6 • “And What Was Dead Was Hope”: 1932 and the Interregnum

(photo credit 6.1)

The probability of a Republican victory in 1932 was better than that of being dealt a royal straight flush in five-card-stud poker, but only marginally so. Most voters blamed either Herbert Hoover or big businessmen for the Depression. Both were inextricably bound up with the Grand Old Party; all three were sinking in a common embrace.

Association with financiers and industrialists was doubly damning for the Republican party. Not only were businessmen blamed for causing the Depression, their attitudes during the crisis showed them to be even more heartless and selfish than did the increasing revelations of their past shady dealings. While many poverty-stricken workers were contributing part of their meager wages to help the unemployed, the wealthy often refused to make any sacrifice. Henry Ford, erstwhile champion of high wages, insisted that businessmen had no responsibility for the jobless. Such prominent financiers as Albert Wiggin of the Chase National Bank and J. P. Morgan manipulated their incomes through such devices as the pretended sale of stock to their wives, so that they paid not a penny of tax in the early years of the Depression.

The Depression grew worse almost by the day in 1932. This was due, at least in part, to the draconian program of retrenchment that Hoover had instituted at the end of 1931, in his desperate attempt to restore confidence by balancing the budget. By May, Hoover’s brief burst of optimism at the year’s outset had expired. He was in the depths of despair, and privately predicted that a new collapse would occur within three weeks. A few weeks later, Charles G. Dawes resigned as head of the Reconstruction Finance Corporation and returned to Chicago to prepare not only for the likely failure of his bank, but for the possible crash of the whole system. Perhaps for the first time, the true dimensions of the Depression were dawning on administration leaders. Hoover’s social and economic beliefs may have been the right ones, but their chance had passed. People were no longer willing to wait. The public did not understand the causes and solutions of unemployment, but people could judge policies by results. They had little tolerance for anyone who claimed current policies were working when, in fact, more jobs were being lost. One indication of how desperate the situation was came in June when Chicago Mayor Anton Cermak told a House committee that the federal government still had a choice: it could send relief, or it could send troops.

Under the circumstances, Herbert Hoover was an almost certain loser in 1932, but so was any other Republican. Some in the party hoped that Hoover would follow Coolidge’s precedent and “choose not to run.” This, one party official said, would make it possible to “look forward to the nomination of Coolidge or Dawes.… The effect would be electrical. There would be no stopping us.” The man who expressed this view suffered from an overdose of wishful thinking. The idea that they could restore Coolidge Prosperity by bringing back Coolidge was a measure of how desperate the Republicans were in 1932. The people were in no mood to buy such nonsense that year. “We are in a new era to which I do not belong,” Coolidge himself said a few months later, shortly before his death, “and it would not be possible for me to adjust myself to it.” This may have been the most penetrating of all Coolidge’s notable statements of wisdom.

The Republicans could not repudiate Hoover without appearing to accept blame for the Depression. Few of the party’s delegates who gathered in Chicago in June were enthusiastic about Hoover; fewer still sincerely believed he had much chance of winning a second term. Nowhere in the city, it seemed, was a picture of Hoover displayed, not even in the convention hall. Slides of the President flashed on a screen during the demonstration following the placing of his name in nomination. Such quick flashes apparently were all the Republicans wanted as reminder of their candidate. Significantly, the Hoover demonstration ended with the playing of “California, Here I Come, Right Back Where I Started From.” Few doubted that this was an appropriate, if embarrassing, choice. The most impressive, though rather questionable, endorsement was carried by one of those seconding Hoover’s nomination. Brought “fresh” from the Lincoln Memorial was this message from the sixteenth President: “If you see him, speak to Hoover for me and say that this road is the one I traveled.” It may have seemed to some of the cheerless delegates that the only enthusiasm for Hoover came from beyond the grave.1

Democrats had every reason to be optimistic. After more than a decade in the political wilderness, the party expected to win. Nevada Senator Key Pittman spoke for Democrats everywhere: “I am tired of being in the minority. I want to win.” The likelihood of victory meant the struggle for the nomination would be even more fierce than was the party’s custom. As far as most party regulars were concerned, though, the most important qualification for a candidate was that he be able to capitalize on the people’s hatred for the incumbent without alienating many voters himself. In short, the party needed someone who looked like a president. The twin disabilities of death and Republicanism having made Warren Harding unavailable, Governor Franklin D. Roosevelt of New York was the front-runner.

Many were looking for a hero to save the nation. Teddy had been a hero; why not another Roosevelt? It might seem strange that people looking for a “man on horseback” turned to a man in a wheelchair. But the aura of the heroic seemed to many to surround this second Governor Roosevelt of New York.

