Biden and his supporters have been presenting him as the new Franklin Delano Roosevelt, but is he acting like FDR and would we want him to act like the president of long ago? Since Biden has been president for a short time, one can compare him with the first months of the Roosevelt administration. And Roosevelt’s most important program in his first year in office was the National Industrial Recovery Act, which could be compared to Biden’s Green New Deal.
According to David Gergen, CNN senior political analyst, “Though President Joe Biden is no Roosevelt, he bears some important similarities. And Biden is off to an excellent start — arguably, one of the best since Roosevelt.”
“The most obvious comparison,” says Gergen, “is of the two presidents’ records of accomplishments. Roosevelt entered office with the economy near collapse and the public mood severely depressed, and he took a series of dramatic steps to reverse course. He not only saved the country’s banks in his first week but helped to pass 15 major pieces of legislation in his first 100 days, building the foundation of the New Deal. On at least one occasion, his team introduced a major new bill in the morning, the Emergency Banking Relief Act, and had it enacted by sundown.”
The National Industrial Recovery Act (NIRA), which created the National Recovery Administration (NRA), was supposed to facilitate cooperation between the federal government and the business sector, and this presumably would stimulate the economy and pull the country out of the Depression. Under the NRA, business competitors met to develop business “codes of fair competition” that would govern prices charged for goods and services, wages paid to labor, and business practices. The proposed codes would then be reviewed for approval by government code administrators. Companies that subscribed to the NRA codes were allowed to display a Blue Eagle emblem, symbolic of cooperation with the NRA, and announcing, “NRA Member. We Do Our Part.”
Roosevelt appointed Hugh S. Johnson as Director of the NRA to administer the code-writing process and enforce what would become a huge bureaucracy of codes. Johnson admired some aspects of Italian fascism and was known to consult the book The Corporate State by Raffaello Viglione, a favorite economist of Mussolini’s. And Johnson was not alone in that view. FDR’s close adviser Rexford Tugwell wrote in his diary that Mussolini had done “many of the things which seem to me necessary.”
The NRA sought to alter the competitive market mechanism by promoting cooperation among business, labor, and government to maintain prices and wages above existing market rates, in the then-widespread belief, especially in the large business community, that excessive (“cut-throat”) competition had caused and prolonged the Depression. The belief was that such competition led to a vicious downward spiral of reduced prices and reduced wages, ultimately bringing about business failures and unemployment. As Johnson colorfully put it: “The very heart of the New Deal is the principle of concerted action in industry and agriculture under government supervision looking to a balanced economy as opposed to the murderous doctrine of savage and wolfish individualism, looking to dog-eat-dog and devil take the hindmost.” [Quoted in Arthur M. Schlesinger, The Coming of the New Deal: 1933-1935, The Age of Roosevelt, vol. 2 (Boston: Houghton Mifflin, 1958), p. 112.]
The legislation tried to appear to be all things to all people and ended up mired in ambiguity. While one clause exempted the proposed codes from the anti-trust laws, another forbade the codes “to permit monopolies or monopolistic practices, or to eliminate, oppress, or discriminate against small enterprises.” [Ellis W. Hawley , The New Deal and the Problem of Monopoly: A Study in Economic Ambivalence (Princeton, N.J.: Princeton University Press, 1966), pp. 38-50.] Once in operation, however, the NRA essentially acted as a giant cartel scheme under which the federal government attempted to enforce cartel pricing and output reductions in the economy.
During 1933, however, the NRA was flowering. There were gigantic NRA marches—the one in New York City supposedly having 1,500,000 participants. And Johnson was named the “Man of the Year” for 1933 by Time Magazine ahead of President Roosevelt.
Things, however, were rapidly going downhill. Senators Gerald Nye of North Dakota and William Borah of Idaho were the strongest critics of the NRA because they believed the codes adversely impacted small businesses. Small businesses, particularly small manufacturers, complained that large businesses used the codes to drive them out of business. Their main complaint was against price fixing set by the codes. The NRA codes set a minimum price that reflected prices charged by larger businesses. For many small businesses, especially small manufacturers, the only way to stay competitive was to charge lower prices for a good or service, but this was not allowed by the codes.
Clarence Darrow was chosen to head the review board that would investigate the impact of the codes. He was the most famous attorney in the United States, but he was not an ardent supporter of Roosevelt. Johnson would soon regret endorsing Darrow to serve on the board and he later said he made the endorsement in “a moment of total aberration.” [ Lowell Mason, Darrow vs. Johnson, 238 N. Am. Rev. 524, 525 (1934).]
Darrow declined to accept NRA staff. At a meeting with Roosevelt, the President agreed to create the board by executive order and explicitly directed the board to report directly to the President and not to Johnson. [Stephen J. Sniegoski, The Darrow Board and the Downfall of the NRA, 14 CONTINUITY 63, 72 (1990).]
Less than four months after it had been created, the National Recovery Review Board filed its last report on June 28, 1934. The third report had a section for conclusions the board thought important enough to emphasize. The first such conclusion was that in virtually all of the 34 codes examined “one condition has been persistent, undeniable and apparent to any impartial observation. It is this, that the code has offered an opportunity for the more powerful and more profitable interests to seize control of an industry or to augment and extend a control already obtained.” [Investigation of the National Recovery Administration: Hearings on S. Res. 79 Before the S. Comm. on Finance, 74th Cong. 298 (1935).]
