Phillips-Fein - Invisible hands: the businessmens crusade against the New Deal

L ATE IN THE SPRING of 1981, only a few months after being sworn in as president, Ronald Reagan mailed his old friend Lemuel Ricketts Boulware a set of autographed golf balls for his eighty-sixth birthday, accompanied by a personal note: Dear Lemin case I do something wronghit one of these with a 9 iron or a wedge and Ill feel it.

The two men had known each other for almost thirty years, ever since they met at General Electric in the 1950s. Reagan had gone to work as a spokesman for the industrial giant after his Hollywood film career began to wane, hosting the companys hour-long television drama program and touring plants to give pep talks to workers, while Boulware was in charge of labor relations and community affairs for the company. But even in the 1950s, Reagan and Boulware were not only colleagues and acquaintances; as Reagans note suggests, they were also political allies. During the years when Reagan worked at the company, Boulware believed that GE was in grave danger, threatenedas was all American capitalismby the power of the labor unions and the expanded federal government that had been created by the New Deal. From his position, he tried to work toward a goal that seemed impossible at the time: to turn back the central institutions and the reigning ideas of New Deal liberalism, and revive an age of laissez-faire.

In 1981, with Reagan in office, it seemed to Boulware as though the agenda he had sought to establish for decades might finally be on the verge of success. He wrote back to the president thanking him for the gift: Heres to your creative and courageous program of correction continuing to live up to its great promisefor you and all the rest of us.

T HIS IS a book about conservative politics. But it isnt a book about the political leaders of the movement, the men like Reagan whose names and faces everyone knows. It is a book about businessmen like Lemuel Boulware, who supported and helped to build the conservative movement that brought Reagan to power in 1980.

The rise of conservative politics in postwar America is one of the great puzzles of American political history. For much of the period that followed the end of World War II, conservative ideas about the primacy of the free market and the dangers of too-powerful labor unions, government regulation, and an activist, interventionist state seemed to have been thoroughly rejected by most intellectual and political elites. Scholars and politicians alike dismissed those who adhered to such faiths as a radical right, for whom (to quote the Columbia University historian Richard Hofstadter) politics becomes an arena into which the wildest fancies are projected, the most paranoid suspicions, the most absurd superstitions, the most bizarre apocalyptic fantasies. How, then, did such ideas move from their marginal position in the middle years of the twentieth century to become the reigning politics of the country by the centurys end?

Historians and social critics often explain the successes of conservative politics by pointing to the backlash against the victories of the social movements of the 1960s, the cultural reaction against the radicals who fought for civil rights, feminism, and gay and lesbian rights and who protested against the Vietnam War. The 1970s defection of white working-class people alienated and frightened by the liberal program shifted the politics of the country far to the right. The argument is that in the days before the onset of the culture wars, a liberal consensus dominated American politics, especially around economics. During the thirty-odd years between the rise of the New Deal and the election of Richard Nixon in 1968, when the Democratic Party held the White House for all but eight years, many political leaders and social critics believed that there existed a general consensus that the federal governmentand other collective institutions, like labor unionshad an important role to play in shaping economic life and helping to redress the ordinary inequalities of a capitalist economy. The fierce and open conflict between rich and poor that had dominated American politics in the early years of the twentieth century had largely disappeared. Businessmen responded to this era of liberal dominance in a variety of ways. Many supported the New Deal order inaugurated by Franklin D. Roosevelt (whom some of them saw as one of their own)and not without reason, as it fostered a period of relative prosperity and peace. They accepted the general framework of Keynesian economics, acknowledging that government spending could help counterbalance destructive recessions; they saw the welfare state as a necessary social safety net. And indeed, despite the persistence of divisions of class and race, those years saw dramatic improvements in the standard of living for most Americans, as the economy grew without accelerating the inequality between rich and poor.