A Fair Deal

President Truman's January 5, 1949 State of the Union Address

Speech

By: Harry S. Truman

Date: January 5, 1949

Source: Truman Presidential Museum and Library. "Annual Message to the Congress on the State of the Union, January 5, 1949." <http://www.trumanlibrary.org/whistlestop/tap/1549.htm> (accessed May 21, 2006).

About the Author: Harry S. Truman (1884–1972) was the thirty-third President of the United States. Truman was president during a seminal period in American history. Although the war in Europe was over in May 1945, the war with Japan continued and Japan refused to surrender. As a result, Truman made the decision to drop atomic bombs on Hiroshima and Nagasaki— Japanese cities that were very actively engaged in war industry. Following the end of World War II, Truman also was a witness to the founding of the United Nations, among the world's foremost organizations dedicated to achieving and preserving peace. He also argued for equality and instituted programs to facilitate desegregation in the U.S. Armed Forces. Truman created a detailed plan, dubbed the "Fair Deal," for economic prosperity and equality for the inhabitants of the United States. The plan, outlined in his 1949 State of the Union address, paid homage to Roosevelt's "New Deal."

INTRODUCTION

During the years of Harry S. Truman's presidency, the United States was undergoing very rapid and dramatic changes. World War II was ending, thousands of soldiers were returning home, industry was rapidly expanding, the field of medicine was advancing exponentially, and technology was beginning to boom. At the same time, there were significant political upheavals elsewhere in the world, and Communism was spreading in Russia and parts of Europe and Asia. America was active in a rebuilding and peace-keeping role, but was also becoming progressively more wary of the perceived threats to national security and stability posed by Communist Russia, setting the stage for the beginning of the Cold War in the 1950s.

Racial and economic segregation were well entrenched in American society by the 1930s and 1940s. Truman strongly opposed this status quo and was very active in the effort to promote full civil rights for African Americans and an end to segregation in all of its forms. In early 1948, he announced a plan to end segregation in the U.S. Armed Forces, as well as in all civil service occupations. In mid–1948, he enacted legislation that ended segregation and racist activities within all branches of the U.S. military.

Shortly after he assumed the presidency, following President Franklin Roosevelt's death, Truman began proposing an extensive plan to create prosperity, equality and civil rights, and nationwide access to health care throughout the country. In deference to President Roosevelt's "New Deal" program of economic growth and expansion, Truman referred to his wide-ranging program as the "Fair Deal" for all Americans.

Truman developed a twenty-one point program concerned with social and economic development and presented it to the nation during his January 5, 1949 State of the Union address. In the plan, he called for raising the minimum wage for all workers, for nationwide, guaranteed, affordable health insurance and health care, and for abolishing segregation and affording equal rights to all Americans. He proposed federal aid for education, broadening access to higher education for all qualified students, and improving the quality of the public school system. He favored agricultural subsidies, empowering farmers to maintain and expand farm production, with the goal of making America able to grow all its own food. He was a liberal politician who believed that labor unions were good for the protection of workers and that all people should be able to achieve economic stability if given the appropriate tools.

PRIMARY SOURCE

During the last 16 years, our people have been creating a society which offers new opportunities for every man to enjoy his share of the good things of life.

In this society, we are conservative about the values and principles which we cherish; but we are forward-looking in protecting those values and principles and in extending their benefits. We have rejected the discredited theory that the fortunes of the Nation should be in the hands of a privileged few. We have abandoned the "trickle-down" concept of national prosperity. Instead, we believe that our economic system should rest on a democratic foundation and that wealth should be created for the benefit of all.

The recent election shows that the people of the United States are in favor of this kind of society and want to go on improving it.

The American people have decided that poverty is just as wasteful and just as unnecessary as preventable disease. We have pledged our common resources to help one another in the hazards and struggles of individual life. We believe that no unfair prejudice or artificial distinction should bar any citizen of the United States of America from an education, or from good health, or from a job that he is capable of performing.

The attainment of this kind of society demands the best efforts of every citizen in every walk of life, and it imposes increasing responsibilities on the Government.

The Government must work with industry, labor, and the farmers in keeping our economy running at full speed. The Government must see that every American has a chance to obtain his fair share of our increasing abundance. These responsibilities go hand in hand.

