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Posts Tagged ‘Great Depression

Missing 20th Century Republican Roots….

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Regarding the desire of many on the left and among Democrats to see the GOP die, I have very mixed emotions. I remember a very different GOP: one which had lived through the Great Depression and WWII and was firmly committed to fiscal responsibility, rebuilding and renewing the homeland, staying out of foreign military engagements as much as possible, and creating economic growth and security for everyone.

With this ignorant and bombastic GOP, I say keep up the publicity ’cause they’ll continue to lose and maybe lose even more sooner if the current Democratic fundraising push has legs, provided, of course, that the GOP doesn’t rig the electoral game too much more in their favor regardless of what is in the best interests of a constitutional democratic Republic. (FYI, a lot of these sneaky gerrymandering, etc., actions were Cheney’s grand idea. Another reason to hate that rotten old SOB.)

Movement conservative GOP libertarian ideology

Yes, I do want them to lose because they do not represent the GOP I grew up knowing and appreciating for their conservative yet economic moderation, understanding and knowledge of fiscal realities, their desire to rebuild and renew the American physical and economic landscape, and to keep Americans out of more wars. The modern conservative movement, and its many faceted coalition, no longer represent, let along understand, what those earlier Republicans stood for or helped build. Let alone why.

On the other hand, I’d like to see a renewal of a more centrist, post WWII like GOP, aka Eisenhower or Rockefeller Republican party, who were fiscally responsible (as in raised taxes to keep deficits and spending down), did not believe in American Imperialism or being the world’s great cops and liberty bringers, and recognized that the way to create both wealth and a strong functioning society was build the up middle class by providing economically family sustainable jobs and economic opportunity (including quality k-12 and affordable higher education) to anyone who worked hard enough to rise up through the ranks as two of my uncles did within major corporations to senior management ranks.

Those same old-fashioned Republicans, now called RINOs and who have been driven from the party by the Limbaughs, Ericksons, Coulters, and Hannitys of the GOP infotainment media universe, were the ones who also believed in efficient but enforced financial regulations that kept our financial system sound for 50 years. A financial soundness they knew had never happened before in the nation’s history, but at the same time empowered tremendous growth and development of new businesses, quite often through the sharing of financial and information resources of combined government and private enterprise.

Those Republicans had lived through the Great Depression and deeply understood the economic, family, and social harm caused by that speculative financial crash. Even Reagan proudly said he was an FDR Democrat (and a union head) until the ’60s when Democrats went too far left (and yes, Reagan was wrong on Medicare – the best thing the nation could do today economically would be to let go of its obsession with employer provided health care for one of the other OECD models in order to save well over a trillion dollars annually. But many like Reagan believed the AMA denunciations of Medicare way back when).

They, too, had experienced real war, unlike most in the GOP today who either like McCain cannot forget, let alone forgive, leaving Vietnam without winning, or hold to a Cheney-Kristol neo-con belief in American Imperialism that would have been antithetical to the Greatest Generation Republicans who fought WWII. Anyone who had read the dispatches of Ernie Pyle – there’s an out of print book of them and his diaries – quickly understands why Eisenhower kept the US out of more wars. Most of today’s leading GOP pundits and followers hold fast to their guns but have absolutely no knowledge or experience with actual realities of war. I’d bet few of them have ever seen the mid-1950s TV series, “Victory at Sea” that was aired every Sunday morning. They think guns, shooting, et al, are all fun and games kind of like a video game. But Ernie Pyle wrote about the dirty, bloody underside of war. Embedded with Army, he wrote about slogging through the mud, the American GIs (and himself) exhausted and worn out; seeing the bombed, bloody body parts of American GIs he knew spread across the landscape; seeing and feeling death and destruction everywhere as the Army moved north in Italy towards Germany.

My father and mother’s generation had lived through the hell of the Great Depression and WWII. My Dad rode the rails as a teenager, looking for work to send money home to his family and to support himself. My mom’s family lost their home and moved into a cousin’s barn, while my grandfather walked the highways and streets of eastern Washington, selling spices door to door. My dad convinced his mother to lie about his age so he could join the Army and later transferred to the Army Air Corps because he was allergic to horses. He and two other uncles became part of the USAF during WWII. Dad flew missions over Africa. My two other USAF uncles flew missions over Germany. Another uncle was lost when his ship was sunk in the Pacific. That is what Eisenhower knew about war and what today’s neo-cons have never experienced war and do not know…and have never experienced. They never joined up. They have never known the dirt and exhaustion, the horrors of the killing and the ugliness of death.

