The Next Steps: The Way It Was, 12 March

FEATURED BROADCAST
FIRESIDE CHAT:
THE BANKING CRISIS; OR, WHAT HAS BEEN DONE
(INAUGURAL BROADCAST; ALL NETWORKS, 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 come to believe the Fireside Chats keep you informed, and that the first chat offered 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. Somewhat the way many among a future generation will prove at around the same point of the new administration of a certain former Senator from Illinois.

And, you may not know, even as you listen to this first Fireside Chat, that the freshly-inaugurated Roosevelt 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, now writing in his 1948 book, The Roosevelt Myth) would consider more simplicity and perhaps less financial anguish than would come in due course.

Hoover's proposal: 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---all 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 further believed that---Roosevelt having the "ultimate responsibility"---he would give any order Roosevelt approved, Flynn would continue, "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 choice 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) sent word that the banks were about to collapse, anyway . . .**

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.

CHANNEL SURFING . . .

VIC & SADE: VIC'S BUSINESS LUNCH; OR, THE LITTLE TINY PETITE PHEASANT FEATHER TEA SHOPPE (NBC, 1942)---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. Writer/director: Paul Rhymer.

OUR MISS BROOKS: THE BURGLAR (CBS, 1950)---He's a rather polite sort (Rory McMillan), actually, whose targets are refrigerator leftovers, prompting tenderhearted Connie (Eve Arden) to try getting him a custodial job at Madison High---whose bullheaded principal (Gale Gordon) was burglarised out of a chicken dinner the same evening. Mrs. Davis: Jane Morgan. Harriet: Gloria McMillan. Boynton: Jeff Chandler. Walter: Richard Crenna. Annoucer: Bob LaMond. Writer: Al Lewis.

THE PHIL HARRIS-ALICE FAYE SHOW: TRYING TO BREAK UP JULIUS AND MARJORIE (NBC, 1950)---That's the mission of the hour when Julius (Walter Tetley), engaged to sponsor Scott's (Gale Gordon) niece (Louise Erickson), lets his newfound connections and success go so far to his head that he starts throwing his miniscule weight around, to Phil (Harris), Alice (Faye), and Remley's (Elliott Lewis) annoyance. Willie: Robert North. Little Alice: Jeanine Roos. Phyllis: Anne Whitfield. Announcer: Bill Forman. Music: Walter Sharp, Phil Harris Orchestra. Writers: Ray Singer, Dick Chevillat.

THE COUPLE NEXT DOOR: NEGOTIATING THE PRICE (CBS, 1958)---It isn't necessarily pleasant when a husband (Alan Bunce) fears his short trip out of town means a modeling agent (Alexander Clark) taking advantage of his absence to lure his wife (Peg Lynch) into signing a less-than-satisfactory contract for their charming daughter's modeling services. Writer: Peg Lynch.

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.

* - 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 who believed no return to minimal government was feasible so long as there was a Cold War to wage.