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FDR and the New Deal: The Vision of a Transformational Leader

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Introduction

“A Leader is summoned to the fore by the needs of the time”. – (Smith, 2008) We stand today at a time of change and challenge. At a time when humanity faces its greatest and most complex challenges, we are unfortunate to have a dearth of leadership. Competence has become a rare commodity among some of the world’s most prominent leaders, with value being placed on its appearance rather than its existence. Now more than ever Franklin Delano Roosevelt’s (FDR) leadership practice is important because he represents leadership that had the rare combination of inspiration, selflessness and grit, a naturally charismatic individual who was transformed through personal struggle into a fearless, intellectual heavyweight. “Indeed, if ever an argument can be made for the conclusive importance of the character and intelligence of the leader in fraught times, at home and abroad, it will come to rest on the broad shoulders of Franklin Delano Roosevelt.” (Goodwin, 2018). In his inaugural address as President of the Unites States of America on January 20th, 1937, FDR stated: “The test of our progress is not whether we add more to the abundance of those who have much it is whether we provide enough for those who have little.” (Speeches That Made History, 2018). FDR managed to achieve the true alchemy of public service, by creating the environment for sustained economic growth coupled with enshrined social equality. In this essay/evaluation, I am going to:

  • Provide an overview of FDR’s leadership, particularly as it pertains to his management of the Great Depression and his implementation of the New Deal.
  • Critically evaluate FDR’s leadership practice by drawing upon three distinct leadership theories/models (listed below)
  • Show how FDR’s leadership demonstrates the effectiveness or otherwise of each theory
  • Draw my own conclusions and learnings about how this applies to my own political leadership ambitions as a member of the Fine Gael party

Context

Franklin Delano Roosevelt (January 30, 1882 – April 12, 1945) served as the 32nd President of the United States from 1933 until his death in 1945. A member of the Democratic Party, he won a record four presidential elections and became a central figure in world events during the first half of the 20th century. As a dominant leader of his party, he built the New Deal Coalition to tackle the crisis of the Great Depression, an alignment of interest groups and voting blocs in the United States to support the New Deal. This alignment voted for Democratic candidates from 1932 until the late 1960s & moulded American politics into the Fifth Party System, defining American liberalism throughout the middle third of the 20th century. An evaluation of his leadership practice bears fruit in identifying how FDR applied his natural abilities to become a catalyse change in himself, in the alignment of politics in the US and in his country.

Theoretical approach

Throughout the course of my evaluation of FDR’s leadership practice, I will show: A) That FDR possessed inherent leadership traits (Trait Theory, Leadership, Northouse, 2016) that were brought to the fore when confronted with the appropriate challenge, i.e. The Great Depression B) That in response to this challenge FDR laid out a vision for a new politic in America (The New Deal) (Visionary Leadership, Leadership That Gets Results, Goleman, D., April-May, 2000) and C) Once FDR had laid out his vision he set about bringing this transformation to fruition through implementation of The New Deal (Transactional Vs. Transformational Leadership, Burns, 1978, Leadership, Burns, 2010)

Theory 1: Trait Theory

Historical views on leadership maintained that it “was a set of qualities or personal characteristics (i.e. traits) that someone was born with” ((Martin and Fellenz, 2017). This take on leadership originated from the “great man view of leadership which suggested that in every situation, particularly in times of crisis, “great men” would emerge to lead though the difficulties.” (Martin and Fellenz, 2017). Hardy in 1993 suggested that by 1950 there had been over 100 studies that had attempted identify appropriate traits. However, there was very little agreement about actual traits, with only about 5 per cent being common & little evidence to support the key contentions about these traits. (Martin and Fellenz, 2017). Northouse in his 2016 book: Leadership: Theory and Practice, identified the 6 most common traits found in most studies, namely: intelligence, self-confidence, determination in pursuit of goals, drive, integrity & willingness to take responsibility and sociability. (Northouse, 2016) Contemporary leadership trait research focuses less on direct effects of individual traits and more on constellations of traits, interactions between traits and situational characteristics, and the implication of traits on skills and behaviours that affect leadership (Dinh and Lord, 2012; Judge and Long, 2012; Ng et al., 2008). Those traits found to have some direct (proximal) and or remove (distal) association with successful leadership in large organisations include (e.g. Yukl, 2010; Zaccaro, 2007). (Zaccaro et. Al, 2004)

