"I Want to Talk For a Few Minutes": The Way It Was, 12 March

1933---With the previous fortnight's bank crisis followed by the previous nine days' "bank holiday," after gold withdrawals from banks began to hike as high as fifteen million dollars a day,* President Franklin D. Roosevelt introduces America to his Fireside Chat series of periodic radio broadcasts.

I want to talk for a few minutes with the people of the United States about banking---with the comparatively few who understand the mechanics of banking but more particularly with the overwhelming majority who use banks for the making of deposits and the drawing of checks. I want to tell you what has been done in the last few days, why it was done, and what the next steps are going to be. I recognize that the many proclamations from State Capitols and from Washington, the legislation, the Treasury regulations, etc., couched for the most part in banking and legal terms should be explained for the benefit of the average citizen. I owe this in particular because of the fortitude and good temper with which everybody has accepted the inconvenience and hardships of the banking holiday. I know that when you understand what we in Washington have been about I shall continue to have your cooperation as fully as I have had your sympathy and help during the past week.

Thus the inaugural Fireside Chat addresses the banking crisis and Roosevelt's plans to allow bank re-openings on a measured basis, while the President offered at least one rejoinder to critics who feared the new administration driving toward fiat money.

The success of our whole great national program depends, of course, upon the cooperation of the public---on its intelligent support and use of a reliable system. Remember that the essential accomplishment of the new legislation is that it makes it possible for banks more readily to convert their assets into cash than was the case before. More liberal provision has been made for banks to borrow on these assets at the Reserve Banks and more liberal provision has also been made for issuing currency on the security of those good assets. This currency is not fiat currency. It is issued only on adequate security---and every good bank has an abundance of such security.

If you admire President Roosevelt, as many Americans do, you believe the Fireside Chats keep you informed and that the first chat offers at least a semblance of solution against what Roosevelt denounced, in his famed inaugural address, and in language purely from the populist briefing books, as the unscrupulous moneychangers.

If you are wary of President Roosevelt, as many Americans are, you may ponder whether the Fireside Chats serve as a friendly salve aimed at gulling and lulling while a fat government paw riffled your pocket.

And you may not know that Roosevelt, inaugurated earlier this month, may have spurned a proposal by outgoing President Herbert Hoover to resolve the banking crisis with what author John T. Flynn (a former writer for The New Republic writing in his 1948 book The Roosevelt Myth) would consider more simplicity and perhaps less financial anguish than would come in due course.

Hoover had proposed a one-day bank closure, with concurrent submissions by each bank of assets and liabilities, listing live and dead assets separately, and solvent banks allowed to re-open following the single-day holiday with a government declaration of and guarantee of solvency during the bank crisis, a plan Hoover believed would stop the rash of runs on the banks. "The inactive assets," Flynn will continue, describing the Hoover plan, "would then be taken over to be liquidated in the interest of depositors."

Flynn will argue that Roosevelt ignored a 17 February 1933 letter from Hoover outlining that plan. "Had [the plan] been done," Flynn will write, "countless millions in deposits would have been saved and the banking crisis at least would have been removed from the picture. However, the Attorney General ruled that the President did not possess the power to issue such an order unless he could have the assurance of Congress that it would confirm his action by an appropriate resolution, and that this, as a matter of political necessity, would have to be approved by the new President who would take office in a month. It was some such plan as this which Hoover had in mind when he wrote Roosevelt . . .It had one defect from Roosevelt's point of view. It would not do to allow Hoover to be the instrument of stemming the banking crisis before Roosevelt could do it."

Hoover believed, Flynn will continue, that---Roosevelt having the "ultimate responsibility"---he would give any order Roosevelt approved "provided he could do so in conscience and Roosevelt could assure approval by Congress." But Hoover's Secretary of the Treasury (Ogden Mills) fell on the deaf ears of Roosevelt's candidate for the Cabinet post (William Woodin), Hoover couldn't prevail on Roosevelt to issue even a statement of reassurance, and Roosevelt brain truster Rexford Tugwell (not long in becoming an undersecretary in the Agriculture Department) sending word that the banks were about to collapse and that that was what the incoming administration might have wanted.**

It was now dawning on Hoover that he and Roosevelt were talking about two different things. Hoover was talking about saving the banks and the people's savings in them. Roosevelt was thinking about the political advantage in a complete banking disaster under Hoover. Actually, on February 25, Hoover received a message . . . that Rexford Tugwell had said the banks would collapse in a couple of days and that is what they wanted.

---John T. Flynn, The Roosevelt Myth. (New York: Devin-Adair, 1948; Fox & Wilkes: 1998.)

Whether to inform or to lull and gull, and there are opinions on both sides, FDR would deliver thirty Fireside Chat broadcasts between 1933 and 1944.

* - By 19 February 1933, this was the level of daily gold withdrawals from banks. Within a fortnight, Flynn noted, "$114,000,000 of gold was taken from banks for export and another $150,000,000 was withdrawn to go into hiding. The infection of fear was everywhere. Factories were closing. Unemployment was rising rapidly. Bank closings multiplied daily."

** - According to Flynn, Mills reminded Woodin that Grover Cleveland "in a similar though less grave emergency" had issued such a "reassuring statement" eight days before his own inauguration. Interestingly enough, Rexford Tugwell in due course would write a biography of Cleveland with the subtitle, A Biography of the President Whose Uncompromising Honesty and Integrity Failed America in a Time of Crisis.

A longtime opponent of metastasising government, John T. Flynn in due course proved that it wasn't only the left to whom his analyses might prove distasteful. By the mid-1950s, the man whom The New Republic fired over his continuing critique of the New Deal would find his critics on the right as well, among those on the right who believed no return to minimal government was feasible so long as there was a Cold War to wage.

CHANNEL SURFING . . .

1942: VIC'S BUSINESS LUNCH; OR, THE LITTLE TINY PETITE PHEASANT FEATHER TEA SHOPPE---It becomes known under both titles. It begins with a cheerfully absurd scene in the family kitchen, with Rush (Bill Idelson) chattering about school gymnasium gossip, Sade (Bernadine Flynn) putting the finish on lunch, and in due course Vic (Art Van Harvey) coming home---for a clean shirt, because he's been roped into a spur-of-the-moment business lunch at the "homey" Tea Shoppe "with the hotshot bluebloods," as Sade needles knowingly, on today's edition of Vic & Sade. (NBC.) Writer/director: Paul Rhymer.

PREMIERING TODAY . . .

1893---Gene Morgan (actor: Myrt & Marge), Racine, Wisconsin.
1900---Harlow Wilcox (announcer/actor, Fibber McGee & Molly; announcer, Suspense, Amos 'n' Andy), Omaha, Nebraska.
1912---Paul Weston (conductor: Chesterfield Supper Club), Springfield, Massachussetts.
1916---Mandel Kramer (actor: Yours Truly, Johnny Dollar), Cleveland.
1917---Googie Withers (as Georgette Lizette Withers; actress: Theatre Royale), Karachi, Pakistan.
1921---Gordon McRae (singer/actor: Texaco Star Theater, Railroad Hour), East Orange, New Jersey.