By Raymond Freeman 04/17/2014
America’s greatest presidents go simply by their initials: FDR and JFK.
Franklin Delano Roosevelt took over in 1933 at the height of the Depression. His task was made harder by the Dust Bowl and mindless Republican obstruction. He realized that economic stimulus measures were needed due to the collapse of private market demand. He instituted public works programs, and many of those roads, courthouses and dams are still in use today.
In Republican mythology, only the war cured unemployment. This is entirely false. Unemployment was at 25 percent when he took office. This staggering number was getting worse. But by Pearl Harbor (December 1941), he’d reduced it to 10 percent. Given the hand he was dealt, that’s astounding.
He had no guidebook. This was the world’s first mass depression. British economist John Keynes was puzzling over the same problem. His work showed that FDR’s intuition was correct. My expenditures create your income; your expenditures create other incomes, etc., etc., as the money rolls around the economy creating jobs. This expands the economy through a “multiplier effect,” around 1.8 to 2.0, because an economy is not like a family. It’s a huge open system. Why don’t Republicans understand that? Why can’t Democrats get that message out? If everyone is paid good wages (as Henry Ford’s workers did), the result is the prosperity we had for 30 years up to 1975.
Slashing Social Security and Medicare because “we can’t afford them” is nonsense. The first thing to be slashed should be tax breaks for “job creators” who refuse to create jobs despite having $2 trillion stashed away. And they refuse to create jobs because of what? Because there’s no demand for their products — because the real “job creators” (that’s YOU) in a consumer-driven economy don’t have enough money to spend.
Another Republican myth is that FDR “prolonged the Depression.” It dishonestly ignores the employment from New Deal programs. Yes, unemployment rose in 1937. Why? Because FDR foolishly pursued Republican policies. But he quickly gave up, and then the economy continued to improve. John Fitzgerald Kennedy said, “The great enemy of the truth is very often not the lie — deliberate, contrived and dishonest, but the myth, persistent, persuasive and unrealistic. Belief in myths allows the comfort of opinion without the discomfort of thought.”
Republican mythology is rampant. Democrats are “socialists” who don’t believe in the free enterprise system. In reality, today’s Democrats are roughly equivalent to the Republicans of the ’50s and ’60s. The GOP has taken a swing to the hard right, but Republican voters haven’t noticed. Democrats are incapable of pointing it out. To me, this is the greatest mystery of American politics. Hence, inertia sets in with the older crowd who vote Republican out of habit.
Another myth is that Republicans are rugged individualists who don’t take a penny from the government. In reality, they see the public purse as a cash cow for themselves. They expect low rents for using federally owned lands. Another example is George Bush Junior’s giveaway to drug companies on Medicare “reform.” The federal government was forbidden to use its buying power to drive down drug costs. In Republican theory, government isn’t a club to benefit everyone; it’s a way for them to get rich at your expense.
A persistent myth is that if you vote Republican, you’ll get richer. You won’t. For the last 30 years average Americans have become poorer in real terms, despite huge productivity gains and working their fingers to the bone. Today’s average wage should be almost double what it actually is (see “The Graph” in Sharper Focus, “Short of Money?”).
The simple fact that we’re back in the Gilded Age or The Great Gatsby is no real news. Books have piled up in bookstores about this. Check out The Betrayal of the American Dream by Donald L. Bartleet and James B. Steele, one day. And catch Robert Reich’s movie Inequality for All.
It’s best summarized by Warren Buffett: “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning. It’s been a rout.” Buffett is America’s third-wealthiest man, self-made, a lifelong Democrat and plain speaker. He criticized the mindless deregulation of Wall Street demanded by the GOP. He called Wall Street’s impenetrable derivatives, flogged worldwide as AAA investments, “instruments of mass financial destruction.” It wasn’t 9/11 that did this country in. It was 9/15.
In case you’ve forgotten about 9/15, that was 9/15/08, when Lehman Brothers collapsed and set off mass panic worldwide. John McCain looked a fool as he’d said the economy had “never been stronger.” It crashed three hours later. Later, the Queen of England went to the London School of Economics and asked why nobody saw the Great Crash of 2008 coming. She got a simple answer.
It was Republican lunacy allowed to run wild.