Although FDR was the clear front-runner, that was no guarantee of victory. The party’s requirement that its nominee win two-thirds of the convention votes, rather than a simple majority—a rule instituted a century earlier to allow southern Democrats to veto candidates unacceptable to them—meant that Roosevelt’s nomination was far from a certainty. Such Republicans-in-Democratic-clothing as the party’s millionaire national chairman, John J. Raskob, feared the New York governor. They generally grouped behind FDR’s predecessor as governor, Alfred E. Smith. Since his 1928 loss to Hoover, Smith had been hobnobbing with the rich and in the process lost whatever progressive tendencies he had ever possessed. H. L. Mencken later wrote that Smith had “ceased to be the wonder and glory of the East Side and [become] simply a minor figure of Park Avenue.” Progressive Republican Harold Ickes of Illinois said in the spring of 1932 that Smith had become “an enthusiastic little brother of the rich.” On the other side of the Democratic party, some agrarian reformers from the South and West were skeptical of Roosevelt. They backed the candidacy of Speaker of the House John Nance Garner of Texas. Garner also attracted another type of Democrat. “Unconsciously, what they want,” a political writer said early in 1932, “is a Democratic Coolidge, and they instinctively feel that Garner is their man. They are not wrong.” By the summer, however, it was apparent that in their developing mood the voters wanted no Coolidge of any kind. Garner faded rapidly after assuming leadership of the drive to adopt a sales tax. He failed to win support because he hooked his wagon to a horse (or, rather, a Hearst) going in the wrong direction. Despite his “populist” reputation, Garner joined with the conservative forces of Bernard Baruch and William Randolph Hearst. Garner had little choice, since Roosevelt had already preempted much of the progressive support and the Texan needed Baruch’s financial backing, but in the context of 1932 this move to the right was fatal to his chances for attracting popular approval.

Roosevelt’s early advisers—Louis Howe, Jim Farley, and old Wilson confidant Colonel Edward House—carried him to the front of the pack, but they grew overly optimistic and almost lost the nomination. When it became clear to Roosevelt that this team was not making sufficient progress with delegates to assure winning the necessary two-thirds and that they were certainly not capable of developing solutions to the nation’s economic problems, FDR sought to widen his staff. Governor Roosevelt’s legal counsel, Samuel I. Rosenman, suggested in March that a group of academic advisers be formed. Although leery of such people, Roosevelt agreed and asked Raymond Moley of the Columbia Law School to assemble a group of professors. Thus was conceived the assemblage of academics that New York Times reporter James Kieran later dubbed the “Brains Trust.” The group was to play a crucial role in Roosevelt’s 1932 victories and in shaping the New Deal.

The key figure in the Brains Trust (the plural was used originally, although subsequently it came more often to be “Brain Trust”) was Raymond Moley. Moley grew up in the populist-progressive tradition in small town Ohio. At the age of ten, he was already an avid follower of William Jennings Bryan, and considered himself an enemy of “the Interests” and “Wall Street.” By the time he was sixteen, Moley owned an often-read copy of Henry George’s Progress and Poverty. When he began his doctoral studies at Columbia in 1914, Moley came under the spell of historian Charles A. Beard, thus becoming even more solidly progressive than he had been before. For a time he flirted with socialism. After taking his degree in political science, Moley became an expert on criminal justice, eventually returning to Columbia. There he came to know Louis Howe and, through him, he met Roosevelt in 1928.

Moley’s first important collaboration with Roosevelt was the “Forgotten Man” radio address early in April 1932. It set the tone for the campaign and the New Deal by reflecting the values that were emerging among the people as the Depression progressed. The speech created something of a sensation. It committed Roosevelt to a humane theme and program, including a much larger role for the federal government than it had ever before assumed in peacetime. The speech stressed the idea that the root cause of the Depression lay in the problems of farmers and the consequent lack of purchasing power in the rural-small-town half of the population. This placed Roosevelt clearly among those who saw lack of demand—underconsumption—as the key, and some form of redistribution of income as the solution. FDR attacked Hoover’s recovery program as an elitist, trickle-down approach. What was needed instead, Roosevelt said, were “plans like those of 1917 [a reference to the American war economy, not the Russian Revolution] that build from the bottom up and not from the top down; that put their faith once more in the forgotten man at the bottom of the economic pyramid.” “A real economic cure,” Roosevelt declared, “must go to the killing of the bacteria in the system rather than to the treatment of external symptoms.”

This struck some as radical talk. Senator Cordell Hull of Tennessee, a Roosevelt supporter, feared “another Bryan campaign of 1896.” The most bitter attack came from Al Smith. “I protest,” Smith declared, “against the endeavor to delude the poor people of this country to their ruin by trying to make them believe that they can get employment before the people who would ordinarily employ them are also again restored to conditions of normal prosperity.” Smith was endorsing the trickle-down approach.

As the criticism from the right over the “Forgotten Man” speech rose, Howe, House, and other members of the inner circle told Roosevelt to back off, to take a conservative tack. Even progressive Senator Burton K. Wheeler of Montana recommended that Roosevelt clarify his position by saying that “in calling attention to the necessity of doing something for the foundation, he did not mean to criticize any proper efforts to repair the roof.” Roosevelt rejected this advice and gave another stirring speech only five days after Smith’s attack on him. In his Jefferson Day address at St. Paul, FDR called for “a real community of interest,” “common participation … planned on the basis of a shared common life, the low as well as the high. In much of our present plans, there is too much disposition to mistake the part for the whole, the head for the body, the captain for the company, the general for the army,” Roosevelt said. “I plead not for a class control, but for a true concert of interests.”

