If I were to listen to the arguments of some prophets of calamity who are talking these days, I should hesitate to make these alterations. I should fear that while I am away for a few weeks the architects might build some strange new Gothic tower or a factory building or perhaps a replica of the Kremlin or of the Potsdam Palace. But I have no such fears. The architects and builders are men of common sense and of artistic American tastes. They know that the principles of harmony and of necessity itself require that the building of the new structure shall blend with the essential lines of the old. It is this combination of the old and the new that marks orderly peaceful progress—not only in building buildings but in building government itself.
Our new structure is a part of and a fulfillment of the old.
All that we do seeks to fulfill the historic traditions of the American people. Other nations may sacrifice democracy for the transitory stimulation of old and discredited autocracies. We are restoring confidence and well-being under the rule of the people themselves. We remain, as John Marshall said a century ago, "emphatically and truly, a government of the people." Our government "in form and in substance. . . emanates from them. Its powers are granted by them, and are to be exercised directly on them, and for their benefits."
Before I close, I want to tell you of the interest and pleasure with which I look forward to the trip on which I hope to start in a few days. It is a good thing for everyone who can possibly do so to get away at least once a year for a change of scene. I do not want to get into the position of not being able to see the forest because of the thickness of the trees.
I hope to visit our fellow Americans in Puerto Rico, in the Virgin Islands, in the Canal Zone and in Hawaii. And, incidentally, it will give me an opportunity to exchange a friendly word of greeting to the Presidents of our sister Republics: Haiti, Colombia and Panama.
After four weeks on board ship, I plan to land at a port in our Pacific northwest, and then will come the best part of the whole trip, for I am hoping to inspect a number of our new great national projects on the Columbia, Missouri and Mississippi Rivers, to see some of our national parks and, incidentally, to learn much of actual conditions during the trip across the continent back to Washington.
While I was in France during the War our boys used to call the United States "God's country". Let us make it and keep it "God's country".
September 30, 1934.
Three months have passed since I talked with you shortly after the adjournment of the Congress. Tonight I continue that report, though, because of the shortness of time, I must defer a number of subjects to a later date.
Recently the most notable public questions that have concerned us all have had to do with industry and labor and with respect to these, certain developments have taken place which I consider of importance. I am happy to report that after years of uncertainty, culminating in the collapse of the spring of 1933, we are bringing order out of the old chaos with a greater certainty of the employment of labor at a reasonable wage and of more business at a fair profit. These governmental and industrial developments hold promise of new achievements for the nation.
Men may differ as to the particular form of governmental activity with respect to industry and business, but nearly all are agreed that private enterprise in times such as these cannot be left without assistance and without reasonable safeguards lest it destroy not only itself but also our processes of civilization. The underlying necessity for such activity is indeed as strong now as it was years ago when Elihu Root said the following very significant words:
"Instead of the give and take of free individual contract, the tremendous power of organization has combined great aggregations of capital in enormous industrial establishments working through vast agencies of commerce and employing great masses of men in movements of production and transportation and trade, so great in the mass that each individual concerned in them is quite helpless by himself. The relations between the employer and the employed, between the owners of aggregated capital and the units of organized labor, between the small producer, the small trader, the consumer, and the great transporting and manufacturing and distributing agencies, all present new questions for the solution of which the old reliance upon the free action of individual wills appears quite inadequate. And in many directions, the intervention of that organized control which we call government seems necessary to produce the same result of justice and right conduct which obtained through the attrition of individuals before the new conditions arose."
It was in this spirit thus described by Secretary Root that we approached our task of reviving private enterprise in March, 1933. Our first problem was, of course, the banking situation because, as you know, the banks had collapsed. Some banks could not be saved but the great majority of them, either through their own resources or with government aid, have been restored to complete public confidence. This has given safety to millions of depositors in these banks. Closely following this great constructive effort we have, through various federal agencies, saved debtors and creditors alike in many other fields of enterprise, such as loans on farm mortgages and home mortgages; loans to the railroads and insurance companies and, finally, help for home owners and industry itself.
In all of these efforts the government has come to the assistance of business and with the full expectation that the money used to assist these enterprises will eventually be repaid. I believe it will be.
The second step we have taken in the restoration of normal business enterprise has been to clean up thoroughly unwholesome conditions in the field of investment. In this we have had assistance from many bankers and businessmen, most of whom recognize the past evils in the banking system, in the sale of securities, in the deliberate encouragement of stock gambling, in the sale of unsound mortgages and in many other ways in which the public lost billions of dollars. They saw that without changes in the policies and methods of investment there could be no recovery of public confidence in the security of savings. The country now enjoys the safety of bank savings under the new banking laws, the careful checking of new securities under the Securities Act and the curtailment of rank stock speculation through the Securities Exchange Act. I sincerely hope that as a result people will be discouraged in unhappy efforts to get rich quick by speculating in securities. The average person almost always loses. Only a very small minority of the people of this country believe in gambling as a substitute for the old philosophy of Benjamin Franklin that the way to wealth is through work.
In meeting the problems of industrial recovery the chief agency of the government has been the National Recovery Administration. Under its guidance, trades and industries covering over 90 percent of all industrial employees have adopted codes of fair competition, which have been approved by the President. Under these codes, in the industries covered, child labor has been eliminated. The work day and the work week have been shortened. Minimum wages have been established and other wages adjusted toward a rising standard of living. The emergency purpose of the N.R.A. was to put men to work and since its creation more than four million persons have been reemployed, in great part through the cooperation of American business brought about under the codes.
Benefits of the Industrial Recovery Program have come, not only to labor in the form of new jobs, in relief from overwork and in relief from underpay, but also to the owners and managers of industry because, together with a great increase in the payrolls, there has come a substantial rise in the total of industrial profits—a rise from a deficit figure in the first quarter of 1933 to a level of sustained profits within one year from the inauguration of N.R.A.
Now it should not be expected that even employed labor and capital would be completely satisfied with present conditions. Employed workers have not by any means all enjoyed a return to the earnings of prosperous times, although millions of hitherto underprivileged workers are today far better paid than ever before. Also, billions of dollars of invested capital have today a greater security of present and future earning power than before. This is because of the establishment of fair, competitive standards and because of relief from unfair competition in wage cutting which depresses markets and destroys purchasing power. But it is an undeniable fact that the restoration of other billions of sound investments to a reasonable earning power could not be brought about in one year. There is no magic formula, no economic panacea, which could simply revive over-night the heavy industries and the trades dependent upon them.
