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Journal of Policy History 12.4 (2000) 473-512

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Earl Warren's New Deal: Economic Transition, Postwar Planning, and Higher Education in California

John Aubrey Douglass


World War II was a time of unprecedented industrial growth and urban and suburban expansion in California. War mobilization ushered in new types of postindustrial and technology-based industries. Military bases were established up and down the Pacific Coast. Factories suddenly materialized, supplying military hardware, jobs, and, in turn, attracting a new wave of migrants.

Reflecting on the surge of federal money and economic activity in 1944, Governor Earl Warren observed that "our Western pattern of employment has not only been changed in line with the national conversion, but our change has been three or four times as drastic as the national average." While total civilian employment in the nation was up 14 percent since 1941, California's was up 40 percent; manufacturing employment rose 51 percent in the nation, while California's was up a spectacular 201 percent; total civilian population had dropped 3 percent throughout the country, but in California it had risen 15 percent. 1 "We have been changing at a speed with which nothing in our past can logically be compared," declared the governor: "neither the colorful gold rush nor any other dramatic period in our history brought quite so many new people or caused the same sweeping changes to our economy and social life. We find that the war has caused us to actually jump into our future." 2

Yet the war was more than a catalyst for a dramatic expansion in California's economy. It also set the stage for a proactive state government led by Warren and intent on shaping the transition to a peacetime economy. If the Depression and the exigencies of the war mark the birth of a new era of federalism, the postwar period brought an equally important emergence of state government as an influence on economic development and arbiter [End Page 473] of social services--a subject thus far largely ignored by historians. Other states pursued similar postwar planning efforts. It was a national movement. Some thirty-eight states created agencies and commissions to delve into the world of planning for postwar conversion. 3 California differed in the scale of its effort, in the unique circumstances of its new economy, and in the peculiarities and strengths of existing institutions such as the University of California and its vast network of community colleges.

Three interrelated factors help to explain California's drive to shape its postwar economy. The first derives from a political tradition of activism in state government that was revived by the war effort, and conditioned by the prospect of continued and substantial population increases. California's unprecedented growth in the twentieth century provides an important context for policymaking. The economic development of the state, the expansion of urban areas, the need for water, the desire for roads, and the expectation for access to the state's pioneering system of higher education--each provide the context for the activism of California Progressives and the emergence of a political culture that, to varying degrees, attempted to anticipate future population growth and urban development. 4

The second factor relates to the impact of California's wartime economic boom. Despite California's relatively low state and local tax rates during the war, California's state coffers accumulated a huge surplus that, in turn, provided a significant source of money for the expansion of postwar social services, schools, public works, and other state government-funded projects. The accumulation of this surplus provided not only the means for state government to influence economic development, but also the political currency necessary to justify state government activism.

The fear of a substantial decline in the state's economy provides the third factor important to understanding policymaking in California. With the expected conclusion of World War II, Governor Warren and political leaders in the California legislature saw the threat of an economic downturn--a boom-to-bust trial that could destroy the...


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