Roosevelt’s veteran advisers were looking backward; he and Moley were looking forward. FDR had an understanding, perhaps an instinctive one, that what would have been political suicide a few years before was just what many Americans wanted to hear in 1932. They had seen enough attempts at roof repair and were anxious for some foundation work. Roosevelt’s “radical” speeches came in the month following the public outcry that had defeated the sales tax. Roosevelt and Moley must have understood that message from the public. Siding with the top of the pyramid was no longer the expedient thing to do. (This is not meant to imply that FDR’s speeches were motivated mainly by expediency, but that he realized contentions that his position would be politically disastrous were mistaken.)

Roosevelt had based his promise of curing the nation’s economic ailments on increasing the purchasing power of the farmer. The only trouble was that neither Roosevelt nor Moley could figure out how to do this. An economist with new ideas and some knowledge of agriculture was needed. Moley looked, naturally, to the Columbia faculty and found Rexford Guy Tugwell. Tugwell was the son of a modestly successful fruit grower and canner in upstate New York. He studied economics at the University of Pennsylvania, where he came under the influence of Scott Nearing and Simon N. Patten. He was especially impressed with the arguments of J. A. Hobson that underconsumption is a basic flaw of capitalism.

Always a maverick, Tugwell believed in experimentation and loved order and symmetry. As early as 1924, he was calling for a new experimental economics that rejected the divinity of Adam Smith. Tugwell was a firm believer in planning and government regulation of the marketplace to protect the consumer. He thought the planning done in the American economy during World War I was a step in the right direction. In 1927 he visited Russia and he later believed that he had seen the future there. Laissez faire, Tugwell believed, was nearing its end and social control was coming to the forefront. Eventually, he said, “business will logically be required to disappear. This is not an overstatement for the sake of emphasis; it is literally meant.”

Rex Tugwell was the most radical of Roosevelt’s academic advisers, but he was not at this point completely out of step with the others. Moley remembered that Tugwell’s “original and speculative turn of mind made him an enormously exhilarating companion. Rex was like a cocktail, his conversation picked you up and made your brain race along.” He may have also had this effect on Governor Roosevelt. Certainly he influenced the candidate, although not as much as Tugwell would have liked. The economist kept most of his more radical notions to himself when he was around Roosevelt, and was able to sell him on some less grandiose ideas.

The Tugwell influence was first apparent in FDR’s speech at Georgia’s Oglethorpe University in May. There Roosevelt spoke of the possibility of using “drastic means” to correct “the faults in our economic system.” The candidate’s famous “bold, persistent experimentation” statement was completely in line with Tugwell’s thinking. Roosevelt aligned himself with the growing public hostility to bankers and greedy businessmen: “We cannot allow our economic life to be controlled by that small group of men whose chief outlook upon the social welfare is tinctured by the fact that they can make huge profits from the lending of money and the marketing of securities—an outlook which deserves the adjectives ‘selfish’ and ‘opportunist.’ ” In the twenties many people had not considered those adjectives particularly damning. Roosevelt was wagering that they were taken as terms of opprobrium in 1932. They were. If we wanted our economic order to endure, Roosevelt told his audience, we must “bring about a wiser, more equitable distribution of the national income.” The candidate had placed himself solidly in line with the set of values that Americans were embracing under the impact of the Depression. It is significant that this move to the left—for such it was—was made after Roosevelt had been crushed by Smith in the Massachusetts primary and was in need of reigniting his campaign.

The new emphasis of the Roosevelt campaign was crystallized in a long memorandum Moley wrote in May. In this document Moley called for a reorientation of the Democratic party toward humane, progressive policies and a lower- and middle-class base. Moley denounced the economic view that “sees to it that a favored few are helped and that some of their prosperity will leak through to labor, to the farmer, and to the small businessman.” This, he said, was the reactionary view of the Republicans, but some Democrats (e.g., Al Smith) shared it. “There is,” Moley continued, “no room in this country for two reactionary parties.” What the people wanted, he asserted, was “not a choice between two names for the same reactionary doctrine. The alternative should be a party of liberal thought, of planned action, of enlightened international outlook, … of democratic principles.”

Here was an outline of the principles of the New Deal (Moley used that term in the May memorandum, although without any emphasis), even to the point of suggesting the party realignment that Roosevelt attempted in 1938. Nothing Moley said was inconsistent with the general positions Roosevelt had taken for many years, but Moley organized and filled them out. They were in the background of the 1932 campaign and the early New Deal measures; they surged to the forefront in the Second New Deal of 1935 and Roosevelt’s reelection campaign in 1936. By that time, though, Moley had taken a right turn and become distressed over Roosevelt’s move in just the direction Moley himself had outlined in 1932.

