From the Outside In: World War II and the American State
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From the Outside In: World War II and the American State
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Overview
From the Outside In examines the profound impact of World War II on American government. The book argues that the wartime and immediate postwar experiences of the 1940s transformed and redirected the policies and government institutions of the New Deal. In a work that makes significant contributions to the study of U.S. politics and history, Bartholomew Sparrow proposes a new model of the state and of "state-building." The author applies this model, which derives from the resource dependence perspective, to the historical record of four areas of public policy: social security, labor-management relations, public finance, and military procurement.
This book is the first to use recently available archival materials documenting the consequences of World War II for the programs and political agendas of the welfare state. It is also the first to apply the resource dependency perspective to the U.S. federal government as a complex organization. The book will lead readers to reevaluate the impact of international factors on American political development, to reappraise the role of the New Deal in shaping the postwar federal government, and to reconsider the application of organizational theory to American government.
From the Outside In will be of particular interest to political scientists, political sociologists, and historians. It will appeal to anyone with an interest in the comprehensive effects of the Second World War on domestic policies and U.S. government itself.
Originally published in 1996.
The Princeton Legacy Library uses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These editions preserve the original texts of these important books while presenting them in durable paperback and hardcover editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.
Product Details
| ISBN-13: | 9781400864218 |
|---|---|
| Publisher: | Princeton University Press |
| Publication date: | 07/14/2014 |
| Series: | Princeton Studies in American Politics: Historical, International, and Comparative Perspectives , #321 |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 372 |
| File size: | 25 MB |
| Note: | This product may take a few minutes to download. |
Read an Excerpt
From The Outside In
World War II and the American State
By Bartholomew H. Sparrow
PRINCETON UNIVERSITY PRESS
Copyright © 1996 Princeton University PressAll rights reserved.
ISBN: 978-0-691-04404-0
CHAPTER 1
Introduction
In a true sense, there are no longer nondefense expenditures. It is a part of our war effort to maintain civilian services which are essential to the basic needs of human life. —President Franklin D. Roosevelt, 6 January 1942
War does not always give democratic societies over to military government, but it must invariably and immeasurably increase the powers of civilian government; it must almost automatically concentrate the direction of all men and the control of all things in the hands of the government. If that does not lead to despotism by sudden violence, it leads men gently in that direction by their habits. —Alexis de Tocqueville
States make wars; wars make states. The political development of the United States is no exception. The War of Independence brought the United States into being; the Civil War established the politics and government of the United States for much of the nineteenth and early twentieth centuries; and the First World War spurred the development of the twentieth-century American state. But most important for understanding American political development in the latter half of the twentieth century is the Second World War. World War II jolted a moribund national economy out of the Depression, led to the creation of international systems of trade, investment, foreign exchange, and diplomacy, and established the United States as a political, economic, and military superpower.
Far less appreciated, however, have been the effects of the Second World War on domestic programs and, specifically, on the political institutions associated with American exceptionalism: the limited and delayed provision of social services, the politically weak labor movement, the low tax rates and the reliance on income taxation, the absence of strong fiscal policy, and the large defense sector. The intranational American state, thought to be the legacy of the New Deal, was systematically affected by the extranational factors of World War II and its aftermath; the American state was built from the outside in.
To say that the mid- and late-twentieth-century American state was forged through the crisis of global warfare is, however, to say little by itself. We need to determine that what actually happened during the war years had important and lasting effects on U.S. politics and government; we have to find out the extent to which international crises and world wars more generally affect American political development; and we have to clarify what is meant by the "state"—given the ambiguity of the term—and by "state-building"—how it is that crises transform states.
Many social scientists and historians acknowledge the importance of the Second World War in the establishment of international system after 1945, and many theorists of international relations recognize that wars may reorient the international system; but few social scientists or historians have looked at how the shocks of the Second World War affected the United States internally. The conventional wisdom is that the programs of the New Deal survived the war and continued on in the postwar years, as evidenced by the public ownership of electric utilities (1933), the regulation of the securities industry (1933), the introduction of the social security system (1935), the guarantee of the right of workers to collective bargaining (1935), the provision of unemployment insurance (1938), and the deliberate use of deficit spending for economic stimulation (1938).
The argument here, however, is that the creation (to borrow Dean Acheson s term) brought about by the Second World War was as much evident in the institutions of domestic government as in international relations. The effect of World War II was to at once delay further reforms of the social security system, cause a small expansion of the budget and staff of the Bureau of Old-Age and Survivors Insurance in relation to other social security programs, and allow for other social provisions to displace federally guaranteed social provisions. Between the rise in employment resulting from the war and the increase in non-government social programs resulting from the wartime policies, social security—the "social insurance" component of government social provisions—became better rooted among employees and employers, and better established as federal policy. Yet the social security program that was becoming better supported and better administered was one that had been directed away from redistribution and was distinctly late in coming.
