3

“I Saw One Woman Faint”: Toward a Sociology of Panic

In the late 1930s, a young man named Robbins had everything. His father was an executive at a large, thriving company. His family had money and belonged to the right church. Just twenty years old, Robbins drove his own car and owned his own stocks. He was a junior at Princeton. He read the popular magazines (Esquire, Reader’s Digest, Colliers) and the daily newspapers, but few books beyond the ones assigned to him. Still, he did not think this indifference to book learning would do him much harm. He imagined a future in advertising. He liked to play tennis.¹

On the night of October 30, 1938, Robbins and a college friend were driving home from visiting a girlfriend in another state. As they approached the New Jersey border, they turned the car radio to the local CBS station. An orchestra played a tango for a minute or two, until it was interrupted by a news flash. An astronomer had observed “several explosions of incandescent gas, occurring at regular intervals on the planet Mars.” The gas appeared to be hydrogen and was “moving towards the earth with enormous velocity.”²

It was probably nothing to worry about. Indeed, Robbins and other listeners had grown used to these sorts of interruptions. In September, Adolf Hitler had announced his intention of reclaiming—by force if necessary—what he called the Sudetenland, the section of Czechoslovakia inhabited by German speakers. The British prime minister Neville Chamberlain and other European leaders rushed to Munich to meet with Hitler, and over the next few days the radio routinely broke into broadcasts to report on efforts to stave off war. Then as now, the station would soon return to its regular program.

On this night, too, the music returned, but shortly thereafter the announcer interrupted yet again to report that the “Government Meteorological Bureau has requested the large observatories of the country to keep an astronomical watch on any further disturbances occurring on the planet Mars.”³ The announcer also promised a forthcoming interview with a Princeton astronomer, Professor Pierson, whose name Robbins thought he had heard around campus.⁴

Soon, things began to spin out of control. During the interview, Professor Pierson was told that a meteor had landed within twenty miles of Princeton, and the radio correspondent informed listeners that “a huge flaming object, believed to be a meteorite, [had fallen] on a farm in the neighborhood of Grovers Mill, New Jersey,” just “twenty-two miles from Trenton.” The correspondent rushed to the scene, where he described, amid noises of a crowd and police sirens, the truly incredible things he saw.⁵

Now Robbins and his friend began to worry, especially when the meteorite turned out not to be a meteor but a huge metal cylinder that emitted a curious hum. They really began to worry when its top unscrewed and something with tentacles, big as a bear and glistening like wet leather, wriggled out of the capsule. The creature was followed by “a humped shape” with “a small beam of light against a mirror.” As the correspondent on the scene breathlessly described the scene, suddenly fire flashed from the mirror, incinerating everything and everyone in its path. “Good Lord,” the radio correspondent shrieked, “they’re turning into flame!”⁶

The broadcast from the scene cut off, but the announcer back in New York mournfully reported “at least forty people, including six State Troopers, lie dead in a field east of the village of Grovers Mill, their bodies burned and distorted beyond all recognition.”⁷ The commander of the State Militia at Trenton, New Jersey came on the air to announce that the governor was placing “the counties of Mercer and Middlesex as far west as Princeton, and east to Jamesburg, under martial law.” The roads would be closed, and the State Militia would evacuate the area.⁸

At this point, Robbins and his friend were distraught. His family lived in the area that fell under martial law. He stopped at a drugstore to use the phone. On his way in, he told the four people in the store about the news. In the phone booth, he could not place his call; the lines were jammed. Back in the drug store, the patrons had turned on the radio, and now they too were anxiously listening. Not thinking entirely clearly, Robbins and his friend decided to drive back and rescue the girlfriend. The two raced back across the state line listening to the radio, and when the secretary of the interior made an announcement to the whole nation, urging calm, Robbins concluded that we—the United States, humanity—were finished. An “invading army from the planet Mars,” as Robbins later put it, would soon conquer the country, in all likelihood the world. Robbins “could not bear to hear the worst,” so he turned off the radio and prayed. “I was waiting for doom to strike,” he remembered. “I could practically smell the gas.”⁹

Eventually, Robbins turned the radio back on, and by switching to other stations, which were not covering the catastrophe, he and his friend figured out that they were not listening to news of an apocalyptic Martian invasion but to a radio play, Orson Welles’s adaptation of H.G. Wells’s War of the Worlds.¹⁰

If he felt embarrassed about having fallen for the hoax, Robbins could take comfort that he was not alone. The next day, newspapers across the country reported on the nationwide panic caused by the play. The New York Times told of a woman who “walked into the West Forty-seventh Street police station dragging two children. She said she was ready to leave the city.” In Washington Heights, a man ran into the Wadsworth Avenue Police Station “white with terror, shouting that enemy planes were crossing the Hudson River and asking what he should do.”¹¹ The Associated Press reported that in Pittsburgh, a “man returned home in the midst of the broadcast and found his wife, a bottle of poison in her hand, screaming: ‘I’d rather die this way than like that.’ ”¹² In Indianapolis, “a woman ran into a church screaming: ‘New York destroyed; it’s the end of the world. You might as well go home to die. I just heard it on the radio.’ ”¹³ As Welles himself later boasted, exaggerating, as only he could, for effect, “Houses were emptying, churches were filling up; from Nashville to Minneapolis, there was wailing in the street and the rending of garments.”¹⁴

Journalists and media critics now think decidedly less of the story of the radio play that supposedly caused a “Wave of Hysteria over Nation,” as one newspaper declared at the time.¹⁵ Recently, W. Joseph Campbell, professor of communications at American University, referred to the panic broadcast as “a media-driven myth” and included it among his list of ten of the greatest misreported stories in American journalism. According to Campbell and other scholars, newspaper editors exaggerated the panic because it made good copy, and because they could not resist an opportunity to swat the new medium of radio, which was cutting into circulation, on the nose.¹⁶

If these critics doubt the story itself, they think even less of the academic study, The Invasion from Mars: A Study in the Psychology of Panic, written by Hadley Cantril and published by Princeton University Press in 1940, that in many respects inaugurated—regrettably so for many scholars—the field of mass communication studies. According to Joy Elizabeth Hayes and Kathleen Battles, Cantril started from the premise that some listeners lacked “the critical ability to distinguish fact from fiction” and, thus, his study contributed to “the idea that, by the 1930s, radio broadcasting was a centralized, self-contained, one-way form of communication that enthralled listeners.”¹⁷ Cantril’s study therefore epitomized the so-called hypodermic needle model of communication, which, as Michael J. Socolow observes, “posited that the media injected ideas, more or less directly, into the consciousness of the audience.”¹⁸ In the field of contemporary communication studies, where no one simply passively consumes popular culture but must always “talk back” to it, an argument like Cantril’s can seem as elitist and out of fashion as a top hat.

In fact, though, Cantril’s study is more sophisticated than its later caricatures would suggest. True, in seeking funding from the Rockefeller Foundation for his study, and in seeking to establish his own reputation, Cantril may have exaggerated the panic caused by the broadcast. (Privately, he referred to his project as the “Mass Hysteria Study.”)¹⁹ He certainly played up the parallels between the response to the War of the Worlds broadcast and German propaganda for all they were worth.²⁰ And, to be sure, Cantril started from the premise that some listeners lacked “the critical ability … to distinguish between reality and fiction.”²¹ But evidently some listeners did lack the critical ability to distinguish fact from fiction. Perhaps not the millions that Cantril, working from phone surveys conducted after the broadcast, estimated, and perhaps not even the hundreds of thousands that newspapers led readers to believe, but certainly tens of thousands of people. Moreover, Cantril fought against the widespread perception that those who panicked were merely stupid. Writing in the New York Herald Tribune, the columnist Dorothy Thompson asserted that Welles and the War of the Worlds broadcast “have shown up the incredible stupidity, lack of nerve and ignorance of thousands.” “Such glib generalizations,” Cantril averred, “are not only wrong but dangerous, both theoretically and socially.”²²

Cantril brought a similar skepticism to the question of panic. As his colleague on the project, Paul Lazarsfield, observed, the fact that people panicked is not compelling. Indeed, given the realism of the play, panic was inevitable.²³ What was compelling is why some people panicked and others did not. Cantril thus shifted the question of panic to the question of standards of judgment and critical ability. How did people distinguish between fact and fiction? Who was more likely to take fiction as fact? Could people learn to be more critical? Based on his survey data and interviews, Cantril concluded that those with more years of formal education did a better job of recognizing the play as a play, but as with the case of Robbins, the Princeton undergraduate, education did not always suffice. Cantril further speculated, based on interviews with those who took the broadcast at face value, that the widespread economic and political insecurity of the Depression had something to do with why people panicked. Jitters, as he quoted the columnist Heywood Broun, had come home to roost. During the Depression, people had come to expect the worst, so why not Martians?²⁴

One can learn a lot about the Great Depression from War of the Worlds and Invasion from Mars: the rise of radio and mass communication; how economic insecurity and, especially, the prospect of war in Europe, may have changed how people inhabited the world; and, not least, what many Americans feared. Some feared Martians, while others feared a cowed and credulous people who could be made to panic over the invasion of make-believe Martians. In addition, one can learn about the emotion of panic itself. In any reckoning of the emotional life of the Great Depression, as War of the Worlds and Invasion from Mars both indicate, panic figures prominently. During the decade, Americans tried to evacuate cities after hearing a fictional radio play, sold stocks for whatever they could get, made runs on insolvent and solvent banks alike, took justice into their own hands, and, in countless ways, responded to events with something less than reason and equanimity. If it was the red decade, it was also the panic decade. In 1932, Americans could have gone to theaters and seen the uneven film American Madness, directed by Frank Capra, which features a bank run. In 1935, the poet Archibald MacLeish staged his first play, called, simply enough, Panic! Everyone knew what he meant.