Nevertheless the gains of trade and industry, as a whole, have been substantial. In these gains and in the policies of the administration there are assurances that hearten all forward- looking men and women with the confidence that we are definitely rebuilding our political and economic system on the lines laid down by the New Deal—lines which as I have so often made clear, are in complete accord with the underlying principles of orderly popular government which Americans have demanded since the white man first came to these shores. We count, in the future as in the past, on the driving power of individual initiative and the incentive of fair private profit, strengthened with the acceptance of those obligations to the public interest which rest upon us all. We have the right to expect that this driving power will be given patriotically and whole-heartedly to our nation.
We have passed through the formative period of code making in the National Recovery Administration and have effected a reorganization of the N.R.A. suited to the needs of the next phase, which is, in turn, a period of preparation for legislation which will determine its permanent form.
In this recent reorganization we have recognized three distinct functions: first, the legislative or policy making function; second, the administrative function of code making and revision; and, third, the judicial function, which includes enforcement, consumer complaints and the settlement of disputes between employers and employees and between one employer and another.
We are now prepared to move into this second phase, on the basis of our experience in the first phase under the able and energetic leadership of General Johnson.
We shall watch carefully the working of this new machinery for the second phase of N.R.A., modifying it where it needs modification and finally making recommendations to the Congress, in order that the functions of N.R.A. which have proved their worth may be made a part of the permanent machinery of government.
Let me call your attention to the fact that the national Industrial Recovery Act gave businessmen the opportunity they had sought for years to improve business conditions through what has been called self-government in industry. If the codes which have been written have been too complicated, if they have gone too far in such matters as price fixing and limitation of production, let it be remembered that so far as possible, consistent with the immediate public interest of this past year and the vital necessity of improving labor conditions, the representatives of trade and industry were permitted to write their ideas into the codes. It is now time to review these actions as a whole to determine through deliberative means in the light of experience, from the standpoint of the good of the industries themselves, as well as the general public interest, whether the methods and policies adopted in the emergency have been best calculated to promote industrial recovery and a permanent improvement of business and labor conditions. There may be a serious question as to the wisdom of many of those devices to control production, or to prevent destructive price cutting which many business organizations have insisted were necessary, or whether their effect may have been to prevent that volume of production which would make possible lower prices and increased employment. Another question arises as to whether in fixing minimum wages on the basis of an hourly or weekly wage we have reached into the heart of the problem which is to provide such annual earnings for the lowest paid worker as will meet his minimum needs. We also question the wisdom of extending code requirements suited to the great industrial centers and to large employers, to the great number of small employers in the smaller communities.
During the last twelve months our industrial recovery has been to some extent retarded by strikes, including a few of major importance. I would not minimize the inevitable losses to employers and employees and to the general public through such conflicts. But I would point out that the extent and severity of labor disputes during this period has been far less than in any previous, comparable period.
When the businessmen of the country were demanding the right to organize themselves adequately to promote their legitimate interests; when the farmers were demanding legislation which would give them opportunities and incentives to organize themselves for a common advance, it was natural that the workers should seek and obtain a statutory declaration of their constitutional right to organize themselves for collective bargaining as embodied in Section 7 (a) of the national Industrial Recovery Act.
Machinery set up by the federal government has provided some new methods of adjustment. Both employers and employees must share the blame of not using them as fully as they should. The employer who turns away from impartial agencies of peace, who denies freedom of organization to his employees, or fails to make every reasonable effort at a peaceful solution of their differences, is not fully supporting the recovery effort of his government. The workers who turn away from these same impartial agencies and decline to use their good offices to gain their ends are likewise not fully cooperating with their government.
It is time that we made a clean-cut effort to bring about that united action of management and labor, which is one of the high purposes of the Recovery Act. We have passed through more than a year of education. Step by step we have created all the government agencies necessary to insure, as a general rule, industrial peace, with justice for all those willing to use these agencies whenever their voluntary bargaining fails to produce a necessary agreement.
There should be at least a full and fair trial given to these means of ending industrial warfare; and in such an effort we should be able to secure for employers and employees and consumers the benefits that all derive from the continuous, peaceful operation of our essential enterprises.
Accordingly, I propose to confer within the coming month with small groups of those truly representative of large employers of labor and of large groups of organized labor, in order to seek their cooperation in establishing what I may describe as a specific trial period of industrial peace.
From those willing to join in establishing this hoped-for period of peace, I shall seek assurances of the making and maintenance of agreements, which can be mutually relied upon, under which wages, hours and working conditions may be determined and any later adjustments shall be made either by agreement or, in case of disagreement, through the mediation or arbitration of state or federal agencies. I shall not ask either employers or employees permanently to lay aside the weapons common to industrial war. But I shall ask both groups to give a fair trial to peaceful methods of adjusting their conflicts of opinion and interest, and to experiment for a reasonable time with measures suitable to civilize our industrial civilization.
Closely allied to the N.R.A. is the program of Public Works provided for in the same Act and designed to put more men back to work, both directly on the public works themselves, and indirectly in the industries supplying the materials for these public works. To those who say that our expenditures for public works and other means for recovery are a waste that we cannot afford, I answer that no country, however rich, can afford the waste of its human resources. Demoralization caused by vast unemployment is our greatest extravagance. Morally, it is the greatest menace to our social order. Some people try to tell me that we must make up our minds that for the future we shall permanently have millions of unemployed just as other countries have had them for over a decade. What may be necessary for those countries is not my responsibility to determine. But as for this country, I stand or fall by my refusal to accept as a necessary condition of our future a permanent army of unemployed. On the contrary, we must make it a national principle that we will not tolerate a large army of unemployed and that we will arrange our national economy to end our present unemployment as soon as we can and then to take wise measures against its return. I do not want to think that it is the destiny of any American to remain permanently on relief rolls.
Those, fortunately few in number, who are frightened by boldness and cowed by the necessity for making decisions, complain that all we have done is unnecessary and subject to great risks. Now that these people are coming out of their storm cellars, they forget that there ever was a storm. They point to England. They would have you believe that England has made progress out of her depression by a do-nothing policy, by letting nature take her course. England has her peculiarities and we have ours but I do not believe any intelligent observer can accuse England of undue orthodoxy in the present emergency.
