Let’s consider one phrase in FDR’s first modern State of the Union message:
I shall continue to regard it as my duty to use whatever means may be necessary to supplement State, local and private agencies for the relief of suffering caused by unemployment. With respect to this question, I have recognized the dangers inherent in the direct giving of relief and have sought the means to provide not mere relief, but the opportunity for useful and remunerative work. We shall, in the process of recovery, seek to move as rapidly as possible from direct relief to publicly supported work and from that to the rapid restoration of private employment.
Note the hierachy of values in the statement. Benefits paid by the government (“relief”) are a necessary evil. Publicly supported work is an explicit, temporary transition to the ultimate goal, private employment.
Is there a comparable vision at work now? I don’t see it. The closest I see is the Keynesians’ insistence on boosting “aggregate demand” to realize “potential GDP”, a substantial step of abstraction away from FDR’s statement of objectives.
That the effectiveness of boosting aggregate demand is predicated on there being unused production does not seem to enter into the thinking. My view, as I have said for some time, is that there’s a lot less unrealized potential GDP than many people seem to assume. Remember, GDP is measured in dollars, not in widgets or hours worked. That means that, when the price of widgets goes down, the GDP represented by that decrease is just plain gone.