FDR's 1932 Pittsburgh Speech: A Masterful
by Gary North: Home
Schools and the Tea Party
anniversary of the most deceptive speech in American political history.
Nothing else comes close. Of all the flip-flops in American political
history, this was the premier flip. The flop was his inaugural address
on March 4, 1933.
was an industrial city where unemployment was astronomical. The
steel town of the world was effectively shuttered. There was little
demand for American steel in 1932. Industrial production had collapsed.
It was less
than two weeks before the national election. Everyone knew that
this was the most momentous election since 1860. The stakes were
high: control over the national government in the middle of the
worst depression in world history. Yet no widely read commentator
at the time gave any indication of just how high these political
stakes were. The federal government in 1932 was not the center of
gravity economically that it became over the next four years, let
alone four decades.
the premier political columnist of the day a very long day,
from 1913 until his death in 1974 infamously wrote in 1932,
"Franklin Roosevelt is no crusader. He is no tribune of the people.
He is no enemy of entrenched privilege. He is a pleasant man who,
without any important qualifications for office, would very much
like to be President."
Lippmann have believed this? From the evidence available in 1932.
In his years out of politics, beginning in 1921 after his failed
attempt to be elected Vice President in 1921, until his election
as Governor of New York in 1928, FDR was a corporate bond salesman.
This is rarely mentioned and never discussed by his biographers.
Only one scholar has told the story in detail, Antony Sutton, in
Street and FDR (1975). That book went down the memory hole
in both conservative and liberal academia, as did all of his books.
Sutton began his book with this observation.
This book portrays
Franklin Delano Roosevelt as a Wall Street financier who, during
his first term as President of the United States, reflected the
objectives of financial elements concentrated in the New York business
establishment. Given the long historical association since
the late 18th century of the Roosevelt and Delano families
with New York finance and FDR's own career from 1921 to 1928 as
banker and speculator at 120 Broadway and 55 Liberty Street, such
a theme should not come as a surprise to the reader. On the other
hand, FDR biographers Schlesinger, Davis, Freidel, and otherwise
accurate Roosevelt commentators appear to avoid penetrating very
far into the recorded and documented links between New York bankers
Pittsburgh speech was part of a grand deception a deception
that is unparalleled in modern history. FDR had three major states
in this deception: (1) as a lifetime Wall Street agent, (2) as the
"voice of the common man" in a truly revolutionary take-over of
the American government, and (3) as an agent of the British empire
who in fact self-consciously destroyed that empire, 1941-45. You
are not told this story in any biography of FDR. It is the supreme
mark of the failure of the American conservative movement that there
is not a single volume that tells this story. FDR remains the textbooks'
man of the twentieth century, rivaled only by Winston Churchill,
that other master of career flip-flops and hidden financing.
The 1932 election
was crucial. Sutton shows why in his book. "So we shall find it
not surprising that the Wall Street groups that supported Al Smith
and Herbert Hoover, both with strong ties to the financial community,
also supported Franklin D. Roosevelt. In fact, at the political
crossroads in 1932, when the choice was between Herbert Hoover and
FDR, Wall Street chose Roosevelt and dropped Hoover."
This is not
the textbook version of the New Deal.
his 1932 speech in Pittsburgh.
AS THE ULTIMATE SPENDTHRIFT
He began his
speech with an attack on what he called "the gospel of fear" and
policy of seeking to win by fear of ruin is selfish in its motive,
brutal in its method and false in its promise. It is a policy that
will be resented as such by men and women of all parties in every
section of the country on November eighth.
had campaigned in 1928 on the slogan "the full dinner pail." (That
sounds truly archaic today.) Well, he said, the dinner pail is empty
today, and the threat is that this will continue.
good relations from now on. No more mean rhetoric.
What is the
normal and sensible thing to do when your neighbor gets all excited
and starts calling you and your family bad names over the back fence?
I take it that nothing is gained by your calling your neighbor worse
names or by losing your own temper. As a matter of fact, the peace
of the community is best served by sitting down and quietly discussing
the problems without raising one's voice. That is why I decline
to answer vituperation merely by more vituperation.
so reasonable. It sounded so conciliatory. It did not sound like
a man who, five months later, would cry out against the bankers
as money-changers in the temple.
Then he warned
his listeners about what was to come.
somewhere in this campaign, I have to talk about dollars and cents.
It is a terrible thing to ask you people to listen for forty-five
minutes to the story of the Federal budget, but I am going to ask
you to do it; and I am going to talk to you about "dollars and cents"
in terms that I think not only public accountants, but everybody
else can understand.
He said he
would discuss the problem facing American families, "the problem
of making both ends meet." He then told them that he would tell
them the truth, the whole truth, and nothing but the truth. "I want
to discuss this problem with you tonight. To do so sincerely I must
tell the facts as they are and conceal nothing from you." He assured
them that they had nothing to fear. "It is not a pretty picture,
but if we know that picture and face it we have nothing to fear."
Why not? Because political salvation was imminent. Leadership was
at hand. An election was coming.
country is the richest and most resourceful Nation in the world.
It can and will meet successfully every problem which it faces;
but it can do so only through intelligent leadership working unselfishly
for the good of all people.
That was a
political message for all seasons, or at least every four years
in the fall.
