Public Comment

The Great Depression: An Essential Lesson

By Harry Brill
Thursday January 15, 2009 - 06:31:00 PM

The front page of the New York Times recently captioned “In His Emphasis on Economy, Obama is Looking to History.” Elected officials and working people should take a careful look at the history of the Great Depression of the 1930s for guidance on not only how to generate millions of decent paying jobs, but how to do so within a very short period of time. To accomplish this challenging task, the main lessons to be learned are not from the well known 1935 WPA program, which although it created many jobs, it was nevertheless a work relief, needs tested program. The nation’s most effective and largest ever job program both before and after WPA, is barely known to most people and perhaps not even to Obama himself. 

By executive order, President Roosevelt in November 1933 created the Civil Works Administration (CWA) and appointed Harry Hopkins, who was a social worker, not a CEO of a major corporation, to head it. By January 1934, which was just two months later, 4,260,000 workers were employed performing useful work at decent pay, which on average was more than twice the monthly WPA income and employed substantially fewer workers. To assure that the money allocated would be mainly spent on labor rather than on materials, 70 percent of CWA’s budget had to be spent on wages. 

CWA’s accomplishments included building or improving thousands of schools, playgrounds, and athletic fields. Its orchestras gave free concerts, and its theater project performed plays in hospitals and public libraries. Its artists painted publicly displayed murals. And thousands of CWA teachers participated in adult schools, day care, and keeping rural schools open. Other workers made clothing for charitable purposes. Making night gowns, sheets, and pillow cases were also among CWA’s charity contributions.  

Unfortunately, the program was terminated in March 1934, four months after it began despite efforts by Sen. Wagner and others to extend it. From the perspective of the business community, suffered from being too successful. It paid its workers too well in wages and benefits, made hiring workers at poverty wages more difficult, and that it competed with private enterprise. Tremendous business pressure was brought to bear to terminate CWA. Neither President Roosevelt nor Harry Hopkins vigorously resisted efforts to close the agency. In deference to business, the less offensive WPA, which employed far fewer workers, took its place a year later. 

The essential lesson to be learned is that CWA didn’t stand a chance, not because its job program was economically unfeasible. Rather, the political will of public officials was lacking and the political muscle at the grass roots to counter business pressure was not strong enough. Indeed, it would have been good economics to substantially increase CWA’s budget to create even more jobs to fuel the economy.  

Unlike CWA jobs, which were defined as government jobs, WPA was a work relief program, which as already mentioned, paid a substantially lower monthly wage. Generally speaking, there are many routes that will have to be taken to rescue the economy, including some long range investments. But the most urgent need is to immediately create jobs for unemployed and underemployed workers. For these jobs to be dignified socially and economically, they should not be based on an ideology of public charity. The important lesson of the Great Depression is that the CWA route is the way to go. 


Harry Brill is a Berkeley resident.