These prissy gun-toting haters of our social safety net have never experienced the fear, loss and devastation that my parents and grandparents went through. Worse, they don’t care to even learn or even understand. But the Eisenhower and Rockefeller Republicans knew just as Democrats of that era knew. Just as my Republican parents and grandparents knew. They had seen and lived through the worst of deregulation and speculation as well as the real horrors of war. They demanded stability, economic growth and opportunity for a better life than the one in which they had grown into adulthood. They demanded some sense of economic security and the knowledge that the killing was over. They supported reasonable, sound gun laws, as did the NRA in those days, to end the killing of which they had seen far too much.

They supported a social safety net because they knew how easily it was to lose everything they had worked years to achieve to be left with nothing: not homes, not jobs, not businesses, and often without families. They approved of restrictive regulations on Wall St. to prevent another Great Depression, caused by over speculation and gambling. Even the very McKinley-like Lochner SCOTUS eventually finally gave way to public demand for more social equity that put workers on a equal footing with owners and eventually gave way for more new business development and opportunity.

These are the reasons why Reagan was an FDR Democrat until the overreach of Democrats in the ’60s. For all of the GOP’s glorification of Reagan, they have quite literally forgotten, or chosen to ignore, what he had lived through and who he really was. They’ve twisted him into a McKinley laissez-faire hero he never was. In truth, he probably felt closer to a Rockefeller Republican with a great deal of sympathy for 1950s McCarthy-Bircher anti-communistic ideology. There is no where in his record of actions, legislation or speeches in which he preaches a laissez-faire, libertarian ideology. He was a real product of both the Great Depression and World War II…not of the cynical, selfish, ignorant modern movement conservative. I know. I lived in California, as an adult, during his Governorship as well as his Presidency. I watched him and I saw him. He is nothing like what modern conservative claim him to have been. Even his breaking of the Air Traffic Controllers Union was a product of union over reach rather than a hatred of unions. As a union negotiator, he knew and understood the values of unions in protecting the membership’s wages and benefits as opposed to inflating corporate profits at the expense of workers.

So, if and when the GOP returns to its 20th Century, post Great Depression, roots, I will begin to root for it as my parents did. Until then, I will pray – and work towards – for the national and state wide demise of its current incarnation. I believe our nation – and all her people – deserves better than the current GOP.

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It Was the Worst of Times….

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A number of people, often much younger than I, who are of a conservative or libertarian persuasion, often criticize or question my policy views. Unlike these younger people, however, I remember the stories of the Great Depression my parents and grandparents told me. Those stories changed my life and views forever, as did the many stories of a caring, compassionate Jesus of whom I learned as a small child.

Never forget the past.

My father quit school at 16 to ride the rails to find a job, as did many thousands of young teens of his generation. At 17, he convinced his mother to lie about his age so he could join the Army for a steady paycheck. My mother lived in a cousin’s barn after her family lost their home and business. My grandfather walked the hundreds of miles of highways and byways of western Washington state selling spices door to door to support his family. Because there was no social security that enabled older people to live on their own, my grandfather’s mother lived with my mother’s family so that she wasn’t forgotten and abandoned to an “old folks” home as so many were before and during the Great Depression.

When I hear the plans and policies of the modern GOP that so much emulate those prior to and including the Great Depression, I can’t help but remember the stories my parents passed down to me of the Great Depression and before.

Our society is far from perfect, but it is so much better than what existed near the turn of the 20th Century for ordinary working families.

Written by Valerie Curl

November 29, 2011 at 9:31 AM

For all the libertarian talk….

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I’ve stayed silent out of disgust and depression following the defeat of the SAFE Banking Act, proposed by Senators Kaufmann (D-DE) and Brown (D-OH). This one act would have broken up the 6 mega-banks that still threaten our economy and the world. Our only hope is that the EU will override Geithner and Congress by breaking up the banks in their countries. The U.S. may be forced to follow. Geithner’s not wanting to upset the markets is the wrong policy to take…and it’s really pitiful that he doesn’t see it and is poorly advising the President.

But that’s not what I propose to write about today. As I sit here writing, I’m watching another episode of PBS’ American Experience on the 1930s. This week the series focuses on the Civilian Conservation Corp.

American Experience Civilian Conservation Corp - Roosevelt sign Forest Jobs Bill

Before the Corp was enacted and millions of young American men were put to work, against all the hue and cry denouncing it, the country had split nearly in two. One portion of the populace believed that those out of work and suffering home loss, denied food and shelter, were strictly on their own. Charity and families only should help these millions of families. Another portion of the populace looked to government for help, realizing that only government had the resources to help. Between these two political camps lay a populace that believed the Republic had failed, that’s it’s philosophy no longer worked and democracy had been taken over by plutarchs. For these people, they saw communism as the new path to follow. The propaganda coming out of the USSR led these down and out, discouraged people to think that communism was better than our democratic republic.

FDR seemed to understand the danger to the Republic if conditions remained. In setting up the CCC, regardless of his being called another Hitler, or Mussolini or socialist, he went ahead with the program. He put men to work who without that work may really have revolted.