A speaker needs
mental images for listeners to connect with. A favorite image is
all know that our own family credit depends in large part on the
stability of the credit of the United States. And here, at least,
is one field in which all business big business and little
business and family business and the individual's business
is at the mercy of our big Government down at Washington, D. C.
What I should like to do is to reduce, in so far as possible, the
problem of our national finances to the terms of a family budget.
It's all so
easy. It's inflow and outflow. It's the need for balance. It's just
like a household. (A household that can print money.)
credit of the family depends chiefly on whether that family is living
within its income. And that is equally true of the Nation. If the
Nation is living within its income, its credit is good. If, in some
crises, it lives beyond its income for a year or two, it can usually
borrow temporarily at reasonable rates. But if, like a spendthrift,
it throws discretion to the winds, and is willing to make no sacrifice
at all in spending; if it extends its taxing to the limit of the
people's power to pay and continues to pile up deficits, then it
is on the road to bankruptcy.
But was America
on the road to bankruptcy in 1932? Yes, he said. It was a Republican
road to bankruptcy. (The Democrats had controlled both houses of
Congress since March 1931.)
was taxes. There were too many taxes.
For over two
years our Federal Government has experienced unprecedented deficits,
in spite of increased taxes. We must not forget that there are three
separate governmental spending and taxing agencies in the United
States the national Government in Washington, the State Government
and the local government. Perhaps because the apparent national
income seemed to have spiraled upward from about 35 billions a year
in 1913, the year before the outbreak of the World War, to about
90 billions in 1928, four years ago, all three of our governmental
units became reckless; and, consequently, the total spending in
all three classes, national, State and local, rose in the same period
from about three billions to nearly thirteen billions, or from 8
1/2 percent of income to 14 1/2 percent of income.
was, he insisted, that high taxes cannot boost the economy.
was the rule. It was all very merry while it lasted. We did not
greatly worry. We thought we were getting rich. But when the Crash
came, we were shocked to find that while income melted away like
snow in the spring, governmental expense did not drop at all.
an incipient Arthur Laffer with no curve drawn on a napkin, he launched
into stupefying numbers.
is estimated that in 1932 our total national income will not much
exceed 45 billions, or half of what it used to be, while our total
cost of Government will likely be considerably in excess of 15 billions.
This simply means that the 14 percent that Government cost has risen
to has now become 33 1/3 percent of our national income. Take it
in terms of human beings: It means that we are paying for the cost
of our three kinds of Government $125 a year for every man, woman
and child in the United States, or $625 a year for the average family
of five people.
FDR looked, there was a branch of government demanding more taxes.
we stand that? I do not believe it. That is a perfectly impossible
economic condition. Quite apart from every man's own tax assessment,
that burden is a brake on any return to normal business activity.
Taxes are paid in the sweat of every man who labors because they
are a burden on production and are paid through production. If those
taxes are excessive, they are reflected in idle factories, in tax-sold
farms, and in hordes of hungry people, tramping the streets and
seeking jobs in vain. Our workers may never see a tax bill, but
they pay. They pay in deductions from wages, in increased cost of
what they buy, or as now in broad unemployment throughout
the land. There is not an unemployed man, there is not a struggling
farmer, whose interest in this subject is not direct and vital.
It comes home to every one of us!
we must not be stingy with the truly afflicted. We must not close
our wallets entirely. The government can and should feed the hungry.
me make it perfectly clear, however, that if men or women or children
are starving in the United States anywhere I regard
it as a positive duty of the Government of the national Government
if local and State Governments have not the cash to raise
by taxes whatever sums may be necessary to keep them from starvation.
ignore that obligation for now. Let's not dwell on it at all. Let's
kick that can down the road.
I am talking about are the taxes which go to the ordinary costs
of conducting Government year in and year out. That is where the
question of extravagance comes in. There can be no extravagance
when starvation is in question; but extravagance does apply to the
mounting budget of the Federal Government in Washington during these
past four years.
expansion of federal spending, he warned prophetically, was a threat
to the stability of America's economic order.
most obvious effect of extravagant Government spending is its burden
on farm and industrial activity, and, for that nearly every Government
unit in the United States is to blame. But when we come to consider
prodigality and extravagance in the Federal Government, as distinguished
from State or local government, we are talking about something even
more dangerous. For upon the financial stability of the United States
Government depends the stability of trade and employment, and of
the entire banking, savings and insurance system of the Nation.
was spinning a fairy tale. This fairy tale involved a huge error,
namely, that federal spending can increase national wealth.
things clear, to explain the exact nature of the present condition
of the Federal pocketbook, I must go back to 1929. Many people
throughout the land rich and poor have believed
the fairy story which has been painstakingly circulated by this
Administration, that the routine spending of our Federal Government
has been kept on a fairly even keel during these past five years.
It was perhaps easy to give this impression because the total
outlay each year up to the emergency appropriations of this year
did not increase alarmingly. But the joker in this is that the
total outlay includes interest and sinking fund on the public
debt; and those charges were going down steadily, right up to
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North [send him mail]
is the author of Mises
on Money. Visit http://www.garynorth.com.
He is also the author of a free 31-volume series, An
Economic Commentary on the Bible.
2012 Gary North
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