This Week in History
April 22-28, 1936:
FDR Tells Democrats: “We Are Becoming ‘Nation-Minded’”
President Franklin Roosevelt addressed the Democratic Party's annual Thomas Jefferson Birthday Dinner in New York City on April 25, 1936. As it was a Presidential election year, it was important for Roosevelt's party to really grasp the outlook which had guided him during the past three years as he worked to pull America out of the Great Depression and ensure that it would not happen again. The "Economic Royalists," as Roosevelt had dubbed the Wall Street crowd and its international allies, were screaming bloody murder about the government credit which the President had extended to American agriculture and industry, and wanted to end the employment programs which had whittled down the number of idled workers.
In countering these attacks, Roosevelt took a comprehensive view of the nation's welfare: "A century ago this country was regarded as an economic unity. But as time went on, things happened. The country, bit by bit, was cut up into segments. We heard, more and more, about the problems of particular localities, the problems of particular groups. More and more people put on blinders; they could see only their own individual interests or the single community in which their business happened to be located.
"It is only in these comparatively recent days that we have been turning back to the broader vision of the Founding Fathers.
"That is why, while I may be breaking another precedent—and they say in Washington that my day is not complete without smashing at least one precedent—I can come here to the City of New York and talk with you about the cotton problem of Georgia, the corn and hog problem of Iowa, the wheat problem of the Dakotas, the dust storms of the West, the destructive tornadoes in the South, and the floods in the Northeast. In the same way I would not hesitate to discuss the slum clearance problems or any other problems of the big cities of the East with any farmer audience in Georgia or Iowa or the Dakotas or anywhere else, because we are becoming nation-minded.
"The strong arm of the Nation is needed not in immediate relief alone. We all grant that. It is needed also in taking measures or prevention before natural disasters occur. It is needed equally in taking measures to prevent economic disasters which are not natural, but are made by man...."
"Some economists are still trying to find out what it was that hit us back in 1929. I am not a professional economist but I think I know. What hit us was a decade of debauch, of group selfishness—the sole objective expressed in the thought—'every man for himself and the devil take the hindmost.' And the result was that about 98% of the American population turned out to be 'the hindmost.'
"Let me illustrate what happened by taking the case of the garment workers in the City of New York. They make about 40% of all the clothes of the Nation worn outside of New York City. Their work and wages in this city were dependent on the sales they made all over the country. The garment workers' depression here did not begin in 1929. It began back in 1921, when the depression began on the farms of the Nation. But back in the '20s, people in power still thought of prosperity chiefly in industrial or financial terms. They overlooked the farm depression; and because it went unrelieved, the troubles that started among the farmers in 1921 finally and inevitably reached the garment workers on Eighth Avenue.
"Nebraska's corn and Eighth Avenue's clothing are not different problems; they are the same national problem. Before the war a Nebraska farmer could take a 200-pound hog to market and buy a suit of clothes made in the City of New York. But in 1932, in order to get that same suit of clothes, he had to take two and a half hogs to market. Back in the '20s, a cotton farmer had to raise seven pounds of cotton to buy one pair of New York-made overalls. By 1932, however, he had to raise 14 pounds of cotton to get those New York overalls...."
"If all of the 7 million people living in the City of New York could afford to buy the bread and meat and vegetables and milk and fish and cotton and wool that their health and decent living call for, then we in this country would need crop production from 3 million more acres of good crop land than we are using today to feed and clothe the City of New York...."
"What our success has been you can prove by the simple process of putting the financial pages of any newspaper published in 1936 alongside the financial pages of the same newspaper published in 1932. By financial pages, I do not mean, as some of you might think, merely the stock market quotation pages, although you will agree that they, too, have at least passed panic prices. By financial pages I mean the published prices of farm products and raw materials and the many reports of industrial earnings...."
"Some individuals are never satisfied. People complain to me about the current costs of rebuilding America, about the burden on future generations. I tell them that, whereas the deficit of the Federal Government this year is about $3 billion, the national income of the people of the United States has risen from $35 billion in the year 1932, to $65 billion in the year 1936. And I tell them further that the only burden we need to fear is the burden that our children would have to bear if we failed to take these measures today.
"Building national income and distributing it more widely, mean not only the bettering of conditions of life, but the end of, and insurance against, individual and national deficits in the days to come.
"Nationwide thinking, nationwide planning and nationwide action are the three great essentials to prevent nationwide crises for future generations to struggle through.
"Other individuals are never satisfied; one of them, for example, that I read about the other day, belongs to a newly organized Brain Trust—not mine. He says that the only way to get complete recovery—and I wonder if he really admits we have had any recovery at all—is to lower prices by cheapening the costs of production...."
"Reduction of costs of manufacture by cutting wages or lengthening hours does not mean more purchasing power and more goods consumed. It means the exact opposite.
"The history of that period from 1929 to 1933 shows that consumption of goods actually declines with a declining price level. And the reason is obvious. The reason is that in such periods the buying power of the Nation goes down faster than the prices go down."
"On the other hand, if you increase buying power, prices will go up, but more goods will be bought. Wages ought to, and must, go up with prices. It does not mean unsound inflation or skyrocketing prices; those should be avoided, just as we seek to avoid deflation and bankruptcy sale values. What we do seek is a greater purchasing power and a reasonably stable and constant price level, and we are attaining that end.... The objective cannot be obtained in a month or a year—we know that. But, my friends, results, proven by facts and figures, show that we are on our way—very definitely on our way. Higher wages for workers, more income for farmers, mean more goods produced, more and better food eaten, fewer unemployed and lower taxes."
"That is my economic and social philosophy, and, incidentally, that is my political philosophy as well."