Did England let nature take her course? No. Did England hold to the gold standard when her reserves were threatened? No. Has England gone back to the gold standard today? No. Did England hesitate to call in ten billion dollars of her war bonds bearing 5 percent interest, to issue new bonds therefore bearing only 3-1/2 percent interest, thereby saving the British treasury one hundred and fifty million dollars a year in interest alone? No. And let it be recorded that the British bankers helped. Is it not a fact that ever since the year 1909, Great Britain in many ways has advanced further along lines of social security than the United States? Is it not a fact that relations between capital and labor on the basis of collective bargaining are much further advanced in Great Britain than in the United States? It is perhaps not strange that the conservative British press has told us with pardonable irony that much of our New Deal program is only an attempt to catch up with English reforms that go back ten years or more.
Nearly all Americans are sensible and calm people. We do not get greatly excited nor is our peace of mind disturbed, whether we be businessmen or workers or farmers, by awesome pronouncements concerning the unconstitutionality of some of our measures of recovery and relief and reform. We are not frightened by reactionary lawyers or political editors. All of these cries have been heard before. More than twenty years ago, when Theodore Roosevelt and Woodrow Wilson were attempting to correct abuses in our national life, the great Chief Justice White said:
"There is great danger it seems to me to arise from the constant habit which prevails where anything is opposed or objected to, of referring without rhyme or reason to the Constitution as a means of preventing its accomplishment, thus creating the general impression that the Constitution is but a barrier to progress instead of being the broad highway through which alone true progress may be enjoyed."
In our efforts for recovery we have avoided on the one hand the theory that business should and must be taken over into an all- embracing government. We have avoided on the other hand the equally untenable theory that it is an interference with liberty to offer reasonable help when private enterprise is in need of help. The course we have followed fits the American practice of government—a practice of taking action step by step, of regulating only to meet concrete needs—a practice of courageous recognition of change. I believe with Abraham Lincoln, that "The legitimate object of government is to do for a community of people whatever they need to have done but cannot do at all or cannot do so well for themselves in their separate and individual capacities."
I am not for a return to that definition of liberty under which for many years a free people were being gradually regimented into the service of the privileged few. I prefer and I am sure you prefer that broader definition of liberty under which we are moving forward to greater freedom, to greater security for the average man than he has ever known before in the history of America.
April 28, 1935.
Since my annual message to the Congress on January fourth, last, I have not addressed the general public over the air. In the many weeks since that time the Congress has devoted itself to the arduous task of formulating legislation necessary to the country's welfare. It has made and is making distinct progress.
Before I come to any of the specific measures, however, I want to leave in your minds one clear fact. The administration and the Congress are not proceeding in any haphazard fashion in this task of government. Each of our steps has a definite relationship to every other step. The job of creating a program for the nation's welfare is, in some respects, like the building of a ship. At different points on the coast where I often visit they build great seagoing ships. When one of these ships is under construction and the steel frames have been set in the keel, it is difficult for a person who does not know ships to tell how it will finally look when it is sailing the high seas.
It may seem confused to some, but out of the multitude of detailed parts that go into the making of the structure the creation of a useful instrument for man ultimately comes. It is that way with the making of a national policy. The objective of the nation has greatly changed in three years. Before that time individual self- interest and group selfishness were paramount in public thinking. The general good was at a discount.
Three years of hard thinking have changed the picture. More and more people, because of clearer thinking and a better understanding, are considering the whole rather than a mere part relating to one section or to one crop, or to one industry, or to an individual private occupation. That is a tremendous gain for the principles of democracy. The overwhelming majority of people in this country know how to sift the wheat from the chaff in what they hear and what they read. They know that the process of the constructive rebuilding of America cannot be done in a day or a year, but that it is being done in spite of the few who seek to confuse them and to profit by their confusion. Americans as a whole are feeling a lot better—a lot more cheerful than for many, many years.
The most difficult place in the world to get a clear open perspective of the country as a whole is Washington. I am reminded sometimes of what President Wilson once said: "So many people come to Washington who know things that are not so, and so few people who know anything about what the people of the United States are thinking about." That is why I occasionally leave this scene of action for a few days to go fishing or back home to Hyde Park, so that I can have a chance to think quietly about the country as a whole. "To get away from the trees", as they say, "and to look at the whole forest." This duty of seeing the country in a long-range perspective is one which, in a very special manner, attaches to this office to which you have chosen me. Did you ever stop to think that there are, after all, only two positions in the nation that are filled by the vote of all of the voters—the President and the Vice-President? That makes it particularly necessary for the Vice- President and for me to conceive of our duty toward the entire country. I speak, therefore, tonight, to and of the American people as a whole.
My most immediate concern is in carrying out the purposes of the great work program just enacted by the Congress. Its first objective is to put men and women now on the relief rolls to work and, incidentally, to assist materially in our already unmistakable march toward recovery. I shall not confuse my discussion by a multitude of figures. So many figures are quoted to prove so many things. Sometimes it depends upon what paper you read and what broadcast you hear. Therefore, let us keep our minds on two or three simple, essential facts in connection with this problem of unemployment. It is true that while business and industry are definitely better our relief rolls are still too large. However, for the first time in five years the relief rolls have declined instead of increased during the winter months. They are still declining. The simple fact is that many million more people have private work today than two years ago today or one year ago today, and every day that passes offers more chances to work for those who want to work. In spite of the fact that unemployment remains a serious problem here as in every other nation, we have come to recognize the possibility and the necessity of certain helpful remedial measures. These measures are of two kinds. The first is to make provisions intended to relieve, to minimize, and to prevent future unemployment; the second is to establish the practical means to help those who are unemployed in this present emergency. Our social security legislation is an attempt to answer the first of these questions; our Works Relief program, the second.
The program for social security now pending before the Congress is a necessary part of the future unemployment policy of the government. While our present and projected expenditures for work relief are wholly within the reasonable limits of our national credit resources, it is obvious that we cannot continue to create governmental deficits for that purpose year after year. We must begin now to make provision for the future. That is why our social security program is an important part of the complete picture. It proposes, by means of old age pensions, to help those who have reached the age of retirement to give up their jobs and thus give to the younger generation greater opportunities for work and to give to all a feeling of security as they look toward old age.