In what follows, I try to get to the bottom of whether people did in fact panic during the Great Depression, what made them panic, and what a diverse group of people—sociologists, economists, diarists, presidents, and protest novelists—thought that propensity to panic on the part of Americans meant. In short, I argue that, even more than most emotions during the period, panic preoccupied Great Depression writers. Yet like Cantril, many writers and legislators during the Great Depression concluded that in order to understand why so many people panicked during the 1930s, they had to go beyond a reductive explanation of panic that chalked it up to the stupidity, irrationality, or baseless fears of those who did panic. Like Cantril, they had to develop a sociology of panic, an understanding of the processes governing this widespread social phenomenon. In doing so, many rejected the heuristic of panic altogether; others revised it so much as to make it unrecognizable. Their conclusions offer some of the most fascinating glosses on some of the major events of the period, including, as the first section of this chapter documents, the inaugural event of the Great Depression, the stock market crash of 1929. Their conclusions would also fundamentally change the texture of American life. The Banking Act of 1933, for example, which created the Federal Deposit Insurance Corporation, and which kept commercial banks from investing their own funds in the stock market, emerged principally out of concerns over what happens when Americans supposedly panicked about their bank deposits. And while it led to no new legislation, Richard Wright’s theory of racial panic offered readers a whole new way to think about American race relations.

But first, there was the crash.

The Crash

On September 3, 1929, the long bull market of the 1920s reached its zenith. After nine years of mostly uninterrupted growth, the Dow Jones Industrial Average peaked at 381.²⁵ It declined in fits and starts for the next six weeks, until October 24, 1929, Black Thursday, when at the opening bell the race to sell began. Within hours, the market lost 11 percent of its value. At noon, leaders of the largest banks and investment houses met, which gave hope to traders that something would be done to stop the free fall. In the event, the banking houses pooled hundreds of millions of dollars and started buying stocks.²⁶ The gambit worked. Confidence was restored. During the afternoon, prices climbed, and the Dow made back almost half of its morning losses.

On Friday and Saturday, the market held. But come the start of the week, the liquidation resumed. On Monday, October 28, the Dow Jones fell 38 points. The next day, it fell an additional 31 points. All told, the Dow Jones fell from 326 at the opening of trading on the morning of Wednesday, October 23 to 230 at the close of trading on Tuesday, October 29, a loss of around 30 percent of its value in a week, which added up to tens of billions of dollars (hundreds of billions of dollars adjusted for inflation).

Then and now, most observers described this race to sell as a panic. “Wall Street in Panic as Stocks Crash,” the Brooklyn Daily Eagle, an afternoon paper, reported on Thursday, October 24. On the 25th, across the Atlantic, the London Daily Mail announced “Deluge of Panic Selling Overwhelms Market.” The same day, back in the United States, a Boston investment trust took out an advertisement in the Wall Street Journal that read: “S-T-E-A-D-Y everybody! Calm thinking is in order. Listen to America’s greatest bankers.”²⁷ The implication was that stocks fell Thursday morning not because they were grossly overvalued and investors suddenly realized this, but because investors panicked and ignored America’s greatest bankers, who apparently knew best what stocks were worth.

The stock market crash of 1929 is commonly credited with starting the Great Depression, and though the crash did not singlehandedly cause the Depression, it did help turn an ordinary recession into an unprecedented economic disaster. At the time, many wished to ascribe the crash to the irrational behavior of panicked investors. As we shall see, however, that story, even for those who wanted to tell it, was not quite so simple.

No one represents the evolving view of the stock market crash, and the role that panic did or did not play in it, better than Irving Fisher. At the time, Fisher was an esteemed professor of economics at Yale University, and today he is acknowledged as one of the most important economists of the twentieth century, not least for his role in bringing mathematics to the dismal science. For decades, though, Fisher was simply known as the batty professor who made one of the worst predictions in economic history. In fact, he made several infamous predictions.²⁸ In New York on October 16, 1929, Fisher addressed the monthly meeting of the Purchasing Agents Association and declared “stocks had reached a permanently high plateau.”²⁹ Even worse, on October 23, 1929, Fisher addressed the District of Columbia Bankers Association. In that speech he walked listeners through the economic reasons why the rise in the market since the war had been “justified,” but the timing of his speech was disastrous. The next day, what would turn out to be Black Thursday, the New York Times carried an account of Fisher’s speech under the headline “Says Stock Slump Is Only Temporary.” In the article, Fisher is quoted as saying how he did not see how a collapse of “60 to 80 points on the Dow Jones barometer could be expected.”³⁰ That morning alone, newspaper in hand, investors watched the Dow drop almost 40 points. By the end of trading the next Tuesday, it had fallen 100 points. By November 13, it had fallen an additional 31 points. When it bottomed out in June 1932, it had not fallen 40 points. It had fallen to around 40 points. In retrospect, Fisher was right that the Dow Jones would not fall 60 to 80 points. When it was all said and done, it had fallen five times that far.

As his truly woeful predictions suggest, the stock market crash caught Fisher off guard. Throughout the fall of 1929 he had insisted that corporate earnings and the prospect of still greater corporate earnings had justified stock prices. True, price-to-earnings ratios looked historically high, possibly even unprecedented, but Fisher thought that plowed-back earnings, mergers, scientific research and invention, industrial management, labor cooperation, the dividends of prohibition, and seven years of stable money more than accounted for that. In other words, this time really was different. Before the crash proper, Fisher blamed the smaller declines throughout the months of September and October on what he called the “lunatic fringe”: the “thousands of small and inexperienced investors [who] try to scramble aboard the stock market bandwagon from time to time, hanging on by their eyelids, that is, inadequate margins and lacking needed specific knowledge of the stocks they thus overbuy.” Fisher concluded, however, that the market would be stronger for shaking out these “reckless speculators.”³¹

As the market continued to fall, though, well beyond what a shaking out of reckless speculators would account for, Fisher turned to other explanations for the inexplicable crash. In early November, he settled on one in particular: panic. He told the New York Herald Tribune: “It was the psychology of panic. It was mob psychology, and it was not, primarily, that the price level of the market was unsoundly high … the fall in the market was very largely due to the psychology by which it went down because it went down.”³² Although this last sentence seems gnomic, Fisher is basically saying that the market acquired its own momentum. It went down—for whatever reason—which persuaded investors that it would continue to go down. Trying to beat the fall, investors sold out, which, of course, drove prices down, which convinced still more investors that prices would fall, and they responded by selling out, which drove prices down, on and on. Throughout all of this, though, the market—and its underlying economic soundness—had not changed. Investors had. In short, they panicked.

According to this school of thought, the market crashed not because there was a bubble, but because people thought there was a bubble and, once the so-called bubble began to pop, this confirmed others in their suspicion that there was a bubble, so they began to sell as well. Moreover, even if you did not think there was a bubble, others clearly did, so you would be wise to sell too. In other words, everyone, at the same time tried to leave by the same door, which, as fire marshals can tell you, is a recipe for panic. By this account, the stock market crash illustrates the power of collective behavior, of the psychology of panic. If enough people think something is true, it may as well be true, even if it is not.

For behavior to count as panic, most dictionaries insist, it must have something irrational and extravagant about it. Either the fear that inspires the panic must be unfounded, and a moment’s pause would reveal this, or the fear that inspires the panic must lead to counterproductive behavior. For Fisher, the crash was a textbook example of panic in both senses. The fear was unfounded: according to Fisher, the price level of the market was not unsoundly high. There was no bubble. And the fear was counterproductive: the fear that the price level of the market was unsoundly high led to frantic selling, which, like a contagion, spread to other investors, thus undermining what in reality (or so Fisher thought) was a legitimate level of prices. For Fisher, then, panicked investors needlessly crashed the stock market.

This explanation, it should be noted, attracted immediate ridicule. In response to Fisher’s assertion that the crash owed to “mob psychology,” the editor of the Commercial and Financial Chronicle wrote, “The learned professor is wrong as he usually is when he talks about the stock market.”³³ Yet focus for a moment on Fisher’s original explanation of the crash, that it was the “psychology of panic.” It may seem plainly wrong, as the editors of the Commercial and Financial Chronicle concluded, but from Fisher’s perspective it made perfect sense. Assume for the moment, as many economists now believe, and at the time Fisher fervently believed, that the stock market in 1929 was not as grossly overvalued as the conventional wisdom holds. In a book he wrote in the months following the crash, The Stock Market Crash—and After, Fisher insisted “that between two-thirds and three-fourths of the rise in the stock market between 1926 and September, 1929, was justified.”³⁴ (Other, later economists would put the fraction even higher.)³⁵ On January 2, 1926, the Dow Jones stood at 159. On September 3, at its peak, it had risen to 381. By Fisher’s calculation, the Dow should have been somewhere between 307 and 326. On January 2, 1930, around the time Fisher sent his book to press, it was 244.³⁶ As Fisher saw it, then, the psychology of panic drove stock prices significantly lower than where they belonged.