The war further resulted in greater intervention by the federal government in labor-management relations, beyond anything seen in the 1930s. It brought on large increases in the number of labor-management disputes that were subject to government mediation, caused the government to seize industrial facilities, and resulted in the growth of the agencies regulating labor-management relations. Spurred on by the wartime emergency, the labor boards likewise improved their procedures for handling petitions and settling disputes. The war forced the Roosevelt Administration to seek the cooperation of the AFL and CIO, and top union officials worked closely with the Roosevelt Administration and the Democratic party. The early 1940s marked the transition of American labor from being a social movement to becoming one of many influential interest groups in the latter half of the 1940s and in subsequent decades.
In addition, the events and policies of the 1940s were fundamental to effecting the tax and borrowing policies characteristic of the postwar institutions of U.S. public finance. The war caused a great expansion in income taxation, on both an absolute and a per capita basis, and the Bureau of Internal Revenue significantly increased its budget and staff. Then, with the introduction of current withholding in 1943, the government was able, at the stroke of a pen, to either withhold more money from taxpayers' paychecks or increase their take-home pay (thereby either reducing or increasing consumer spending); the federal income tax became the means for raising revenue even while other forms of revenue collection were being rejected.
With the large expansion in the public debt that accompanied the war, the Roosevelt Administration and the Treasury Department set up a multitude of joint public-private agencies to sell U.S. securities to individual and institutional investors at the local, state, and national levels. Millions of individuals and thousands of financial institutions suddenly started to buy, and would continue to buy, U.S. government securities. The Bureau of Public Debt expanded accordingly in order to handle the increases in sales, redemptions, and resales of government securities. Both the Bureau of Public Debt and the Bureau of Internal Revenue also streamlined their operations in order to better secure the government's financing as a result of the war.
Finally, the events of the 1940s were signally critical in expanding both the quantity and the quality of government-business relations. The government revised its procedures for securing needed matériel and created a variety of agencies for overseeing, coordinating, and expediting procurement. The amount of money spent on matériel soared, as did the volume of contracts and the number of officials administering procurement (i.e., letting contracts, supervising contractors, renegotiating contracts, providing contractor financing, inspecting, monitoring subcontracting, coordinating procurement, etc.). Although the postwar spending on matériel fell off substantially from the wartime levels, the budgets and personnel needed for national defense remained at levels far above their prewar mark. And the new processes and agencies of procurement introduced during the war mostly stayed on, to be integrated first into the National Military Establishment and then into the Department of Defense. World War II affected far more than weaponry and military alliances.
In short, the effect of World War II was not only to transform American government and society, but also to direct the development of U.S. public policies and political institutions in ways that would typify American government for decades to come.
The Second World War as Crisis
Whether periods of non-incremental change are called "critical moments," "punctuated equilibria," or "branching points," the crux of the matter is that some historical periods engender significantly more institutional transformation than others. Change in the state happens not gradually or incrementally, but disjunctively and sporadically. And crises create opportunities for, and make transparent the necessity for, change; it is during crises and major wars that the categories of political identity and the bonds of social networks become subject to severe stress. Alternative paths of political development become possible; factors previously considered fixed for strategic purposes now vary (at least in the short term); and established collectives and everyday government-society relations become unfixed. The decisions and directions taken during critical eras at once guide and constrain future political development.
But crises can take many forms and are present in varying degrees. The study here is of international crises, and of wars especially. For states are penetrated in many policy domains by the actions or even mere presence of other states; they are not simply billiard balls interacting with other states on an outside surface. A states own constitution and intranational structure may be conditioned, by international relations, and particularly by wars. Wars not only shape the "extra-societal or international role" of the state, then, but may also affect the size and array of societal actors and therefore the relation between government and society.
As a global war and as an international crisis, World War II can be contrasted with the crises that occur within states, such as revolutions, civil wars, and economic depressions, which pit political party against party, region against region, or economic class against class. More specifically, World War II was a hegemonic war, to follow the political scientist Robert Gilpin. It manifested direct conflict among the dominant powers in the international system—the United States, Great Britain, France, the Soviet Union, Germany, Japan, and Italy—conflict in which the very "nature and governance" of the international system was at stake. Just as the end of the Punic Wars marked the fall of Rome, and as the end of the Napoleonic Wars marked the beginning of British hegemony, so did the Second World War mark the start of American international dominance.