The unemployment insurance part of the legislation will not only help to guard the individual in future periods of lay-off against dependence upon relief, but it will, by sustaining purchasing power, cushion the shock of economic distress. Another helpful feature of unemployment insurance is the incentive it will give to employers to plan more carefully in order that unemployment may be prevented by the stabilizing of employment itself.
Provisions for social security, however, are protections for the future. Our responsibility for the immediate necessities of the unemployed has been met by the Congress through the most comprehensive work plan in the history of the nation. Our problem is to put to work three and one-half million employable persons now on the relief rolls. It is a problem quite as much for private industry as for the government.
We are losing no time getting the government's vast work relief program underway, and we have every reason to believe that it should be in full swing by autumn. In directing it, I shall recognize six fundamental principles:
(1) The projects should be useful.
(2) Projects shall be of a nature that a considerable proportion of the money spent will go into wages for labor.
(3) Projects will be sought which promise ultimate return to the federal treasury of a considerable proportion of the costs.
(4) Funds allotted for each project should be actually and promptly spent and not held over until later years.
(5) In all cases projects must be of a character to give employment to those on the relief rolls.
(6) Projects will be allocated to localities or relief areas in relation to the number of workers on relief rolls in those areas.
I next want to make it clear exactly how we shall direct the work.
(1) I have set up a Division of Applications and Information to which all proposals for the expenditure of money must go for preliminary study and consideration.
(2) After the Division of Applications and Information has sifted those projects, they will be sent to an Allotment Division composed of representatives of the more important governmental agencies charged with carrying on work relief projects. The group will also include representatives of cities, and of labor, farming, banking and industry. This Allotment Division will consider all of the recommendations submitted to it and such projects as they approve will be next submitted to the President who under the Act is required to make final allocations.
(3) The next step will be to notify the proper government agency in whose field the project falls, and also to notify another agency which I am creating—a Progress Division. This Division will have the duty of coordinating the purchases of materials and supplies and of making certain that people who are employed will be taken from the relief rolls. It will also have the responsibility of determining work payments in various localities, of making full use of existing employment services and to assist people engaged in relief work to move as rapidly as possible back into private employment when such employment is available. Moreover, this Division will be charged with keeping projects moving on schedule.
(4) I have felt it to be essentially wise and prudent to avoid, so far as possible, the creation of new governmental machinery for supervising this work. The national government now has at least sixty different agencies with the staff and the experience and the competence necessary to carry on the two hundred and fifty or three hundred kinds of work that will be undertaken. These agencies, therefore, will simply be doing on a somewhat enlarged scale the same sort of things that they have been doing. This will make certain that the largest possible portion of the funds allotted will be spent for actually creating new work and not for building up expensive overhead organizations here in Washington.
For many months preparations have been under way. The allotment of funds for desirable projects has already begun. The key men for the major responsibilities of this great task already have been selected. I well realize that the country is expecting before this year is out to see the "dirt fly", as they say, in carrying on the work, and I assure my fellow citizens that no energy will be spared in using these funds effectively to make a major attack upon the problem of unemployment.
Our responsibility is to all of the people in this country. This is a great national crusade to destroy enforced idleness which is an enemy of the human spirit generated by this depression. Our attack upon these enemies must be without stint and without discrimination. No sectional, no political distinctions can be permitted.
It must, however, be recognized that when an enterprise of this character is extended over more than three thousand counties throughout the nation, there may be occasional instances of inefficiency, bad management, or misuse of funds. When cases of this kind occur, there will be those, of course, who will try to tell you that the exceptional failure is characteristic of the entire endeavor. It should be remembered that in every big job there are some imperfections. There are chiselers in every walk of life; there are those in every industry who are guilty of unfair practices; every profession has its black sheep, but long experience in government has taught me that the exceptional instances of wrong-doing in government are probably less numerous than in almost every other line of endeavor. The most effective means of preventing such evils in this Works Relief program will be the eternal vigilance of the American people themselves. I call upon my fellow citizens everywhere to cooperate with me in making this the most efficient and the cleanest example of public enterprise the world has ever seen.
It is time to provide a smashing answer for those cynical men who say that a democracy cannot be honest and efficient. If you will help, this can be done. I, therefore, hope you will watch the work in every corner of this Nation. Feel free to criticize. Tell me of instances where work can be done better, or where improper practices prevail. Neither you nor I want criticism conceived in a purely fault-finding or partisan spirit, but I am jealous of the right of every citizen to call to the attention of his or her government examples of how the public money can be more effectively spent for the benefit of the American people.
I now come, my friends, to a part of the remaining business before the Congress. It has under consideration many measures which provide for the rounding out of the program of economic and social reconstruction with which we have been concerned for two years. I can mention only a few of them tonight, but I do not want my mention of specific measures to be interpreted as lack of interest in or disapproval of many other important proposals that are pending.
The National Industrial Recovery Act expires on the sixteenth of June. After careful consideration, I have asked the Congress to extend the life of this useful agency of government. As we have proceeded with the administration of this Act, we have found from time to time more and more useful ways of promoting its purposes. No reasonable person wants to abandon our present gains—we must continue to protect children, to enforce minimum wages, to prevent excessive hours, to safeguard, define and enforce collective bargaining, and, while retaining fair competition, to eliminate so far as humanly possible, the kinds of unfair practices by selfish minorities which unfortunately did more than anything else to bring about the recent collapse of industries.
There is likewise pending before the Congress legislation to provide for the elimination of unnecessary holding companies in the public utility field.
I consider this legislation a positive recovery measure. Power production in this country is virtually back to the 1929 peak. The operating companies in the gas and electric utility field are by and large in good condition. But under holding company domination the utility industry has long been hopelessly at war within itself and with public sentiment. By far the greater part of the general decline in utility securities had occurred before I was inaugurated. The absentee management of unnecessary holding company control has lost touch with, and has lost the sympathy of, the communities it pretends to serve. Even more significantly it has given the country as a whole an uneasy apprehension of overconcentrated economic power.
A business that loses the confidence of its customers and the good- will of the public cannot long continue to be a good risk for the investor. This legislation will serve the investor by ending the conditions which have caused that lack of confidence and good-will. It will put the public utility operating industry on a sound basis for the future, both in its public relations and in its internal relations.