A chart Fisher placed at the beginning of Stock Market Crash—and After makes the same point (see Figure 3.1). The chart purports to depict how far stock prices depart from where the fundamentals of the economy predict they should be. (Fisher based his chart on the research of the statistician and investor Karl Karsten, who started one of the first—if not the first—hedge funds.) In the upper right-hand corner, stock market prices for 1928 and 1929 initially soar beyond their line of fundamentals. After the crash, however, they dive below where Karsten (and Fisher) believed they belonged. The area in white thus documents the harm that panic has done to the stock market: if not for it, the actual value of stocks would be closer to the bold line. That is why Fisher could conclude his 1930 book with the soon-to-be infamous prediction that “For the immediate future, at least, the outlook is bright.”³⁷ Relative to their actual value, Fisher believed, stocks were now cheap. Sooner or later investors would come to their senses, put panic aside, and figure this out. When the future arrived, of course, it looked anything but bright. Stocks, it turned out, had a long way left to fall.

Figure 3.1. Chart from Irving Fisher’s Stock Market Crash—and After.

Source: Irving Fisher, The Stock Market Crash—and After (New York: Macmillan, 1930)

When it comes to the actual values of stocks at the time, it does not matter all that much whether Fisher was right or wrong. I happen to think he was more right than wrong; stocks—and the underlying economy—need not have fallen as far as they did.³⁸ The Great Depression is full of tragedy, but the greatest is that it need not have been as “great” of a depression as it was. A combination of bad luck and bad policy turned a normal recession into a decade-long disaster. In any event, what does matter—at least for the purposes of this chapter—is the extent to which for Fisher emotion functioned as a heuristic, or as a way to make sense of the otherwise inexplicable. Whatever did not make sense or departed from what it should be could be chalked up to emotion, especially panic. According to Fisher, investors were “over-enthusiastic” on the way up, which led them to drive up prices higher than where they belonged.³⁹ More seriously, investors panicked on the way down, driving stocks below where they belonged. In both cases, what Fisher called the “ ‘psychological short swing’ ” was to blame.⁴⁰ If something, say, stock prices, did not make sense, if reality did not follow rational predictions, then something irrational and distorting must explain why. For Fisher, after the crash, that something was panic.

To his credit, Fisher ultimately acknowledged his misplaced faith in panic as the sole explanation for the stock market crash. To be sure, he never abandoned panic entirely, but like others I explore in this chapter, he started to look behind it, into the reasons for it. In Stock Market Crash—and After, Fisher listed eighteen possible “causes for the crash,” accepting some, rejecting others. In the end, Fisher settled on the “chief cause” of the crash in “the unsound credit situation,” by which he meant the truly spectacular amount of investment that took place in borrowed money, so-called margin trading, which left investors vulnerable to large drops in prices.⁴¹ Instead of buying stocks outright, margin traders buy stocks and use them as collateral to borrow still more stocks. Trading on margin can magnify gains, but it can also magnify losses. If, for example, I use $10 of my own money as collateral to buy $100 worth of stock, I do very well if the price of the stock rises by 10 percent to $110. I could return the $90 worth of borrowed stock to my broker and still have $20, my original $10 plus the $10 by which the stock increased.⁴² I have doubled my investment. If I only invested my $10, however, without using it as collateral, I would have only made $1 by the 10 percent increase in prices.

The problem, of course, is that in margin trading, drops in prices can quickly bankrupt investors. In the example above, if, instead of rising to $110, the value of the stock fell to $90, my original investment would disappear. From my broker’s perspective, the collateral I deposited with him—my initial $10—is gone. The stock is only worth $90 now, or how much he leant me. To keep trading, I would need to raise more collateral. (The term of art is “receiving a margin call.”) To meet it, perhaps I dip into my savings. Or maybe I sell other stocks. If I cannot raise the collateral, however, the broker will sell off the stocks that remain in order to recover his loan. In that case, like it or not, I will be selling stocks. That term of art is called “distress selling,” and, like panic, it can achieve its own momentum. If many people trade on margin, and prices fall, they may all have to sell at once, which can drive prices lower, which will lead to more margin calls and more distress selling, which will drive prices lower, which will lead to still more margin calls and still more distress selling, on and on until everyone is bankrupt. “Between the loans on a stock market and the stock market price levels,” Fisher observed in 1933, “there could not be a better example of a vicious spiral.”⁴³

A “vicious spiral” is what, after calling the learned professor wrong as he usually is, the Commercial and Financial Chronicle had in mind when it insisted in early November that the crash “was not due to mob psychology” or “the psychology of panic,” as Fisher claimed. Rather, its editor insisted, “the mob held on to the last minute with the greatest tenacity and finally got sold out instead of selling out.”⁴⁴ Fisher admits “that there may be some substance to this view,” but he refuses to admit “there was no panic at all.”⁴⁵ Not everyone who traded on margin during the Great Crash faced bankruptcy. But they might if they did not sell. They owed much more than they owned. Hence panic—or what looked like panic. In other words, Fisher seems to feel, overleveraged investors feared that they might be sold out and, so, panicked and sold out. In a speech before the American Statistical Association, Fisher argued, “it was just because there were great chances to make money such as have seldom if ever, in the aggregate, occurred before in the history of the world that so many people were eager to profit by them and went into debt for this purpose.”⁴⁶ And it is debt that creates the conditions for panic. “Anxiety is always present, or should be,” Fisher wrote in 1933, “in the person who has a margin account.”⁴⁷ It did not help, Fisher felt, that interest rates were “artificially low,” and investors could borrow cheaply.⁴⁸ In any case, Fisher concluded, it was no longer a “lunatic fringe” that had speculated with borrowed money and brought the market down with them. It was most everyone.

Still, Fisher believed, now that the speculators had sold out or been sold out—take your pick—those who had, for the moment, stepped in to buy stocks after the initial crash would insure greater stability in the market. “They will be much more cautious than holders who bid up the stock price level,” Fisher hoped, “and will buy less on borrowed money.” He admitted that this “contraction in demand … may prevent prices for a long time from regaining their old height on the new plateau,” but he had no doubt that in the long run prices would return to that plateau.⁴⁹

Of course, as the Commercial and Financial Chronicle might have put it, the learned professor was wrong again. The market continued to plunge. In addition to having to acknowledge his misreading of the stock market, in a few years Fisher would also have to acknowledge his misreading of the entire economy, too. In another speech to the American Statistical Association, in March 1933, Fisher ate crow. Speaking of the fact that “all would-be economic forecasters have for the last four years failed dismally to tell the business man what to expect,” Fisher argued that it “is well that we face these failures and that, when we fail, we confess it with due humility.” “I confess it,” he added, in a line that must have been difficult but nevertheless liberating to write.⁵⁰ His error, though, led to one of the real breakthroughs in thinking about the business cycle. In a 1933 book, Booms and Depressions, and a widely cited article in the journal Econometrica, Fisher developed a debt-deflation theory of the Great Depression, which, as he summarized it, focused on “the important role of over-indebtedness and its tendency to break down the price level through distress selling, contraction of deposit currency, and slackening of velocity.”⁵¹ Basically, Fisher argued, what happens in a deflating stock market—forced selling and a driving down of prices—can happen to an entire economy, and keep happening, longer than anyone, including insightful Yale economists, would ever have thought possible. John Maynard Keynes would shortly come to the very same conclusion.

Only when Fisher revised the heuristic of panic, though, did he begin to understand why the stock market crashed and why the economy behaved the way it did. Or, since he continued, rightly, to view emotion and panic as part of the business cycle, only when he stopped viewing them principally as causes did he begin to understand why the economy boomed and, even more so, why it fell into depression. Emotions like panic could cause markets to crash; but certain real economic forces (debt, distress selling) created the conditions that led people to panic. The same could be said about emotion and the economy writ large. If capitalists grow pessimistic and do not believe the economy will grow, they will not invest money in their own businesses, thus assuring that the economy does not in fact grow. (Keynes referred to the motivating emotions that underlie an economy as “animal spirits.”) In other words, pessimism, like panic, only looked causal.⁵² Even pessimism and animal spirits traced back to other, very much material forces, and, in theory anyway, were subject to those same material forces.⁵³

It took Fisher longer than most to come to this realization about the minimal role panic played in the stock market crash; or, if you prefer, the realization that panic was not a cause but an effect of the crash. Still, it was an essential realization. It forecast the one that the federal government would soon make about another plague of panics during the Great Depression, bank runs.

