That Old 1960s Dreaming

Stand-up US comedian Charles Fleischer is credited as the originator of the now well-worn line: “If you remember the sixties, you really weren’t there.” Well, historians and archivists are another matter. Many were there and kept the record. Others, like Amity Shlaes, have gone through the records to uncover much that has been forgotten.

The 1960s age of revolution, with its pop culture and violent protest, has been captured unendingly in photographic and cinematic playback. In 2020, Aaron Sorkin’s The Trial of the Chicago 7 (leaders of the violent anti-war protest at the 1968 Democratic National Convention) sought to cameo the 1960s as a generational struggle between counter-culture, drug-infused, revolutionary youth and ageing white male (racist) institutional parochialism. This may be the popular view of the 1960s, yet it was but the extreme end of a much more subtle shift in direction, one guided and enforced from Capitol Hill and the White House. 

In her new book Great Society: A New History, Amity Shlaes lays bare, in compelling style, the development of an administratively wrought movement through the Johnson and Nixon years, in part echoing the failed aims and outcomes of Roosevelt’s New Deal. Beginning with a sense that the US could afford big and fundamental reforms, economic and public policy thinking at the highest levels sought to apply socialist principles in a promise to end poverty and racial inequality.

Shlaes comprehensively analyses how these efforts at reform, through prescribed programs, became counter-productive and were largely responsible for the era of market-driven revival that became the 1980s. She writes:

What the 1960s experiment and its 1970s results suggest is that social democratic compromise comes close enough to socialism to cause economic tragedy … The popular expression of these new insights was the 1980 election of Ronald Reagan.

It’s a big canvas and yet Shlaes’s readers are propelled forward by the personalities at play. As in an action drama, key political figures take on the roles of protagonists, humanising what might otherwise be dry detail emerging from a decade of bureaucratic discussions. Great Society pushes through the fog of administrative detail to capture an era of well-meaning but flawed social planners and the society they helped to engineer—one quite the reverse of what they had envisaged. The “Great Society” they set out to build never eventuated. As spending on domestic programs rose as a percentage of GDP, the jobless queues lengthened and poverty traps became entrenched. Cries for black equality strengthened.

Using the television series Bonanza as her metaphor, Shlaes opens Great Society at the start of 1960 with a US that sees itself as possessing great wealth but without a plan to manage that wealth while poverty remains rusted-on and a majority of black Americans show little interest in voting at elections. Shlaes quickly sets the tone, drawing out the parallels to be found in Bonanza and what would become government thinking around dealing with the US as an enterprise where, as John Maynard Keynes once told President Franklin Roosevelt, businessmen resembled domestic animals. According to Keynes’s argument:

All you need to get profit out of cattle was to treat the animals decently and herd them. Then you would get the beef and the milk. And most Americans trusted the faithful shepherd. The relationship was reciprocal: Americans needed the government, and the government needed them.

Shlaes demonstrates how over a decade and a bit more, government’s belief that it could use the private sector as its workhorse eventually proved unsustainable once the private sector found the burden too heavy. At the opening of Great Society, Detroit is the manufacturing showpiece of the nation; by the 1970s it had begun to fall into the desolate wasteland it still struggles to recover from.

In her opening chapter Shlaes unpicks the struggle of General Electric’s vice-president, Lemuel Boulware, with his belief in co-operation between labour and business in a contractual-style free-market arrangement against a growing union campaign—assisted by the powerful United Automobile Workers’ (UAW) Walter Reuther—to resist the deal-making (“Take it or leave it”) Boulwarism approach to workers’ pay and conditions. By the spring of 1962, Boulwarism had been discredited—GE executives had been found guilty of price fixing while its company profits were up, in spite of the “flash” crash at the end of 1961 and early 1962. The struggle for workers to gain some of the benefits of this corporate wealth had become a reasonable cry.  

Ironically, for the world’s leading nation, it was to the UK that US policy-makers looked for guidance a decade and more after the Second World War. In post-war Britain, the Attlee Labour government had embarked on the development of a welfare state where government programs were intended to alleviate problems of poverty, homelessness and inequality. By the 1960s, with Democrat administrations, US government policy-makers were also looking for new ways to make a difference.