This legislation will not only in the long run result in providing lower electric and gas rates to the consumer, but it will protect the actual value and earning power of properties now owned by thousands of investors who have little protection under the old laws against what used to be called frenzied finance. It will not destroy values.
Not only business recovery, but the general economic recovery of the nation will be greatly stimulated by the enactment of legislation designed to improve the status of our transportation agencies. There is need for legislation providing for the regulation of interstate transportation by buses and trucks, for the regulation of transportation by water, for the strengthening of our Merchant Marine and Air Transport, for the strengthening of the Interstate Commerce Commission to enable it to carry out a rounded conception of the national transportation system in which the benefits of private ownership are retained while the public stake in these important services is protected by the public's government.
Finally, the reestablishment of public confidence in the banks of the nation is one of the most hopeful results of our efforts as a Nation to reestablish public confidence in private banking. We all know that private banking actually exists by virtue of the permission of and regulation by the people as a whole, speaking through their government. Wise public policy, however, requires not only that banking be safe but that its resources be most fully utilized in the economic life of the country. To this end it was decided more than twenty years ago that the government should assume the responsibility of providing a means by which the credit of the nation might be controlled, not by a few private banking institutions, but by a body with public prestige and authority. The answer to this demand was the Federal Reserve System. Twenty years of experience with this system have justified the efforts made to create it, but these twenty years have shown by experience definite possibilities for improvement. Certain proposals made to amend the Federal Reserve Act deserve prompt and favorable action by the Congress. They are a minimum of wise readjustments of our Federal Reserve System in the light of past experience and present needs.
These measures I have mentioned are, in large part, the program which under my constitutional duty I have recommended to the Congress. They are essential factors in a rounded program for national recovery. They contemplate the enrichment of our national life by a sound and rational ordering of its various elements and wise provisions for the protection of the weak against the strong.
Never since my inauguration in March, 1933, have I felt so unmistakably the atmosphere of recovery. But it is more than the recovery of the material basis of our individual lives. It is the recovery of confidence in our democratic processes and institutions. We have survived all of the arduous burdens and the threatening dangers of a great economic calamity. We have in the darkest moments of our national trials retained our faith in our own ability to master our destiny. Fear is vanishing and confidence is growing on every side, renewed faith in the vast possibilities of human beings to improve their material and spiritual status through the instrumentality of the democratic form of government. That faith is receiving its just reward. For that we can be thankful to the God who watches over America.
September 6, 1936.
I have been on a journey of husbandry. I went primarily to see at first hand conditions in the drought states; to see how effectively federal and local authorities are taking care of pressing problems of relief and also how they are to work together to defend the people of this country against the effects of future droughts.
I saw drought devastation in nine states.
I talked with families who had lost their wheat crop, lost their corn crop, lost their livestock, lost the water in their well, lost their garden and come through to the end of the summer without one dollar of cash resources, facing a winter without feed or food— facing a planting season without seed to put in the ground.
That was the extreme case, but there are thousands and thousands of families on Western farms who share the same difficulties.
I saw cattlemen who because of lack of grass or lack of winter feed have been completely compelled to sell all but their breeding stock and will need help to carry even these through the coming winter. I saw livestock kept alive only because water had been brought to them long distances in tank cars. I saw other farm families who have not lost everything but who, because they have made only partial crops, must have some form of help if they are to continue farming next spring.
I shall never forget the fields of wheat so blasted by heat that they cannot be harvested. I shall never forget field after field of corn stunted, earless and stripped of leaves, for what the sun left the grasshoppers took. I saw brown pastures which would not keep a cow on fifty acres.
Yet I would not have you think for a single minute that there is permanent disaster in these drought regions, or that the picture I saw meant depopulating these areas. No cracked earth, no blistering sun, no burning wind, no grasshoppers, are a permanent match for the indomitable American farmers and stockmen and their wives and children who have carried on through desperate days, and inspire us with their self-reliance, their tenacity and their courage. It was their fathers' task to make homes; it is their task to keep those homes; it is our task to help them win their fight.
First let me talk for a minute about this autumn and the coming winter. We have the option, in the case of families who need actual subsistence, of putting them on the dole or putting them to work. They do not want to go on the dole and they are one thousand percent right. We agree, therefore, that we must put them to work for a decent wage; and when we reach that decision we kill two birds with one stone, because these families will earn enough by working, not only to subsist themselves, but to buy food for their stock, and seed for next year's planting. Into this scheme of things there fit of course the government lending agencies which next year, as in the past, will help with production loans.
Every governor with whom I have talked is in full accord with this program of doing work for these farm families, just as every governor agrees that the individual states will take care of their unemployables but that the cost of employing those who are entirely able and willing to work must be borne by the federal government.
If then we know, as we do today, the approximate number of farm families who will require some form of work relief from now on through the winter, we face the question of what kind of work they should do. Let me make it clear that this is not a new question because it has already been answered to a greater or less extent in every one of the drought communities. Beginning in 1934, when we also had serious drought conditions, the state and federal governments cooperated in planning a large number of projects—many of them directly aimed at the alleviation of future drought conditions. In accordance with that program literally thousands of ponds or small reservoirs have been built in order to supply water for stock and to lift the level of the underground water to protect wells from going dry. Thousands of wells have been drilled or deepened; community lakes have been created and irrigation projects are being pushed.
Water conservation by means such as these is being expanded as a result of this new drought all through the Great Plains area, the Western corn belt and in the states that lie further south. In the Middle West water conservation is not so pressing a problem. Here the work projects run more to soil erosion control and the building of farm-to-market roads.
Spending like this is not waste. It would spell future waste if we did not spend for such things now. These emergency work projects provide money to buy food and clothing for the winter; they keep the livestock on the farm; they provide seed for a new crop, and, best of all, they will conserve soil and water in the future in those areas most frequently hit by drought.
If, for example, in some local area the water table continues to drop and the topsoil to blow away, the land values will disappear with the water and the soil. People on the farms will drift into the nearby cities; the cities will have no farm trade and the workers in the city factories and stores will have no jobs. Property values in the cities will decline. If, on the other hand, the farms within that area remain as farms with better water supply and no erosion, the farm population will stay on the land and prosper and the nearby cities will prosper too. Property values will increase instead of disappearing. That is why it is worth our while as a nation to spend money in order to save money.