By the time Moley wrote this memorandum, he had recruited the third and last member of the Brains Trust. Adolf A. Berle, Jr., was the son of a Congregationalist minister. The Social Gospel permeated the Berle household. Something of a prodigy, Berle took his B.A. at Harvard at age eighteen, his M.A. a year later, and a law degree at twenty-one. He had wanted to study history, but had heeded his father’s unassailable argument that no one could expect to make a respectable living as a professional historian. Instead, young Berle entered upon a law career, hoping to influence a change in the American economy that would put some of the teachings of the Social Gospel into practice.

Berle obtained a position at Columbia Law School in 1927 and received a grant that enabled him to hire an assistant, Gardiner C. Means, and study the influence of corporations on modern American life. When he joined Roosevelt’s group of academic advisers, Berle became its most moderate member. With his Christian background, he believed that businessmen could be redeemed and made to act benevolently. Berle favored a federal incorporation act for the purpose of regulating corporations through a Federal Trade Commission with sharpened teeth.2

Feeling was running so high against the Republicans in 1932 that almost any Democrat could have won the presidential election. The only prominent Democrat capable of losing was Al Smith. His own backers recognized this, and Smith himself may have known it. Hoover was the perfect “issue.” There was no point in raising the specter of Catholicism again and diverting attention from the Depression.

Yet diverting attention from the Depression was precisely what the people behind Smith had in mind. Raskob and his associates on the Democratic National Committee strove to ignore economic issues and concentrate on prohibition. The DNC was “trying to merge … with the Republican Party on everything except prohibition,” Kentucky Democrat Alben Barkley charged. The zeal of this group for repeal was grounded in more than their taste for alcohol.

Whether or not Smith thought of himself as a serious contender, his key backers clearly never intended to nominate him in 1932. Their plan from the start was to use Smith as a major part of the “Stop Roosevelt” movement. They would deadlock the convention and bring forth Newton D. Baker, who had been Woodrow Wilson’s secretary of War, as a “compromise.” From the viewpoint of its authors, this was a neat script. The trouble was that Smith would not have enough votes by himself to deny the nomination to Roosevelt.

Politics, the cliché says, makes for strange bedfellows. This is especially so where attempts to prevent a nomination are concerned, since such efforts can provide the most disparate individuals with a common objective. In 1932 the “Stop Roosevelt” movement may not have brought anyone together in bed (although Smith indicated a willingness for such a liaison), but it made for a remarkable luncheon meeting. William Gibbs McAdoo, still hoping for the nomination that the Smith forces had denied him in 1924, had joined with Hearst behind the candidacy of John Nance Garner. It appears to have been McAdoo’s goal to have a deadlocked convention make him the nominee. This coalition controlled the large California and Texas delegations and was critical for either stopping Roosevelt or putting him over the top. Bernard Baruch, who had no love for Roosevelt and less for his radical rhetoric, acted as matchmaker and invited Smith and McAdoo to a luncheon meeting in Baruch’s suite at Chicago’s Blackstone Hotel just before the convention. “Bernie, I don’t like him,” Smith is reported to have said of McAdoo to Baruch, “I don’t trust him, but in this fight, I would sleep with a Chinaman to win and I’ll come.” Thus the desire to deny the nomination to Roosevelt brought together the bitter enemies of eight years before.

Such a shotgun marriage was by its nature unstable and subject to instant annulment prior to its consummation. Roosevelt was on the verge of losing the nomination. His only hope was to lure away one of the partners in the odd Smith-McAdoo alliance. A reconciliation with Smith was out of the question; it would have to be McAdoo and his allies, Hearst and Garner. Each of them had a reason finally, though reluctantly, to swing over to FDR. Baker was an open “internationalist,” and anathema to Hearst. When the publisher realized that Baker’s nomination would be the consequence of denying Roosevelt, Hearst became more favorable to FDR. Garner feared that a deadlocked convention would follow the 1924 pattern and destroy the party. McAdoo, though, remained the key. His basic reason for finally being willing to switch is evident in a simple statement in his autobiography published in the previous year: “I like movement and change.” He wanted the nomination himself, but his first priority was to have a progressive nominee. Roosevelt fit that description; Baker did not.

The dynamics of a multiballot convention require that the front-runner gain strength on each ballot. This Roosevelt did on the second ballot, but he almost lost the nomination on the third ballot. That vote, held after an all-night session, saw the Mississippi delegation teeter on the brink of abandoning Roosevelt. The delegation, operating under the unit rule, was divided 10½ to 9½ for Roosevelt and had cast its 20 votes for him on the first two ballots. The Roosevelt leader in the state, Senator Pat Harrison, believing the convention adjourned, went to his hotel after the second ballot. As he got into bed, he turned on the radio and heard, “Mississippi passes.” Harrison dressed quickly and raced the three miles back to the convention hall. In the meantime, Louisiana Senator Huey Long, who had earlier announced his support of Roosevelt by telling Senator Wheeler, “I don’t like your sonofabitch, but I’ll be for him,” cajoled the Mississippi delegates and kept them from deserting. Roosevelt escaped the third ballot with a gain of five votes. Had Mississippi fallen, his cause probably would have been lost.

