Tuesday, February 24, 2009

We'd Like to Thank You, Herbert Hoover

I didn't listen to Obama's speech tonight. I tend not to like to listen to these speeches, but to read them, instead, so that I can focus on the words, instead of on such things as delivery, camera angles, fawning, swooning news anchors with leg-tingling-syndrome, and the like.

But as I read over Obama's words from this transcript, I was haunted by a sense of familiarity. Surely we've been down a road like this one before? Surely we've heard some of these same words?

What follows will be quotes from Obama's speech tonight in bold print, compared with quotes from Herbert Hoover's annual message to Congress from Dec. 1931 in italics. There are some very interesting similarities--and some even more interesting differences:

The weight of this crisis will not determine the destiny of this nation. The answers to our problems don't lie beyond our reach. They exist in our laboratories and our universities; in our fields and our factories; in the imaginations of our entrepreneurs and the pride of the hardest-working people on Earth. Those qualities that have made America the greatest force of progress and prosperity in human history we still possess in ample measure. What is required now is for this country to pull together, confront boldly the challenges we face, and take responsibility for our future once more.

If we lift our vision beyond these immediate emergencies we find fundamental national gains even amid depression. In meeting the problems of this difficult period, we have witnessed a remarkable development of the sense of cooperation in the community. For the first time in the history of our major economic depressions there has been a notable absence of public disorders and industrial conflict. Above all there is an enlargement of social and spiritual responsibility among the people. The strains and stresses upon business have resulted in closer application in saner policies, and in better methods. Public improvements have been carried out on a larger scale than even in normal times. The country is richer in physical property, in newly discovered resources, and in productive capacity than ever before. There has been constant gain in knowledge and education; there has been continuous advance in science and invention; there has been distinct gain in public health. Business depressions have been recurrent in the life of our country and are but transitory. The nation has emerged from each of them with increased strength and virility because of the enlightenment they have brought, the readjustments and the larger understanding of the realities and obligations of life and work which come from them.

As soon as I took office, I asked this Congress to send me a recovery plan by President's Day that would put people back to work and put money in their pockets. Not because I believe in bigger government -- I don't. Not because I'm not mindful of the massive debt we've inherited -- I am. I called for action because the failure to do so would have cost more jobs and caused more hardship. In fact, a failure to act would have worsened our long-term deficit by assuring weak economic growth for years. And that's why I pushed for quick action. And tonight, I am grateful that this Congress delivered, and pleased to say that the American Recovery and Reinvestment Act is now law. (Applause.)

Over the next two years, this plan will save or create 3.5 million jobs. More than 90 percent of these jobs will be in the private sector -- jobs rebuilding our roads and bridges; constructing wind turbines and solar panels; laying broadband and expanding mass transit.

The emergencies of unemployment have been met by action in many directions. The appropriations for the continued speeding up of the great Federal construction program have provided direct and indirect aid to unemployment upon a large scale. By organized unity of action, the states and municipalities have also maintained large programs of public improvement. Many industries have been prevailed upon to anticipate and intensify construction. Industrial concerns and other employers have been organized to spread available work amongst all their employees instead of discharging a portion of them. A large majority have maintained wages at as high levels as the safe conduct of their business would permit. This course has saved us from industrial conflict and disorder which have characterized all previous depressions. Immigration has been curtailed by administrative action. Upon the basis of normal immigration the decrease amounts to about 300,000 individuals who otherwise would have been added to our unemployment. The expansion of Federal employment agencies under appropriations by the Congress has proved most effective. Through the President's organization for unemployment relief, public and private agencies were successfully mobilized last winter to provide employment and other measures against distress. Similar organization gives assurance against suffering during the coming winter. Committees of leading citizens are now active at practically every point of unemployment. In the large majority they have been assured the funds necessary which, together with local government aids, will meet the situation. A few exceptional localities will be further organized. The evidence of the Public Health Service shows an actual decrease of sickness and infant and general mortality below normal years. No greater proof could be adduced that our people have been protected from hunger and cold and that the sense of social responsibility in the nation has responded to the need of the unfortunate….