I have used the argument in relation only to a small area. It holds good in its effect on the nation as a whole. Every state in the drought area is now doing and always will do business with every state outside it. The very existence of the men and women working in the clothing factories of New York, making clothes worn by farmers and their families; of the workers in the steel mills in Pittsburgh, in the automobile factories of Detroit, and in the harvester factories of Illinois, depend upon the farmers' ability to purchase the commodities they produce. In the same way it is the purchasing power of the workers in these factories in the cities that enables them and their wives and children to eat more beef, more pork, more wheat, more corn, more fruit and more dairy products, and to buy more clothing made from cotton, wool and leather. In a physical and a property sense, as well as in a spiritual sense, we are members one of another.
I want to make it clear that no simple panacea can be applied to the drought problem in the whole of the drought area. Plans must depend on local conditions, for these vary with annual rainfall, soil characteristics, altitude and topography. Water and soil conservation methods may differ in one county from those in an adjoining county. Work to be done in the cattle and sheep country differs in type from work in the wheat country or work in the corn belt.
The Great Plains Drought Area Committee has given me its preliminary recommendations for a long-time program for that region. Using that report as a basis we are cooperating successfully and in entire accord with the governors and state planning boards. As we get this program into operation the people more and more will be able to maintain themselves securely on the land. That will mean a steady decline in the relief burdens which the federal government and states have had to assume in time of drought; but, more important, it will mean a greater contribution to general national prosperity by these regions which have been hit by drought. It will conserve and improve not only property values, but human values. The people in the drought area do not want to be dependent on federal, state or any other kind of charity. They want for themselves and their families an opportunity to share fairly by their own efforts in the progress of America.
The farmers of America want a sound national agricultural policy in which a permanent land-use program will have an important place. They want assurance against another year like 1932 when they made good crops but had to sell them for prices that meant ruin just as surely as did the drought. Sound policy must maintain farm prices in good crop years as well as in bad crop years. It must function when we have drought; it must also function when we have bumper crops.
The maintenance of a fair equilibrium between farm prices and the prices of industrial products is an aim which we must keep ever before us, just as we must give constant thought to the sufficiency of the food supply of the nation even in bad years. Our modern civilization can and should devise a more successful means by which the excess supplies of bumper years can be conserved for use in lean years.
On my trip I have been deeply impressed with the general efficiency of those agencies of the federal, state and local governments which have moved in on the immediate task created by the drought. In 1934 none of us had preparation; we worked without blueprints and made the mistakes of inexperience. Hindsight shows us this. But as time has gone on we have been making fewer and fewer mistakes. Remember that the federal and state governments have done only broad planning. Actual work on a given project originates in the local community. Local needs are listed from local information. Local projects are decided on only after obtaining the recommendations and help of those in the local community who are best able to give it. And it is worthy of note that on my entire trip, though I asked the question dozens of times, I heard no complaint against the character of a single work relief project.
The elected heads of the states concerned, together with their state officials and their experts from agricultural colleges and state planning boards, have shown cooperation with and approval of the work which the federal government has headed. I am grateful also to the men and women in all these states who have accepted leadership in the work in their locality.
In the drought area people are not afraid to use new methods to meet changes in Nature, and to correct mistakes of the past. If overgrazing has injured range lands, they are willing to reduce the grazing. If certain wheat lands should be returned to pasture they are willing to cooperate. If trees should be planted as windbreaks or to stop erosion they will work with us. If terracing or summer fallowing or crop rotation is called for, they will carry them out. They stand ready to fit, and not to fight, the ways of Nature.
We are helping, and shall continue to help the farmer to do those things, through local soil conservation committees and other cooperative local, state and federal agencies of government.
I have not the time tonight to deal with other and more comprehensive agricultural policies.
With this fine help we are tiding over the present emergency. We are going to conserve soil, conserve water and conserve life. We are going to have long-time defenses against both low prices and drought. We are going to have a farm policy that will serve the national welfare. That is our hope for the future.
There are two reasons why I want to end by talking about reemployment. Tomorrow is Labor Day. The brave spirit with which so many millions of working people are winning their way out of depression deserves respect and admiration. It is like the courage of the farmers in the drought areas.
That is my first reason. The second is that healthy employment conditions stand equally with healthy agricultural conditions as a buttress of national prosperity. Dependable employment at fair wages is just as important to the people in the towns and cities as good farm income is to agriculture. Our people must have the ability to buy the goods they manufacture and the crops they produce. Thus city wages and farm buying power are the two strong legs that carry the nation forward.
Reemployment in industry is proceeding rapidly. Government spending was in large part responsible for keeping industry going and putting it in a position to make this reemployment possible. Government orders were the backlog of heavy industry; government wages turned over and over again to make consumer purchasing power and to sustain every merchant in the community. Businessmen with their businesses, small and large, had to be saved. Private enterprise is necessary to any nation which seeks to maintain the democratic form of government. In their case, just as certainly as in the case of drought-stricken farmers, government spending has saved.
Government having spent wisely to save it, private industry begins to take workers off the rolls of the government relief program. Until this administration we had no free employment service, except in a few states and cities. Because there was no unified employment service, the worker, forced to move as industry moved, often travelled over the country, wandering after jobs which seemed always to travel just a little faster than he did. He was often victimized by fraudulent practices of employment clearing houses, and the facts of employment opportunities were at the disposal neither of himself nor of the employer.
In 1933 the United States Employment Service was created—a cooperative state and federal enterprise, through which the federal government matches dollar for dollar the funds provided by the states for registering the occupations and skills of workers and for actually finding jobs for these registered workers in private industry. The federal-state cooperation has been splendid. Already employment services are operating in thirty-two states, and the areas not covered by them are served by the federal government.
We have developed a nationwide service with seven hundred district offices and one thousand branch offices, thus providing facilities through which labor can learn of jobs available and employers can find workers.
Last spring I expressed the hope that employers would realize their deep responsibility to take men off the relief rolls and give them jobs in private enterprise. Subsequently I was told by many employers that they were not satisfied with the information available concerning the skill and experience of the workers on the relief rolls. On August 25th I allocated a relatively small sum to the employment service for the purpose of getting better and more recent information in regard to those now actively at work on W.P.A. Projects—information as to their skills and previous occupations—and to keep the records of such men and women up-to- date for maximum service in making them available to industry. Tonight I am announcing the allocation of two and a half million dollars more to enable the Employment Service to make an even more intensive search then it has yet been equipped to make, to find opportunities in private employment for workers registered with it.