It was still far from won. Indeed, many people believed that Roosevelt’s strength had peaked and Baker would be nominated. FDR himself telephoned Baker in the evening, prior to the fourth ballot, offering to help him. Soon thereafter, a tearful Jim Farley met with two of McAdoo’s supporters and told them, “Boys, Roosevelt is lost unless California comes over on the next ballot.” They replied that California would go for FDR, but not for a few more ballots. “Well, then,” Farley said, “Newton D. Baker will be nominated. He is the interests’ candidate, and you will be playing squarely into their hands if you wait. I tell you, unless California comes over on the fourth ballot, Roosevelt is lost and Baker will win!”

McAdoo was convinced. So was Garner. Despite the objections of many California and Texas delegates, the states would be swung to Roosevelt. It was none too soon. Just before the balloting began, Mississippi went over to the opposition. The anti-Roosevelt forces thought they had won. When California was called, though, McAdoo rose and said, “California came here to nominate a President.” The meaning was clear. Roosevelt won, but Smith refused to release his delegates so that the nomination could be made unanimous. Garner was persuaded to take the vice presidency, an office the Texan later complained, according to published reports, was “not worth a pitcher of warm spit.” (Garner is rumored to have actually used more colorful language.)

Franklin Roosevelt demonstrated his boldness by breaking with tradition and flying from Albany to the convention in Chicago to deliver his acceptance speech. It was a doubly symbolic act. It indicated the candidate’s willingness to try new things; it also foreshadowed a campaign that would have more style than substance. In his speech Roosevelt told the delegates: “We will break foolish traditions and leave it to the Republican leadership, far more skilled in that art, to break promises.”

Roosevelt’s acceptance speech reflected Moley’s influence. Several parts were taken almost directly from the adviser’s May memorandum. Roosevelt spoke of the “Tory” idea that the rich should be helped in hopes that “some of their prosperity will leak through, sift through, to labor, to the farmer, to the small businessman.” Again echoing Moley, Roosevelt said the people wanted a genuine choice. “Ours must be a party of liberal thought, of planned action, of enlightened international outlook, and of the greatest good to the greatest number of our citizens.” Roosevelt also pledged himself “to a new deal for the American people.” This phrase has generally been attributed to Samuel Rosenman, who is said to have inserted it in the speech draft the previous night, attaching no special significance to it. Historian Elliot Rosen, however, has made a convincing case that Raymond Moley was responsible for the “new deal” phrase, and that he intended it to be more than a rhetorical flourish. In a paragraph that was dropped at the last minute in order to use part of a draft by Howe, Moley proposed “a new deal” as “an emblem—a happy emblem of new purposes, renewed life, rededicated devotion … to the sorely tired people of this country.” That the Roosevelt program came to be known as the New Deal was no journalistic accident.

All of this was in keeping with the shift to the left that had begun with the “Forgotten Man” speech. But other parts of the acceptance speech were slightly more conservative. The candidate promised help for “the top of the pyramid” as well as its base. The reason for this slight retreat is plain. Winning a general election is quite a different matter from winning a nomination. Splitting the party is often the mode of winning a nomination; uniting the party is necessary to win a general election. After the nomination is won, pontoon bridges must be rapidly constructed to replace the sturdier structures that the candidate found it necessary to burn in his campaign for the nomination. In the wake of his defeat in the Massachusetts primary, Roosevelt had been obliged to take the risk of alienating some within the party by moving to the left. Now a reconciliation with Raskob, Baruch, Smith et al., would be useful, so Roosevelt tried to be a bit more moderate. The campaign against Hoover, after all, was far more of a “sure thing” than had been that for the Democratic nomination. Fewer chances needed to be taken during the general election campaign.3

The middle of the road was shifting into the left lane with the worsening Depression. All of that area was occupied by Roosevelt. Hoover had available to him only the right shoulder. An unaccustomed spot for him, he tried to run his campaign there.

Hoover sincerely believed that the future of the nation depended on his reelection. This conviction, Secretary of State Stimson said, led to the President “losing his balance” in the summer and fall of 1932. It was small wonder that this happened. Many Republican candidates found it necessary or expedient to ignore Hoover—or worse. Some went so far as to allow backers to employ such slogans as the one used for South Dakota Republican Senator Peter Norbeck: “Elect Norbeck and Roosevelt.” Just before the election, one telegram sent to Hoover carried the message: “Vote for Roosevelt and make it unanimous.” By that time, observers reported that the President looked like a “walking corpse.” His car had been the target of rotten eggs in Elko, Nevada. Huey Long added insult to such near injuries when he told a reporter that “the great trouble with the Democrats is that we have all the votes and no money.” Long suggested that the Democrats could “sell President Hoover a million votes for half of what he is going to pay to try to get them. We can spare the votes and we could use the money.”