“You People Must Have Faith”

On June 5, 1931, Benjamin Roth, then a lawyer in the industrial city of Youngstown, Ohio, started keeping a diary. In his foreword, he wrote, “For the first time in my personal business life I am witnessing a major financial crisis. I am anxious to learn the lessons of this depression.” Unlike those past middle age, for whom the crisis would only mean “tragedy and disaster,” Roth thought he was young enough to learn valuable lessons from the experience. “With this thought in mind,” he wrote, “I am going to write down brief accounts of developments as they occur from time to time.”⁵⁴

Among other developments, Roth could watch the banking crisis as it battered Americans during the early years of the Great Depression. On July 30, 1931, Roth noted almost in passing the “numerous bank failures” and their effect on spending.⁵⁵ On August 5, the failures, which until then had mostly affected banks in St. Louis, Chicago, and outlying areas, finally hit Youngstown. The first banks to wobble were the savings and loan companies, which had made bad loans on real estate, as Roth explains. “The town is stunned,” Roth wrote, “by the news that the Home Savings & Loan Co. has suspended payments and would demand 60-day notice of withdrawals.” Other banks followed suit. These banks, Roth noted, had “earned their money by lending on real estate.” But, as he also observed, correctly, mortgages “are not a good investment for a bank which has agreed to pay out its deposits on demand.” With “the coming of the depression people stopped paying their mortgages—mortgages became frozen and the banks had no way to get cash.” Thus, “for the past three days, these institutions have been besieged by hysterical depositors demanding their money.”⁵⁶

But the crisis—and the hysterical depositors—would not stop with savings and loan banks. On August 17, Roth noted that the local newspaper carried “the news that four of the largest commercial banks in Toledo, Ohio, closed their doors (total deposits over $100 million).”⁵⁷ On August 18, he observed, apropos of Youngstown and its bank closings: “This town is fast becoming panic-stricken.”⁵⁸

Roth could not know it, but he and the city of Youngstown were caught in by far the most catastrophic and prolonged banking crisis in U.S. history (see Figure 3.2). From 1930 to 1933, over 9,000 undercapitalized and overleveraged banks failed, with deposits in those banks amounting to nearly 7 billion dollars.⁵⁹ (That is well over 100 billion in inflation-adjusted dollars.) Over a couple of days and sometimes even hours, millions of Americans could only watch as their savings simply disappeared. The crisis culminated in early 1933 with first the state of Michigan, then adjoining states, and finally the whole of the United States ordering banks to close so that federal authorities could sort out the solvent from the insolvent ones. More than any other event in the Great Depression, even the stock market crash, the banking crisis, as Roth observes, grew out of and gave rise to panic, and few other events in the Great Depression can reveal as much about the emotion as the banking crisis and the psychological and legislative attempts to dispel it. It too reveals what Irving Fisher eventually learned: what at first looks like panic may not be entirely so.

Figure 3.2. Photograph of depositors in front of the closed American Union Bank in New York City, April 1932.

Source: National Archives (12573155)

Throughout the month of August, Roth followed reports of bank closures in the state. His entries on August 22 and 25 illustrate what made the banking panic so devastating. On August 22, he wrote:

There is a quiet but steady stream of depositors at every bank in Youngstown this morning quietly withdrawing their funds. The closing of banks in Toledo and Warren received much publicity and distrust of all banks is growing like a cancer. It is a movement which feeds on itself and is hard to stop. At the Dollar and Union Banks there are about 4 or 5 depositors at each withdrawal window. There is no excitement but a quiet look of intensity on the faces of both depositors and bank officials. Even the strongest banks can’t keep this up long. They do not have enough cash to pay everybody … It is hard to rent a safety box today because there has been such a demand by hoarders. Actually the liquid cash of the bank is being transferred from the bank vaults to the private safety vaults where it is taken out of circulation and becomes sterilized.⁶⁰

On August 25, he was much more succinct: “Everyone is afraid of the banks.”⁶¹

Roth, admittedly no poet, nevertheless captures, with his metaphors of cancer and sterilization, the twin problems posed by the banking crisis. Just as cancerous cells can metastasize and spread to other parts of the body, destroying previously healthy cells, so too can bank panics spread and destroy not just unhealthy banks but healthy ones too.

As Roth outlines, the roots of the banking crisis lay in banks taking on too much risk and paying for it when the economy crashed. Banks pay you interest for depositing your money with them. They do not do this out of the goodness of their hearts, but because they take your money and lend it out at higher interest rates than the one that they pay you, thereby making a profit for themselves and their shareholders. At any given time, a bank retains only a small percentage of its deposits as capital, say 10 percent. These reserves allow it to meet the day-to-day demands of its depositors. The bank lends out the other 90 percent of its assets at interest. However, if a bank makes bad loans, or if a Great Depression turns once good loans into bad loans, and those to whom it has loaned money no longer pay their loans, the bank may find itself in trouble. With no or little money coming in, it will quickly run through its capital reserves, and once those are depleted, it can no longer pay interest to you nor, if it has completely run through its reserves, can it even produce your savings if you show up asking for them. At that point, the bank must close, and the prospect of it closing fuels bank panics. Depositors race to the bank to get their money before the money runs out, which, of course, only hastens the bank’s failure.

That is what happened to the Savings and Loan Companies in Youngstown and elsewhere in 1931. They took in money from depositors, loaned most of it out for real estate, but when people lost their jobs or businesses during the Depression, they could no longer make their mortgage payments, leaving banks with little or no income. The banks could foreclose on the properties and sell them in order to raise cash, but in a Depression no one would buy them, except at a tremendous loss to the banks. These properties were, in Roth’s terms, “frozen.” The Savings and Loan Companies in Youngstown did not close, but they did stop paying interest on deposits and required customers to wait sixty days before withdrawing money. (The banks needed that time to raise it.) More often, however, as Roth describes, banks would simply close. When that happened, depositors could not access their money, and they could not know how much of their money would remain when the bank opened again, if it ever did.

The truly malignant feature of bank panics, though, is that as soon as one bank closes, or even threatens to close, it imperils the rest. A bank that has made good loans, retains more of its capital, or has more capital to begin with, can nevertheless fall prey to a panic. Weak or strong, as Roth observes, no bank can withstand everyone asking for their money at once. Yet that is just what happens during a bank run. A depositor in Youngstown notices that the Savings and Loan Companies have closed, or he reads of bank closings in nearby cities, and he begins to worry about his bank and his own money. Just to be safe, he withdraws his money and stashes it in a safety deposit box. The problem, of course, is that if enough people think that way, they all descend on the bank at once, demanding their money. Meanwhile, other people see depositors lined up outside a bank, desperate to withdraw money, and think they had better withdraw their money, too. So off they go to their bank, bringing more people with them, until every bank in town, in the state, and in the country faces a panic, and many banks close altogether. Thus bank runs, in Roth’s apt metaphor, are a cancer.

For this reason, the British journalist Walter Bagehot outlined in his 1873 book 65 Lombard Street what has come to be known as Bagehot’s Dictum, which holds that to dispel a banking panic one must dispel the fear of loss that drives it. Therefore, central banks ought to lend liberally to banks in trouble.⁶² When the public perceives that it can access its money whenever it likes, calm will return. In theory, the Federal Reserve of the United States was created in 1913 to make good on Bagehot’s Dictum. It would act as lender of last resort to banks facing runs. But not all banks during the early years of the Great Depression belonged to the Federal Reserve system, which meant they could not borrow money from it, and even when banks did belong to it, they oftentimes did not have sufficient assets to allow the Fed to loan funds to them. In addition, banks were sometimes reluctant to apply to the Federal Reserve. If its application was made public, people might think the bank was in trouble, which would cause depositors to make a run on it, thereby undoing whatever temporary aid the loan from the Federal Reserve offered.

Yet bank runs can have less obviously dramatic though equally pernicious effects. As Roth notes in his last sentence quoted above, when depositors withdraw their savings from banks and stash it in safe deposit vaults, that is that much less money the bank can lend to people or businesses for the sake of investment. The money becomes sterilized, unable to infect—and beget—other money. To make things worse, in order to withstand runs, banks may begin to hoard reserves themselves. In their annual report for the year 1933, the Federal Reserve Board included a fascinating chart documenting how much of the money it had printed remained outside Treasury and Federal Reserve banks at any given time; in other words, how much money, and of which denominations, was in circulation and not, say, in safe deposit vaults or under mattresses (see Figure 3.3). Throughout 1931 and again in 1933, notice the ascent in the number of $50 bills and higher that Americans had withdrawn from banks. No other denomination, with the exception of $20 bills, was withdrawn nearly so quickly. As the Federal Reserve Board report pointed out, “The increase in large denominations clearly indicates that most of the currency withdrawn represented funds taken out for hoarding.”⁶³

Figure 3.3. Federal Reserve Board chart depicting denominations of paper currency in circulation outside banks.

