ECONOMISTS NOW AGREE that in the late 1920s and early 1930s the United States and other countries did the absolute worst thing to revive their economies: They raised taxes and cut spending, depressing demand even further. They did this to keep their budgets balanced and avoid devaluating their currencies. Why did they so fervently seek to avoid devaluation? Because if they devalued their currencies and used inflation to get their economies moving again, they would have to go off the holy gold standard.
It was a self-contained theology of money, made worse by the image of Weimar Germany, where inflation got so bad after the world war that people pushed wheelbarrows full of worthless cash to the grocery store. Raising taxes, erecting trade barriers, and cutting spending in a depression was the equivalent of doctors bloodletting to cure disease (or Campobello doctors telling Eleanor and Howe to massage FDR’s legs after the onset of polio): They made a bad situation worse.
But like most other major political leaders, Roosevelt adhered to the old economic orthodoxies. He sensed they were inadequate but was not yet ready to repudiate them. The Democratic Party Platform called for balancing the budget and a “sound” currency, a codeword for staying on the gold standard. So when Roosevelt started campaigning in earnest, his speeches were full of bromides; no sense, he figured, in risking his advantage by saying something unsound. He made not a single speech on foreign policy during the entire campaign. More astonishing, FDR said nothing about banking, though thousands of banks had already closed.
Instead, FDR scored points with offhand remarks calling Hoover, whom he never mentioned by name, “Humpty Dumpty,” or mocking his lateness in responding to the Depression. When Republicans echoed Lincoln’s 1864 slogan, “Don’t change horses in the middle of a stream,” Democrats chanted, “Change horses—or drown!” When Democrats spread the rumor that Hoover had exploited Chinese coolies while a mining engineer in Asia thirty years before, Republicans retaliated by whispering that FDR’s polio was actually venereal disease that spread to the brain, a lie they would resurrect in the years ahead when battles over the New Deal turned bitter.
For the most part, FDR kept his speeches unspecific. One exception was a speech to the Commonwealth Club of San Francisco during his western swing in late summer. Written by Adolf Berle, the substantive address had the ironic distinction of being the campaign speech that the candidate himself had the least involvement in preparing; by one account, he barely even saw it until he reached the lectern. Because FDR had no time to sand down the edges and apply his usual caution, it reflected the thinking behind the early New Deal more explicitly than anything else he said in the whole period. The Commonwealth Club speech managed to combine all that was wrong and right about FDR’s worldview.
The first theme, disturbing in its implication, was that “our industrial plant is built…overbuilt. Our last frontier has long since been reached.” With growth and exploitation of natural resources at a dead end, the goal should be “administering” existing economic arrangements not “producing more goods.” Even if FDR was by nature much more optimistic than Berle’s text conveyed, this popular but false premise—embedded in the mind-set of New Dealers—would have serious consequences: until World War II, the Roosevelt administration offered no growth agenda besides public works. Policies were implemented without regard for their impact on productivity; “expanding the pie” was not much a part of the discussion. This was perhaps the central conceptual flaw of the New Deal.
The second, more inspiring part of the Commonwealth Club speech was its emphasis on an updated social contract whereby “every man has a right to life; and this means that he also has a right to make a comfortable living. He may by sloth or crime decline to exercise that right; but it may not be denied him.” This was a revolutionary concept, which FDR expanded on in the years ahead, culminating in his landmark “Second Bill of Rights” speech in 1944.
Americans are still debating whether health care is a “right” and other ramifications of the deep philosophical shifts that FDR launched, almost inadvertently, in 1932. At the time, the emphasis was more negative, and focused on the villains who were depriving Americans of these rights. The reason the unemployed man was not getting work and access to the American horn of plenty, Roosevelt said in San Francisco, was “the lone wolf, the unethical competitor, the reckless promoter.” These businessmen claimed to oppose government’s involvement in their affairs but were always quick to ask Washington for a loan or protective tariff. Even if FDR didn’t see the specific language until he reached the podium in San Francisco, he knew the thrust of the speech was to lower the boom on business for the first time in twenty years. Rex Tugwell believed the Commonwealth speech marked “the dividing line” in FDR’s political evolution: “It was a real shocker for those who simply assumed that free competition was no more to be questioned than home and mother.”