The heavy toll taken on Hoover was reflected in his last speeches before the election. In Madison Square Garden on October 31, Hoover said the election was “a contest between two philosophies of government.” His opponents, he charged, “are proposing changes and so-called new deals which would destroy the very foundations of the American system of life.” The Democrats, Hoover said, wanted “to change our form of government and our social and our economic system.” “We denounce any attempt to stir class feeling or class antagonisms in the United States,” the President affirmed. Hoover even had the temerity near the end of his extremely long address to repeat his statement of four years earlier that we would “with the help of God, be in sight of the day when poverty will be banished from this Nation.” God’s help was Hoover’s only hope for reelection.

With his opponent painting him as a radical, Franklin Roosevelt had little need to portray himself that way. There was, in fact, little call for him to say or do anything. Many party leaders urged Roosevelt to run a front porch campaign. “All you have got to do is to stay alive until election day,” Garner told his running mate. He was probably right. But Roosevelts are not given to sitting out campaigns, whether the enemies be Spaniards, Democrats, Germans, or Republicans. So Franklin insisted on taking to the hustings, albeit somewhat less boisterously than had Cousin Ted.

Democratic conservatives still hoped to make prohibition the main issue of the campaign, thus taking the pressure off business and its responsibility for the Depression. Roosevelt came out against the noble experiment, but refused to allow the main spotlight to be shifted from Hoover and the Depression. Since his supporters had differing economic ideas, Roosevelt tried to steer a middle course that, while it would entirely satisfy no one, would alienate few and would commit him to nothing specific. Thus in Columbus, Ohio, the candidate seemed to attack Hoover for overregulation and call instead for more competition. At Topeka, Roosevelt gave an agriculture speech that included bits of all the various farm proposals. In the most notable speech of the campaign, given at San Francisco’s Commonwealth Club, he reaffirmed his belief in a planned economy and called for a more equitable distribution of wealth. Not wishing to lose votes on either side of the tariff question, FDR took two proposed speeches on the subject, one protectionist, the other free trade, and astonished Raymond Moley by telling him to “weave the two together.” Finally, in Pittsburgh, Roosevelt complained that the 50 percent increase in federal spending since 1927 was “the most reckless and extravagant past that I have been able to discover in the statistical record of any peacetime government anywhere, anytime.” He called for reducing government expenditures by 25 percent and attacked Hoover for not balancing the budget and for trying “to center control of everything in Washington as rapidly as possible.” The actions of presidents often bear scant resemblance to their campaign pledges, but the difference between the New Deal and this speech is a prime candidate—along with the chasm separating Ronald Reagan’s 1980 promise to balance the budget by 1983 from his actual budget figures for the mid-eighties—for the largest such gap in American history. As his administration embarked on unprecedented deficit spending and centralization, Roosevelt and his advisers jokingly decided that the only way to get around the speech was to deny that he had ever been in Pittsburgh.

The Pittsburgh speech was an attempt to appease the Smith-Raskob faction. Roosevelt sought consensus during the campaign and got it. The conservative Democrats stuck with the party through the 1932 election, despite their fear that a Roosevelt victory would mean the end of an era: theirs. Keeping John Raskob in the same tent with Huey Long, and Al Smith under the same roof as William McAdoo, was quite a feat. It could not last forever.

The Roosevelt campaign in 1932 also had its more left-leaning statements. At Portland, Oregon, Roosevelt made what was probably his most radical-sounding statement of the campaign. Saying that he wanted “to protect the welfare of the people against selfish greed,” he exclaimed: “If that be treason, my friends, then make the most of it!” These words of Patrick Henry had been suggested by Moley five months before. Roosevelt went on to defend his “radicalism” by reminding his auditors that their nation had been founded by revolutionaries: “My friends, my policy is as radical as American liberty.”

Astute observers were upset by Roosevelt’s vagueness. At the beginning of the election year Walter Lippmann, in one of his most famous columns, summed up the views many held of the New York governor. He was, Lippmann stated, “an amiable man with many philanthropic impulses, but he is not the dangerous enemy of anything.” Rather than being a “crusader” or an “enemy of entrenched privilege,” Lippmann wrote, Franklin Roosevelt was “a pleasant man who, without any important qualifications for the office, would very much like to be President.”

But what did it matter? Hoover must be removed, so people had to vote for Roosevelt. There were other alternatives—Socialist Norman Thomas and Communist William Z. Foster, most notably—but Hoover and other conservatives helped Roosevelt overcome the danger of massive defection to the left. By lashing his opponent as one who would lead to drastic change, Hoover may have done more to win votes for Roosevelt than the Democrat did for himself. Drastic change was, after all, appealing to the masses of hungry, jobless people. Discontent was sufficient that upward of 5 percent of the electorate strongly considered voting for Thomas on the Socialist ticket, as the Literary Digest poll indicated. In the end, the Thomas vote was less than a million (2.2 percent) and Foster won just over one hundred thousand ballots. Thomas, at least, had a good deal more support, but many of his backers voted for FDR, fearing that in a two-party system Hoover might be reelected if they “threw their vote away” by marking the Socialist column. Roosevelt’s landslide victory—the largest electoral margin since 1864—unquestionably was a mandate for a “new deal,” though less a vote of confidence in Roosevelt himself. Most of all, the large Roosevelt vote was a repudiation of Hoover. Will Rogers pointed to this fact when he said most ordinary voters would like to be able to cast two ballots, one against Hoover and one against Roosevelt. No one really knew what to expect from the President-elect, but it seemed that any change had to be for the better.