Source: Twentieth Annual Report of the Federal Reserve Board Covering Operations for the Year 1933 (Washington, D.C.: G.P.O., 1934)

To be sure, the problem during depressions is not primarily a lack of money but rather a lack of profitable investments; even so, the hoarding of money, by diminishing credit, does not help matters. (Among other ills, it drives up interest rates and creates deflation.) Therefore, in a series of speeches given in early 1932, as the banking crisis worsened, Herbert Hoover took to the radio to spell out the dangers of hoarding. “I am convinced,” he said,

that citizens hoarding currency or money do not realize its serious effect on our country … Every dollar hoarded means a destruction of from $5 to $10 of credit. Credit is the bloodstream of our economic life. Restriction or destruction of credit cripples the revival and expansion of agriculture, industry, commerce, and employment.⁶⁴

With some cause, many people scoffed at Hoover’s diagnosis of the causes of the Depression. Many people had no money whatsoever, to hoard or not, and the rhetorically tone-deaf Hoover could not imagine what his speech would sound like to them. Even so, Hoover is not wrong about the hazards of hoarding. It does harm the economy. His solution, however, illustrates why bank panics could prove so hard to contain. Hoover urged Americans “to put their dollars to work—either by conservative investment, or by deposit in sound institutions,” which sounds good, but with banks failing right and left, who could be sure which institutions, if any, were sound, and which unsound? Depositors did not have access to a bank’s balance sheets. As Roth notes, in the absence of information about the soundness of any given bank, it made more sense to withdraw your money from it and stash it in a safe deposit vault, whose soundness or unsoundness you could easily judge. Better safe, so to speak, than sorry.

In the event, none of Hoover’s efforts, neither speeches nor the Reconstruction Finance Corporation, a federally funded program begun in early 1932 that would lend money to banks when the Federal Reserve could not, could halt the banking crisis. Indeed, over the next two years, Roth records the slow, accumulating wreck of bank closures and hysteria that played out in Youngstown and across the country. On October 15, 1931, his worst fears came to pass. In addition to three other banks, his bank, the Dollar Bank, “the Gibraltar of Youngstown,” closed.⁶⁵ The two remaining banks, he observed, “are besieged by depositors seeking to withdraw their deposits. I do not see how it can last. The town is panic-stricken and the streets are crowded with people excitedly discussing the situation.”⁶⁶

In the months that followed, nothing much changed. On November 12, Roth observed, “The banks are still closed.”⁶⁷ And a week later: “The banks remain closed.”⁶⁸ In December, Roth heard that “The Commercial Bank and the (now closed) First National Bank will combine and reopen on January 4th as a new bank.”⁶⁹ When the new bank did open, it started “with a bad run.”⁷⁰ Finally, on May 18, 1932, seven months—yes seven months—after it closed, Roth’s bank, the Dollar Savings and Trust Co., the Gibraltar of Youngstown, reopened. Even so, depositors could only withdraw 10 percent of their savings. After an initial run, Roth noted, the bank settled “down to normal business.”⁷¹

Just when it appeared that the worst of the crisis had passed, though, at least in Youngstown, anyway, it returned. On January 23, 1933, Roth observed, “bank closings are again coming to the front.”⁷² A month later, he wrote:

Without any warning this morning 69 banks in Ohio including three in Youngstown restricted withdrawals to approximately 5% of deposits. All day in the Union National Bank bedlam reigned with hundreds in line clamoring for money. There was no violence but I saw one woman faint. The same thing was happening in every other city of Ohio.⁷³

It is not quite right to say, as Roth does, that the bank closings in Ohio came “without any warning.” Two weeks earlier, with scores of banks, including its largest, in trouble, the state of Michigan declared a bank holiday, closing every bank in the state for eight days. Other states, including Ohio, soon followed suit. By the time Franklin Roosevelt took office on March 4, 1933, thousands more banks had forbidden or restricted withdrawals and most states had closed their entire banking systems.

In his first official act as president, Roosevelt declared a national bank holiday. Every bank in the country would close for four days. (A few days later, Roosevelt extended the banking holiday for an additional three days.) During that time, Roosevelt announced, officials in the Treasury Department would examine banks and determine which ones were fundamentally sound and which ones were not. (States would examine banks that did not belong to the Federal Reserve System.) Over the coming days, solvent banks would open, and the federal or state government would reorganize or close insolvent ones.

Roosevelt devoted the first of his fireside chats entirely to the banking crisis, and his rhetoric reveals a great deal about how emotion drove the crisis, and how despite the bedlam and fainting women that characterized it, panic may not have been the best description of that emotion. Over the radio, in a relaxed but still urgent tone that may have gone far toward reassuring Americans, Roosevelt promised to explain the crisis “for the benefit of the average citizen.” (As Will Rogers shortly thereafter quipped, “He made everyone understand it, even the bankers.”)⁷⁴ Roosevelt then gave an abbreviated though perfectly lucid lecture about banking in America.

Because of undermined confidence on the part of the public, there was a general rush by a large portion of our population to turn bank deposits into currency or gold—a rush so great that the soundest banks couldn’t get enough currency to meet the demand. The reason for this was that on the spur of the moment it was, of course, impossible to sell perfectly sound assets of a bank and convert them into cash except at panic prices far below their real value.⁷⁵

To solve this dilemma, Roosevelt described recently passed legislation—the Emergency Banking Act of 1933—that “allows the twelve federal reserve banks to issue additional currency on good assets and thus banks that reopen will be able to meet every legitimate call.” “I can assure you, my friends,” Roosevelt closed, “that it is safer to keep your money in a reopened bank than it is to keep it under the mattress.”⁷⁶

Comforting words, but would they convince Americans? As Roosevelt’s acting comptroller of the currency later remembered, “No one knew how the public would react when banks reopened. If they demanded their money they either had to have it or the reopening would be a failure.”⁷⁷ Adding to the uncertainty of how the public would react was that if someone stopped to think about it for even a moment, they would realize that the federal and state governments could not possibly judge the soundness (or unsoundness) of literally tens of thousands of banks in under a week. Or they could, but the examination would be cursory and rely almost exclusively on information the banks themselves provided. Moreover, what if the assets a bank held were not perfectly sound? What if the prices a bank could fetch for them were not “panic prices far below their real value” but simply their new value? Roosevelt, that is, assumed that the economy would improve, but nothing guaranteed that it would. In essence, that is, Roosevelt bluffed, except that he backed up his bluff with billions of dollars. When the banks did open, people would, in fact, be able to withdraw their money. But that is less because their bank was judged sound than because Roosevelt instructed the Federal Reserve and the Reconstruction Finance Corporation to approve every request from banks for more funds. Basically, the federal government would turn on the currency spigot and banks could absorb as much as they needed to make good on their depositors’ claims.

In the event, the federal government did not need to drench banks with currency. When the banks reopened, depositors lined up, not to withdraw money but to return it. Evidently, they believed their bank had been judged sound. Look again at the Federal Reserve chart for 1933. After the bank holiday in March of 1933, large bills returned to the banks. The bluff worked. Or, rather, the steps the federal government took to stop the panic worked. In his fireside chat, Roosevelt predicted that “when the people find that they can get their money—that they can get it when they want it for all legitimate purposes—the phantom of fear will soon be laid,” and so it was.⁷⁸ Bagehot was right.

As the noted historian Charles A. Beard and his co-author, George H.E. Smith, observed at the time, “the sudden nationwide holiday performed the same function for the bank panic as may a slap in the face for a person gripped by unreasoning hysteria.”⁷⁹ It is a nice analogy, but it does not do justice to those who hurried to withdraw their money during the months and years leading up to the 1933 bank holiday. As we have seen, those who lined up outside of banks to withdraw their money may have panicked, in a manner of speaking, and no doubt things got unruly and maybe a woman or two fainted, but their choices were neither unreasoning nor hysterical. Rather they were caught in a classic Prisoner’s Dilemma, wherein two individuals acting purely rationally may nevertheless betray their best interests.

Perhaps to avoid judging people—like me—who would withdraw their money from banks, in his fireside chat Roosevelt rarely used the word panic, and then only in the context of banks, not depositors. Instead, he chose words like rush and, most often, the more dignified fear. In doing so, Roosevelt echoed his Inaugural Address from the previous week, in which he asserted, possibly with the banking crisis in mind, that the only thing Americans had “to fear was fear itself—nameless, unreasoning, unjustified terror.” Although as I write in Chapter 4, that is not quite true—Americans had plenty to fear beyond just fear itself during the Great Depression—Roosevelt did put his finger on the principal cause of the banking crisis, which was not panic per se but fear and, in the case of the banking crisis anyway, neither nameless, unreasoning, nor unjustified fear. Panic implies hysteria and irrationality. Fear acknowledges a genuine threat, which people might act rationally by acknowledging.

True, Roosevelt believed that in the case of the banking crisis, that threat was exaggerated. In the closing lines of his fireside chat, Roosevelt lectured his listeners: “You people must have faith; you must not be stampeded by rumors or guesses. Let us unite in banishing fear.”⁸⁰ In the days that followed, Americans may have resisted being stampeded by rumors or guesses, and they may have united in banishing fear, but all that was made easier because the source of their rumors, guesses, and fear—that their bank would fail and take their money with it—had been banished for them, and in a way that none could have done for themselves. In the days after the banking holiday, the federal government informally guaranteed bank deposits. A few months later, with the passage of the Glass-Steagall Act, the federal government made those guarantees formal, insuring bank deposits up to $2,500. Basically, if your bank failed, the federal government would return your deposit. (In an effort to keep banks from taking on too much risk, the Act also barred commercial banks that received federal deposit insurance from speculating in the stock market.) That promise spelled the end of the banking crisis. In making it, the federal government acknowledged the good reasons Americans had to panic, which amounted to admitting that they hadn’t really panicked at all.