Roosevelt was in fact the originator of what President Bill Clinton and British prime minister Tony Blair sixty-five years later called “Third Way” politics. In a lesser known speech around this time, in Columbus, Ohio, FDR said that, in one sense, Hoover was right about the importance of “the individual,” but that his definition was too limited. That individual, Roosevelt said, should “have full liberty of action to make the most of himself.” But the invocation of “that sacred word”—individual—should not allow “a few powerful interests” to make “industrial cannon fodder of the lives of half the population of the United States.” He added that he wanted neither a business elite nor the U.S. government to manipulate the individual or betray “the sacredness of private property.”
Sometimes, Roosevelt’s “Third Way” instincts reached almost comical proportions. In an address in September to Sioux City, Iowa, pig farmers, FDR—perhaps recalling how he had solved the Rosenman-Howe spat in his Chicago convention acceptance speech—again pulled the stunt of merging drafts. One draft, written in part by Charles (“the Molasses King”) Taussig, represented the views of Senator Cordell Hull, whose single-minded goal in politics was a 10 percent across-the-board reduction in tariffs. Roosevelt liked Hull and would make him secretary of state, but he was addressing farmers who insisted on tariff protection. So another draft, by brain truster Hugh Johnson, pandered to protectionists. When faced with the choice of which one to give, Roosevelt instructed an exasperated Moley to “weave them together.”
Fudging the trade issue—as Roosevelt would continue to do for years—was probably unavoidable during the Depression, when unilateral tariff reductions would have thrown millions more out of work. Hoover, playing the protectionist card, thought he smelled blood and grimly predicted that “the grass will grow in the streets of a hundred cities, a thousand towns; the weeds will over-run the fields of millions of farmers…their churches and schoolhouses will decay” if FDR and his nefarious free trade policy prevailed. Faced with the Democrats’ “Roosevelt or Ruin” campaign, this line of attack didn’t work for Hoover. Grass was already growing in the streets. Democrats would mock the remark by wheeling hand mowers in the Inaugural Parade the following March.*
At Pittsburgh’s Forbes Field in October, FDR bid to neutralize the old guard fiscal conservatives. He blasted Hoover for “reckless and extravagant spending” in increasing government outlays by 50 percent, and for waiting too long before raising taxes to help balance the budget. This was a pro-business speech; businessmen in those days were willing to see taxes raised to close deficits. But in a more familiar vein, they wanted spending cuts. The speech also written by Johnson, included a pledge to fulfill the “economy” plank of the Democratic platform, which called for cutting the cost of government by a full 25 percent, far beyond any cuts proposed since. To accomplish this, FDR proposed abolishing many small agencies and promised to don a green eyeshade and “eliminate from Federal budget-making all new items except such as relate to direct relief of unemployment.” This would eventually rank among the most violated campaign promises of all time.
One promise Roosevelt never dared make, even in Pittsburgh, was to “restore confidence.” The whole idea had been so chewed over by Hoover that the public had lost confidence in confidence-building. Prosperity was not around the corner and there was no use pretending it was. So Roosevelt’s task was a more daunting one—he would have to bring back hope in a way that gave meaning to platitudes. The confidence he would build during the opening Hundred Days was not faith in a stock market surge or a spurt in the GNP but confidence in the entire American system, in the idea that capitalism and democracy deserved to survive.
By the fall, it was dawning on people that FDR’s positions on specific issues—to the extent that one could discern anything coherent—were not much different from Hoover’s. To the chagrin of his Brain Trust, a Roosevelt victory would mean a mandate only to end Prohibition, to experiment with some farm relief and public works programs, and to balance the budget. That was about it. All proposals to raise prices and generate purchasing power were fuzzy at best. It didn’t matter. Hardly anyone was paying attention to Hoover anymore.
The president was by turns morose and manic, stumbling over words in his speeches; some drafts ballooned to more than seventy typewritten pages of his own musings. Hoover was sure that an economic recovery had been underway but was aborted by, of all things, the election results from Maine. In those days, that state followed the unusual custom of holding elections for state and local candidates in September, two months before the national elections. A solid Republican state, Maine would end up going for Hoover in November. But in September, when voters elected a Democratic governor and two Democratic senators for the first time since the Civil War, the press considered the GOP losses there a shocking omen for the incumbent.
Hoover spent the rest of his life arguing that the Maine vote caused widespread fear of Roosevelt, which in turn caused the economy to sputter once more. This was special pleading. But he was right about some fleeting signs of economic improvement in the summer of 1932. Wholesale prices did surge in the third quarter, with cotton and wheat up 20 percent and wool consumption tripling. Cotton mill capacity went from 51 percent in July to 97 percent in October. Walter Lippmann wrote in late 1933 that Hoover had “arrested” the Depression in the summer of 1932.