The Democratic victory in 1932 was overwhelming. The shift from two years before was immense. Democrats gained 90 seats in the House and 13 in the Senate. Republicans won only 6 of 34 Senate races. All the Old Guard leaders and foremost defenders of big business who were up for reelection—James Watson, Reed Smoot, George Moses, Hiram Bingham—went down to defeat. The Democrats won their biggest advantage in the Senate since the Civil War. The turnaround in the House saw the Democrats go from 44.9 percent of the major party national votes in 1930 to 56.6 percent in 1932. The New Era was repudiated in no uncertain terms.

A fundamental change in American politics appeared to be under way. Henry Stimson said after the election that “the people of sobriety and intelligence and responsibility” had voted Republican, “yet we have the feeling that the immense undercurrent is against us.” Stimson believed that “a very unworthy element of the nation [was] coming into control.” From his viewpoint, this was just what was happening. “The mood of the country was such,” wrote Commerce Secretary Roy Chapin, “that … perhaps we are lucky that we didn’t get a Socialist or a Radical, instead of Roosevelt.” The lower and middle classes to whom Moley and Roosevelt had said the Democrats must appeal had shifted their votes in decisive numbers.

Almost all of this political upheaval was anti-Hoover, although Roosevelt’s lower-class-oriented rhetoric had some effect. Whether the Democratic gains in 1932 would be lasting or simply a one-time protest depended upon what Roosevelt and his congressional majorities did to deal with the Depression.4

While Americans waited from November 1932 to March 1933 to see what the Democrats would do, the economy continued to collapse. The interregnum between Hoover’s defeat and Roosevelt’s inauguration was the most critical such period since the lame duck months of James Buchanan, during which the nation awaited the start of Abraham Lincoln’s presidency. As in 1860–61, events continued during the interregnum to worsen the situation facing the new President.

The winter of 1932–33 was the most desperate of the Depression. Hoover later insisted that recovery had begun in the summer and the new collapse was caused by uncertainty over Roosevelt. This was largely, although perhaps not entirely, nonsense. One-fourth of the nation’s work force was unemployed. Funds available for relief were pitifully inadequate. Hoover still refused to agree to direct federal assistance, and Roosevelt had implied that Hoover was a spendthrift. It was not a time for much hope. By February, even those who had voted for Roosevelt were said to have little confidence that he would accomplish anything.

Conditions were particularly bad for farmers, who were now in the second decade of their depression. After the rest of the nation had joined their economic plight, farmers faced an even more difficult situation. By 1932 a bushel of wheat would fetch only 30 cents, down nearly 90 percent from the almost $3 it had brought twelve years earlier. And the farmer now had to deal not only with low prices for his products, but also with a general deflation, the late nineteenth-century nemesis of American agriculture. The combination meant that many farmers, crushed by long-term debt, were threatened by foreclosure.

Some met the danger with an old American expedient: direct action. Nooses were suggestively dangled over trees when judges attempted to hold foreclosure sales. In one such incident, an Iowa judge was momentarily hanged; but the farmers revived him and forced him to say: “O Lord, I pray thee, do justice to all men.” Rather than depend upon the Lord to provide justice, other farmers took matters into their own hands. “Penny auctions” were one example of homegrown justice. Neighbors of a bankrupt farmer would prevent—by threat of force if necessary—realistic bids, buy back the farm for a nominal fee (often one dollar), and return it to the original owner. Such actions never became very common, but their repeated occurrence in the heart of the supposedly conservative Middle West gave rise to heightened fears of revolution. Many believed that Roosevelt would have the last opportunity to save capitalism and stave off revolution. Others—mainly in the business community—feared that Roosevelt’s victory was the revolution.

Based on his campaign, however, no one could be sure what to expect from the President-elect. Accordingly, people of various viewpoints sought to commit him in advance to their own policies. Conservative Democrats again proposed a national sales tax designed to balance the budget at any cost—even that of further eroding purchasing power. Incredibly, the outrageous proposal won many supporters in the lame duck Congress. Roosevelt was unsure of his own policies, but he was sure he was against this regressive tax. The people’s view on the subject had already been heard. The scheme was jettisoned once more.

Prior to the ratification of the Twentieth Amendment in 1933, a full session of each Congress was held after each election, with the old members still in office. These lame duck sessions never made any sense, as they allowed congressmen to continue making laws after they had been rejected by the voters. The last lame duck session, that of 1932–33, was the worst. Fully 30 percent of its members—144 representatives and 14 senators—either had been defeated or had not sought reelection. With the nation facing one of its worst crises, this was a wholly indefensible situation. Virtually nothing happened in the last session of the Seventy-second Congress, because both Hoover and Roosevelt preferred no legislation to any this rejected group would pass.

