Let’s Play Spot the Fallacies

From a review in the most recent issue of Reviews in American History:

Like most conservatives, Shlaes assumes a perfectly competitive marketplace in which the government can only make an unwarranted and counterproductive intrusion. This perspective leads Shlaes to discount the role of jobs programs such as the CCC and the WPA that contributed to the decline in unemployment from 22 percent in 1932 to 9 percent in 1937. By setting a standard in which a public program cannot provide real work and must be temporary, she forecloses the possibility that any government program could strengthen the economy. Because Shlaes’ position is roughly equivalent to a cancer researcher who refuses to count remissions from chemotherapy, Hiltzik easily rebuts her.

Outside these parameters, however, Hiltzik has his own problem. The New Deal did reduce unemployment, but it was ultimately World War II and the warfare/welfare state emerging out of it that has kept the rate down ever since. Although Hiltzik briefly acknowledges World War II’s role in reducing unemployment, both he and Shlaes actually suffer from parallel oversights: Hiltzik does not fully account for the military component of the intervention, and Shlaes does not count the welfare.