As with Irving Fisher, though, legislators, including Roosevelt, could only make progress when they stopped ascribing individual behavior to panic and similarly irrational emotions. To call it hoarding, for example, as Hoover did, implies greed but also emotional excess, a perverse, even hysterical attachment to money.⁸¹ Unsurprisingly, depositors did not recognize themselves in Hoover’s characterization of them as hoarders. Hoarders are mad; those making runs on banks were wise. Only when Roosevelt acknowledged the legitimacy of their fears and addressed its causes did they abandon their supposed panic and, for that matter, their hoarding.

Thus far, we have examined two instances—the stock market crash and bank runs—when observers concluded that panic may not have described well the phenomenon at hand. In the next and final section of this chapter, I show how one of the most famous works of Great Depression fiction also revised the conventional wisdom about panic.

Laboring under Too Much Emotion

In “How Bigger Was Born,” his account of the genesis and composition of Native Son (1940), Richard Wright spoke of his desire to elicit certain emotional responses from Bigger, and in the first part of the novel no emotional response, with the possible exception of hatred, is elicited from Bigger more often than fear.⁸² Indeed, Native Son provides perhaps the definitive example of fear—and then panic—in all of American literature: when Bigger carries Mary Dalton to her bedroom, lingers to molest her, and is discovered by her blind mother, a scene I examine in some detail below. Yet the novel contains numerous smaller examples, too. In addition to giving the novel the title of its first section, the word fear appears roughly 120 times in the text, while afraid and scared log in at forty-eight and forty times, respectively. In the next chapter, I parse more closely the difference between fear and panic, but for now my interest lies in when fear passes over into panic, when, that is, fear leads Bigger to behave wildly and irrationally.

Although Wright occasionally uses the word panic to describe that behavior, he more often than not opts for hysteria or its variant hysterical, a term with an admittedly fraught gendered history, and which Wright likely picked up from his reading of Freud. Nevertheless, the term, like panic, bears for Wright the same burden of irrational and extravagant fear that overtakes the thinking and conscious self. For example, early in the novel, as Bigger and his friends contemplate robbing Blum’s store, one of the friends, Gus, hesitates to undertake the robbery. Like Bigger, he is afraid, and his fear simultaneously angers and outrages Bigger. The narrator speaks of the “hysterical tensity of [Bigger’s] nerves,” and in the course of confronting Gus, hysteria overcomes Bigger. Quite simply, he loses it: “He faced Gus, his eyes red with anger and fear, his fists clenched and held stiffly to his sides.”⁸³ Later still, when Gus does in fact arrive at the pool hall for the robbery, Bigger attacks him. Wright describes Bigger laughing, “softly at first, then harder, louder, hysterically; feeling something like hot water bubbling inside of him and trying to come out.” Eventually, Bigger punches Gus: “he had struck him really before he was conscious of doing so”; afterwards, he humiliates him by holding a knife to his throat, then forcing Gus to lick it.⁸⁴

At moments like these, when Bigger is overcome by emotion, especially an emotion like hysteria, Wright experiments with how to depict what Bigger feels and how intensely he feels it. On the one hand, Wright has to convey that Bigger is overcome by emotion and, as a result, does not think entirely clearly. On the other hand, if Wright is too articulate about what Bigger is feeling during these moments of intense, overwhelming emotion, he undermines the effect of Bigger becoming overcome by intense emotion. By definition, Bigger ought not to be able to describe what happens to him when he loses control of his emotions. Trying to square this circle, Wright often leaves a reader wondering where Bigger’s consciousness leaves off and where the narrator’s description of his consciousness begins. Occasionally, as in the scene when Wright describes Bigger’s hatred and fear of Gus, Wright articulates Bigger’s feelings more clearly than Bigger, or anyone, ever could in the moment. (“He hated Gus because he felt that Gus was afraid.”) When his emotions reach a pitch, however, Wright sensibly departs from trying to describe what Bigger thinks or feels at all. Sometimes, Wright resorts to simile: “feeling something like hot water bubbling inside of him and trying to come out.” Other times, especially in the early pages of the novel, as when Bigger attacks Gus in the pool hall, Wright presents the scene objectively. We stay with Bigger until the moment that Bigger loses consciousness, after which we watch him from the outside as he panics and behaves hysterically, violently. When we do get a glimpse inside his head, as when Bigger thinks he has struck Gus “before he was conscious of doing so,” it is only to render how little consciousness Bigger has of his behavior. Later, after the emotional storm, the subjective view returns. The point is that when Bigger panics, or behaves hysterically, he loses his mind. Fittingly, it disappears from the narration as well.

It can come as a surprise, then, when during the most hysterical passage in the novel and, as I say, the most definitive example of panic in all of American literature, that Wright departs from this narrative technique and, for the whole of the long scene, leaves us trapped in Bigger’s head. As Mary loses consciousness on the way from the car to her room, Bigger and his consciousness—“a mingled feeling of helplessness, admiration, and hate”—takes over.⁸⁵ To a certain extent, like elsewhere in the novel, fear drives Bigger to behave as he does. When he wrestles a drunken Mary out of the car in the driveway, he “wondered what a white man would think seeing him here with her like this. Suppose Old Man Dalton saw him now? Apprehensively, he looked up at the big house. It was dark and silent.”⁸⁶ But Bigger is also plainly “excited” by Mary.⁸⁷ At one point, fully passed out, Mary’s lips, “faintly moist in the hazy blue light, were parted and he saw the furtive glints of her white teeth,” which is a wonderful detail, revealing, as it does, how much Mary has exposed herself to Bigger, how much this titillates him, and how much of a threat her whiteness—here in the form of the glittering of her teeth—poses to Bigger.⁸⁸ The scene that follows, when Bigger molests Mary, can be hard to read; perhaps because of this, or because critics believe the meaning is self-evident, few have looked at it or the scene that follows in much detail. Yet it can tell us a lot about panic and how to narrate it. Here is the passage:

He kissed her again and felt the sharp bones of her hips move in a hard and veritable grind. Her mouth was open and her breath came slow and deep.

He lifted her and laid her on the bed. Something urged him to leave at once, but he leaned over her, excited, looking at her face in the dim light, not wanting to take his hands from her breasts. She tossed and mumbled sleepily. He tightened his fingers on her breasts, kissing her again, feeling her move toward him. He was aware only of her body now; his lips trembled. Then he stiffened. The door behind him had creaked.

He turned and a hysterical terror seized him, as though he were falling from a great height in a dream. A white blur was standing by the door, silent, ghostlike. It filled his eyes and gripped his body. It was Mrs. Dalton. He wanted to knock her out of his way and bolt from the room.⁸⁹

Wright can occasionally strive for one effect too many in his prose, but here he has pared everything down to the bone. Notice how he uses syntax to achieve the effect of dread and then horror. Most of the sentences in the first paragraph follow a simple subject-verb-object structure, with Bigger as the subject manipulating the world—in this case Mary—around him. Mary intrudes as a subject long enough to toss and mumble sleepily, but Bigger reasserts himself. (“He tightened his fingers on her breasts.”) As the scene progresses, Wright focuses Bigger and his “awareness” exclusively on Mary’s body. So too ours. For a moment (“his lips trembled”) we may or may not step outside of Bigger’s awareness, but that merely sets up the bombshell that follows. Instead of doing this or that to Mary, here he “stiffens,” an intransitive verb, the “Then” at the beginning of the sentence signaling that something has interrupted his domain over Mary’s body. He is no longer initiating the action but responding to it. Finally, magnificently, Wright shifts the subject of his sentences. Now it is the door that does something: “creak.” The creaking door suggests another agent in the room, Mrs. Dalton. The shift toward other subjects and agents continues in the paragraph that follows. It is Bigger who turns, but it is a “hysterical terror” that seizes him. Then “a white blur” stands by the door. Suddenly, the room has filled up. While the scene concludes from Bigger’s perspective—we learn that he “wanted to knock her out of his way and bolt from the room”—he has traded his status as subject and doer for object and done to. He has also begun to panic. The two are related.