Fig.1: Extended model of leader traits and leadership performance

In engaging with the above extended model (Fig. 1) in further detail it is clear to see that in FDR’s case he possessed the following distal traits: integrity, willingness to take responsibility, sociability & the following proximal traits: determination in pursuit of goals, drive, intelligence, self-confidence. This constellation of traits when merged together and applied to the situation conditions of 1993 America, i.e. the “havoc” (Goodwin, 2018) of The Great Depression, lead to FDR’s success and impact as a leader, i.e. The New Deal and subsequent establishment of social security in the US, as well as the longest period of economic growth in US History. His deep well of self confidence stemmed from his wealthy upbringing in Hyde Park, New York and a doting mother (The Roosevelts: An Intimate History, 2014). It was there that FDR first embodied the belief that he was at the centre of the world and was born to lead. While this self-confidence did aid FDR in his ascendancy to the president it turned to over-confidence as he faced criticism for his consolidation of power into the Executive via the Reorganization Act of 1939, which subsequently created the Executive Office of the President, making it ‘the nerve center of the federal administrative system.’ (Leuchtenberg, 2015) This concentration of power into the Executive played into the President’s leadership style: “The president stayed in charge of his administration…by drawing fully on his formal and informal powers as Chief Executive; by raising goals, creating momentum, inspiring a personal loyalty, getting the best out of people…by deliberately fostering among his aides a sense of competition and a clash of wills that led to disarray, heartbreak, and anger but also set off pulses of executive energy and sparks of creativity…and always by persuading, flattering, juggling, improvising, reshuffling, harmonizing, conciliating, manipulating.” (Burns, 1970) This may have suited FDR’s style as the “great man” (Carlyle, 1840) at the centre of many spokes in a wheel but this style of leadership was dependent on the health and well-being of the President. If this begins to wain, as FDR’s did during WWII, this can have an impact on effective policymaking. Power must always be balanced and distributed, with fundamental structures never disturbed.

Evidence of FDR’s persistence, resilience and deep intellect was clear early on. He is attended at Harvard University and subsequently won election to the New York State Senate in 1910. He then served as Assistant Secretary of the Navy under President Woodrow Wilson during World War I. Roosevelt was James M. Cox’s running mate on the Democratic Party’s 1920 national ticket, however Cox was unsuccessful, (Dallek, 2018). However, in 1922, FDR’s political career was derailed by illness. In August 1921, he diagnosed with poliomyelitis at the time. This however did not dampen his drive and ambition to reach the uppermost echelon of political life & become President of the United States. With the help of his mother (Sara) and wife (Eleanor), he relearned to walk & successfully returned to politics in 1929, becoming Governor of New York and President of the United States by 1933.

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“Only fourteen-pound braces on each of his lower limbs and the use of crutches enabled him to walk unassisted, and mastering these would require substantial practice”, (Dallek, 2018) FDR had innate distal and proximal traits suited to leadership, however his interactions with a supportive mother (Sara) and wife (Eleanor) & the situational conditions of battle with polio helped bring those talents to fruition in response to the immense challenge of The Great Depression. “Yet, the picture of Roosevelt as a prodigy, a natural, a purely instinctive leader belies the long periods of hard thought and preparation that went into everything he said or did” (Smith, 2008). FDR had the ambition and intellect to be a leader, but recovering from polio and returning to politics gave him the grit & humility required to forge substance in his leadership. In today’s landscape of leadership, real substance in one’s leadership would certainly be a rare commodity and an edge. Furthermore, Fine Gael requires a re-establishment of its grit to forge a new substance to its governance. Akin to W.T. Cosgrave at the helm of the state at its establishment or Leo Varadkar at the helm during COVID-19, Fine Gael responds marvellously to acute crises but they must carry this over to day to day crises such as Health and Housing.

