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1900
The Early Years
By: David K. Every
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Apr 10,1999
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 is early career
FDR was basically failing as a lawyer, and so FDR went into politics. This was where FDR found his purpose. His lack of experience was compensated for by his family name. Even though FDR had supported Teddy Roosevelt (Republican), FDR had no problems running as a Democrat (probably since the Republicans weren't interested in him) for New York State Senator (1910). He had a nack for listening and telling people what they wanted to hear but his views seemed to vary depending on who he was talking to (to meet their desires). Roosevelt also reaped the rewards of a national trend away from Republicans (establishment) at that time, and he won a surprise victory. His follow on election (1912) was close, but he remained in office.
In 1911 FDR was named a Master Mason, and much later he was responsible for the "Great Seal" being put on the dollar bill. But many Presidents and men were into Masonry, so I don't think this as big a deal as some might make it out to be. It was just an old boys club as a means to get more power and influence.
Roosevelt became Assistant Secretary of the Navy (1913-1920), which suited his tastes since he had been into sailing for quite some time. Roosevelt used this opportunity to build up his Washington contacts, and contacts into the democratic part.
In 1914 he made another play for senator, but he lost the nomination in a resounding defeat. He had crossed the Tammany hall political machine once too often, and they returned the favors. After this he seemed to lose much of his "principles" and became far more pragmatic, and made an effort to be "agreeable".
In 1920 he got the Vice Presidential nomination but went down to a stellar defeat against Warren G. Harding and Calvin Coolidge. This gave him a "cooling off" period, and he dropped out of politics for a bit, and he formed a new law firm in New York City and became vice president of Fidelity and Deposit Company of Maryland. He was stricken with polio in August 1921. In 1924 he discovered the medicinal waters of Warm Springs in western Georgia -- and he created a commercial venture to exploit it's theraputic value for other polio victims. Of course it never became a commercial success, and later he dropped the business plans and it became a "charity" to make FDR look good.
Roosevelt got back into politics by asking Presidential Candidate Alfred Smith if he could deliver his nomination speech. FDR borrowed a speech intended for someone else to deliver, which included the "Happy Warrior" phrase that got Roosevelt a lot of credit. FDR also made a side power play with a mail campaign to many Democratic leaders in D.C. about party unity.
Smith needed a strong gubernatorial candidate on the Democratic ticket in New York -- and felt FDR was the right person for that, especially because it had been a decade since FDR had done anything political and so he was the safest candidate (he had no "fresh" enemies, and there were a lot of disputes in Tammany over which candidate to support -- so a trump card seemed best). Al Smith knew FDR wanted to get back in the game, but FDR kept sending mixed messages and started playing coy -- in the end it was asked what he wanted to run, and he admitted that he needed help out of his debt (or potential losses) in Warm Springs before he would run. Roosevelt only ran after making some arrangements to have his losses "covered" -- this was a loan (or security on a loan) of about $250,000 by John J. Raskob (Chairman of the National Democratic Comitee to manage Al Smith's campaign), and guarantees of more if necessary. It turned out though that Raskob only contributed $100,000 to FDR's gubinatorial campaign. It was a somewhat complex issue, and while not completely dirty, this stuff just doesn't feel completely clean either.
In 1928 he won the election, and Roosevelt became Governor of New York, while Smith lost the election to Hoover. FDR held this position for two terms.
       
While FDR was Governor of New Yory (1929 - 1932) he tended to ignore the banking crises and scandals that were a catalyst for the great depression -- in fact some of the worst banking scandals happened under his governance. The Senator of New York had repeatedly urged him to do something about the Wall Street speculation and shady financial practices of banks that would lead to crises -- but FDR generally ignored such pleas (and refused to respond) until public pressure (through the press) forced him to "appoint a comittee" to ignore the problem. And of course he put the head of the Bank of U.S. in a position of power on the comittee -- because the Bank of U.S. was where the biggest problems were claimed to have been. FDR was a master manipulator of the system, and knew how to do nothing while pretending to do something. The fox was appointed to guard the henhouse, in a political manuever meant to pretend to do something -- and of course the banks collapsed, and millions were hurt but that wasn't FDR's problem, and he knew he could not be blamed for that.