The men interviewed in this American Experience program thanked FDR and loved the CCC. It gave them hope and so much more. It saved their lives and taught them to believe in our country again.

So when I hear libertarian talk or the rhetoric of conservatives, I remember the struggles of so many families during the 1930s. My own family – both parents – included. My dad road the rails after leaving home at 16, like so many other young men and women. The Army/Air Corps saved him. Mom’s family lost their home and income, turning to a relative for shared housing while my grandfather hiked the roads of Washington State as a commission only door-to-door salesman. The only work this talented butcher could get.

I remember what it was like for those millions of families who had nothing or had lost everything. Compassion is something that has to be learned and well taught. I think we, as a nation, have forgotten compassion. Maybe the American Experience series should become mandatory viewing in every family and household. We might learn a little from our forebears.

Great Depression vs Great Recession

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The market crash of 1929 and the Great Depression were brought on by the very same behaviors that caused the Great Recession and financial crisis. Overconfidence in the belief that prices would never fall. Over-speculation. Debt levels too high. Leverage too great.

While the financial instruments that sparked this crisis did not exist, the euphoria brought on by rising profits and wealth caused everyone to “get in on the action.” Greed overcame prudence…and thoughts of risk were pushed aside as everyone told themselves the market will never fall.

Well, the market did crash in 1929 just as it did again in 2008.

Jesse’s Café Américain, an economy blog, wondered if the monetary expansion seen today as a response to the Great Recession had an historical equivalent in the Great Depression. He found it and offers, as well, his recommendations on changing the current economy. It follows closely what many other well respected economists are saying…and could help Congress in its financial regulatory deliberations if they were willing to take the advise of someone outside of the Beltway and Wall St.


Let’s take a look again at a prior period of dollar devaluation and monetary expansion in a period of deep recession, the period in the 1930’s in which the US departed from specie currency to facilitate the radical expansion of the monetary base.

monetarybase to 1939

As you can see, the Federal Reserve increased the monetary base in several steps, resulting in an aggregate increase of about 155% in four years. In this chart above one can also nicely see the contraction in the monetary base, the tightening, that caused a dip again into recession in 1937.

It is also good to note that the recession ended and the economy was in recovery prior to the start of WW II, which I would tend to mark from Hitler’s invasion of Poland in August, 1939. There was a military buildup in Britain before then, but I believe that the common assumption that only the World War could have ended the Great Depression was mistaken.

If real GDP is any indication, the recovery of the economy was underway, but somewhat anemic compared to its prior levels, reflected in a slow decline in unemployment. It is absolutely essential to remember that the US had become a major exporting power in the aftermath of the first World War. The decline therefore of world trade with the onset of the Depression hit the US particularly hard. But the recovery was underway, until the Fed dampened it with a premature monetary contraction that brought the country back into recession, a full eight years after the great crash. Such is the power of economic bubbles to distort the productive economy and foster pernicious malinvestment.[…]

The status quo has failed in its own imbalances and artificial distortions. But while avoiding bubbles in the first place through fiscal responsibility and restraint is certainly the right thing to do, plunging a country which is in the aftermath of a bubble collapse into a hard regime, such as the liquidationists might prescribe, is somewhat like taking a patient which has just had a heart attack and throwing them on a rigorous treadmill regimen. After all, running is good for them and if they had run in the first place they might not have had a heart attack, so let’s have them run off that heart disease right now. Seems like common sense, but common sense does not apply to dogmatically inclined schools of thought.

What the US needs to do now is reform its financial system and balance its economy, which means shrinking the financial sector significantly as compared to its real productive economy. This is going to be difficult to do because it will require rebuilding the industrial base and repairing infrastructure, and increasing the median wage.

The US needs to relinquish the greater part of its 720 military bases overseas, which are a tremendous cash drain. It needs to turn its vision inward, to its own people, who have been sorely neglected. This is not a call to isolationism, but rather the need to rethink and reorder ones priorities after a serious setback. Continuing on as before, which is what the US has been trying to so since the tech bubble crash, obviously is not working.

The oligarchies and corporate trusts must be broken down to restore competition in a number of areas from production to finance to the media, and some more even measure of wealth distribution to provide a sustainable equilibrium. A nation cannot endure, half slave and half free. And it surely cannot endure with two percent of the people monopolizing fifty percent of the capital. I am not saying it is good or bad. What I am saying is that historically it leads to abuse, repression, stagnation, reaction, revolution, renewal or collapse. All very painful and disruptive to progress. Societies are complex and interdependent, seeking their own balance in an ebb and flow of centralization and decentralization of power, the rise and fall of the individual. Some societies rise to great heights, and suffer great falls, never to return. Where is the glory that was Greece, the grandeur that was Rome?

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