He writes:
"If you want a rough analogy, think back to the conversations about capitalism in the 1930s, as the Great Depression set in. Critics said the programs of the New Deal amounted to socialism. Nothing could be farther from the truth. Programs like Social Security created a level of basic economic protection -- so that people were willing to put up with the risks of a market economy.
The social welfare state didn't kill capitalism. It saved it. The same can be true today."
The thought of the great progressive reformers at the time (back to Wilson and Theodore Roosevelt, actually) was just that: to save capitalism from itself. They were successful. Cohn is wrong when he says "nothing could be farther from the truth," that the New Deal involved socialism, however. A more accurate read is to say America borrowed minimally from socialism, and ended up mainly with its best points in its social safety net. It allowed much of the market economy to remain intact.The larger point is that most political movements and ideas contain at least some truth, and no idea solves every problem. American pragmatism, when functioning at its apex, takes the best ideas from multiple points of view and ends up with something better than any one of them could provide alone.
Free trade is the most efficient and productive way to trade, but it has undeniable downsides for those hit by its economic destruction. A strong social contract and national unity would strongly argue for free trade plus programs to minimize social disruption. Protectionism should be our last resort.
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