Epilogue

Summary

Government isn't infallible by any means. Government is only beginning to learn a lot of these new tricks. We are all going to school.

– Franklin D. Roosevelt, remarks on his economic program during his 66th Press Conference, November 3, 1933

For a dozen years, Roosevelt did indeed provide the nation with a “school” for economic learning. One of its by-products was the emergence of a home-grown variant on Keynesian doctrine that was to become an agenda-setter in policy debate. This perspective on the management of the economy was a far cry from the chaos of the “policy mix” with which his administration began in 1933. The new “model” appeared to be serviceable in providing intellectual leverage on problems of actual or potential underemployment, on the one hand, and problems of inflation containment, on the other. Moreover, economists in government contributed much more to its analytic refinement in these years than did their colleagues who operated exclusively from ivory towers.

While a Keynesian-style way of thinking set the pace in the framing of economic policy issues – post-1940 – it by no means followed that its champions prevailed in all the battles in which they chose to engage. Even though they were at the cutting edge of analytic innovation, they still faced formidable opposition. The legislative achievement represented by the Employment Act of 1946 has sometimes been treated as a triumph for a Keynesian point of view.