Roosevelt spared no expense to malign Hoover, and constantly ridiculed him and his policies -- it was popular, and Roosevelt liked following and controlling the populous. Yet, in hind-sight, there is no doubt that Hoover knew 1,000 times more about economics and the depression (and its causes) than Roosevelt and all of his "Brain Trust" put together. (I recommend you study the "Brain Trusts" ideals and compare them against modern economic theory).
Hoover warned against the depression when he still the secretary of Commerce -- he wrote to the Federal Reserve board cautioning that banks were creating artificial capital by creating loans for everything. You could start a bank account with no money, and they would give you a balance (debt) to operate on. Wall Street was operating on margins and broker's loans. Hoover stated this easy money "might lead to dangerous inflation and perhaps a collapse." Going further he stated, that would lead to a disaster which "would bring the greatest calamities on farmers, workers, and legitimate business". All of which came to pass. Of course Hoover could do little about it, and once the system collapsed (and we had a depression), it was just a matter of time until things would slowly recover -- he knew the worst thing we could do was to over-react.
But Hoover did react, and he did increase public spending to try to create jobs. He just believed all of it should be on useful infrastructure like roads, dams, and public works. He just also tried to work with business, and tried to create and stimulate real jobs (not just temporary Government jobs). But his pace was too slow (so as to not over-stress the economy and reduce growth) -- and Democrats were fighting him in congress (since the Depression was a boon to their power). Hoover started many programs before Roosevelt took over, but FDR is usually given all the credit (and Hoover all the blame). Hoover started the RFC (Reconstruction Finance Corporation), and had $2B to buttresss the credit of banks in trouble. The Senate had started an investigation of the Federal Reserve System, and had also started the investigation of the Stock Exchange. Why should the Democrats change the status quo? They knew what the results would be in the elections if they could just keep things the same.
     
When Banks were collapsing in 1933 and Hoover was a lame-duck president (waiting for Roosevelt to take power in March), Hoover contacted Roosevelt about the banking collapses. Hoover wanted to do a temporary shut-down (to give banks time to gather their assets and liquidate), then reopen solvent banks slowly, and have the President-Elect come in and give a speech and instill confidence in the Banking System at large and quell the fear.
Roosevelt resisted, and would counsel Hoover that no shut-down was necessary, and respond very slowly to Hoovers requests and delay Hoover as much as possible. Privately it was noted by Roosevelt's aides that FDR wanted as big a collapse in Banking as was possible, so that when he came in to power, things would be completely bottomed out -- Hoover would have all the blame, and anything Roosevelt did would help. It worked. Millions lost their savings and hundreds of more banks collapsed under runs and scares between Feb. and March. Then Roosevelt came in, he declared a Bank Holiday, gave a speech about how the only thing we have to fear is fear itself, and basically did everything that Hoover had been urging for the many weeks. However, by waiting Roosevelt was able to take credit for Hoovers ideas, and he was able to pin the blame for all the issues on Hoover. Roosevelt was a politician in the worst sense of the word.
The issues were complex, and govt. was at fault in some ways for not doing enough, and in other ways for doing too much. Presidents and Politicians usually get blamed for what happens during their ternure -- whether it was their fault or not. The democrats put all the blame on the republicans, and took all the credit for anything good that happened -- and in the history of the depression, that has continued to this day. The truth is both sides were at fault, and in some ways niether side was at fault. But certainly the Republicans more moderate solutions at the time would have been far better (economically and long term) than the Democrats solutions -- though in the short term it is harder to say. The Democrats certainly did at least as much bad (to hurt the economy) as the Republicans. While there were some good gains made during this time for labor -- there were as many big losses during this time that are not talked about.
It was a tough, tough time for America. Roosevelt ran for, and won, the Presidential nomination for 1932 -- and things got far worse (long term) under our 32nd President and his policies.
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