Here's something I wrote elsewhere, which might help to explain the differences between TR's outlook and those of the New Dealers:
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Progressivism Dependent on Prosperity? TR on the 1914 Elections
Not exactly a what-if, but some thoughts prompted by reading John Allen Gable, *Theodore Roosevelt and the Progressive Party.*
1914 was a bad year for Progressives--with both a large and small "p." The Progressive Party did miserably, except for Hiram Johnson in California (whose victory was more a personal than a party triumph). More generally, it was a bad year for liberal reformers within the two major parties, as well as for third parties. The Old Guard was widely triumphant in the GOP. Joseph G. Cannon and William B. McKinley, old enemies of the insurgents, regained House seats lost in 1912. Boies Pentose, Reed Smoot, and others were re-elected to the Senate, and Warren Harding was elected senator from Ohio. In TR's own state of New York, the September primaries were bad news for progressives in all parties. Tammany candidates Governor Martin H. Glynn and Ambassador to Germany James W. Gerard overwhelmingly defeated the reformers John A. Hennessey and Franklin D. Roosevelt for the Democratic gubernatorial and Senate nominations, respectively. (This was the worst electoral defeat of FDR's career--much worse than 1920, both in percentage of the vote and because nobody blamed him for Cox's defeat.) In the GOP primary, standpatter James W. Wadsworth, Jr. was nominated for the Senate, while machine-backed Charles S. Whitman defeated the TR-backed Harvey D. Hinman for governor. In the general electiom, the Progressive candidate, Frederick M. Davenport, finished a poor fourth behind Whitman, Glynn, and impeached former governor Sulzer (who was runnng as a Prohibitionist and as candidate of his own "American" party--he had also unsuccessfully tried for the Progressive nomination).
https://en.wikipedia.org/wiki/New_York_state_election,_1914
Although the Demcorats did retain control of Congress, they lost many seats in the House to (generally conservative) Republicans. This was perhaps to be expected--many of the seats the Democrats had gained in the three-way race of 1912 could not be held under normal conditions--but was still interpreted as a trend to the Right.
Why the liberal debacle? The explanation given by TR and others is interesting. 1914 was a recession year--a recession the Republicans blamed on the Underwood Tariff and Wilson's alleged "anti-business" policies. (With regard to the tariff, TR partly agreed.) Eventually, the flood of war orders would help end the recession, but this was only beginning in November 1914. Contrary to the later belief fostered by the experience of the New Deal that depressions lead to liberal reforms (if not revolution), TR argued that progressivism depended on prosperity and could not thrive in hard times. (This was a widespread belief at the time, and a natural one, given that the Progressive Era, unlike the New Deal, was the child of prosperity, not depression.) Workers, said TR, "felt the pinch of poverty; they were suffering from hard times; they wanted prosperity and compared with this they did not care a rap for social justice or industrial justice or clean politics or decency in public life." As TR wrote in *The Outlook*:
"We cannot pay for what the highest type of democracy demands unless there is a great abundance of prosperity. A business that does not make money necessarily pays bad wages and renders poor service. Merely to change the ownership of the business without making it yield increased profits will achieve nothing. In practice this means that when the Nation suffers from hard times wage-workers will concern themselves, and must concern themselves, primarily with a return to good times, and not with any plan for securing social and industrial justice. If women cannot get any work, and nevertheless have to live, they will be far more concerned with seeing a factory opened in which they can work at night or work twelve hours every day than they are concerned with the abolition of night work or the limitation of hours of labor. Exactly the same is true of men. In the recent election in Pennsylvania the majority of the miners and wage-workers generally voted for the Republican machine, although this Republican machine had just defeated a workmen's compensation act, a child labor law, a minimum wage for women law, and various other bits of very desirable labor legislation. The attitude of the wage-workers was perfectly simple. They wished employment. They wished a chance to get a job. They believed that they had more chance if the candidates of the Republican machine were elected than they would otherwise have. Personally I very strongly believe that they were in error; but it was their belief that counted...."
https://books.google.com/books?id=gE1YAAAAYAAJ&pg=PA651
As Gable writes (p. 225), "Economically, he [TR] was expressing a concept held in common with many of his generation: that reform depended on what Walter Weyl called the 'social surplus,' the wealth produced by the nation over and above what was necessary to meet essential needs like food. The 'social surplus' could be used for social improvements and, as Beveridge put it, to 'pass prosperity around.' But without such a 'surplus' men and women were forced to turn their attentions and energies to a struggle for the bare necessities, were precented form pursuing humanitarian goals, blinded to the needs of others and to the commonweal. The concepts behind later Keynesian economics and the potentials of massive tax revenues for social improvements were largely absent from progressive thinking. The belief that prosperity and reform had to go hand in hand gave a certain ambivalence to progressive attitudes toward business, an ambivalence reflected in the policies of the Roosevelt and Wilson administrations alike, for capitalism was at once the threat to and the promise of the good life..."