The concern is that if we do not restart lending in this country, our recovery will be choked off before it even begins.

You see -- (applause) -- you see, the flow of credit is the lifeblood of our economy. The ability to get a loan is how you finance the purchase of everything from a home to a car to a college education, how stores stock their shelves, farms buy equipment, and businesses make payroll.

But credit has stopped flowing the way it should. Too many bad loans from the housing crisis have made their way onto the books of too many banks. And with so much debt and so little confidence, these banks are now fearful of lending out any more money to households, to businesses, or even to each other. And when there is no lending, families can't afford to buy homes or cars. So businesses are forced to make layoffs. Our economy suffers even more, and credit dries up even further.

That is why this administration is moving swiftly and aggressively to break this destructive cycle, to restore confidence, and restart lending.

The situation largely arises from an unjustified lack of confidence. We have enormous volumes of idle money in the banks and in hoarding. We do not require more money or working capital -- we need to put what we have to work.

The fundamental difficulties which have brought about financial strains in foreign countries do not exist in the United States. No external drain on our resources can threaten our position, because the balance of international payments is in our favor; we owe less to foreign countries than they owe to us; our industries are efficiently organized; our currency and bank deposits are protected by the greatest gold reserve in history.

Our first step toward recovery is to reestablish confidence and thus restore the flow of credit which is the very basis of our economic life. We must put some steel beams in the foundations of our credit structure. It is our duty to apply the full strength of our government not only to the immediate phases, but to provide security against shocks and the repetition of the weaknesses which have been proven.

Second -- second, we have launched a housing plan that will help responsible families facing the threat of foreclosure lower their monthly payments and refinance their mortgages. It's a plan that won't help speculators or that neighbor down the street who bought a house he could never hope to afford, but it will help millions of Americans who are struggling with declining home values -- Americans who will now be able to take advantage of the lower interest rates that this plan has already helped to bring about. In fact, the average family who refinances today can save nearly $2,000 per year on their mortgage. (Applause.)

I recommend the establishment of a system of home-loan discount banks as the necessary companion in our financial structure of the Federal Reserve Banks and our Federal Land Banks. Such action will relieve present distressing pressures against home and farm property owners. It will relieve pressures upon and give added strength to building and loan associations, savings banks, and deposit banks, engaged in extending such credits. Such action would further decentralize our credit structure. It would revive residential construction and employment. It would enable such loaning institutions more effectually to promote home ownership. I discussed this plan at some length in a statement made public November 14, last. This plan has been warmly endorsed by the recent National Conference upon Home Ownership and Housing, whose members were designated by the governors of the states and the groups interested.

And that's why I've asked Vice President Biden to lead a tough, unprecedented oversight effort -- because nobody messes with Joe. (Applause.) I -- isn't that right? They don't mess with you. I have told each of my Cabinet, as well as mayors and governors across the country, that they will be held accountable by me and the American people for every dollar they spend. I've appointed a proven and aggressive Inspector General to ferret out any and all cases of waste and fraud. And we have created a new website called recovery.gov so that every American can find out how and where their money is being spent.

I have referred in previous messages to the profound need of further reorganization and consolidation of Federal administrative functions to eliminate overlap and waste, and to enable coordination and definition of government policies now wholly impossible in scattered and conflicting agencies which deal with parts of the same major function. I shall lay before the Congress further recommendations upon this subject, particularly in relation to the Department of the Interior. There are two directions of such reorganization, however, which have an important bearing upon the emergency problems with which we are confronted. (...)

These words -- these words and these stories tell us something about the spirit of the people who sent us here. They tell us that even in the most trying times, amid the most difficult circumstances, there is a generosity, a resilience, a decency, and a determination that perseveres; a willingness to take responsibility for our future and for posterity.

Their resolve must be our inspiration. Their concerns must be our cause. And we must show them and all our people that we are equal to the task before us. (Applause.)

