That Roosevelt see-sawed between Keynesianism and budget-balancing has been conventional wisdom among mainstream historians and economists for decades. The MIT economist E. Carey Brown wrote this in 1956. Keynes made the same point in a pleading letter to Roosevelt in 1937. Economists disagree about the extent to which Roosevelt's fiscal expansion helped. Many give more credit to his abandonment of the gold standard--which Shlaes, naturally, also decries. The fact that he retreated from Keynes in 1937 and that this retarded the recovery, though, bears little dispute.
Adam Cohen's Nothing to Fear, an admiring history of Roosevelt's first hundred days, captures the deep tensions between camps in the Roosevelt administration. Cohen's take is conventional, but it is executed well, tracing the disparate life stories of the main New Dealers in such a way as to make the inevitability of their conflict clear. This was a true team of rivals, some of them winding up as Roosevelt's most unhinged critics. Even before Roosevelt took office, Cohen writes, there was a "fundamental conflict--between spending more to fight the Depression and spending less to balance the budget--that would be a central tension of the Hundred Days." Yet for Shlaes and her admirers, the finding that Roosevelt vacillated between Keynesianism and orthodoxy represents a devastating intellectual blow to the New Deal edifice. And, yes, if you think of the New Deal as a series of unbroken triumphs held together by a clear and consistent ideology, and you have failed to take in any of the scholarship about the period produced over the last half-century, then The Forgotten Man will come as a revelation.
Shlaes writes that her discoveries about the New Deal show that "Roosevelt was unworthy of emulation." But who, exactly, is proposing to emulate everything that Roosevelt did? Much of his program has long been deemed a failure by liberals, including Roosevelt himself. (This includes the National Recovery Administration, which Shlaes dwells on at great length, while breezing past or ignoring altogether vast swaths of the New Deal.) When liberals suggest that Obama follow Roosevelt's model, they do not mean that he should replicate the entire thing. (The way, say, conservatives do when they suggest following Reagan's model.) They mean that he should emulate the Keynesian fiscal policies and other parts of the New Deal that worked. Shlaes has set out to demolish an argument that no serious person has ever made.