But no one noticed. The only political campaign many Americans could stomach that fall was comedian Eddie Cantor’s satirical run for president. The cry, “We want Can-tor!”, was known throughout the country, the most famous line on the radio—far better known than anything the presidential candidates said.
Hoover could only dream of being Eddie Cantor. By the end of the campaign, the president was booed and his train was pelted with eggs and tomatoes. When the presidential party pulled into Detroit, a huge crowd began rhythmically chanting: “Hang Hoover! Hang Hoover! Hang Hoover!” Although Hoover couldn’t bear to visit the soup lines or shanty towns, he bristled at the idea that he was uncaring: “No more cruel thing was ever said,” he protested. By the time he arrived at his home in Palo Alto on the eve of the election, his old California friends thought he looked haggard and beaten, though he seemed genuinely surprised that reliably Republican states were apparently defecting from him.
The country was unsure about the challenger right through election day and beyond. Harry Hopkins, who three years later would enter FDR’s inner circle and was already working for him in Albany running a relief program, felt it necessary to reassure his brother that fall that “all this business about his health is utter nonsense,” a reference to the whispering campaign that had grown during the fall campaign to include the rumor that Roosevelt was deathly ill.
On election night at New York’s Biltmore Hotel, Roosevelt sat with Jim Farley and Ed Flynn going over the happy returns, throwing back his head in exultation. Howe didn’t want to sit at their table. He was off to the side, looking glum. “Losers always have a big spurt at the start before they finally begin to dwindle off to defeat,” he said. When a newspaperman shouted, “Roosevelt wins! And Howe!” Louis finally reached down and broke out some sherry he had put away twenty-two years earlier when the Billy Sheehan fight was underway in Albany, swearing he wouldn’t open it until Roosevelt was president.
Eleanor sat crying quietly in a corner, according to her cousin, Corinne Alsop. “Now I will have no identity. I’ll only be the wife of the president,” she said. Later, Eleanor wrote, “The turmoil in my heart and my mind was rather great that night.” By contrast, Sara told her son elatedly, “This is the greatest moment of my life.”
The final tally on November 8, 1932, marked what political scientists call a “realigning election.” Republicans lost 12 seats (and their majority) in the Senate and a staggering 101 seats in the House. Roosevelt thrashed Hoover by 57.4 percent to 39.7 percent, carrying forty-two out of forty-eight states and becoming the first Democratic president since Franklin Pierce in 1852 to win a majority of popular votes. The Socialist candidate, Norman Thomas, and the Communist, William Z. Foster, won only 3 percent combined: most of those who talked of voting for them ended up with Roosevelt, not because they liked him but because they loathed Hoover more. The continued faith of the trade union movement in the Democratic Party was also pivotal. Had labor created its own party, as in Europe, the American two-party system might have fragmented under the pressure of the Depression.
Roosevelt went before the press to say that “two people more than anybody else are responsible for this great victory”—Jim Farley and Louis Howe. It was true, and it reinforced a point that the brain trusters and other talented people he had drawn around him often didn’t understand. First, you had to win. And even then, to succeed, you had to play politics. The ones who played the game well would win again, and bend events to their will.
Even with a big victory, FDR was—like Lincoln in late 1860—still just another politician struggling against the storm, with no place yet in the hearts of Americans. Arthur Krock of The New York Times wrote that the electorate was playing national grouch, restless and angry. “All informed observers agree that the country did not vote for Roosevelt; it voted against Hoover,” The New Republic concluded.
After FDR received Hoover’s congratulatory telegram, he scrawled out a standard reply that he was prepared “to cooperate with you” in the months ahead. But something about that language gave him pause, and he replaced it with more vaguely gracious words about “common purpose.”
Late on Election Night, FDR let down his hair a bit as his son James helped him into bed. “You know, Jimmy, all my life I have been afraid of only one thing—fire,” FDR mused. “Tonight, I think I’m afraid of something else.”
“Afraid of what?” James asked.
“I’m just afraid that I may not have the strength to do the job.”
Then Franklin Roosevelt said he was going to pray to God for strength and guidance and asked his son to do the same.
“Pray for me, Jimmy.”
*Hoover was more on point when he compared Roosevelt’s vague views on tariffs to “the dreadful position of the chameleon on the Scotch plaid.” Sixty years later, in the election of 1992, President George Bush accused his challenger, Governor Bill Clinton, of having positions on trade and other issues that could best be described as “plaid.” He lost, too. In politics, plaid pays.