ideological rationales based less on political discourse, and more on social welfare. This idea, however, should be noted not as a fact, but as a conclusion based on the events that transpired during this era. For example, while many militant liberals formerly opposed capitlism, these anti-business sentiments eventually dissolved. This may be a result of America’s ideas about individualism. Som even argue that the social welfare state did not last and that leftist activism was strictly discouraged. Jefferson Cowie and Nick Salvatore argued this point, reminding readers that the welfare state would disappear if conservatives gained power (Cowie and Salvatore, 2008). The transmutation of this idea occurred with many gradually accumulating, miniscule changes that were imperceptible to liberals at the time. By 1945, this idea had matured markedly.

Factors Contributing To the Evolution of New Deal Liberalism

The pre and post war era was reshaped and molded by a slew of converging factors. Urbanization was beginning to proliferate throughout the nation, and this aided the maturation of these ideas. Factories and other industrial jobs were growin in popularity, and working class individuals took on these opportunities, as described in many of Cohen’s narratives in making a New Deal (Cohen, making a new deal). A waning level of power and influence was noted among merchants, capitalists, etc. In this world of destabilizing control, bureaucracies ascended the rankings, and governmental agencies enveloped the sources of power once reserved for the corporate world. Once again, Cohen touches upon this idea by highlighting the formation of federal government powers (Cohen, Making a New Deal, pg. 3). Furthermore, these ideas evolved as consumers grappled increasing levels of political and public control. The exceptionally wide range of ideas that defined New Deal Liberalism were often marked as a master class of obfuscation, with very little clarity. Both Alvin Hansen and Richard Hofstader proved that they were not uncritical defenders of this idea (Cowie and Salvatore, 2008). Instead, they repeatedly cite their apparent confusion with what this idea truly encapsulated. But as years progressed, social welfare and economic reform became the most predominant ideals of this movement (Cohen, Making a New Deal, 3).

New Deal Liberalism
New Deal Liberalism

Conflicting Definitions of New World Liberalism

Many fiercely competing belief systems detracted from the overall coherence of this idea. This concept required some time to take a unified, coherent form. One particular sector of society comprised firm contenders against capitalism, whom attributed the nations problems to the centralized and potently concentrated power of the capitalistic economy and corporate structure. This fueled unionization among many working class groups (Cohen, Making a New Deal, 3). Other opposing parties upheld an alternative facet of New Deal Liberalism. Some offered compelling arguments to support the integration of governmental authority with control with the economy. Others proposed radical leaps of change, purporting that capitalism became obsolete after the events of the Great Depression, and that an entirely novel system was needed to fully restructure the country’s economy. However, many scholars have reflected back, calling this a form of communism or socialism. In The Age of Roosevelt: The Coming of the New Deal, 1933-1935, it is noted that Harold Lare led a communist movement, along with many other radicals at the time (Schlesinger, 1959). Hence, New Deal Liberalism was a dispersive movement that fragmented the population into varying directions. In spite of its conflicting framework, this idea did grow and develop over time into a more clear, and organized set of ideas.

A Communal, Consumer-centric Vision

There were major attempts to centralize and restore the equity of power in various facets of society as indicated by the leftist activism discussed (Cohen, 3). This emerged most notably in regional and agricultural planning, as noted by the Agricultural Adjustments Administration and the Tennessee Valley Authority. Infrastructure projects, including bridges and irrigation systems, were a defining feature of the New Deal Movement. Furthermore, social welfare programs increased rapidly as this movement was developing. By 1945, this idea bore little resemblance to that of its earlier days. The initial opposition to capitalism dissolved. Instead, this latter model began to propose a inter-depedent framework comprising both state-level control and capitalism, in which the state would ameliorate capitalism’s flaws. The crux of this newly revised ideological model proposed the expansion of an all-encompassing welfare state. The anti-monopoly sentiment still pervaded the air of this time, but the efforts shifted to a differing type of reform. This new type of world view was based on Keynesian economic, which will be discussed.

The new model of New World Liberalism was one in which the corporate world and the social welfare efforts could coexist and manifest an economically healthy environment. Instead of penalizing the financially elite, these new liberals concocted a very different approach, deeming the government responsible for protecting the industrial world’s well being. Instead of merely reforming the economy, they believed it was necessary for the government to expand it as well. In essence, the newly proposed model of social welfare and reform would serve as a cultivating atmosphere in which corporations could grow steadily within the contextual framework of the society and economy. In essence, the government was expected to supply the capitalistic world with a nourishing element to help it flourish.

Focus switched from intruding into daily affairs, to the notion of Keynesianism, the concept that an individual state could regulate control of the economy without directly muting and curtailing control exercised by economic institutions (Sullivan, 2003). As New Deal Liberalism became reassembled into a more evolved format, it experienced a substantial period of change. The Roosevelt New Deal Liberalism was a disoriented stew of desperate ideas and attempts to repair the economy, as well as an impulsive prescription to the nation’s capitalistic flaws. However, the World War II period was met with significant changes to this concept. As time proceeded forth, Keynesian ideas were implemented, garnering increasing levels of support. It was only until the post war efforts that this formerly makeshift ideology was shaped in to a more decisive, precedent that would serve as a foundational pathway for future, liberal ideals.

Conclusion: The Lingering Effects of New World Liberalism

The administrative goals of Roosevelt were met with innumerable adaptations, which ultimately entered their final stage of maturation in the post-war effort. After the United States was stricken with the Great Depression, the government misdiagnosed the overarching issue that contributed to the nation’s economic incompetencies at the time. It seems that the cultural, societal and intellectual landscape, however, helped reshape and refine the convictions of this ideological model, until it was adapted to a more polished form. Initially, it was a convoluted stew of anti-capitalist ideas designed to penalize the corporatist agencies and elite. However, it eventually became a symbol of economic restructuring and reform, in which social welfare and capitalism worked inter-depedently to yield a more economically sound nation as a whole. And these liberal ideas became ingrained in countless social welfare movements that characterized the 20th century, including those pertaining to civil rights, health care, and social welfare.


Arthur M. Schlesinger. Jr. (1959) The Age of Roosevelt: The Coming of the New Deal, 1933-1935.Houghton Mifflin

Carol Berkin et al. (2011) Making America, Volume 2: A History of the United States: since 1865

David Von Drehle’s Triangle (2004)

Jefferson Cowie and Nick Salvatore, “The Lon Exception: Rethinking the Place of the New Deal in American History.”International Labor and Working Class History, (2008)

Jerold S. Auerbach, “New Deal, Old Deal, or Raw Deal: Some Thoughts On New Left Historiography.”Journal of Southern History (1969)

Liz Cohen’s Making a New Deal (2008)

Social Democracy and Welfare Capitalism: A Century of Income Security Politics by Alexander Hicks

Sullivan, Arthur; Steven M. Sheridan (2003) Economics: Principles in action. Upper Saddle River: Pearson Prentice Hall

What are your thoughts on New Deal Liberalism, do you think it destabilizes corporate power or helps revive capitalism? Please add your comments below. Thank you.

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Steve Jones

My name is Steve Jones and I’m the creator and administrator of the dissertation topics blog. I’m a senior writer at and hold a BA (hons) Business degree and MBA, I live in Birmingham (just moved here from London), I’m a keen writer, always glued to a book and have an interest in economics theory.

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