On the 90th anniversary of FDR’s Inauguration
By Nancy Spannaus
March 3, 2023—It was March 3, 1933, the eve of Franklin Delano Roosevelt’s inauguration as President of the United States. On the one hand, the situation in the country was unprecedentedly bleak, with unemployment, bankruptcies, foreclosures, and despair at record levels. On the other hand, the crisis had all the elements of previous national economic emergencies, especially the decade immediately after the end of the Revolutionary War, an emergency we had built our way out of before.
Under these conditions, the incoming President drew on America’s best traditions, and launched what has become known as the New Deal. He determined that the Federal government would rededicate itself to the principles of the U.S. Constitution by going to work to defend the general welfare of the suffering population. In so doing, he initiated the greatest drive for economic progress embracing the entire population that this nation has ever seen.
That’s a very controversial statement these days, thanks to the aggressive and all-too-successful campaign that has been waged by small government ideologues from almost the moment of FDR’s death. But reality speaks for itself. Under FDR, the nation was electrified, deserts greened, farmland restored, floods controlled, many millions of useful jobs provided, and a vast infrastructure of roads, schools, and parks created. Millions of lives were saved, and the foundations built for not only winning the war against fascism, but for establishing the United States as the industrial envy of the world.
Indeed, to our shame, we are still relying on much of the infrastructure from the FDR era.
So, what are the principles FDR brought to bear? They are the same ones that Alexander Hamilton defined as the core of the American System of Economics: national sovereignty in finance as in fact; use of public credit to support industry and build necessary infrastructure; promotion and protection of the productive powers of labor (the general welfare); and energetic Federal leadership in unifying the country around national goals.
There are many articles on this blog which elaborate the particular programs of FDR’s New Deal and the subsequent war mobilization which he led. I especially recommend “FDR’s 100 Days Put the Constitution into Action” and “FDR: Leadership in a Time of Crisis,” as well as the series on “Urgent Lessons of the WWII Mobilization.” Their content need not be repeated here.
Rather, I wish to conclude by reprinting the introduction to FDR’s Inaugural address, in which he outlined his approach to the urgent crisis the American people faced, and the necessity of energetic Federal action to deal with the emergency. All too often the content of that speech has been reduced to the quote about having notion to fear but fear itself. But there is much more to it.
While some aspects of FDR’s speech were later superseded, his determination to reassert the general welfare is clear. As he said in his speech accepting the Democratic Party nomination, “We must lay hold of the fact that economic laws are not made by nature. They are made by human beings.”
In the following excerpts, I have bold-faced certain critical sections which I believe reflect his Hamiltonian outlook. (The full text can be found here.)
The First Inaugural Address
I am certain that my fellow Americans expect that on my induction into the Presidency I will address them with a candor and a decision which the present situation of our Nation impels. This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great Nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself–nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. In every dark hour of our national life a leadership of frankness and vigor has met with that understanding and support of the people themselves which is essential to victory. I am convinced that you will again give that support to leadership in these critical days.
In such a spirit on my part and on yours we face our common difficulties. They concern, thank God, only material things. Values have shrunken to fantastic levels; taxes have risen; our ability to pay has fallen; government of all kinds is faced by serious curtailment of income; the means of exchange are frozen in the currents of trade; the withered leaves of industrial enterprise lie on every side; farmers find no markets for their produce; the savings of many years in thousands of families are gone.
More important, a host of unemployed citizens face the grim problem of existence, and an equally great number toil with little return. Only a foolish optimist can deny the dark realities of the moment.
Yet our distress comes from no failure of substance. We are stricken by no plague of locusts. Compared with the perils which our forefathers conquered because they believed and were not afraid, we have still much to be thankful for. Nature still offers her bounty and human efforts have multiplied it. Plenty is at our doorstep, but a generous use of it languishes in the very sight of the supply. Primarily this is because the rulers of the exchange of mankind’s goods have failed, through their own stubbornness and their own incompetence, have admitted their failure, and abdicated. Practices of the unscrupulous money changers stand indicted in the court of public opinion, rejected by the hearts and minds of men.
True they have tried, but their efforts have been cast in the pattern of an outworn tradition. Faced by failure of credit they have proposed only the lending of more money. Stripped of the lure of profit by which to induce our people to follow their false leadership, they have resorted to exhortations, pleading tearfully for restored confidence. They know only the rules of a generation of self-seekers. They have no vision, and when there is no vision the people perish.
The money changers have fled from their high seats in the temple of our civilization. We may now restore that temple to the ancient truths. The measure of the restoration lies in the extent to which we apply social values more noble than mere monetary profit.
Happiness lies not in the mere possession of money; it lies in the joy of achievement, in the thrill of creative effort. The joy and moral stimulation of work no longer must be forgotten in the mad chase of evanescent profits. These dark days will be worth all they cost us if they teach us that our true destiny is not to be ministered unto but to minister to ourselves and to our fellow men.
Recognition of the falsity of material wealth as the standard of success goes hand in hand with the abandonment of the false belief that public office and high political position are to be valued only by the standards of pride of place and personal profit; and there must be an end to a conduct in banking and in business which too often has given to a sacred trust the likeness of callous and selfish wrongdoing. Small wonder that confidence languishes, for it thrives only on honesty, on honor, on the sacredness of obligations, on faithful protection, on unselfish performance; without them it cannot live.
Restoration calls, however, not for changes in ethics alone. This Nation asks for action, and action now.
Our greatest primary task is to put people to work. This is no unsolvable problem if we face it wisely and courageously. It can be accomplished in part by direct recruiting by the Government itself, treating the task as we would treat the emergency of a war, but at the same time, through this employment, accomplishing greatly needed projects to stimulate and reorganize the use of our natural resources.
Hand in hand with this we must frankly recognize the overbalance of population in our industrial centers and, by engaging on a national scale in a redistribution, endeavor to provide a better use of the land for those best fitted for the land. The task can be helped by definite efforts to raise the values of agricultural products and with this the power to purchase the output of our cities. It can be helped by preventing realistically the tragedy of the growing loss through foreclosure of our small homes and our farms. It can be helped by insistence that the Federal, State, and local governments act forthwith on the demand that their cost be drastically reduced. It can be helped by the unifying of relief activities which today are often scattered, uneconomical, and unequal. It can be helped by national planning for and supervision of all forms of transportation and of communications and other utilities which have a definitely public character. There are many ways in which it can be helped, but it can never be helped merely by talking about it. We must act and act quickly.
Finally, in our progress toward a resumption of work we require two safeguards against a return of the evils of the old order; there must be a strict supervision of all banking and credits and investments; there must be an end to speculation with other people’s money, and there must be provision for an adequate but sound currency.
There are the lines of attack. I shall presently urge upon a new Congress in special session detailed measures for their fulfillment, and I shall seek the immediate assistance of the several States. … (emphasis added)