Theory 2: Visionary Leadership

The significance of the Great Depression as a turning point not only in FDR’s Leadership practice but also in US History cannot be understated. Secretary of Labor Frances Perkins said of the deepening Depression of 1933: “It is hard today to reconstruct the atmosphere of 1933 and to evoke the terror caused by unrelieved poverty and prolonged unemployment.” The economy had reached “rock bottom.” (Goodwin, 2018). Modern interpretation of the Great Depression would undoubtedly class this as a VUCA environment (Volatile, Uncertain, Compelx, Ambiguous), (Bennett and Lemoine, 2014), one in which “American industry was paralyzed; a quarter of the labor force was unemployed…Thousands of banks had collapsed, taking with them the deposits and savings of millions of people.” (Goodwin, 2018). It was in response to this catastrophe that FDR’s innate leadership traits crystallised in the form of a vision for a New Deal and the will to achieve this transformation. Daniel Goleman in his book: Leadership That Get Results (Goleman’s 6 Leadership Styles: Leadership That Gets Results, April-May, 2000), put forward the idea of 6 distinct Leadership Styles with accompanying behaviours, emotional intelligence capabilities, optimal environments and suggested impacts on the working climate. Goleman defines a visionary leadership as: the ability to take charge and inspire with a compelling vision.”.

Fig. 2 (Goleman, 2000)

Engaging with the model above it is clear that FDR’s modus operandi was as a visionary leader. Goleman writes further on the visionary style of leadership that ‘Visionary leaders articulate where a group is going” (Goleman, 2000) and in doing so it sets “people free to innovate, experiment, and take calculated risks” (Goleman, 2000). FDR drew a line in the sand and unfurled a new canvas in his Inaugural Address in 1933: “This is a day of national consecration” (Speeches That Made History, 2018) With this one sentence he made a distinction between what had gone before and charted a course for what was to begin. He then set about exercising his self-confidence & his empathy to mobilise his people towards a new vision, to become a catalyst for positive change. Roosevelt began by directly facing the facts of the dire situation.

Characteristic of the Visionary Leader, they are most effective: “when changes require a new vision or when a clear direction is needed” (Speeches That Made History, 2018). “FDR in attempting to create a “most strongly positive climate” asserted(Speeches That Made History, 2018), “the only thing we have to fear is fear itself.” This sense of ambition mixed with empathy, was characteristic of Roosevelt’s sociability that would later characterise his Fireside chats. (Roosevelt, F., 2006) He told his people to accompany him (“come with me”) (Goleman, 2000) and infused a sense of shared purpose and direction. He made it clear what they could expect from him: “He told the country he was prepared to recommend to Congress a series of measures that “a stricken Nation” required (Speeches That Made History, 2018). He put forward a new image for a better America, a more ethical country that serves the many and not the few. “Restoration calls” (Speeches That Made History, 2018), however, not for changes in ethics alone. “This Nation asks for action, and action now” (Speeches That Made History, 2018). This action, this new vision, took the form of the New Deal. These were a series of programs, public work projects, financial reforms, and regulations enacted by FDR during the period 1933-1936 in response to needs for relief, reform, and recovery from the Great Depression. Major federal programs and agencies included the Civilian Conservation Corps (CCC), the Civil Works Administration (CWA), the Farm Security Administration (FSA), the National Industrial Recovery Act of 1933 (NIRA) and the Social Security Administration (SSA). Two of the key hallmarks of FDR’s New Deal were the United States Banking Act (1933) & the Social Security Act (1935) which ushered in, simultaneously, the longest era of sustained economic growth in US history and a fundamental paradigm shift in the realm of social equality. (Dallek, 2018) Ultimately, FDR had the vast emotional intelligence a visionary leader needs to understand that the people were exhausted and broken by the speculators and “money changers” (Speeches That Made History, 2018) and new that he had to present and act early on a new positive, compelling vision to become the catalyst for change, “something new and hopeful was beginning. “ (Goodwin, 2018). Clear objectives, well communicated are the key to effective visionary leadership, it is clear that FDR’s Inaugural Address in 1933 contained this. However, visionary leadership is a double-edged sword. Ates et. Al, 2019 research on “Why Visionary Leadership Fails” found “that the positive impact of visionary leadership breaks down when middle managers aren’t aligned with top management’s strategic vision. This can cause strategic change efforts to slow down or even fail.” FDR tackled this weakness of visionary leadership through the Judicial Procedures Reform Bill of 1937, adding judges to the Supreme Court in order to bolster support for his New Deal, leading many ponder how far FDR would’ve gone to consolidate his position and his vision, had he not died in 1944, while in his unprecedented fourth term in office.

