Texas-size chutzpah: Phil Gramm's ridiculous revisionist history

The king of deregulation says FDR was a failure -- just like Obama. But let's not write off the New Deal just yet


By Andrew Leonard
Salon.com

Remarkable in both its effrontery and its brazen historical revisionism, Phil Gramm's editorial in the Wall Street Journal today, "Echoes of the Great Depression," is a true piece of work.

The thesis is simply marvelous. According to the former senator from Texas and arch-deregulation evangelist, the recovery from the financial crisis of 2007-08 has been so slow and painful precisely because Obama pushed the same kind of collectivist, progressive agenda embodied by Franklin Roosevelt's New Deal. But in Gramm's reading of history, the New Deal failed, and so has Obama. The main difference between then and now: The public has been quicker to reject Obama's radicalism, mainly because of the stalwart opposition of the brave and fearless Republican congressional minorities.

The progressive vision that resonated in the 1930s foundered on the hard experience of the 20th century, and it has no broad appeal in the 21st. The recovery from the Great Depression did not occur until World War II was underway, but it appears, as of today, that voters will bring the latest experiment in American collectivism to an end on Nov. 2. A real economic recovery won't be far behind.

This is some Texas-size chutzpah, folks. Phil Gramm, more than any other modern politician, pushed the deregulatory ethos that the financial crisis of 2007-08 exposed as a criminally irresponsible sham. His very name is on the law that repealed the Glass-Steagall prohibition on the commingling of commercial and investment banking. He was the lead force behind the Commodity Futures Modernization Act, which ensured that derivatives trading would be largely unregulated. And yet he has the gall to complain about the "the regulatory burden" that "exploded during the Roosevelt administration"!

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