We cannot maintain prosperity unless we have a fair distribution of opportunity and a widespread consumption of the products of our factories and farms.

Our Government has undertaken to meet these responsibilities.

We have made tremendous public investments in highways, hydroelectric power projects, soil conservation, and reclamation. We have established a system of social security. We have enacted laws protecting the rights and the welfare of our working people and the income of our farmers. These Federal policies have paid for themselves many times over. They have strengthened the material foundations of our democratic ideals. Without them, our present prosperity would be impossible.

But, great as our progress has been, we still have a long way to go.

As we look around the country, many of our shortcomings stand out in bold relief.

We are suffering from excessively high prices.

Our production is still not large enough to satisfy our demands.

Our minimum wages are far too low.

Small business is losing ground to growing monopoly.

Our farmers still face an uncertain future. And too many of them lack the benefits of our modern civilization.

Some of our natural resources are still being wasted.

We are acutely short of electric power, although the means for developing such power are abundant.

Five million families are still living in slums and firetraps.

Three million families share their homes with others.

Our health is far behind the progress of medical science. Proper medical care is so expensive that it is out of the reach of the great majority of our citizens.

Our schools, in many localities, are utterly inadequate.

Our democratic ideals are often thwarted by prejudice and intolerance.

Each of these shortcomings is also an opportunity—an opportunity for the Congress and the President to work for the good of the people.

Our first great opportunity is to protect our economy against the evils of "boom and bust."

This objective cannot be attained by government alone. Indeed, the greater part of the task must be performed by individual efforts under our system of free enterprise. We can keep our present prosperity, and increase it, only if free enterprise and free government work together to that end.

We cannot afford to float along ceaselessly on a postwar boom until it collapses. It is not enough merely to prepare to weather a recession if it comes. Instead, government and business must work together constantly to achieve more and more jobs and more and more production— which mean more and more prosperity for all the people.

The Employment Act of 1946 pledges the Government to use all its resources to promote maximum employment, production, and purchasing power. This means that the Government is firmly committed to protect business and the people against the dangers of recession and against the evils of inflation. This means that the Government must adapt its plans and policies to meet changing circumstances.

At the present time, our prosperity is threatened by inflationary pressures at a number of critical points in our economy. And the Government must be in a position to take effective action at these danger spots. To that end, I recommend that the Congress enact legislation for the following purposes:

1. First, to continue the power to control consumer credit and enlarge the power to control bank credit.
2. Second, to grant authority to regulate speculation on the commodity exchanges.
3. Third, to continue export control authority and to provide adequate machinery for its enforcement.
4. Fourth, to continue the priorities and allocation authority in the field of transportation.
5. Fifth, to authorize priorities and allocations for key materials in short supply.
6. Sixth, to extend and strengthen rent control.
7. Seventh, to provide standby authority to impose price ceilings for scarce commodities which basically affect essential industrial production or the cost of living, and to limit unjustified wage adjustments which would force a break in an established price ceiling.
8. Eighth, to authorize an immediate study of the adequacy of production facilities for materials in critically short supply, such as steel; and, if found necessary, to authorize Government loans for the expansion of production facilities to relieve such shortages, and to authorize the construction of such facilities directly, if action by private industry fails to meet our needs.

One of the most important factors in maintaining prosperity is the Government's fiscal policy. At this time, it is essential not only that the Federal budget be balanced, but also that there be a substantial surplus to reduce inflationary pressures, and to permit a sizable reduction in the national debt, which now stands at $252 billion. I recommend, therefore, that the Congress enact new tax legislation to bring in an additional $4 billion of Government revenue. This should come principally from additional corporate taxes. A portion should come from revised estate and gift taxes. Consideration should be given to raising personal income rates in the middle and upper brackets.

If we want to keep our economy running in high gear, we must be sure that every group has the incentive to make its full contribution to the national welfare. At present, the working men and women of the Nation are unfairly discriminated against by a statute that abridges their rights, curtails their constructive efforts, and hampers our system of free collective bargaining. That statute is the Labor-Management Relations Act of 1947, sometimes called the Taft-Hartley Act.

That act should be repealed!

The Wagner Act should be reenacted. … The use of economic force to decide issues arising out of the interpretation of existing contracts should be prevented. Without endangering our democratic freedoms, means should be provided for setting up machinery for preventing strikes in vital industries which affect the public interest.

