TVA holds lessons for Obama
Today’s health care debate parallels FDR’s battles in the 1930s.
By Diane McWhorter
As President Obama ponders the fate of health care reform, he would do
well to review the mother-of-all-strife between government and private
enterprise, the New Deal. Franklin D. Roosevelt's battle with the
electricity industry over the Tennessee Valley Authority (TVA) was an
uncanny template for the recent health care hostilities. And it might
suggest a strategy better than "bipartisanship" for any future
administration plans to afflict the powerful.
The TVA was an ambitious public project, coordinating hydroelectricity
and land management in what its sponsors considered a moral crusade to
help suffering Southern farmers — the Great Depression counterparts of
the Great Recession's medically disadvantaged. It was also Exhibit A
in corporate America's brief against New Deal "socialism."
Among the other echoes between the showdowns over the TVA and health
care: an embattled industry striking back with an egregious war chest;
a distracted president constrained by conservative Democrats; a nation
in grave need of the services at stake; and a pivotal senator from
The TVA Act — signed on May 18, 1933 — shines a light on the crucial
flaw in the stalled health care bill: The TVA was the "public option,"
its professed purpose to provide a "yardstick" to prevent private
utilities from gouging customers. Though somewhat specious, the
yardstick was politically attractive: Private power had been
implicated in the 1929 stock market crash, and the Federal Trade
Commission had uncovered a propaganda apparatus unexcelled in
peacetime. Its mission, according to Thomas K. McCraw in TVA and the
Power Fight, 1933-1939, was to paint public power as "Bolshevistic,
socialistic, inefficient and generally odious."
Hands-on vs. hands-off
The resulting disgrace of the industry made a prophet of Sen. George
Norris of Nebraska, a real maverick Republican who had long championed
public ownership of the Tennessee River's vast hydroelectric
potential. Building on Norris' groundwork, Roosevelt seized advantage
from the economic crisis he had inherited and pushed through the TVA.
Obama, by contrast, was so hands-off that his health care program
wound up in the lap of another Nebraska senator, Ben Nelson — a
renegade Democrat and former insurance company CEO. Lacking a public
option, the Senate bill is the equivalent of a TVA that sort of
inconvenienced the power companies but didn't actually make
electricity. Oh, and because the government required everyone to buy
electricity, the utilities reaped millions of new customers.
With the TVA, passing the bill was the easy part. The companies then
refused to honor their contracts with the government. Along with their
publicists, lobbyists and citizens fronts, the utilities fielded a
formidable legal team. The private interests ultimately lost the
constitutional challenges, but tying up the TVA in court bought them
time to massage the midterm elections and cultivate the 1930s
forerunners of Blue Dog Democrats.
At least the power industry had a brilliant spokesman in Wendell
Willkie, whose folksy Indiana charm ("a simple, barefoot Wall Street
lawyer," Roosevelt's deputy Harold Ickes griped) helped gain him the
1940 Republican presidential nomination. And the product he was
selling — light itself — did liberate human beings from what one rural
Alabama woman called the "prison of isolation and darkness and
What comparable claim can be made of today's health insurance industry?
That gets at this administration's most remarkable failure: its
inability to capitalize on widespread outrage against a vilified foe.
Where were the advisers who would tell the accommodating Obama, as
Norris urged Roosevelt, "For God's sake, do not give our laurels of
victory to those whom we have defeated"? Or, failing that, where was
the administration's version of the TVA's top-notch "public education"
initiative, which might have explained the virtues of a public option
to protesters who wanted the government to keep its hands off their
Partly because of private enterprise's warnings of a wholesale
government takeover, the TVA was a never-duplicated experiment. Yet
Norris would say he could hardly believe the TVA had come to pass at
all. Willkie's base "would destroy you in a moment, if they had the
power," Norris warned Roosevelt, "without regard to the means if they
were sure they would not be discovered."
That is a truth the "post-partisan" Obama might be resistant to
hearing. But FDR, however affable, embraced his killer instinct. His
Congress lashed back with the Public Utility Holding Company Act to
restrain the power trust. If today's Democrats do switch to an
incremental approach and focus on regulating the monopolistic
insurance industry, they should study up on that 1935 bill: According
to McCraw, it "ignited one of the most intensive and scandalous
lobbying campaigns in American history."
Hearts, minds, votes
Classic (as opposed to Tea Party) conservatism could be defined as a
permanent campaign to "correct" the paradigm shift that was the New
Deal. For what was at stake in the TVA fight was not just profits but
also hearts and minds. When citizens see that government can improve
their lives, as the TVA brought civilization to a benighted region,
the political culture becomes less suggestible to corporate
The relatively progressive TVA areas of Alabama produced the powerful
Democratic congressman-turned-senator John Sparkman — Adlai
Stevenson's 1952 running mate. But laurels are perishable. Last year,
the representative from Sparkman's old district, Parker Griffith,
became the first Democrat to defect to the Republicans. Perhaps if
Obama had not given up on the public option, the Democrats might have
made medical care a right as attainable as the TVA rendered
electricity. And the late Ted Kennedy, avatar of health care reform,
would not be yielding to the 41st Republican senator.
Diane McWhorter, a member of USA TODAY's board of contributors, is
author of Carry Me Home and A Dream of Freedom.