Saturday, November 22, 2008

On Our Way

On Our Way is President Roosevelt's book describing the policies of his first year or so of presidency and the rationale behind them.

Perhaps the most important quote fromthe book is on its very first page:
"Some people have called our new policy 'Fascism'. It is not Fascism because it springs from the mass of the people themselves rather than from a class or a group or a marching army. Moreover, it is being achieved without a change in fundamental republican method".

That is, the fact that his economic policies were very much modeled after those of Fascist Italy is of no significance, since there is nothing wrong with those policies. The only thing objectionable about fascism is the methods used to gain and hold power. This theme echoes throughout the book. The ideas that there is a clearly defined national good, that the great helmsman can clearly see where this good lies, that those who pursue their own interests rather than acting to advance this general good are utterly wicked and undeserving of any rights, to Roosevelt these are not even subject to question.

The combination of arrogance and idiocy is astonishing. Here's a particularly egregious quote, from page 86 of the John Day 1934 edition: "We had for many weeks, and indeed months, subscribed to the general principle that if the hours of labor for the individual could be shortened, more people would be employed on a given piece of work. That was the purpose behind Senator Black's bill that called for a thirty-hour week for all employees in every industry and in every part of the country. Closer study, however, led us to believe that while the ultimate objective might be sound, the convulsive reorganization necessary to put such a law into effect might do almost as much harm as it would do good."

Roosevelt breaks his arm patting himself on the back for establishing relations with Stalinist Russia... at the height of the Ukrainian terror famine! He does not dismiss objections to opening relations with the brutal despotism. He does not acknowledge there could be any such objections. He merely proclaims, "thus, after many years the historic friendship between the people of Russia and the people of the United States was restored", as if the government was synonymous with the people.

Roosevelt's main objection to the free market seems to be that it is far too productive, although why less productivity would be better in his mind is not made clear. He was certain that "speculation", that is, buying low in order to sell high is by nature sinful and destructive. It would degrade the purity of assertion to explain why this is so.

Roosevelt more or less acknowledges that much of what he did, he did because he could not do what he really wanted to, which was to reduce the nominal debt, both of the government and of private individuals. The purchasing power of a dollar is far from constant, and Roosevelt argues that it is more just to require debtors to repay their debts in "dollars" which have approximately the same purchasing power for goods and services in general as "dollars" had at the debt was initially issued rather than "dollars" having the same value in gold. In 1933 it was not yet feasible to simply print paper "dollars" until their purchasing power had returned to pre-crash levels. So instead he chose to decimate productivity in order to raise the prices of goods, and restrict employment in order to raise wages. Sort of like tying a tourniquet around a patient's neck to stop a bleeding head wound. In fairness, it was a severely bleeding head wound.

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