The Department of Labor should be rebuilt and strengthened and those units properly belonging within that department should be placed in it.

The health of our economy and its maintenance at high levels further require that the minimum wage fixed by law should be raised to at least 75 cents an hour.

Our national farm program should be improved-not only in the interest of the farmers, but for the lasting prosperity of the whole Nation. Our goals should be abundant farm production and parity income for agriculture. Standards of living on the farm should be just as good as anywhere else in the country.

Farm price supports are an essential part of our program to achieve these ends. Price supports should be used to prevent farm price declines which are out of line with general price levels, to facilitate adjustments in production to consumer demands, and to promote good land use. Our price support legislation must be adapted to these objectives. The authority of the Commodity Credit Corporation to provide adequate storage space for crops should be restored.

Our program for farm prosperity should also seek to expand the domestic market for agricultural products, particularly among low-income groups, and to increase and stabilize foreign markets.

We should give special attention to extending modern conveniences and services to our farms. Rural electrification should be pushed forward. And in considering legislation relating to housing, education, health, and social security, special attention should be given to rural problems.

Our growing population and the expansion of our economy depend upon the wise management of our land, water, forest, and mineral wealth. In our present dynamic economy, the task of conservation is not to lockup our resources but to develop and improve them. Failure, today, to make the investments which are necessary to support our progress in the future would be false economy.

We must push forward the development of our rivers for power, irrigation, navigation, and flood control. We should apply the lessons of our Tennessee Valley experience to our other great river basins. …

In all this we must make sure that the benefits of these public undertakings are directly available to the people. Public power should be earned to consuming areas by public transmission lines where necessary to provide electricity at the lowest possible rates. Irrigation waters should serve family farms and not land speculators.

The Government has still other opportunities-to help raise the standard of living of our citizens. These opportunities lie in the fields of social security, health, education, housing, and civil rights.

The present coverage of the social security laws is altogether inadequate; the benefit payments are too low. One-third of our workers are not covered. Those who receive old-age and survivors insurance benefits receive an average payment of only $25 a month. Many others who cannot work because they are physically disabled are left to the mercy of charity. We should expand our social security program, both as to the size of the benefits and the extent of coverage, against the economic hazards due to unemployment, old age, sickness, and disability.

We must spare no effort to raise the general level of health in this country. In a nation as rich as ours, it is a shocking fact that tens of millions lack adequate medical care. We are short of doctors, hospitals, nurses. We must remedy these shortages. Moreover, we need—and we must have without further delay—a system of prepaid medical insurance which will enable every American to afford good medical care.

It is equally shocking that millions of our children are not receiving a good education. Millions of them are in overcrowded, obsolete buildings. We are short of teachers, because teachers' salaries are too low to attract new teachers, or to hold the ones we have. All these school problems will become much more acute as a result of the tremendous increase in the enrollment in our elementary schools in the next few years. I cannot repeat too strongly my desire for prompt Federal financial aid to the States to help them operate and maintain their school systems.

The governmental agency which now administers the programs of health, education, and social security should be given full departmental status.

The housing shortage continues to be acute. As an immediate step, the Congress should enact the provisions for low-rent public housing, slum clearance, farm housing, and housing research which I have repeatedly recommended. The number of low-rent public housing units provided for in the legislation should be increased to 1 million units in the next 7 years. Even this number of units will not begin to meet our need for new housing.

Most of the houses we need will have to be built by private enterprise, without public subsidy. By producing too few rental units and too large a proportion of high-priced houses, the building industry is rapidly pricing itself out of the market. Building costs must be lowered.

The authority which I have requested, to allocate materials in short supply and to impose price ceilings on such materials, could be used, if found necessary, to channel more materials into homes large enough for family life at prices which wage earners can afford.

The driving force behind our progress is our faith in our democratic institutions. That faith is embodied in the promise of equal rights and equal opportunities which the founders of our Republic proclaimed to their countrymen and to the whole world.

The fulfillment of this promise is among the highest purposes of government. The civil rights proposals I made to the 80th Congress, I now repeat to the 81st Congress. They should be enacted in order that the Federal Government may assume the leadership and discharge the obligations clearly placed upon it by the Constitution.