The Kennedy administration favoured organised labour’s vision of a broader social welfare state. Heavyweight in the push for state socialism was UAW leader Walter Reuther, who from the 1950s had carried a dream of American socialism. Shlaes traces the links between Reuther’s union following and the growing movement among radical students around Students for a Democratic Society (SDS) and its leaders like Tom Hayden and Allen Ginsberg. This came to a peak at the 1962 national convention of SDS held at a UAW retreat at Port Huron, Michigan. The SDS manifesto from that convention was an attack on liberal politics and its continuing inequalities. It laid out a utopian view of how citizens might achieve an end to what SDS labelled the military industrial complex uniting business and government.

Idealistic and revolutionary as it undoubtedly was, Shlaes demonstrates that any move to the left in US politics—agitated for by student radicals, civil rights activists and unions—was not simply the result of a push from without on government. Government itself was seeking to overturn much of the American system also, the planners united in a campaign to remake society as part of their legacy.

Enter Michael Harrington, academic, democratic socialist and author of The Other America. Given a hearing at the White House in 1964, his social democrat (socialist) prescriptions offered a new “New Deal” that struck a chord with President Lyndon Johnson, who had promised to “cure poverty” in his State of the Union address. Days after President Kennedy had been assassinated, newly sworn-in President Johnson had contacted Walter Reuther and, later, other union leaders. Lawyer Joseph Rauh, who was with Reuther when the President phoned, recalled that while Johnson was supposed to be a conservative, “he was contacting liberal labor people all over the place”.

A hyperactive Johnson emerges as the president who took the US on a social welfare pilgrimage which Nixon continued. The move was not smooth, and much advice, discussion and manoeuvre came with it. The tide seemed to be pushing a shake-up of old ways and the key players were ready for the big experiment, or what they called making the Great Society. Democracy would use government planning—five-year or otherwise—to remake America.

The Johnson White House, as Shlaes reconstructs it from a multitude of sources, was energetic and set on a crusade to engineer an almost utopian society. In a commencement address at Ann Arbor in May 1964, Johnson spelt out his vision of the Great Society. Shlaes writes of the speech:

 In the past, presidents had striven for abundance. The challenge of the next half century was proving “whether we have the wisdom to use that wealth to enrich and elevate our national life”. Some corners of the country are still poor. The Great Society, therefore, required, as Johnson said … an “end to poverty”.

Needless to say, this Johnson vision would require the sort of large-scale spending used only in wartime. Shlaes captures this contest at the beginning of each chapter with a small statistic—spending on “Guns” as opposed to spending on “Butter”. The book opens in 1960 with “Guns” at 9.0 per cent of GDP versus “Butter” at 4.5 per cent. By 1971, “Guns” are 7.0 per cent of GDP and “Butter” is 7.1 per cent. In spite of the expense of the Vietnam War, social spending had overtaken spending on defence. Meanwhile, by 1971, inflation was the raging problem alongside unemployment, while President Nixon was in a fight with the legislators on Capitol Hill to cut spending.

The push for social and economic reform did not change with Richard Nixon’s White House win in 1968. The slick move by Johnson’s Assistant Secretary for Labor, Patrick Moynihan, to the Nixon executive offices as Assistant to the President for Domestic Policy and executive secretary of the Council of Urban Affairs, was viewed by Democrats as betrayal. For all that, the Moynihan influence ensured that Johnson-style social and economic programs designed to beat unemployment and reduce poverty continued in one form or another. And, with Nixon distracted by the Vietnam War and its fallout, policy planners in domestic affairs took the wheel. Great Society efforts continued.

