Which economic system did many New Deal measures strengthened?
2 Answers
Multiple answers can be given according to the different schools of thought.
Explanation:
Marxists claimed that the New Deal at strengthening capitalism or even halped it to survive by introducing measures and regulations. The Welfare State is therefore a tool to help capitalism overthrow the contradictions that shook it and would eventually lead to its collapse.
Keynesians also claimed that it strengthened capitalism but unlike Marxists they thought it was a positive move since they favored this economic system whereas Marixists longed to overthrow it.
Libertarians claimed it strengthened the state and undermined capitalism. The latter is the one system they stand for as the only way to promote both liberty and economic prosperity. They indeed believe in liberal economics. Some argued like Murray Rothbard or Anthony Sutton that the New Deal was aimed at protecting the interests of an oligarchy who wished to get rid of the traditional market economy to be able to dominate the economy. Government intervention is a means for them to get rid of the competition of smaller businesses.
The New Deal strengthened the influence of a socialistic economic system.
Explanation:
While die hard socialist condemned the New Deal for not going far enough toward the progressive ideals of Socialism, The New Deal brought the American economy one large step closer to socialism.
The new deal was based on the socialistic systems of Stalin and Hitler. The government would use its power to take money from the rich and redistribute the money to the needy and poor.
The most notable action was the formation of the Social Security System. This idea was socialistic. The government would use its power to take a portion of everyones income, and then redistribute the money years later at retirement. This would prevent extreme poverty for the elderly poor.
The 1935 Wealth Tax Act, was specially aimed at the super wealthy with an 80% tax on the income of the wealthy.
The 1936 undistributed profits Tax was aimed at collecting wealth from large corporations.
The New Deal greatly strengthened the socialistic economic model in the United States but stopped short of implementing a pure socialistic economic model.
