The Old "New Deal"

"And so the commissions come together and revise the old plan and frame a new one, in which everybody gets his share. The peasant gets protection for his agriculture, the industrialist protection for his product, the consumer protection for his purchase, the teachers' salaries are raised, the civil servants' pensions are improved, widows and orphans are to be taken care of most liberally by the state, trade is promoted, tariffs are to be reduced, and taxes are pretty much, if not altogether, done away with. Occasionally it transpires that some group has been forgotten after all, or that some demand circulating among the people has not been heard of. Then anything there is room for is patched in with the greatest of haste, until the framers can hope with a clear conscience that the army of run-of-the-mill petty 'middle class' have been pacified and are simply delighted." I know what you're thinking, FDR sounds a lot like Bobama. Well, you would be right, but... maybe the preceding quote was not from FDR. Let's read on... "Thus inwardly armed with confidence in God and the unshakable stupidity of the voting citizenry, the politicians can begin the fight for the 'remaking' of the kingdom".





What you have just read is a paragraph from Adolf Hitler's Mein Kampf . He was a student of Marxism but he knew that the overtaking of a world philosophy could not be achieved through fighting alone. He placed the bulk of the power squarely in the hands of democracy. It would take a social movement born from simple humanity and cultivated into the youth through federal programs that would provide a guided wealth of knowledge, equal wages, national pride and unshakable confidence. Merit and personal responsibility were corrosive to his plan because those virtues bore independence where dependency was the foundation of socialism.





At the same time, the U.S. population was outpacing it's own resources and the gap between the wealthy and the workers was spreading like a cancer. The "have nots" who were generally uneducated were learning from the thousands of new immigrants, who were flooding into America, about the promise of socialism. A new idea was needed, a deal that would close the wealth gap through government regulation. Much like every attempt at democracy since the days of ancient Greece, the poor were prepared to vote the money away from the rich, giving up the freedom to succeed in order to protect themselves from failure.





Enter the "New Deal". The American socialist movement now had a hero in F.D.R. and he was far more effective at gathering support for outright state dependency then even Hitler had imagined. With an overall equal goal, Hitler and Roosevelt had unwittingly entered a race to create the most perfect "social democracy", a race that would forever change the face of the American free market.



We all know the Hitler doctrine, his plan to revive the economy by raising taxes on the rich to help pay for his stimulus package. A package that included the provision of jobs through the building of new infrastructure such as the Autobahn, the legal federal support of trade unions to help keep power in the hands of employees instead of employers, a demand for energy independence through the development of synthetic oil and easy access to transportation through the federally backed VW Beetle which destroyed the other, free market, auto manufacturers within Germany. We also know that his plan was to take over the neighboring countries to help make up for the lack of resources within his own.



The U.S., on the other hand, seemed to have unlimited resources but only needed the right plan to exploit them. That was the basic difference between the Nazi party and the American Democratic party of the early 1930s, the Nazis needed to expand to survive while the Democrats needed to withdraw from global involvement which explained Roosevelt's reluctancy to get involved in WWII despite the massive American casualties inflicted by the antagonistic Germans.



So let's try to define this "New Deal". Named for a popular book released earlier that year, the "New Deal" was the complete restructuring of the American political and economical relationship. Prior to F.D.R. the federal government had a slight regulatory role in the free market but was constitutionally prevented from having any direct effect on private industry. The economy oscillated as the struggle between price (set by industry) and market value (set by consumers) rested on the fulcrum of free market capitalism. When the price got too high the people stopped buying, the price would then drop and demand would soar. That led back to an increase in price and so on and so on.. This is what the right calls "natural correction".



That kind of "stability through instability", like a suspension bridge, was frightening to many who would rather not risk crossing the shaky bridge at all, those people would choose to just stay put. These are the people who call themselves "progressive", ironic isn't it. The solution that they presented was called "the broker state", putting the government in charge of defining the terms of any contract. This gave complete market power to a group of politicians and took it away from "we the people".



To simplify the process I will give you a timeline of actions taken by the radical leftist, F.D.R., and the response by the people and the economy.



1929

Oct 24. "Black Thursday", prices on the NYSE dropped as 13 million shares are sold. Four days later, "Black Tuesday", another 16 million shares are dropped.



1930

Dec 2. Hoover gets congress to fund several Public works projects, employing 4.5 million at a cost of $100 million. He, like Bush, was reluctant to enact such a policy but folded under political pressure.



1931

Feb 27. After an overwhelming loss in the mid-term election the republican majority in congress was less than a week away from the change in power. Under more political pressure they overrode Hoovers veto to pass the Bonus Loan Bill. This allowed Vets to receive loans at half the value of the bonus certificates issued to them seven years earlier.

Mar 4. The 72nd congress took over. The senate would still be held by the Republicans but only by one seat, although many of the remaining Republicans leaned left. The House, on the other hand, completely inverted towards the Democrats.

1932
Jan 22. The Reconstruction Finance Corporation was created to "bail out" banks and insurance companies.

Nov 8. Nearly 23 million people cast a vote for F.D.R., helping to defeat Hoover (with nearly 16 million) votes and deny him a second term. It was noted that Roosevelt lost votes to Norman Thomas (socialist party), William Foster (communist party) and William Upshaw (prohibition party).