At this point, Wright describes Bigger’s wild response in excruciating detail. As often happens when one panics, Bigger begins to repeat himself. After Mrs. Dalton appears, we are told, “He waited tensely, afraid to move for fear of bumping into something in the dark and betraying his presence.” A few lines later, he thinks: “He wanted to move from the bed, but was afraid he would stumble over something and Mrs. Dalton would hear him, would know that someone besides Mary was in the room.” He does worse than repeat himself. As Bigger panics at the sight of Mrs. Dalton—“Frenzy,” we are told, “dominated him”—he “frantically” grabs a pillow and unwittingly smothers Mary. After Mrs. Dalton leaves, and Bigger remains undiscovered, Bigger observes, “He felt he had been in the grip of a weird spell and was now free,” which describes well the suspension of consciousness—or the hyperconsciousness that goes beyond consciousness—that characterizes panic. Unfortunately, Bigger will once again fall into the grip of that spell. When he discovers that Mary is dead, panic—and repetition—returns: “His hand moved toward her, but stopped in mid-air. He blinked his eyes and stared at Mary’s face; it was darker than when he had first bent over her. Her mouth was open and her eyes bulged glassily. Her bosom, her bosom, her—her bosom was not moving!”⁹⁰

Unlike earlier scenes, especially in the pool hall, where Wright steps outside of Bigger as he behaves hysterically, from this point on Wright locks readers into Bigger’s consciousness as he responds to his newly dire situation. For the next half dozen pages, as Bigger realizes what he has done and blunders about trying to clean up the mess, readers come along for the panic-stricken ride. In many ways, these pages disturb even more than the initial molestation and murder. We stay with Bigger as he hatches and follows one bad—irrational, counterproductive, doomed—idea after another. Panicking, Bigger first stuffs Mary’s body into her half-packed trunk, which is strange indeed. If he simply wants to hide her body to buy time, he does not need to put her in the trunk. He then drags her to a basement boiler room, where he—again, needlessly—attempts to burn her body in the coal furnace. (Wildly, he concludes, “That was the safest thing of all to do.”) Then, because he was, as the narrator puts it, “tired and scared, and because her feet were nearer, he pushed her in, feet first,” which meant that he would have to decapitate her to make her fit in the furnace. At one point, the family cat, wandering in from an Edgar Allan Poe short story, confronts Bigger as he conducts his gruesome work in the basement. At arguably his most hysterical, Bigger wonders whether he should catch the cat, kill it, and put it in the furnace too, and he makes a move to do so until he remembers, “Cats can’t talk.”⁹¹ Before leaving the house, he foolishly takes Mary’s purse. (Later, the missing purse will lead the police to conclude, briefly, that Mary has absconded, but at the time Bigger is not thinking that far ahead.) The next morning, he disposes of the purse and his bloody knife in a garbage pail. (The police will later find both, and they will surface at his trial.) All the while, he cooks up a half-baked plan to implicate Jan, Mary’s communist boyfriend, repeating to himself, like a comforting mantra, “Reds’d do anything. Didn’t the papers say so?”⁹² It never occurs to him that Jan may have an alibi, as he does.

In sum, Bigger behaves, let us say, less than rationally in these moments, but I do not think Wright wants us to find fault with him. Few people can calmly and thoroughly cover up an accidental murder. Rather, Wright offers a masterful portrait of a mind in the grip of panic, with its tendency to repeat phrases, its irrationality, and its propensity for shortcuts that in the end only complicate things. In addition, Wright adds a new dimension to panic; namely, that one of its sources, and certainly one of the things that makes it worse, is race. Indeed, the desire to violate racial taboos at least in part puts Bigger in Mary’s room in the first place, where, of course, he panics when he is discovered by Mrs. Dalton and inadvertently kills Mary. (For her part, Mary also wants to violate racial taboos by treating Bigger like a harmless victim, but as she may or may not ever learn, he is not.) But after the murder, Wright shows how Bigger suffers a kind of racial panic that drives his hysteria and inexplicable actions, as in this unnerving passage, complete with simile, after he has killed Mary but before he has decided what to do about it: “He stood with her body in his arms in the silent room and cold facts battered him like waves sweeping in from the sea: she was dead; she was white; she was a woman; he had killed her; he was black; he might be caught; he did not want to be caught; if he were they would kill him.”⁹³ Here, Wright almost certainly makes Bigger’s consciousness altogether too orderly. The sequential arrival of facts—like waves in Wright’s metaphor—seem more like axioms in a mathematical proof. In any case, these cold facts and the panic they inspire explain much of Bigger’s otherwise inexplicable—and needlessly violent—actions that follow.

For all the power of these scenes, I want to argue that Wright saves his most compelling illustration of racial panic and, especially, hysteria for the conclusion of the novel. As I have explored elsewhere in this chapter, many in the 1930s, from actual sociologists to drafters of banking legislation, struggled to arrive at a sociology of panic, to describe and understand the forces that produced this powerful emotion, one that seemed to arise at every meaningful turn in the decade. They did not work in a vacuum, however, and many of them confronted an existing if, they nevertheless felt, occasionally flawed existing academic literature on panic, which oftentimes went under the heading of the study of collective behavior or the behavior of crowds. Wright, in particular, had a ringside seat for scholarly theorizing about collective behavior. Biographers have known about his connections to the University of Chicago School of Sociology for decades, and while most scholars have focused on what Wright took from the Chicago School and its theory of race relations, the sociologist most closely associated with the Chicago School of Sociology, Robert Ezra Park, also studied what he called collective behavior. Another pioneer in the field, Herbert Blumer, also of the University of Chicago, began his work just as Wright began Native Son.

The study of collective behavior dates at least as far back as Gustave Le Bon’s The Crowd: A Study of the Popular Mind (1895). Famously, Le Bon explained the wild behavior of large groups of people by arguing that joining a crowd radically changed the otherwise sensible individuals who formed it. The “fact that [individuals] have been transformed into a crowd,” Le Bon argued, “puts them in possession of a sort of collective mind which makes them feel, think, and act in a manner quite different from that in which each individual of them would feel, think, and act were he in a state of isolation.”⁹⁴ In a crowd, Le Bon argued, conscious personality disappears and an atavistic unconscious personality appears. “Our savage, destructive instincts,” he wrote, “are the inheritance left dormant in all of us from the primitive ages. In the life of the isolated individual it would be dangerous for him to gratify these instincts, while his absorption in an irresponsible crowd, in which in consequence he is assured of impunity, gives him entire liberty to follow them.”⁹⁵ Not surprisingly, Freud admired Le Bon’s work. In the former’s terms, when we join the crowd, we shed our civilizing Ego and free our primitive Id.⁹⁶

The University of Chicago sociologist Robert Ezra Park incorporated Le Bon’s thinking about crowds into his 1904 dissertation, The Crowd and the Public, and afterwards regularly offered a course at the University of Chicago of the same name.⁹⁷ With a slightly better opinion of them than Le Bon, Park (along with his co-author Ernest W. Burgess) argued that crowds embody social unrest but also the possibility for social reformation. He emphasized, as well, the “circular reaction” of collective behavior, or how “social unrest … is transmitted [and reinforced] from one individual to another.”⁹⁸ In other words, Park noticed how one may be drawn into crowds; or, put differently, how the behavior of crowds infects others. Nevertheless, like Le Bon, Park distinguished, as in the title of his dissertation and his class, between the irrational, impulsive crowd and the rational, deliberative public. In particular, Park emphasized the role that newspapers play in forming that deliberative public. But newspapers often failed in keeping the public critical, and “when the public ceases to be critical,” Park wrote, “it dissolves or is transformed into a crowd.”⁹⁹ Despite some minor differences, Park’s views about crowds often dissolve into Le Bon’s. In short, neither thinks much of them, and both think that civilization will—or should, anyway—evolve beyond them.¹⁰⁰

Yet few represented the conventional wisdom about collective behavior, then or, perhaps, now, better than Park’s colleague at the University of Chicago, Herbert Blumer. For decades, his frequently reprinted 1939 essay, “Collective Behavior,” offered the last word on the subject. Under the heading of “Collective Behavior,” Blumer, looking back on the panic-stricken decade, included many of the phenomena we have already witnessed in this chapter: “a highly excited mob, a business panic, a state of war hysteria, a condition of social unrest.”¹⁰¹ In seeking to explain these phenomena, Blumer, like Park, emphasized the contagious nature of collective behavior, going so far as to borrow Park’s term “circular reaction,” which, Blumer argued, was “a type of interstimulation wherein the response of one individual reproduces the stimulation that has come from another individual and in being reflected back to this individual reinforces the stimulation.”¹⁰² In a helpful aside, Blumer argued, “one sees the process [the reflection and intensification of feeling] amidst cattle in a state of alarm. The expression of fear through bellowing, breathing, and movements of the body, induces the same feeling in the case of other cattle who, as they in turn express their alarm, intensify this emotional state in one another.”¹⁰³ Later in the essay, Blumer will refer to the more intense version of circular reaction as “social contagion.”¹⁰⁴ “Under such conditions,” he writes, opting for a different metaphor, “the given kind of behavior will spread like wildfire.”¹⁰⁵

Like Park, Blumer emphasized the difference between the collective behavior of crowds and the individualized behavior of a public. “Individuals in the public,” Blumer observed, optimistically, “are likely to have their self-consciousness intensified and their critical powers heightened instead of losing self-awareness and critical ability as occurs in the crowd.”¹⁰⁶ By contrast, in moments of “pure circular reaction”—that is, when someone has been swallowed up by the crowd—an individual may “embark on lines of conduct which [he or she] previously would not likely have thought of, much less dared to undertake.”¹⁰⁷ “Impulses which ordinarily would be subject to a severe check by the individual’s judgment and control of himself,” Blumer wrote, “now have a free passage to expression.” It should not be surprising, he concluded, “that much of the actual behavior should be violent, cruel, and destructive.”¹⁰⁸ Like Le Bon and Park, Blumer thought crowds robbed human beings of their humanity, turned them into beasts, though on second thought, the comparison may not do justice to beasts.

