Franklin Roosevelt fascist policies prolonged a recovery from the 1930’s depression until it was twice as long as any in history. The same policies that FDR tried and failed at are being carried out in Washington today. Just like President Obama blaming the economic problems on his predecessor, Roosevelt blamed Herbert Hoover. The truth is unemployment was still 20 percent in 1939, six years after Franklin Roosevelt was elected president. Fascism is when a leader gets control of the government, the military and the business infrastructure. Think Hitler and Mussolini.
Generations have been led to believe that Roosevelt’s New Deal policies got the US out of the Great Depression. It’s all myth and a false legend. In fact, he started us on the path to Keynesian socialism that is now top-heavy. We are probably right in the middle of the Greater Depression crash. It could be three times as large and three times as long as the 1930’s depression according to author and deflationist, Robert Prechter. John Maynard Keynes preached that government could micro-manage the economy through stimulation, spending, investment, adjusting interest rates, adjusting tax rates, deficit spending, bailouts, borrowing and fiat money financing. An eighty year Kondratiev long wave world economic bubble was the result of the love affair with Keynesian economics. The Federal Reserve Bank cartel and monopoly was created in secret by the elitist Morgan and Rothchild families back in 1913. The value of the 1913 U.S. dollar is now down close to four cents. Fiat means “let it be made” in French, by the way. Aka inflation.
Socialism and communism never work. The socialist state is constantly creating counterfeit fiat paper money, spending too much, pushing tax rates higher, imposing rules and regulations limiting free enterprise, bailing out banks, bailing out companies, borrowing more than it brings in and fostering a welfare state that lets too many people live off the backs of the few citizens left working for real businesses. Eventually business people out of frustration give up trying. Then the bankers out of fear quit lending. Just like in the 1930’s Great Depression. The same thing is going down now. In 2008 it got so bad banks wouldn’t even lend to each other.
Franklin Roosevelt fascist policies started with signing of the National Industrial Recovery Act (NIRA), June 16, 1933. Henry I. Harriman, president of the United States Chamber of Commerce said, “I tried to show Roosevelt that this stuff was sheer fascism, that it was a remaking of Mussolini’s “corporate state” and refused to agree to any of it.
The NIRA was based on Franklin Roosevelt’s idea that bigger was best and more efficient. Most of us now know that it is small business startups that do the most hiring. Anyway, FDR said industry, labor and government must work together, as in Italy (Mussolini again), or risk staying in depression. There are no jobs left when the government make-work project is over. High tax rates and anti-business regulations just make depressions last longer. The growth in the size of government that Franklin Roosevelt socialist ideas started are the direct cause of the problems we face today.
His new regulations did not allow price cutting. FDR’s “brain trust” thought the problem was low prices. So, FDR backed price supports, tariffs like the Smoot-Hawley Act and even subsidies paying farmers not to grow. People were starving and he limited production? Most of these farm subsidies are still in effect today, by the way. The were never repealed.
22 million workers came under the 557 NIRA codes and 100 industries would be affected. All this regulatory red tape made it harder to do business and grow a company. The new regulations included minimum wage rules, child labor rules, maximum hour rules, health requirements, production quotas and standards regarding customer choice. Fearful business people slowed their activity.
One regulation outlawed the choosing of your own live chicken down at the chicken vendor. Instead “straight killing” was to be the FDR way – as the chicken was grabbed from the pen. In the kosher chicken butcher named Schechter court case, it was later ruled in Supreme Court that these laws were “coercive exercise of the law-making process.” The Schechter family fighting fearlessly for their good reputation was almost bankrupted by the FDR administration.
Production quotas were used to get prices up in oil. Macaroni components were restricted. Even what tailors could sew was stipulated. The idea was to increase efficiency with larger quantity. If smaller businesses died, that was just survival of the fittest according to FDR. Not the way to create jobs and get an economy working again, by the way. A better way is to lower their taxes.
The Agricultural Adjustment Administration was to create price supports and pay farmers not to produce. Again, why make food more expensive? Another negative effect was many Negro sharecroppers were thrown off the land they farmed so the owner could receive subsidy money to not produce. Whenever the government gets involved the free market goes out the window. Inefficiencies balloon. People don’t switch crops or switch production to products with more profit and more demand like they would in a free market.
The gold price was raised from $20 to $35 an ounce. Then the owning of gold was outlawed completely. Everyone had to exchange gold for fiat paper money. Gold clauses in contracts requiring payment in gold if the value of the paper money decreased were also invalidated. After most people turned in their gold coins it was disclosed that the law only covered bullion bars of gold. Where is the gold today?
His Tennessee Valley Authority (TVA) power and dam project competed with private enterprise. Private companies could only own one “integrated system.” Multilevel companies had to be split up. Only 50% of the population had lights and FDR made it more difficult for utility companies to do business. Why?
The Franklin Roosevelt sponsored Social Security Act was supposed to “flatten out the peaks and valleys of deflation and inflation.” Now, it’s unfunded liabilities are projected to bankrupt the whole United States of America! The money paid in is not saved or invested.
What is deflation? It is the unwinding of all this socialism started by Franklin Roosevelt. We will see a 90% drop in most assets prices. Those in the know have probably already sold their real estate and now will be dumping stocks, bonds and gold only to buy them back in 2016 – 2018 when the unemployment rate may hit 30 percent. The price of gold may even drop in half.
President Obama and the Federal Reserve bank are trying more and more bailouts and monetization stimulus like quantitative easing one (QE1 of $1.2 trillion) and QE2 (of $600 billion). Obama’s Keynesian socialistic programs include Obamanomics, Obamacare, wealth redistribution, tax increases, bank bailouts, General Motors and Chrysler bailouts and “shovel ready” government job creation. President Obama just admitted publicly that there was no such thing as shovel ready jobs. Also, a superior judge ruled that Obamacare was actually a tax. President Obama said it wasn’t a tax.
The two biggest American myths are that the New Deal and World War Two got us out of the depression. Private sector jobs and new business innovation finally did it. Not the New Deal. Not dumping our men and material down a bottomless fox hole in Europe (or Korea, Viet Nam, Afghanistan or Iraq for that matter). Government was only 10% of GDP back in 1930. Now it is 30%. This economy’s top appears to have been the 2000 dot com stock climax.
Lobby for lower taxes so businesses can afford to hire workers who’s jobs won’t just disappear when the project is done. Like FDR’s CCC Corps jobs did. Lobby for private money backed by gold. Otherwise we may get runaway inflation and $5,000 gold after 2020. Lobby for smaller government or we may have a repeat of this whole runaway inflation cycle mess again. This is what led to the rise of Hitler. Hyperinflation.
A worldwide depression is here! There is only one way to slow it from running its course and the pendulum swinging to far toward deflation. Free enterprise. Stand up for FREEDOM AND LIBERTY.
Franklin Roosevelt fascist forte’ was political, not economic. He used his position to intimidate his critics and opponents. The FBI, the Internal Revenue Service and the alphabet soup of myriad new governmental agencies were used to mold people and their businesses into submission. These people were the citizens who thought Roosevelt brought hope. Today, President Obama preaches hope but leans more and more towards more government control. We need to be aware.
What is deflation? It is the de leveraging of a mountain of credit inflation. Mania credit bubbles always ends with a climax blow-off followed by a GREATER DEPRESSION than the last one.
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Copyright 2010 by Delwyn Lounsbury – THE DEFLATION GURU
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