Running Steel, Running America: Race Economic, Policy, and the Decline of Liberalism by Judith Stein
Few subjects are as controversial and hotly contested in modern American historiography than the decline and collapse of New Deal liberalism. In her provocative book, Judith Stein attempts to get to the heart of the matter and argue that, as James Carville famously put it, “it’s the economy stupid.” As Stein succinctly puts it “it was the foreign commitments and economic polices of liberalism, not the excesses of racial reformers or the racism of the culture, that transformed American politics in the post-War era.” Stein makes her case by focusing in on the one industry that policy-makers and politicians thought they could manage the rest of the economy by manipulating: steel (a set of policies which Stein dubs “steel fundamentalism”).
By arguing that the key to understanding liberalism’s collapse by 1980 was liberalism’s (and by liberalism here, Stein means Democratic elites and other establishment politicians) failure to properly address the post-war world of rapidly increasing globalization, Stein is greatly upsetting the historiographical apple cart. Previous interpretations of liberalism’s collapse had focused on one of two primary explanatory mechanisms. One was the argument that New Deal liberalism was spent as a reforming force by things ever got started – i.e. by 1945. This line of reasoning traces what it sees as pre-war attempts to reform capitalism into a more managerial approach that dominated after the war. The second explanation rests on some combination of racial (Civil Rights) and cultural (hippies) backlash dooming liberalism as its traditional base fled into a new culturally conservative “law & order” Republican party.
Stein makes her case casting the New Deal as a political movement that sought to modernize the economy and uplift the working class. In Stein’s telling through the 1960s, these two aims worked in tandem. However, by the late 60s strains were showing as economic change, pressure from military build-up for Vietnam, and Cold War trade policy began to disaggregate these joined New Deal impulses. The economy was modernizing and becoming more efficient but working class uplift stalled. By the end of the 1970s they had completely broken apart and the Democratic “party failed to foster a modernization that was compatible with working-class interests.” This economic failure is what discredited liberalism and not working class backlash to the cultural and social ferment of the 1960s and 1970s.
One of the most interesting aspects of Stein’s book is how she treats race in this story. She argues that the main problem with race is that Democratic politicians and policy makers treated racial inequality and injustice as primarily a moral, not economic problem. These policy makers believe that labor markets functioned properly and thus if the unnatural obstacle of segregation was removed African-Americans would begin competing with whites equally. But as Stein clearly shows inequality between whites and blacks was as much a product of structural factors as it was of the moral injustice of discrimination and segregation. Thus when the admirable war on Jim Crow toppled the racist edifice but black inequality continued, the racism was actually reinforced as politicians, policy-makers, and the public began to believe the problem was with black people themselves and not with society. This had an additional perverse affect of helping aid the war on the social safety net – as fostering a ‘culture of poverty’ – that damaged the prospects of the entire working class – both white and black.
The main weakness of Stein’s book is her admirably relentless focus on the top – on the politicians, policy-makers, and business elite who shaped economic policy from the late 1950s to the turn of the century. This does, however, give a large pass to the vast mass of Americans. The picture one seems to sometimes get reading Stein’s narrative is of a political laboratory where with the politicians had tweaked the experiment here and there things would have turned out much for the better. While such a sometimes sterile prospective aids her argument, it does a great injustice to the complex and contingent politics of the middle and late decades of the twentieth century.
TIE IN: Stein’s book is a direct rebuttal to Alan Brinkley’s The End of the Reform, Thomas Sugrue’s The Origins of the Urban Crisis, and Donald Critchlow’s The Conservative Ascendancy. Any answer about 20th century politics will need to bring these three books into conservation with each other – especially Sugrue.
 Judith Stein, Running Steel, Running America: Race, Economic Policy, and the Decline of Liberalism (Chapel Hill, NC: University of North Carolina Press, 1998), 6.
 Ibid, 319.