Johnson would quit in anger. President Roosevelt wanted the NRA renewed for two years and sent a bill to Congress to pass the renewal. On May 27, 1935, however, while the bill was still pending, the United States Supreme Court held the National Recovery Act invalid because it unconstitutionally regulated intrastate commerce and it was an impermissible delegation of legislative authority to the president.
Now to move on to President Biden. Nicholas Kristof, a Pulitzer Prize winning author, contends in the New York Times that “Joe Biden Is Electrifying America Like F.D.R.”
And Deirdre Shelly writes in “The American Jobs Plan and the Fight for the Green New Deal” that “[we] should feel deeply proud of the power that our movement has built to make a multi-trillion dollar infrastructure plan that centers action on the climate crisis, undoing environmental injustice and racism, and creating millions of union jobs the common sense of the Democratic Party. And we shouldn’t lose sight of how much more power we must build to fully realize our vision of a Green New Deal.”
“If it’s passed, this plan would be the largest investment the federal government has made to address social and economic crises in fifty years. It’d create millions of good jobs and be the biggest investment our country has ever made in fighting the climate crisis. Still, this plan is nowhere near enough to meaningfully combat the climate crisis or transform our society and economy. To really do those things, we need at least $10 trillion in federal spending over the next decade (or $1 trillion/year), and we need to start making those investments as soon as possible.”
President Biden released his infrastructure package on April 2, 2021. “That plan would spend $2 trillion over eight years, much of it on mitigating the climate crisis. It is the first of a two-part push on an expansive array of infrastructure initiatives, green energy projects, as well as social programs that the administration refers to as ‘human infrastructure,’ that is estimated to be around $3 trillion to $4 trillion .” Alexandria Ocasio-Cortez and other progressive Democrats, however, want more than double that amount that Biden has called for.
However, after expressing his support for a Green New Deal , Biden did not complain about Germany allowing Russia to send its gas and oil through its Nord Stream 2 pipeline to NATO Ally Germany. In contrast, Trump, who was not for green energy, had wanted to prevent Russia from having that pipeline to Germany for security reasons.
Biden’s decision was based on maintaining positive relations with German Chancellor Angela Merkel. Merkel supports the project pointing out that Russian gas already flows into Europe along other routes. And Biden is using his presidential authority to waive sanctions on the two countries under a national interest exemption.
Now, one might wonder why Germany would want gas and oil if it could rely on green energy. And Germany thought it could do this over time as it began in 2000 to decarbonize its energy supply. This was referred to in German as “Energiewende”– a German word for “energy transition.” Germany has been called “the world’s first major renewable energy economy.”
However, this was not working well, its emissions having flat-lined since 2009. But the coup de grasse took place during the frigidly cold winter of 2020-2021. Germany turned back to coal and natural gas as millions of its solar panels were blanketed by snow and ice The freezing weather also rendered its 30,000 wind turbines to idleness. Here is how one scientist explained it: “With this supply of wind and photovoltaic energy, it’s between 0 and 2 or 3 percent – that is de facto zero. You can see it in many diagrams that we have days, weeks, in the year where we have neither wind nor PV. Especially this time for example – there is no wind and PV, and there are often times when the wind is very miniscule. These are things, I must say, that have been physically established and known for centuries, and we’ve simply totally neglected this during the green energies discussion.”
Germans paid a large price for this program. For example, the average cost of electricity for German households has doubled since 2000. By 2019, households had to pay 34 U.S. cents per kilowatt-hour, compared to 22 cents per kilowatt-hour in France and 13 cents in the United States, according to data from IEEE Spectrum.
The fact of the matter is that “no amount of marketing could change the poor physics of resource-intensive and land-intensive renewables. Solar farms take 450 times more land than nuclear plants, and wind farms take 700 times more land than natural gas wells, to produce the same amount of energy.”
While President Biden has pledged to move away from fossil fuels and has stated that he would not support oil development on federal lands, the Biden administration has recently defended in the U.S. District Court for Alaska ConocoPhillip’s planned Willow oil and gas project, which was approved under then-president Trump. The project has strong support of Alaska officials which includes Republican Senator Lisa Murkowski, who is seen as a potential swing vote for Biden in his future attempts to push through his policies in an evenly divided Senate. The Willow project, designed to extract more than 100,000 barrels of oil a day for the next 30 years would be one of the first major new oil projects in Alaska in years.
The Biden administration didn’t explain how its stance fitted in with its climate policies, but it said in filing that greenhouse gas emissions considerations and the effects the project would have on “fish, caribou and polar bear habitat” had been sufficiently taken into account when the project was approved.
Climate activists had provided Biden with money and effort in his successful run for president. In January, President Joe Biden signed an order to rejoin the Paris Accord and revoked federal permits for the Keystone XL oil pipeline. Both issues were priorities for environmental activists. However, the administration’s backing of the Alaska oil drilling project on May 26 brought scathing criticism from environmental groups. “It is a serious misstep to pass on administrative authority to constrain an out-of-control oil industry while simultaneously punting to a deadlocked Congress for climate action,” said John Noel, a senior climate campaigner with Greenpeace USA.
While both Biden and Roosevelt initially found success with their major programs—the NRA and the Green New Deal. The NRA was enacted into law and Biden received money and effort from climate activists that helped him to win the election. However, after all of the hoopla, the NRA was stymied by criticism and ultimately terminated by the Supreme Court. And, so far, it does not seem that the Green New Deal will have achieved anything close to replacing the use of fossil fuels by 2030.