In Blumer’s description of the atavistic crowd, readers will instantly recognize the climax of Nathaniel West’s The Day of the Locust (1939), in which a crowd at a movie opening, touched off by a rumor that “a pervert attacked a child,” riots and devolves into a smothering—and literal—circle of reaction, hysteria, and violence.¹⁰⁹ West’s novel should remind us that though we remember the Great Depression for its populism, some had doubts about the wisdom and worth of the people. (It would take too long to list the Frank Capra films from this period that portray mobs in all their furious irrationality. I mention American Madness above, but mention should also be made of Mr. Deeds Goes to Town, Mr. Smith Goes to Washington, and Meet John Doe, and these are just the more famous examples.) In 1936, Carl Sandburg published his populist book-length poem The People, Yes. Reading West after reading Blumer, one imagines that West could just as easily have titled his novel The People, No.

In Native Son, Wright provides an equally disturbing portrait of the hysterical, contagious crowd and those who pander to it. From his jail cell, after his capture, Bigger is shown—by district attorney Buckley—“the streets below crowded with masses of people in all directions.” “See that, boy?” Buckley says. “Those people would like to lynch you.” A little later, Bigger hears “the faint excited sound of mob voices coming through the concrete walls of the building,” and from this moment on the mob functions as a loud if simple-minded Greek chorus to the drama of settling Bigger’s fate that occupies the third and final section of Wright’s novel.¹¹⁰ Later, on his way to court, Bigger will be struck on the head by one member of the mob. And after being made to re-enact his crime at the Dalton’s house, so that the newspapers can get their pictures and further inflame public opinion, the mob will burn a cross atop an adjacent building, thereby aborting whatever spiritual rebirth Bigger may have initially contemplated. In his opening statements at Bigger’s trial, Buckley plays directly to the mob, which, evidently, has nothing better to do than gather outside the courthouse all day long.

“It is not often,” Buckley continued, “that a representative of the people finds the masses of the citizens who elected him to office standing literally at his back, waiting for him to enforce the law … ” The room was quiet as a tomb. Buckley strode to the window and with one motion of his hand hoisted it up. The rumbling mutter of the vast mob swept in. The court room stirred.

“Kill ‘im now!”

“Lynch ‘im!”

Rebuked by the judge for the theatrics of his opening statement, district attorney Buckley apologizes: “I’m very sorry, Your Honor,” he says. “I was laboring under too much emotion.”¹¹¹

In essence, laboring under too much emotion is precisely what Max, in his closing argument to save Bigger’s life, identifies as the problem afflicting not just Buckley but the mob, the court, indeed the nation itself. In most ways, the mob in Native Son resembles the mobs of Le Bon, Park, and Blumer. They say and do things en masse that they would never say or do individually. Unlike Park and Blumer, however, Wright does not distinguish between an irrational, impulsive crowd and a rational, deliberative public, and he especially does not follow Park or Blumer in believing that the newspaper engenders the latter. In “How Bigger Was Born,” Wright describes how when he “was halfway through the first draft of Native Son a case paralleling Bigger’s flared forth in the newspapers of Chicago.”¹¹² Wright refers here to the case of Robert Nixon, who was accused and convicted of the murder—beating to death by brick, just as Bigger kills Bessie with a brick—of a white woman in her apartment. Newspaper coverage of the Nixon case, and newspaper coverage of the Bigger Thomas case in Native Son, does not cultivate rational, deliberate thought among a public so much as it does actively undermine it.¹¹³

In other respects, however, Wright more or less traces Le Bon, Park, and Blumer in his sketch of the hysterical crowd. Like district attorney Buckley, the crowd in Native Son “labors under too much emotion” and not enough reason. Under the weight of that emotion, it behaves violently—or would if given the chance—and in ways that the individuals who compose it would not, in all likelihood, be capable of on their own. Indeed, Max recognizes from the start that the problem he faces in his defense of Bigger is the hysterical crowd itself, which will settle for nothing less than Bigger’s execution, and whose blood thirst infects others as well. Indeed, this view of the crowd lies behind Max’s choice to avoid a jury trial. Max concludes that an impartial jury could not exist. Its twelve members would merely represent a smaller version of the mob that gathers outside the courtroom. His strategy, then, is plain, and takes a page out of Le Bon et. al.: isolate from the crowd those who will determine Bigger’s fate. A jury is a good start, but too numerous to remain immune to the hysteria of the crowd. Better still a single man, the judge, who may be quarantined from the crowd and appealed to rationally.

Indeed, quarantining the judge from “too much emotion” drives Max’s whole defense. Invoking the historical injustice of slavery and its aftermath without immediately naming it, Max nevertheless insists, “I do not claim that this boy is a victim of injustice, nor do I ask that this Court be sympathetic with him.” Avoiding the legacy of historical injustice or the possibility of sympathy may seem like an odd strategy, but for Max both raise the possibility of what Max calls “the mire of blind emotion.”¹¹⁴ For Max has a reading of the hysterical crowd—and of race relations in the United States—that blames both on an excess of emotions. Midway through his defense, Max addresses the judge: “Let me, Your Honor,” he says,

dwell a moment longer upon the danger of looking upon this boy in the light of injustice. If I should say that he is a victim of injustice, then I would be asking by implication for sympathy; and if one insists upon looking at this boy as a victim of injustice, he will be swamped by a feeling of guilt so strong as to be indistinguishable from hate.¹¹⁵

For Max, whites in the United States do not wish to confront the historical injustice of slavery. “Of all things,” Max says, “men do not like to feel that they are guilty of wrong, and if you make them feel guilt, they will try desperately to justify it on any grounds; but, failing that, and seeing no immediate solution that will set things right without too much cost to their lives and property, they will kill that which evoked in them the condemning sense of guilt.”¹¹⁶ In other words, white guilt—and, relatedly, sympathy—leads to fear and hatred of blacks. Just as a man haunted by the ghost of someone he has wronged will seek to thrust the ghost out of sight, so too will whites seek to thrust out of sight the race whom they have wronged. It is a form of racial panic. But the ghost—in Max’s analogy, blacks—does not rest quietly. Thrust out of sight, segregated, they too strike out with fear and hatred. But the fear, hatred, and violence of the ghost only leads to more guilt, fear, and hatred on the part of whites, which, of course, leads to more fear, hatred, and violence on the part of blacks. Hence the climax of Max’s speech: “Your Honor, I’m trying to wipe out this circle of blood, trying to cut down into this matter, beneath hate and fear and guilt and revenge and show what impulses are twisted.”¹¹⁷ Hence, too, Max’s appeal to let Bigger live. More killing will reinforce—rather than begin to wipe out—the circle of blood.

In his defense, Max joins two circles: the circular reaction of Le Bon, Park, and Blumer, and the circle of blood of his own invention. The first explains how an entire community—the white citizens of Chicago—comes to lose its rationality, panics, and begins to behave hysterically. The second, the circle of blood, explains why the first, the circular reaction, happens in the first place. In mob justice—and the racial panic and hysteria it makes possible—lie absolution; or, if not absolution, at least avoidance. One can surrender to the crowd, to the sweet oblivion of emotion. “It is not my duty here, today,” Max tells the judge, “to say how this great problem can be solved. My job is to show how nonsensical it is to seek revenge on this boy under the pretense that we are making a great fight for justice. If we do that, we shall merely be hypnotizing ourselves, and to our own ultimate disadvantage.”¹¹⁸ Notice that word “hypnotizing.” Le Bon, Park, and Blumer each used hypnosis to describe the loss of consciousness and suggestibility that supposedly characterized crowds. So too Max, except for Max, at the moment of the trial, everyone belongs to the crowd. Everyone would prefer revenge, the mire of blind emotion, and hypnotic release to a conscious, rational confrontation with the reality of race in America. Everyone, he hopes, except the judge.

For all that he borrows from them, by now it should be clear where Wright departs from Le Bon, Park, and Blumer. Unlike Le Bon, Park, and Blumer, Wright—in the person of Max, at least—does not settle for an atavistic explanation of the hysterical crowd; that is, that the crowd releases individuals from, in Freudian terms, civilization and its discontents. Rather, Max favors an historical rather than an evolutionary or strictly psychoanalytic account of the hysterical crowd. In Native Son, one joins the crowd because it frees one from responsibility. In racial panic lies freedom; or, at least, evasion.

Not all critics admire Max’s approach to defending Bigger’s life. Still others insist on establishing a distance between Max and Wright, with the latter inviting judgment of the former, and, indeed, Wright composed Native Son just as he lost patience with the Communist Party, so one can imagine him losing patience with the levelheaded but nevertheless still communist Max. As it happens, I admire Max’s defense, and to my mind the Wright of “How Bigger Was Born” sounds an awful lot like the Max of the closing argument of Native Son, which, for that matter, sounds an awful lot like a close reading of the novel Native Son. But that is neither here nor there. My point is only to observe that like Hadley Cantril, Irving Fisher, Franklin Roosevelt, or, say, the drafters of the FDIC provision of the Glass-Steagall Act, Wright sought to go behind or beyond existing approaches to collective behavior and panic. In Wright’s case, he sought the racial origins of that panic.

Like others during the 1930s, Wright concluded that simply saying that those who panicked behaved irrationally would not do. That was not the end of the story but the beginning.