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PAUL JAY: Peter, there's sections of the elites who support the New Deal. Apparently, there's a quote from Joseph Kennedy who says, "I don 't mind giving up even half of my fortune as long as I get to keep the other half," but there were large sections in the elites, particularly in the banking, finance circles that fought Roosevelt tooth and nail. It wasn 't just rhetoric from Roosevelt. It was a real war. What did that look like?
PETER KUZNICK: On the one hand, we know that in 1934 some of these right-wing elements approached Marine General Smedley Butler and urged him to lead a right-wing uprising against the New Deal. There were remarkable congressional hearings about that in 1934, and McCormick, the chair of the House committee, said that they had verified every charge that Butler made, that this had actually gone on. Unfortunately, nothing came of that but it's during the same time, '35 I think it was, that the Liberty League had formed, it was a right-wing organization, funded largely by the DuPont 's and the Morgans, and with support by people like Al Smith who was a Democratic presidential candidate in 1928 and turns against the New Deal because of its more radical elements.
So you've got the Liberty League, and you also have a lot of these shirt movements, these right-wing movements cropping up around the country. So you do have a right-wing element but they're dwarfed by the left in the 1930s. You look at the congressional hearings in 1935 and '36, you've got the Nye Committee hearings in the Senate. Gerald Nye held hearings about the war profiteering and they attacked the munitions makers as being merchants of death and they introduced legislation. There are two possible ways to do it: one is that if the United States goes to war, one part of the legislation says that we should tax at 100% all incomes above $10,000. The other legislation says we should nationalize the munitions industries and the war industries.
The idea in the 1930s coming out of World War I was that it was so deplorable, so vile, the thought that people would make money off war, off this kind of people 's death and destruction and suffering, that they wanted to cut out war profits entirely. Wouldn't that be a great idea, Paul, if we did that today? Yet these greedy bastards who were profiting off killing around the world. As we know, the rates of return on the so-called defense or military expenditures is skyrocketing. These people propel our military machine. They make profit off of death.
Remember Bob Dylan 's great song, Masters of War. The anger Dylan expressed there was the anger that people felt in the mid-1930s against these war profiteers, these merchants of death, who actually calculated that in World War I, as one book argued, they made about $25,000 off of every death in World War I.
PAUL JAY: One of the other big features of the New Deal was financial regulation. As we move forward and talk about the undoing of the new deal, one of the main focuses of attack, especially in more recent years is the undoing of financial regulation but there was quite a bit of regulation put in at that time. What did that look like?
PETER KUZNICK: Well, as you say, there was a federal deposit insurance corporation. There was a lot of regulation. Regulation was not seen as a bad thing. Regulation was seen as a good thing. This is a kind progressive reform that goes back to the turn-of-the-century. In response to Upton Sinclair 's The Jungle was to regulate the meat industry. We have seen regulation as a good thing in the interest of the people. The idea of rampant unbridled capitalists squeezing every last profit out of the system by any kind of deceitful means possible was again a... to the American people in the 1930s.
We see also the introduction of Social Security, works progress administration. We see government support for the arts, the New Deal arts programs, the New Deal theater programs. The idea that the government can play a positive role in bringing the arts and theater, and photography to the people was another part of this.
PAUL JAY: There are two important pieces too. There was in the regulation of commodities trading, there were regulations about how much any individual can control in commodities and commodity speculation, the position limits. Nobody could monopolize a certain commodity and then manipulate the prices. There was the Glass-Steagall Act separating banking from speculation, which later is undone by a Democrat, Mr. President Clinton. So, all of these things envision a capitalism, to quote Hillary Clinton in the election campaign, that "reigns in the excesses of capitalism. " By reigning in those excesses, they will save capitalism and mitigate the worst of the consequences of it, they say.
To a large extent, it's successful, especially compared to the alternative, which would 've been in Europe fascism but perhaps also to make sure there was no real development of a socialist movement in the United States. We're going to pick up this conversation in another segment. We're going to keep doing this series because I think it 's very interesting and pick up again in Truman, and continuing this story of the undoing of the new deal. So please, thanks for joining us again Peter.
[Reposted from The Real News Network]
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