Shades of 1932

...In 1992, as in 1932, the Democrats have a good crack at the White House...

...politically he had the Roosevelt name...

...Without Social Security, unemployment insurance, Aid to Families with Dependent Children, a highway trust fund to build and repair roads, Medicare, Medicaid, etc., our buying power would be even more sharply curtailed and the country would be in a deep depression right now...

...At some point, it will become clear that those pieces of paper are worthless shares in corporations that are daily worth less...

...Roosevelt is today perceived to have been a liberal thinker with a sort of Keynesian strategy for economic recovery...

...These are some of the questions we will address in subsequent installments of this quadrennial series...

...What should their program be...

...The 1980s repeated the 1920s: In 1980, the top 1 per cent of households in America enjoyed 7 per cent of the national income...

...There were Upton Sinclair, Jack London, Lincoln Steffens, Eugene Victor Debs, and a veritable legion of pamphleteers as well as dozens of radical journals...

...Meanwhile, the bottom 20 per cent that had been trying to stay alive with 5 per cent of the national income found its share cut to about 4 per cent...

...Can such a coalition of progressive forces be put together...

...From 1969 to 1992 the GOP occupied the White House in all except four years...

...An exploration of the curious phenomenon may be a useful starting point for a citizenry eager to rescue an uneasy America from its present economic slump and political confusion...

...Americans certainly are hurting, but they are not howling in pain the way they did in the 1930s...

...And had not Franklin himself bucked the encrusted Tammany Hall in his own party...

...The scary part is the striking parallel between economic trends then, when the slump was called a "depression," and now, when it is called a "recession...

...Neither the approach of 1932 nor the approach of 1992 produced a serious plan for dealing with the depression/recession...

...The final and most important difference between 1992 and 1932 is the least recognized...

...The seeds they sowed, intellectually and institutionally, sprouted in the fertile soil of the first Rooseveltian days...

...The Democratic standard-bearer will enjoy the same political climate when he runs this November against George Bush, who presided over the recession (depression...

...According to an old adage, "You can't beat somebody with nobody...

...One important difference, of course, is the absence of a person around whom the Democrats (the progressive forces) can readily rally...

...Here was an establishment man with antiestablishment credentials...

...These individuals and movements had a common denominator: an ethical egal-itarianism that expressed itself in the demand for economic justice...

...The truth is that he was a fiscal conservative . He preached a balanced budget during the campaign, excoriating Hoover for heading "the greatest spending Administration in peacetime history...

...If that is right, then the Democrats are still in pursuit of "somebody...

...And the backbone of the nation— Gus Tyler, a frequent contributor, is Assistant President of the ilgwu...

...The similarities are encouraging and at the same time scary...

...The income of the American farmer and worker began to recede in 1921, while the riches of the richest kept piling up obscenely...

...What is lacking among the movements that exist today is a similar unifying theme, an ideologic common denominator that would join them in a grand coalition...

...Both periods of economic downturn prior to the Presidential balloting—1929-32and 1989-92—have been characterized by an ironic dichotomy: As the real market (the making and selling of goods and services) headed downward, the stock market zoomed upward...

...Both major slumps came after a succession of Republican Presidents...

...That predictable and seemingly prudent response to hard times has reasserted itself in the present recession...

...Bad news in the workplace is good news on "the street...

...The differences are no less striking than the similarities...

...The present 7.5 per cent unemployment rate—even if it truly adds up to 12 per cent when measured correctly—has not caused the depth of distress that the 30 per cent (or higher) unemployment rate produced in the great Depression...

...by 1990, the same top 1 per cent was wallowing in 14 per cent of the national income...

...Had the $6 billion, for instance, that was loaned by corporations and wealthy individuals for stock-market speculation been distributed to the public as lower prices or higher wages, with less profits to the corporations and the well-to-do, it would have prevented or greatly moderated the economic collapse that came at the end of 1929...

...And vice versa...

...The end result is also predictable, however...

...But the planks so far proposed by the various aspirants for the nomination are no more inspiring, or inspired, than FDR's pious platitudes of yesteryear...

...The official Democratic platform this year will not be known until the party convention is held in July...

...In '32 there was a Progressive Party in the Midwest, a Minnesota Farmer-Labor Party electing governors, a Non-Partisan League in the Dakotas, a Socialist Party, and a Communist Party...

...The encouraging part is that the opportunity for recovery seized in 1932 can be seized in 1992...

...The economy, for them, became what John Maynard Keynes called a "casino society...

...FDR was a natural, the right man for the right moment...

...They believed that a more equitable sharing of wealth and income was tbe sine qua non for economic stability, political vitality and social well-being...

...that vast 60 per cent in between the top and bottom fifth—saw its real income (buying power) melt away...

...Indeed, both the media and the masses appear to be persuaded for the moment that Uncle Sam will shortly turn that happy "corner" to prosperity...

...As production nosedived on Main Street, speculation skyrocketed on Wall Street...

...Ironically, Americans are suffering less in 1992 than in 1932 because of the Rooseveltian reforms...

...Personally he had the style...

...Had not the old "trust-buster" preached a socialistic-sounding sermon when he noted the eternal "conflict between the men who possess more than they have earned and the men who have earned more than they possess...

...There was a Townsend Plan for the aged, an epic (End Poverty in California) movement, a Share-the-Wealth surge sparked by Huey Long in Louisiana, and a Workers' Alliance of the Unemployed...

...The perverse behavior of the two markets was not a mere coincidence...

...In other ways this year's Presidential contest seems significantly unlike the Herbert Hoover-Franklin D. Roosevelt race 60 years ago...

...People with capital—andthere was a glut of capital—logically refused to tie up their money in the manufacture of products too few could any longer afford...

...Years later Marriner Eccles, Roosevelt's man at the Federal Reserve, described the 1920s root of the 1930s rot: "Had there been a better distribution of the current income from the national product—in other words, had there been less savings by business and the higher-income groups and more income in the lower groups—we would have had far greater stability in the economy...

...The final similarity concerns the absence of a coherent program...

...Had not his uncle led the Bull Moose revolt within the overly staid Republican Party...

...The decline in the real market caused the rise in the stock market...

...FDR was elected not because of what the people thought he would do for them but because of what they knew Hoover had done to them...

...Too often in recent history," he told Congress, "liberal governments have been wrecked on the rocks of loose fiscal policy...

...The good news about the last disturbing similarity is that in the post-election days a New Deal did soon emerge: A Democrat in the White House did provide a more fertile field for the seeds of economic salvation...

...From 1921 to 1933 the GOP occupied the White House uninterruptedly...

...No such figure has emerged from the Democratic primaries...

...It is the absence of the sort of movements that, in the years preceding the New Deal, generated the economic ideas and the grass roots support for a bloodless liberal revolution...

...For the labels, after all, are purely indications of degree, and if the current slide continues the distinction could be negligible by Election Day...

...In 1929, the year of the Great Depression, the industrial index—the measure of real output and sales—dropped dramatically in July, several months before the financial collapse in October...

...Franklin Delano Roosevelt was a pro and a pol who seemed to have come out of central casting...

...Six days after FDR was inaugurated, he submitted a budget to Congress that called for a spending cut of several hundred million dollars (big money in those days), mainly at the expense of veterans and civilian and military employees of the Federal government...

...Someone will catch cold and the house of cards will be sneezed away...

...A second difference is the severity of the economic condition in 1932 compared with 1992...

...So they turned from production to speculation, to buying and selling pieces of paper...

...In both cases the underlying problem was a maldistribution of income that made it impossible for consumption to keep up with production...