Since hegemonic wars put the basic features of the international system at stake, they are necessarily total wars, involving entire populations and requiring much if not most of national production and the virtually complete attention of governments. All are devoted to the end of eradicating an opposing system of rule, with few limits on the means or the scope of warfare. For the United States, the Second World War may be contrasted with the limited ambitions and the smaller scales of the Spanish-American, Korean, and Vietnam wars.
The Second World War was also a democratic war—at least for the United States, Great Britain, Canada, Australia, New Zealand, and Finland. Democratic wars need the backing of public opinion, since the effects of war pose potential hazards for democratically elected officials: deaths and injuries from military engagements, the stationing of personnel overseas, and large military budgets may cause war to become unpopular and politically unsustainable. Democratic governments therefore have to persuade their citizens of the necessity and importance of war; they have to be justified to a potentially skeptical, even rebellious public. Although the totalitarian governments of Germany, Japan, Italy, and the Soviet Union also depended on public support, nondemocratic governments have more options: Hitler could withstand the opposition of much German public opinion and even that of his own top military leaders; and the Soviet government could withstand the sacrifice of tens of millions of lives for the sake of defeating Germany.
The First and Second World Wars were both hegemonic wars for the United States. Both wars provoked nationwide industrial mobilization, caused the formation of quasi-corporatist government-business-labor partnerships, and brought about large increases in the federal deficits and public indebtedness. They marked permanent increases in the size of government and made for lasting changes in the roles that the federal government would play with respect to labor-management relations, income taxation and public borrowing, and defense spending. After both wars there were similar problems of demobilization, labor unrest, industrial reconversion, and cutbacks in federal spending.
Furthermore, the two wars systematically affected public policies considered characteristic of American exceptionalism. Both wars influenced the fate of proposals for national health insurance: the effect of the First World War was to squelch initiatives towards the public provision of medical insurance, just as the combination of American prosperity and Soviet rivalry obtaining after World War II factored in the success of the private interests that opposed national health insurance and favored the anti-collectivist arguments used against proposals for public health insurance in the late 1940s. The two wars led to government-labor ties that helped suppress labor radicalism and entrenched the positions of more conservative union leaders. The president of the American Federation of Labor during World War I, Samuel Gompers, and the AFL and CIO presidents during World War II used the war to improve their positions both against rival unions and against business management. At the same time, the wars caused the building of government institutions for the purpose of handling labor-management disputes; the wars allowed for the federal government to have a greater impact on labor-management relations in the United States. Nor would the government relinquish the new role it was playing in maintaining industrial peace.
With the big increases in government spending needed to fund the wars, the government had to build new capacity for collecting revenues. One result was the growth of the federal income tax. Another was the unprecedented sale of government securities of various denominations, rates of interest, and maturity periods to individual and corporate investors throughout the country. The combination of the tax and borrowing policies-and their demonstrated efficacy—led to U.S. fiscal policy that would mostly depend on tax and monetary policy, rather than on spending levels or incomes policies.
Finally, the two wars spurred the growth of the defense bureaucracy, accelerated the industrialization of the United States through the military's procurement of matériel, and repositioned the United States in the international system of states. The victory in the Second World War led to a global foreign policy and to characteristically and distinctly high levels of defense spending. Much of what the wars set in place would remain intact for the rest of the twentieth century.
The State, State-Building, and the Resource Dependence Perspective
But why the state? It could be contended that the 104th Congress, elected in November 1994, represents an attempt to dismantle the federal government. After all, the Contract With America signifies a frontal assault on the U.S. national government. The Contract With America has proposed—among its other provisions—to amend the U.S. Constitution by requiring a balanced federal budget; to impose term limits on members of the House and Senate; and to overturn the present welfare system by prohibiting welfare to mothers under the age of 21, by denying increased support payments for mothers who have additional children while on welfare, and by restricting Aid to Families with Dependent Children to a two-year period only.
Yet the status of the state, and thus the merits of a study of state-building, remain in question. It may be that the decentralization of government simply tranfers the responsibilities of national government to the separate states, and that the fifty states—rather than the national government—will then have to amass the resources necessary to deal with the problems of the day. A smaller national government may therefore result in commensurately larger state and local governments, which in turn aggregate into a national government that is still "big" and "intrusive" relative to individuals and private organizations.
(Continues...)
Excerpted from From The Outside In by Bartholomew H. Sparrow. Copyright © 1996 Princeton University Press. Excerpted by permission of PRINCETON UNIVERSITY PRESS.
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Table of Contents
Figures
Tables
Preface
1 Introduction 3
2 Social Security's Missing Years 33
3 The Regulation of Labor-Management Relations 67
4 The Revolutions of Public Finance 97
5 The Transformation of Navy Procurement 161
6 Relative State-Building in the 1940s: The Terms of Exchange 258
7 A Resource-Dependent American State 269
Select Bibliography 317
Index 337