I know -- look, I know that we haven't agreed on every issue thus far -- (laughter.) There are surely times in the future where we will part ways. But I also know that every American who is sitting here tonight loves this country and wants it to succeed. I know that. (Applause.) That must be the starting point for every debate we have in the coming months, and where we return after those debates are done. That is the foundation on which the American people expect us to build common ground.

And if we do -- if we come together and lift this nation from the depths of this crisis; if we put our people back to work and restart the engine of our prosperity; if we confront without fear the challenges of our time and summon that enduring spirit of an America that does not quit, then someday years from now our children can tell their children that this was the time when we performed, in the words that are carved into this very chamber, "something worthy to be remembered."

Many vital changes and movements of vast proportions are taking place in the economic world. The effect of these changes upon the future can not be seen clearly as yet. Of this, however, we are sure: Our system, based upon the ideals of individual initiative and of equality of opportunity, is not an artificial thing. Rather it is the outgrowth of the experience of America, and expresses the faith and spirit of our people. It has carried us in a century and a half to leadership of the economic world. If our economic system does not match our highest expectations at all times, it does not require revolutionary action to bring it into accord with any necessity that experience may prove. It has successfully adjusted itself to changing conditions in the past. It will do so again. The mobility of our institutions, the richness of our resources, and the abilities of our people enable us to meet them unafraid. It is a distressful time for many of our people, but they have shown qualities as high in fortitude, courage, and resourcefulness as ever in our history. With that spirit, I have faith that out of it will come a sounder life, a truer standard of values, a greater recognition of the results of honest effort, and a healthier atmosphere in which to rear our children. Ours must be a country of such stability and security as can not fail to carry forward and enlarge among all the people that abundant life of material and spiritual opportunity which it has represented among all nations since its beginning.
Like I said, some interesting similarities; some interesting differences. But reading through the two speeches, hearing the echoes of the past in the crisis of the present, I can't help but think that poor President Hoover had no idea how much worse things were going to get before they ever got better, how so many Americans clamored for the promise of government handouts and freebies in Roosevelt's proposed New Deal, and how it really, in the opinion of many historians, took the wartime prosperity fueled by World War II and its demands upon the American manufacturing industry (even before we actually entered the war) before the downward spiral was stopped, and the economic situation in America began to improve.

President Obama's speech was a collection of liberal ideas which it seems that he and the Democrats in Congress want to employ, opportunistically one might think, under the cloak of the economic crisis. But if what is now barely being called a recession ends up being an actual depression, the waves of history may end up discrediting the notion that we can socialize our way out of economic turmoil by spending federal government money on energy and health care and free college for all and all the other usual elements of the liberal laundry list, just as the waves of the past battered down some of President Hoover's ideas about solving the economic crisis of his day.


LarryD said...

"I have told each of my Cabinet, as well as mayors and governors across the country, that they will be held accountable by me and the American people for every dollar they spend."

That's darn scary - reaching a bit beyond the scope and power of the president, isn't he?

freddy said...

Rather brilliant comparison!

David Claiborne said...

Nice side-by-side, thank you for that.

I'm cautiously optimistic that 70+ years of history has taught us a few things, and you touch on the most important in your second-to-last paragraph.

Government handouts do little to encourage people to improve their lot in life (which is why we're investing heavily in the manufacturing industry and education), but as can be seen in this Moody's financial research, the only government investments that offer a ROI rate higher than increased infrastructure spending are extending unemployment insurance benefits and temporary increases in food stamps. So in terms of short-term stimulus, "government handouts" are undeniably sound fiscal policy.

Stipulating that it was WWII that got us out of the Great Depression, you still can't get around the fact that it was government spending. Only the government can deficit-spend during the one time when it's needed - economic downturn.

I find it interesting that as a Catholic, you seem to have no problem with government spending for tanks, bullets and bombs, but not for food for the poor and hungry. How do you reconcile this?