History

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T he best ev i den ce of the l i ber al i sm of New D eal l i es i n i t s p r ov i si on of econom i c secu r i t y. As Kennedy ar gues, the New D eal successf u l l y r ef orm ed Am er i can cap i tal i sm , cr eat i ng an unp r eceden ted saf et y net . T he Soci al Secu r i t y Act p r ov i ded a f eder al o l d age pen si on f or the f i r st t im e, p r otect i ng those who cou l d not wor k , wh i l st unem p l oym en t i n su r an ce p r otected the popu l at i on f r om the changi ng busi ness cycl e. I t cou l d be ar gued that as o l d - age pen si on s wer e f unded by a r egr essi on f orm of taxat i on , i t was i n keep i ng w i th the standar ds of the 1920 s r el i ef po l i cy, and con ser vat i ve. H owever , th i s tax was desi gned to st r engthen Soci al Secu r i t y po l i t i cal l y by cr eat i ng a sen se of en t i t l em en t to o l d - age pen si on s am ongst the el ector ate. I t has f u r ther been ar gued that unem p l oym en t i n su r an ce was i n su f f i ci en t and var i ab l e, p r ov i d i ng $61 i n M assachuset t s and on l y $8 i n Ar kan sas due to the f undam en tal f eder al - state

con st i tu t i onal con ser vat i sm of the New D eal and FDR. H owever , th i s l im i tat i on was a com p r om i se m ade due to host i l i t y to f eder al i n ter ven t i on , par t i cu l ar l y am ongst Sou ther n D em ocr at s. T hus the New D eal was f or ced to com p r om i se to p r otect i t s ver y ex i sten ce f r om congr essi onal host i l i t y. I n con cl usi on , the New D eal was not f undam en tal l y con ser vat i ve, w i th i t s l i ber al i sm p r oven i n how ?the basi s f or the m oder n Am er i can wel f ar e state was l ai d? (Kennedy ). T he ar gum en t that i t was con ser vat i ve due to busi ness i n ter est s bei ng p r i or i t i sed i s i nval i d due to the New D eal ?s r ebal an ci ng of l abou r and busi ness r el at i on s. Any con ser vat i ve r esu l t s of the New D eal wer e not a r esu l t of po l i cy, bu t of po l i t i cal and con st i tu t i onal l im i tat i on s.

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