It should be clear by now to all citizens that we are not seeking to freeze the status quo. We have no intention of preserving the injustices of the past. We welcome the constructive efforts being made by many nations to achieve a better life for their citizens. In the European recovery program, in our good-neighbor policy and in the United Nations, we have begun to batter down those national walls which block the economic growth and the social advancement of the peoples of the world.

We stand at the opening of an era which can mean either great achievement or terrible catastrophe for ourselves and for all mankind.

The strength of our Nation must continue to be used in the interest of all our people rather than a privileged few. It must continue to be used unselfishly in the struggle for world peace and the betterment of mankind the world over.

This is the task before us.

It is not an easy one. It has many complications, and there will be strong opposition from selfish interests.

I hope for cooperation from farmers, from labor, and from business. Every segment of our population and every individual has a right to expect from our Government a fair deal.

SIGNIFICANCE

Harry S. Truman had a long history of liberalism and civil rights efforts. He began speaking about the initiatives later to be outlined in his Fair Deal plan shortly after he first assumed the presidency in 1945. Just after the end of World War II, Truman brought a proposal to Congress that included legislation for public housing initiatives, strengthening and broadening the social security program, and a bill that would raise the minimum wage and provide for full employment of the American workforce. In addition, he sought to enact legislation to ensure fair employment practices, in an effort to end racial and ethnic discrimination in the workplace. Nearly all of his proposed legislation was ignored. In response to President Truman's proposal for what he referred to as the Fair Employment Practices Act, Congress did pass legislation called the Employment Act, which made the government responsible for ensuring that the workforce was able to achieve full employment status. The Employment Act also provided for the establishment of the Council of Economic Advisors, a three-member group charged with maintaining a healthy and stable economy in the United States. After Congress's almost total inaction on his overall program, Truman did not reintroduce his proposals until after he was re-elected in 1948.

After the end of World War II, the political climate in America became progressively more conservative. There was considerable reaction against the remaining vestiges of President Roosevelt's New Deal policies, leading to an almost complete lack of political or popular support for Truman's New Deal-like Fair Deal plan. Overall, the four initiatives that Truman most wished to see enacted were the national health insurance plan, the public housing program designed to end slums and ghettos and raise the quality of life for (working) poor populations, the re-tooling and expansion of the Social Security program for elders, and a sixty-two percent increase in the federal minimum wage (from 40 to 65 cents per hour). None of these proposals was enacted. Truman's liberal views concerning civil rights and his platform for ending segregation and abolishing racism were very poorly received by the socially and fiscally conservative Congress. It was Truman's strongly held belief that the best way to ensure economic stability, and to promote the growth of the economy would be to rectify institutionalized injustices, to create a climate in which full employment would flourish, to support the poorest citizens in order to enable them to be gainfully employed and to secure safe and affordable housing, and to shift the economic power away from the wealthiest citizens, permitting a more equitable distribution of resources.

In the end, the conservative political powers held sway. There was no new national health care system created. The only real educational reform was the creation of the G.I. bill supporting veterans returning from wartime service and attempting to reintegrate into the educational and labor markets. Unemployment benefits were improved, but only marginally. The fight for civil rights gained momentum over the next decade until a variety of federal laws were enacted to address this issue in the 1960s. Eventually, a major public housing reform was enacted, with the intent of supporting a move away from slums and ghettos to safe and affordable housing. Ultimately, Truman moved away from his Fair Deal proposals and began to concentrate his efforts on the emerging Cold War and concerns over perceived threats posed by the rise of Communism. By the end of his term, he had ended segregation in the U.S. Armed Forces and in the federal hiring programs, achieved a higher minimum wage, and enacted wider-ranging social security programs and the beginnings of public housing.

FURTHER RESOURCES

Books

Burnes, Brian. Harry S. Truman: His Life and Times. Kansas City, Mo.: Kansas City Star Books, 2003.

Gardner, Michael R. Harry Truman and Civil Rights: Moral Courage and Political Risks. Carbondale: Southern Illinois University Press, 2002.

Hillman, William, and Harry Truman. Mr. President: The First Publication from the Personal Diaries, Private Letters, Papers, and Revealing Interviews of Harry S. Truman. New York: Farrar, Straus, and Young, 1952.

McCullough, David C. Truman. New York: Touchstone, 1992.

Ryan, Halford R. Harry S. Truman: Presidential Rhetoric. Westport, Conn.: Greenwood Press, 1993.