1933 : The New Deal..
Mar 4. Roosevelt is inaugurated.

Mar 5. F.D.R. orders a BANK HOLIDAY, to prevent the wealthy from pulling funds from banks. This move caused an uproar among business owners who would now have no capital with which do do business and cause the release of countless employees. Instantly, unemployment began to rise.

Mar 9. The EMERGENCY BANKING ACT is passed, requiring banks to prove solvency before reopening.

Mar 31. The CCC (CIVILIAN CONSERVATION ACT) is passed. A quarter of a million men from 18 to 25 years of age are given jobs in "national reforestation".

Apr 19. F.D.R. drops the U.S. from the GOLD STANDARD, this allows congress to write unbacked checks to help pay for the government programs.

May 12. Two laws are passed, the FEDERAL EMERGENCY RELIEF ACT (FERA) to provide grants instead of loans to states to help with social programs, and the AGRICULTURAL ADJUSTMENT ACT (AAA) which paid farmers to stop production so that prices would rise. This would later have an unforeseen and unfortunate effect on the entire country.

May 27. The FEDERAL SECURITIES ACT, forcing all purchases of stocks and bonds to be approved and registered through the federal government. This gave the government total control over the success of the market.

June 16. I call this "D Day" for The New Deal. On this day we were hit with the NATIONAL INDUSTRY RECOVERY ACT (NIRA) which, like the new stimulus act, opened the door for several programs. The results of this act were the NATIONAL WORKS ADMINISTRATION (PWA), who provided funds to build roads, buildings and other infrastructure, the NATIONAL RECOVERY ADMINISTRATION (NRA), which put price and wage controls on business to help prevent "destructive competition" as well as the FEDERAL BANK DEPOSIT INSURANCE CORPORATION (FDIC), you know what that does. Other, smaller, bills were passed that day as well.

Aug 5. The establishment of the NATIONAL LABOR BOARD gives Collective bargaining rights to unions. This took more power from the hands of business owners and forced them to agree to union contracts, many of those contracts lead to bankruptcy and inflated the unemployment rate.

Apr 12, The NYE HEARINGS, brought forth by senator Joseph Nye, investigates war profiteering charges referring to American involvement in WWI as a corporate decision rather than a national security decision.

Jun 6, The SECURITIES EXCHANGE COMMISSION is developed to "clamp down" on "illegal speculation".

The leftest-socialist programs kept coming and coming but the economy kept sliding deeper and deeper into depression. Programs like the SOCIAL SECURITY ACT and the REVENUE ACT (raising taxes on gifts and inheritances) helped dig the hole while more Americans found themselves relying on the government to pull them out of that hole.

Finally some light at the end of the tunnel. While the liberals in our education system are quick to praise F.D.R. as our savior, citing all of his great social programs as the direct cause of the end of the "great depression", our public education-retardation system as a whole have willingly misled us. I know that this seems hard to swallow but our teachers do lie to us, it's more like "falsification through omission", but the affect is the same.

You see, on January 6, 1936 the good people of America won their first battle against the tyrannical president through a Supreme court decision find that the AAA (AGRICULTURAL ADJUSTMENT ACT) was unconstitutional. So it turned out that king Roosevelt was not powerful enough to decide which farmers were "too successful" or how much they could charge for their work. Go figure!

This decision led to other decisions that would strike at the heart of President Roosevelt's communist take over and drove congress to soften up the federal programs in order to maintain some control. This loss truly angered his excellency and drove him to his 1937 attempt to drive out the Conservatives in the supreme court and stack it in his favor. At one point he even ordered the addition of 6 extra justices to re balance the power. In my eyes that effort was tantamount to treason and King Roosevelt should have been dragged out of office.

These were the laws and actions of the hero of the modern progressive party. In case you're curious this is the Great Depression unemployment graph , allowing you to get a visual timeline of the great depression. Notice 1930, the year after the stock market crash. Unemployment went up from 4.5 to 9%, not a good year but not devastating like the following years. It was actually going a little better when the mid-term campaign started up and the media induced fear caused the wealthy to stop spending and banks to fold. It was only after the liberals gained control of congress (both in 1931 and 2006) that things went really bad. Much like the recent mid-term election that gave power to the democrats during a prosperous economy, the propaganda from the left caused the rich to sit on their wealth. We all know that when the poor stop spending the prices fall but when the rich stop spending the jobs fall. The rich don't just suddenly lose all of their money, they just get nervous and stop investing it.

Trickle down economics tells us that if successful people get to keep their money they will spend it to make more money. The rich do get richer, but, when they do they hire more people who spend more money and thus creating more jobs to accommodate that new market. With the new market blossoming and the promise of great wealth to anyone who can provide the needed resources, everyone with an extra buck is willing to invest in a new idea. This is the map to the American Free Market system.

If, on the other hand, the unsuccessful get money that they haven't earned (as in the great liberal utopia) then they continue the unsuccessful practices, for which they were rewarded, that made them poor to begin with. Thus, a micro market of un-innovative spenders will simply pass those funds around as they slowly deplete their resources. This is why socialist nations always end up overtaking other countries, they have no system of rewards for effort and no ambition to provide new resources.

In an upcoming post I will show you what led to the 2nd world war and how Bobama is dragging us down the same path. It is both disturbing and aggravating so when you sit down to read the post, please bring some duct tape.