Theory 3: Transformational Leadership

Having put forward his vision of the New Deal, FDR capitalised on his transformational leadership capacities in order to achieve it. Transformational leaders tend to focus on providing a clear mission and instilling pride in the workforce while having high expectations so gaining respect and trust; they function by adopting a rational and careful problem-solving approach to the tasks to be achieved while being focused on a coaching management style. They tend to be optimistic and hopeful, with a development focus. They can produce improved performance in situations of uncertainty and change, creating positive changes on followers and helps them to take more initiative. This is in contrast to transactional leaders who tend to focus on transactions or relationship between leaders and followers. They are often a hindrance to change and fosters a climate of mediocrity, (Burns, 1978, Bass, 1990; Martin and Fellenz, 2017). FDR’s response to the aforementioned VUCA environment & implementation of the New Deal set of reforms, in particular in the United States Banking Act (1933) & The Social Security Act (1935), epitomised his transformational leadership capabilities. “When he (FDR) promised that he and the Democrats would become prophets of a new order, no one could imagine the extent to which they would transform the federal government over the next twelve years by creating a welfare state and making the United Sates into the world’s greatest power”, (Dallek, 2018). Key characteristics of transformational leadership include (Goodwin, 2018): • Demarcation between what has gone before and what will happen ahead, i.e. set a new vision. • Mobilisation people towards that vision & leadership by example. • Addressing systemic problems & launching lasting reforms. • Being open to experiment & designing flexible agencies to deal with new problems. The US Banking Act of 1933 joined together two long-standing Congressional projects: (1) a federal system of bank deposit insurance (2) the prohibition of the combination of commercial and investment banking and other restrictions on ‘speculative’ bank activities. It addressed the systemic problem of banking corruption and speculation with commercial deposits that directly contributed to the Wall Street Crash of 1929 and ensuing Great Depression. It is commonly cited as a central cause for the largest period of sustained economic growth in US history from 1933 to the 1980s, a 60 year expansion of the middle class, the largest increase in productivity & the largest increase in median income, (Burns, 2014). The Social Security Act established Social Security and promised economic security for the elderly, the poor and the sick. For the first time the federal government took responsibility for the economic security of the aged, the temporarily unemployed, dependent children, and the handicapped.

The Social Security Act contributed to a dramatic decline in poverty among the elderly. Furthermore, Roosevelt insisted that it should be funded by payroll taxes rather than from the general fund, saying, ‘We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program.’ (Dallek, 2018) FDR’s transformational leadership on these two key bills, indicated a leadership practice which focussed on creating long-lasting solutions to systemic problems of banking reform and social security that were flexible enough to withstand the test of time. He adopted a rational and careful problem-solving approach to the tasks to be achieved.

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