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on Shlaes' "The Great Society"

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I got to meet Amity Shlaes when she spoke at a U of L Center for Free Enterprise event last September. I had really enjoyed her book on the Great Depression, The Forgotten Man. (See: my review of it and a blog post on other resources connected to the book‘s content.) She gave me a signed copy of her book on The Great Society and I’ve been looking forward to reading it too. 

The work is thorough, but I don’t think the time period, the subjects, or the writing are as compelling as  The Forgotten Man. I can certainly recommend the book for those interested in public policy in general– or poverty and welfare in particular. It would also appeal to people who are interested in the era running from the mid-1960s into the 1970s. But I don’t think the book’s coverage will appeal to most laypeople. 

For similar reasons, I don’t intend to “review” the book, but will provide a list of nuggets for interested readers and for my own uses later. 


-Nixon dramatically increased War on Poverty spending. (In many ways, Nixon was more “liberal” and more “LBJ” than LBJ.) I learned this from Charles Murray’s Losing Ground decades ago. But from Shlaes, I learned that the extent was enough to worry Dems that he was stealing the issue from them! 

-LBJ’s claim that this did not represent “a handout or a dole…We know– we learned long ago– that answer is no answer.” (124)

-A nice passing remark (6) about how govt typically works: measuring (and valuing) inputs over outputs. Why? Well, they’re easier to measure and provide a far-more-flattering picture.

-Moynihan was deeply concerned that govt welfare monies went mostly to bureaucrats– and that a patchwork of fed/state programs and taxes led to disincentive problems (317) and “notches” (325). He promoted UBI as an alternative and universal Medicaid (318). He made progress on this goal (along with Friedman), but ended up proposing an add-on instead of a replacement (342) and the legislative effort failed anyway.

-A detail I didn’t know: Mollie Orshansky’s poverty line estimate for a family of four in 1963 was $3128. The poverty line was drawn a few years later at $3000 (108).

-Shales throws hammers at “urban renewal”. Twice, she quotes James Baldwin’s famous line that it equated to “Negro removal” (72, 237). The Santa Monica Freeway cut through “the most prosperous, best kept and most beautiful Negro owned property in the country” in West Adams (138). Eminent domain ended up trashing Black Bottom (236). She’s particularly rough on the projects in St. Louis at Pruitt-Igoe: it was for mothers only (fathers had to leave); it had means-tested rent disincentives; and provided terrible economic and social results (239-245).

-Shlaes revisits the academic debate over the economic and sociological woes of African-Americans. The somewhat-competing / somewhat-overlapping theses were jobs and families. Both can easily be laid at the feet of welfare policies (163).


-A key story in American Macro history: the domination and optimism of Keynesianism and faith in big-govt solutions. Shales describes this and adds more meat to the bones: the economy seemed unstoppable (with so much growth). They believed that regulation and taxes were largely independent from economic outcomes (26). The same optimism extended to efforts to battle poverty, along with perceived abundance (we could afford it; 97) and progress in many other areas, esp. science (180).

-Another key story in American Macro history is the emergence of Supply-Side Econ. I always tell the story about Ronald Reagan and 91% marginal tax rates in Hollywood. Shlaes tells another Reagan story: he received a 25% pay raise from GE that made little difference to his standard of living, given inflation and taxes (37).

-The Dow flirted with 1000 for a long time, but did not pass it until 1982– the end of the Reagan / post-inflation recession (10). Broadly, there was significant pessimism about America and the American economy– from the mid-60s until Reagan. In this period, it manifested as steady outflow of gold and even runs on gold (9-10)

-LBJ wanted to fight international trade deficits through a two-year moratorium on tourism outside the western hemisphere (264).


-The federal govt was allowed to unionize (but not collectively bargain) in the 1960s. This led to pressure allowing the same (and more) at the state/local level (48-49). 

-She cites tough LA cops– as did Balko (139).

-Mayors initially saw federal efforts as a “power grab” (153), but were successfully bribed by Federal monies (155) before the efforts were eventually federalized (231).

-I did not know about Sen. Everett Dirksen’s pivotal role as a thorn in the side to LBJ’s legislative agenda, especially in trying to reverse Right-to-Work (197-198).

-Johnson referred to liberals/Lefties as “beards”! (287)

-Shlaes reflects on the limits of history in general and the history of the War on Poverty in particular:. Texts and history books have focused on Civil Rights and Vietnam, rather than economics. The result: coverage in “non-narrative, non-economic kaleidoscope fashion (15-16). Pursuing “the great man” approach to history, they have tended to beatify JFK, celebrate LBJ as a man of action despite consequences; and vilify Nixon as he ironically extended LBJ’s failures. 


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