Tonight I urge the workers to cooperate with and take full advantage of this intensification of the work of the Employment Service. This does not mean that there will be any lessening of our efforts under our W.P.A. and P.W.A. and other work relief programs until all workers have decent jobs in private employment at decent wages. We do not surrender our responsibility to the unemployed. We have had ample proof that it is the will of the American people that those who represent them in national, state and local government should continue as long as necessary to discharge that responsibility. But it does mean that the government wants to use resource to get private work for those now employed on government work, and thus to curtail to a minimum the government expenditures for direct employment.
Tonight I ask employers, large and small, throughout the nation, to use the help of the state and Federal Employment Service whenever in the general pick-up of business they require more workers.
Tomorrow is Labor Day. Labor Day in this country has never been a class holiday. It has always been a national holiday. It has never had more significance as a national holiday than it has now. In other countries the relationship of employer and employee has been more or less been accepted as a class relationship not readily to be broken through. In this country we insist, as an essential of the American way of life, that the employer-employee relationship should be one between free men and equals. We refuse to regard those who work with hand or brain as different from or inferior to those who live from their property. We insist that labor is entitled to as much respect as property. But our workers with hand and brain deserve more than respect for their labor. They deserve practical protection in the opportunity to use their labor at a return adequate to support them at a decent and constantly rising standard of living, and to accumulate a margin of security against the inevitable vicissitudes of life.
The average man must have that twofold opportunity if we are to avoid the growth of a class-conscious society in this country.
There are those who fail to read both the signs of the times and American history. They would try to refuse the worker any effective power to bargain collectively, to earn a decent livelihood and to acquire security. It is those short-sighted ones, not labor, who threaten this country with that class dissension which in other countries has led to dictatorship and the establishment of fear and hatred as the dominant emotions in human life.
All American workers, brain workers and manual workers alike, and all the rest of us whose well-being depends on theirs, know that our needs are one in building an orderly economic democracy in which all can profit and in which all can be secure from the kind of faulty economic direction which brought us to the brink of common ruin seven years ago.
There is no cleavage between white collar workers and manual workers, between artists and artisans, musicians and mechanics, lawyers and accountants and architects and miners.
Tomorrow, Labor Day, belongs to all of us. Tomorrow, Labor Day, symbolizes the hope of all Americans. Anyone who calls it a class holiday challenges the whole concept of American democracy.
The Fourth of July commemorates our political freedom—a freedom which without economic freedom is meaningless indeed. Labor Day symbolizes our determination to achieve an economic freedom for the average man which will give his political freedom reality.
March 9, 1937.
Last Thursday I described in detail certain economic problems which everyone admits now face the nation. For the many messages which have come to me after that speech, and which it is physically impossible to answer individually, I take this means of saying "thank you."
Tonight, sitting at my desk in the White House, I make my first radio report to the people in my second term of office.
I am reminded of that evening in March, four years ago, when I made my first radio report to you. We were then in the midst of the great banking crisis.
Soon after, with the authority of the Congress, we asked the nation to turn over all of its privately held gold, dollar for dollar, to the government of the United States.
Today's recovery proves how right that policy was.
But when, almost two years later, it came before the Supreme Court its constitutionality was upheld only by a five-to-four vote. The change of one vote would have thrown all the affairs of this great Nation back into hopeless chaos. In effect, four Justices ruled that the right under a private contract to exact a pound of flesh was more sacred than the main objectives of the Constitution to establish an enduring Nation.
In 1933 you and I knew that we must never let our economic system get completely out of joint again—that we could not afford to take the risk of another great depression.
We also became convinced that the only way to avoid a repetition of those dark days was to have a government with power to prevent and to cure the abuses and the inequalities which had thrown that system out of joint.
We then began a program of remedying those abuses and inequalities—to give balance and stability to our economic system—to make it bomb-proof against the causes of 1929.
Today we are only part-way through that program—and recovery is speeding up to a point where the dangers of 1929 are again becoming possible, not this week or month perhaps, but within a year or two.
National laws are needed to complete that program. Individual or local or state effort alone cannot protect us in 1937 any better than ten years ago.
It will take time—and plenty of time—to work out our remedies administratively even after legislation is passed. To complete our program of protection in time, therefore, we cannot delay one moment in making certain that our national government has power to carry through.
Four years ago action did not come until the eleventh hour. It was almost too late.
If we learned anything from the depression we will not allow ourselves to run around in new circles of futile discussion and debate, always postponing the day of decision.
The American people have learned from the depression. For in the last three national elections an overwhelming majority of them voted a mandate that the Congress and the President begin the task of providing that protection—not after long years of debate, but now.
The courts, however, have cast doubts on the ability of the elected Congress to protect us against catastrophe by meeting squarely our modern social and economic conditions.
We are at a crisis in our ability to proceed with that protection. It is a quiet crisis. There are no lines of depositors outside closed banks. But to the far-sighted it is far-reaching in its possibilities of injury to America.
I want to talk with you very simply about the need for present action in this crisis—the need to meet the unanswered challenge of one-third of a Nation ill-nourished, ill-clad, ill-housed.
Last Thursday I described the American form of government as a three horse team provided by the Constitution to the American people so that their field might be plowed. The three horses are, of course, the three branches of government—the Congress, the Executive and the courts. Two of the horses are pulling in unison today; the third is not. Those who have intimated that the President of the United States is trying to drive that team, overlook the simple fact that the President, as Chief Executive, is himself one of the three horses.
It is the American people themselves who are in the driver's seat.
It is the American people themselves who want the furrow plowed.
It is the American people themselves who expect the third horse to pull in unison with the other two.
I hope that you have re-read the Constitution of the United States in these past few weeks. Like the Bible, it ought to be read again and again.
It is an easy document to understand when you remember that it was called into being because the Articles of Confederation under which the original thirteen States tried to operate after the Revolution showed the need of a national government with power enough to handle national problems. In its Preamble, the Constitution states that it was intended to form a more perfect Union and promote the general welfare; and the powers given to the Congress to carry out those purposes can be best described by saying that they were all the powers needed to meet each and every problem which then had a national character and which could not be met by merely local action.
