©"Don't Let Your Emotions Rule!" by Jack Ragsdale

Nothing has so galled the American public as the bailout. It was put into effect by President Bush’s Secretary of the Treasury Henry Paulson under
emergency circumstances. Mr. Paulson perceived an “about to happen credit shutdown” that would have sent our economy into a collapse difficult to revive. The new Obama administration embraced the same policy and billions were doled out to those who had brought our economy to the brink. They received our money as anyone of our billionaire financial elite would have—with a gigantic yawn. “It’s a great bother but we’ll do you the favor.”

Assets in the billions allow our wealthiest to wait out any depression of any length as was indicated by their survival of the 1929-1939 debacle: entirely without inconvenience. As thousands of businesses went bankrupt, millions of citizens—without work or income, suffered privation, hunger and cold. Fifteen years old then , I personally experienced those times that scarred my youth.

Be informed, the decision to risk lending that money, was an alternative—followed up by the government’s threat not to allow the economy’s shut-down. And a firm decision to force money on lenders, with marching orders to LEND under threat that the government would take over and run the banks. It was a dire alternative for everyone that drew screams of SOCIALISM from those who had so recently abused the nation’s economy.

Without the money, banks would have sat on their money, waiting for assurance that it was safe to lend—for whatever time it might take for that to happen: one year, perhaps, or ten. Meantime, all business would have slowed to a halt. That was the scenario of the Depression of 1929 which lasted until the beginning of World War Two—in 1939 when American business began to thrive on orders of the British government. Britain still had money—barely enough to start the process. Later our fear of a Hitler, in control of world-wide resources and all of Europe, who might then overrun us “across the pond”, stiffened our resolve to aid Britain and France.

Perceiving an America engaged in Europe, arrogant Japan thought to damage us permanently by their attack on our poorly guarded fleet. This successful, bold act seemed to duplicate Admiral Dewey’s destruction of the Spanish fleet in 1898. But Spain was not a modern industrialized nation already in a situation of near collapse. Instead of fear and indecision, we resolved to resist.


THE DEPRESSION of 1929

President Hoover was in the seventh month of his administration when the Stock Market crashed in October. Ferociously conservative with a reputation for the solving problems of whatever magnitude, he took a firm position to keep the government out of this economic occurrence that he claimed would resolve itself automatically—that forces within the system would solve its problems. With statements to that effect restored prosperity was “just around the corner”; that “the nation was economically sound,” this dour man went on with the routine matters of government.

But Capitalism runs on credit—lending institutions with money sat on it in fear that borrowers might not or could not repay. The attitude was—“Let’s just wait and see.” Some folks sought to assure their own security by withdrawing their savings and that weakened banks and lead to more failures. With the slowdown, people were laid off and businesses failed. In full confidence that prosperity was “just around the corner,” the president made statements to that effect and THAT WAS THAT? The problem would solve itself and the president did nothing. People were suffering, but the president was firm in his resolve not to spoil their spirit by coddling a resolute people who were accustomed to self-reliance. Hoover refused to act even in the face of hunger when there was a glut of wheat on the market at cents per bushel.

Mr. Hoover lost his parents at an early age but he worked to study and graduate from Stanford University. An early connection sent him to England for the Bewick Moreing Company and through it he was sent to China to find and evaluate mines. It was in the time of the so-called Boxer Rebellion and in the violence he lost some property for which he put in a claim. Here I am working on my memory so you can check out my evidence. As I recall, Mr. Hoover filed a claim for $40,000 or $50,000 in actual losses. The American commission authorized to review and confirm claims, reduced Hoover’s to $20,000. Mr. Hoover has always been presented to the public as impeccably honorable. Here for me at least, he seems to have been walking on feet of clay.

At the time China was prostrate under control of voracious foreigners: Great Britain, France, Germany, Japan and The United States. The “Boxer Rebellion” was not a rebellion at all. It was a protest by patriotic natives against the robbery of their helpless country. Natives were incensed against rapacious foreigners—get-rich-businessmen, well-off missionaries living luxuriously in fine houses—hucksters of every low kind abusing every Christian doctrine of honor and decency. It may also interest you that Henry Luce’s parents were amongenry the endangered. They escaped to Korea.




Mr. Hoover also worked as mine manager in Australia. The miners had gone on strike against low pay and cruel conditions and it became Mr. Hoover’s task to break the strike. He did so with the aid of the Australian government by importing workers from the Balkans—a tactic used by American mines and smelters—a pattern of unabashed contempt for the rights of working people.

For the balance of Mr. Hoover’s administration of three years and four months it can be said without fear of contradiction that he did nothing to relieve the intense pain and privation of the suffering masses, the millions who could find no work at any wage. Only too often I have told you of the hundred lost souls who gathered daily in the AB&C RR yards where I worked for two summers cleaning cars to haul watermelons, to steal a ride south in the open box cars. They were of the hundreds of thousands in the nation who sought any work that way.

Mr. Hoover was not unique in turning a blind eye to reality, “he set himself firmly against all proposals for federal relief. A federal dole would involve huge appropriations which would unbalance the budget, and thus jeopardize the national credit, he thought. It would invite reckless spending on ‘pork barrel’ projects. Most important, federal relief projects, Hoover argued, would destroy the character of the recipients….” In the midst of this planned inactivity, it was discovered that J. P. Morgan and nineteen of his partners had paid no income taxes for 1931 and 1932.

“Businessmen, especially, bankers, demanded a ruthless deflation” “The depression revived an emphasis on Puritan virtues which the 1920s had rejected and bankers linked their insistence on deflation to Calvinist Morality. President John E. Edgerton told the National Association of Manufacturers, in the autumn of 1930 that it was important to make people understand that the suffering of the unemployed was not the product of an economic breakdown but was the direct result of their moral infirmity.”

“The financial community purported to see the depression as a blessed occurrence which would improve the national character by chastening the spirit. The crash, announced the leading banking periodical, ‘should be highly beneficial.’” p250
Quotations taken from “The Perils of Prosperity” W. E. Leuchtenburg