During the interregnum everyone, it seemed, was attempting to gain the President-elect’s endorsement for schemes of the left or right. Perhaps the most persistent in trying to wed the incoming President to a particular set of policies was the man he had just defeated. Hoover’s first such attempt came less than three weeks after the election. At this and subsequent meetings between the retiring and arriving chief executives, Hoover attempted to maneuver Roosevelt into endorsing the policies so recently repudiated by the electorate. It was politically impossible for Roosevelt to do this, so he contented himself with demonstrating his allegiance to the common man by puffing on cigarettes while Hoover smoked cigars.

By 1933, Hoover and the other guardians of the New Era were the subjects of ridicule and hatred. Calvin Coolidge’s death at the beginning of January was followed by the spiritual demise of the men he had represented. Utility magnate Samuel Insull had fled to Europe in mid-1932, as his empire collapsed. In the ensuing months, evidence of his massive wrongdoing emerged, culminating in his early 1933 indictment for embezzlement. Insull could not understand his unpopularity. “What have I done,” he asked, “that every banker and business magnate has not done in the course of business?” It was a pregnant question, but the offspring was not the one Insull had planned. A Senate investigation in January 1933 saw one banker after another parade before counsel Ferdinand Pecora. Most of them admitted to a long series of misdeeds. The prestige of bankers and big businessmen in general had already dropped at a rate similar to that of the stock market. Now that prestige, so great only a few years before, hit bottom.

The most startling of the early revelations of the Pecora committee surrounded Charles E. Mitchell, president of the National City Bank. He (like many other leading bankers, as it turned out) had done much speculation in the stock of his own bank. What was more, he did it with the bank’s money. Faced with the prospect of a large tax liability in 1929, Mitchell sold stock in his own bank that he had used to secure a loan from J. P. Morgan. He “sold” the stock to his wife, for much less than he had paid for it, creating a huge paper loss and eliminating all of his tax obligation for the year. Mitchell was not a man without principles. Robbing his own bank was one thing, but he was not one to swindle his wife. He subsequently bought the stock back from her for the same price he had received, although the market value had by that time dropped tremendously. Before the Senate committee, Mitchell said: “I sold this stock, frankly, for tax purposes.” He also told of the bank making available to its officers $2.4 million of the stockholders’ money for interest-free loans with which to try to save their portfolios after the Crash. Mitchell was indicted, but later acquitted.

Mitchell’s specific admissions may have created the biggest stir, but a larger picture of extreme greed among the nation’s leading bankers emerged from the hearings: manipulated stock prices, trading in the stock of one’s own bank, unsupportable holding companies, huge “loans” to bank officials, tax evasion, and so on. What remaining faith the public had in bankers expired.

So did many banks. The practices revealed by the Pecora investigation had spawned a banking system of startling weakness. Even in the prosperous twenties nearly 7000 banks had failed. Most of these, however, were small “country” banks and their failures were scarcely noticed in the prosperity decade. In 1930 the situation worsened. There were 1345 failures that year, including the large Bank of the United States in New York. Now it was every banker for himself. Strong banks tried to solidify their own positions (which, in a semantic paradox, they did by increasing their liquidity) rather than trying to save their weaker brothers. Most bankers were “unreconstructed individualists,” believers in the mystical forces of the market. They would not lift a finger to help the banks that were going under because they viewed the latter as “bad” banks that deserved their fate.

This was all well and good, except that banking is built to an extraordinary extent upon confidence. Depositors were unable to distinguish the good bankers from the bad and came to distrust them all. More than 2000 banks failed in 1931. When Hoover’s voluntary schemes to help the banks collapsed, government action came in the form of the RFC and the Glass-Steagall Act. Congress passed the latter measure in February 1932, while in a state of panic. Members of the Banking Committee told other House members that the nation’s banking system was in such bad shape that the details could not be given to the full House—or the public.

These measures stabilized the system for a time, but Hoover made decreasing use of the RFC, and by the beginning of 1933 the American banking structure was tottering more ominously than ever. People fortunate enough to have savings at this point feared losing them in insolvent banks. Senator “Cotton Ed” Smith of South Carolina showed the state of his confidence by carrying all his remaining cash in a belt around his waist. After Henry Ford refused to take any action to save Michigan’s banks, the state’s governor declared a “bank holiday,” a euphemism for closing all banks and preventing further withdrawals. Runs now spread rapidly from one bank to another, and state after state proclaimed bank holidays as panic gripped the nation anew.

President Hoover again insisted that Roosevelt endorse the Republican program and thus restore confidence. After narrowly escaping the February assassination attempt in Miami, however, the President-elect made it clear that he had no desire to kill himself politically. Moreover, Roosevelt probably believed that he was far more likely to restore confidence by taking fresh action when he assumed office than he would by endorsing anything the public associated with Hoover. The banking crisis continued to deepen and by March 4 the nation could only hope that the new President would be able to revive the nation’s financial institutions as well as its spirits.5

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