But the framers went further. Having in mind that in succeeding generations many other problems then undreamed of would become national problems, they gave to the Congress the ample broad powers "to levy taxes. . . and provide for the common defense and general welfare of the United States."
That, my friends, is what I honestly believe to have been the clear and underlying purpose of the patriots who wrote a federal constitution to create a national government with national power, intended as they said, "to form a more perfect union. . . for ourselves and our posterity."
For nearly twenty years there was no conflict between the Congress and the Court. Then Congress passed a statute which, in 1803, the Court said violated an express provision of the Constitution. The Court claimed the power to declare it unconstitutional and did so declare it. But a little later the Court itself admitted that it was an extraordinary power to exercise and through Mr. Justice Washington laid down this limitation upon it: "It is but a decent respect due to the wisdom, the integrity and the patriotism of the legislative body, by which any law is passed, to presume in favor of its validity until its violation of the Constitution is proved beyond all reasonable doubt."
But since the rise of the modern movement for social and economic progress through legislation, the Court has more and more often and more and more boldly asserted a power to veto laws passed by the Congress and state legislatures in complete disregard of this original limitation.
In the last four years the sound rule of giving statutes the benefit of all reasonable doubt has been cast aside. The Court has been acting not as a judicial body, but as a policy-making body.
When the Congress has sought to stabilize national agriculture, to improve the conditions of labor, to safeguard business against unfair competition, to protect our national resources, and in many other ways, to serve our clearly national needs, the majority of the Court has been assuming the power to pass on the wisdom of these acts of the Congress—and to approve or disapprove the public policy written into these laws.
That is not only my accusation. It is the accusation of most distinguished justices of the present Supreme Court. I have not the time to quote to you all the language used by dissenting justices in many of these cases. But in the case holding the Railroad Retirement Act unconstitutional, for instance, Chief Justice Hughes said in a dissenting opinion that the majority opinion was "a departure from sound principles," and placed "an unwarranted limitation upon the commerce clause." And three other justices agreed with him.
In the case of holding the A.A.A. unconstitutional, Justice Stone said of the majority opinion that it was a "tortured construction of the Constitution." And two other justices agreed with him.
In the case holding the New York Minimum Wage Law unconstitutional, Justice Stone said that the majority were actually reading into the Constitution their own "personal economic predilections," and that if the legislative power is not left free to choose the methods of solving the problems of poverty, subsistence, and health of large numbers in the community, then "government is to be rendered impotent." And two other justices agreed with him.
In the face of these dissenting opinions, there is no basis for the claim made by some members of the Court that something in the Constitution has compelled them regretfully to thwart the will of the people.
In the face of such dissenting opinions, it is perfectly clear that, as Chief Justice Hughes has said, "We are under a Constitution, but the Constitution is what the judges say it is."
The Court in addition to the proper use of its judicial functions has improperly set itself up as a third house of the Congress—a super-legislature, as one of the justices has called it—reading into the Constitution words and implications which are not there, and which were never intended to be there.
We have, therefore, reached the point as a nation where we must take action to save the Constitution from the Court and the Court from itself. We must find a way to take an appeal from the Supreme Court to the Constitution itself. We want a Supreme Court which will do justice under the Constitution—not over it. In our courts we want a government of laws and not of men.
I want—as all Americans want—an independent judiciary as proposed by the framers of the Constitution. That means a Supreme Court that will enforce the Constitution as written—that will refuse to amend the Constitution by the arbitrary exercise of judicial power— amended by judicial say-so. It does not mean a judiciary so independent that it can deny the existence of facts which are universally recognized.
How then could we proceed to perform the mandate given us? It was said in last year's Democratic platform, "If these problems cannot be effectively solved within the Constitution, we shall seek such clarifying amendment as will assure the power to enact those laws, adequately to regulate commerce, protect public health and safety, and safeguard economic security." In other words, we said we would seek an amendment only if every other possible means by legislation were to fail.
When I commenced to review the situation with the problem squarely before me, I came by a process of elimination to the conclusion that, short of amendments, the only method which was clearly constitutional, and would at the same time carry out other much needed reforms, was to infuse new blood into all our courts. We must have men worthy and equipped to carry out impartial justice. But, at the same time, we must have judges who will bring to the courts a present-day sense of the Constitution—judges who will retain in the courts the judicial functions of a court, and reject the legislative powers which the courts have today assumed.
In forty-five out of the forty-eight states of the Union, judges are chosen not for life but for a period of years. In many states judges must retire at the age of seventy. Congress has provided financial security by offering life pensions at full pay for federal judges on all courts who are willing to retire at seventy. In the case of Supreme Court justices, that pension is $20,000 a year. But all federal judges, once appointed, can, if they choose, hold office for life, no matter how old they may get to be.
What is my proposal? It is simply this: whenever a judge or justice of any federal court has reached the age of seventy and does not avail himself of the opportunity to retire on a pension, a new member shall be appointed by the President then in office, with the approval, as required by the Constitution, of the Senate of the United States.
That plan has two chief purposes. By bringing into the judicial system a steady and continuing stream of new and younger blood, I hope, first, to make the administration of all federal justice speedier and, therefore, less costly; secondly, to bring to the decision of social and economic problems younger men who have had personal experience and contact with modern facts and circumstances under which average men have to live and work. This plan will save our national Constitution from hardening of the judicial arteries.
The number of judges to be appointed would depend wholly on the decision of present judges now over seventy, or those who would subsequently reach the age of seventy.
If, for instance, any one of the six justices of the Supreme Court now over the age of seventy should retire as provided under the plan, no additional place would be created. Consequently, although there never can be more than fifteen, there may be only fourteen, or thirteen, or twelve. And there may be only nine.
There is nothing novel or radical about this idea. It seeks to maintain the federal bench in full vigor. It has been discussed and approved by many persons of high authority ever since a similar proposal passed the House of Representatives in 1869.
Why was the age fixed at seventy? Because the laws of many states, the practice of the Civil Service, the regulations of the Army and Navy, and the rules of many of our universities and of almost every great private business enterprise, commonly fix the retirement age at seventy years or less.
The statute would apply to all the courts in the federal system. There is general approval so far as the lower federal courts are concerned. The plan has met opposition only so far as the Supreme Court of the United States itself is concerned. If such a plan is good for the lower courts it certainly ought to be equally good for the highest court from which there is no appeal.