The Office of Economic Opportunity (OEO)—a name that hid its goal of eliminating poverty—had been the spearhead in the Great Society endeavour. Headed by Sargent Shriver (brother-in-law of John and Bobby Kennedy) during the presidency of Lyndon Johnson, its federal largesse cut across state and local boundaries, encouraged general misuse of public money, as in any generous subsidy program, and saw mayors bidding higher for funds they said were needed to stop riots like the five days of burning and looting in Watts, Los Angeles. Civil rights and black homelessness and poverty collided while authorities haggled over who got what from the public purse:

The trick, the mayors decided, was to respond with alacrity, to take the lead. And, if the mayor was Democrat, to remind the poverticians in Washington of all that the bidding mayor’s city had done for the Democratic Party … Dallas, which had bucked its own Republican tradition to vote for Johnson, figured a few cosmetic changes to its extant programs were all it needed to be ready for the OEO. And to the shock of old segregationists, the Dallas Citizens Council, similar to a chamber of commerce, was now inviting local leaders to join in programs aimed at the poor. “Why they’re even inviting Negroes and union leaders to sit in on some of the mayor’s special committees now,” commented a Dallas citizen nastily.

Worse was to come. Legal battles and housing projects ate up millions in funding in an attempt to rid cities of slums—slum clearance of the past had uprooted communities but slums remained. Part of the endeavour was to prevent riots by improving housing. Yet, in July 1967, Detroit went up in flames, with rioting for days. Writes Shlaes:

The Detroit Fire Department was fighting 1,682 fires. More than one hundred city blocks were seriously damaged. The death count eventually rose to forty-three … After tens of millions and decades of urban renewal spending, Detroit did not look renewed. Detroit looked, Mayor Cavanagh said, like a city that needed a Marshall Plan, “like Berlin in 1945”.

As states and mayors complained about Washington’s invasion of their territory, albeit taking the handouts, black unemployment dropped and blacks in higher education rose steadily, but applications for welfare payments increased. Family break-up had not been factored into the OEO’s expectations. And, while White House influencers like Walter Reuther and Daniel Moynihan believed housing and employment could fix the ills of inequality, the young black lawyer Thomas Sowell warned that “to expect civil rights to solve our economic and social problems was barking up the wrong tree”. He would later warn that if social welfare handouts were not solving the employment problem, this was because black Americans “are like everybody else in wanting something for nothing”.

Meanwhile global competition in the auto world had seen Japanese cars sneak up on Detroit manufacturers as wages inflated and corporations looked elsewhere for ways to produce goods at a decent profit. Argument ensued at the Nixon White House over how best to direct welfare. Daniel Moynihan’s Guaranteed Income Proposal to structure benefits around people getting back to work floundered with its high costs, and claims that it left the poor taxed the same as the rich and ignored those who could not work such as the aged, single mothers and the disabled. In the wings, Ronald Reagan, then Governor of California, claimed the program would “put one in every seven of our citizens on welfare”.

Great Society closely follows the economics of the 1960s dreamers in the White House, a history of the 1960s that has been forgotten in the cinematic reruns of violent and non-violent protest, principally over the Vietnam War and civil rights. For Shlaes, these upheavals are backdrop to government and at times almost symbolic of the fraying of hopes and visions. Tom Hayden and his SDS companions toured North Vietnam as honoured guests of the Vietnam communists while the democratic White House struggled with anti-war demonstrations and a mounting body count. Meanwhile, the Great Society vision refused to take root. In 1970, the number of Americans below the poverty line grew by a million in that year alone.

In May 1970, Walter Reuther with his wife May and architect Oscar Stonorov took a chartered Learjet to inspect Reuther’s pet project, Black Lake—a luxury haven for unionists he believed would be his legacy. Shlaes writes:

In their attempt to land, the pilots took the plane too low, too early. The little jet clipped the treetops and caught fire, crashing in an inferno. The passengers were gone in minutes. The great dreams were dying, and now the great dreamer had died too.

Shlaes has done us all a service. She has put back into the US narrative the parts of 1960s history that textbooks and most historians have avoided recording. The Left dominated the 1960s—on the streets, in the media and in the record. What historians have to date left out is that the Left also dominated the White House of the 1960s, with its great experiment at social planning, an experiment that ended in failure and economic malaise.

Dreamers come and dreamers go. At the front of Great Society the adage “Nothing is new; it is just forgotten” is quoted. Well, now, thanks to Amity Shlaes, the full story of 1960s USA will not be forgotten.

Great Society: A New History
by Amity Shlaes
HarperCollins, 2019, 528 pages, $44.95

Anne Henderson is Deputy Director of the Sydney Institute and the author of Menzies at War, which was shortlisted for the 2015 Prime Minister’s Award for Australian History.