If all this sounds a trifle primitive, it must be added that, as Caroline Bird has pointed out, certain aspects of American society then could be quite pleasant. To be sure, you needed money, but not a great deal; an income of $5,000 or $6,000, or even less, brought comforts unknown today. The middle-class world was much quieter. There were no sonic booms, high-impact rock drills, air compressors, chain saw, hi-fi sets, tape recorders, playback units or 125-decibel rock groups, and very few riveters. It was more private. The FBI had fewer than three million fingerprints, and the digital society of social security numbers, zip codes, direct distance dialing, and credit card memory banks was unknown. Getting into college was relatively easy. Only thirty-five thousand applicants took college boards in 1932. If you preferred to fly the scheduling was primitive, but passengers received first-class service—the labor market being what it was, airlines could require extra effort from their R.N. stewardesses.
You never needed reservations at hotels, fine restaurants, hairdressing emporia, or hospitals. Nobody worried about pollution; factory chimneys were cold. Tutors, barbers, dressmakers, music teachers, and even physicians came to your house. If you worked in an office, secretaries arrived on time in the morning. They didn’t disappear for coffee breaks, didn’t make personal telephone calls from the office, and didn’t object to working overtime. “The best guarantee of efficiency is a long line at the factory gate,” was the way Samuel Insull put it (he would), but John Kenneth Galbraith stated the principle less cruelly. The more retrograde an economy becomes, he said, the more service improves.
Apart from amenities, the most cheerful feature of life then, as seen from the 1970s, lay abroad. Not only was America untroubled by foreign crises; as far as the vast majority of Americans were concerned, there were no foreign affairs at all. The Japanese were behaving badly in China, but who had time for that? In the German presidential elections eighty-four-year-old Paul von Hindenburg defeated forty-three-year-old Adolf Hitler. Americans were bored by both. In London the Prince of Wales made a date with a Mrs. Wallis Simpson, who had just been presented at court, but of course nothing could come of it because she already had a husband. Saigon was so remote that Hollywood used it as the background for Red Dust, an escapist film starring Clark Gable. The Middle East was quieter than the Middle West; as Time reported on April 4, the Jewish population of Palestine was “a minority (16.9 percent) without political power, save for the advisory powers conferred on the Jewish Agency by the mandate allotted to Great Britain ten years ago.”
Although the decade was two years old, many figures who would later be identified with the 1930s were still relatively obscure. The name of Winston Churchill appeared in print as the author of Amid These Storms, an anti-Communist tract. (Other authors of 1932 were William Faulkner, Christopher Morley, Aldous Huxley, John Dos Passos, Robinson Jeffers, T. S. Stribling, Hendrik Willem van Loon, James M. Barrie, and Charles Nordhoff and James Norman Hall.) The men whose birthdays were matters of public note—e.g., George Bernard Shaw, Rudyard Kipling, George M. Cohan, and John Galsworthy—belong in memory to an earlier age. This was particularly true in the world of entertainment. The five top box office stars were Marie Dressier, Janet Gaynor, Joan Crawford, Charles Farrell, and Greta Garbo. Irene Dunne had just made her film debut; so had Claudette Colbert (with Maurice Chevalier). Ginger Rogers was simply another tap dancer in Busby Berkeley’s chorus line. Nelson Eddy and Fred Astaire wouldn’t arrive in Hollywood for another year. Four-year-old Shirley Temple was appearing on the nation’s standard (eighteen feet high, twenty-four feet wide) screens in a series of one-reel shorts called Baby Burlesks. Benny Goodman was rooming with Tommy Dorsey, working in New York pit bands and playing clarinet cadenzas on radio for the Hoffman Ginger Ale Hour. In Beaumont, Texas, sixteen-year-old Harry Haag James approached a traveling band leader named Lawrence Welk and asked, “You don’t happen to be looking for a trumpet player, do you?” The leader asked for a demonstration, James blasted away, and Welk shook his head. He said, “You play too loud for my band, son.”
In retrospect, America seems to have been singularly blind to the future. When Professor Auguste Piccard penetrated the stratosphere in a balloon and wrote in his log, “We have attained an altitude of 54,120 ft. All human records broken!” there was no way of knowing that time would make the entry seem quaint. People were impressed by Dr. William Beebe’s bathysphere and its brief dive to 2,200 feet off Bermuda; they wouldn’t have believed that aquanauts a generation later would live at that depth for a month. It was in the naval maneuvers of 1932 that an American aircraft carrier, slipping past picket destroyers northeast of Oahu, attacked Pearl Harbor in a dawn “raid” and “sank” the warships anchored there. Nobody noticed the watchful Japanese in Honolulu, or knew that Tokyo was filing a long memorandum on the paper victory.
Most striking of all, newspaper readers were unaware that at Cambridge University Sir James Chadwick had discovered the neutron, the key to atomic fission. Its significance was unappreciated. According to physics doctrine at the time, only projectiles with fantastic penetrating power could split the nucleus of an atom. The very notion of such a split was highly theoretical, and certainly it couldn’t be achieved by the neutron, which carried no electrical charge whatever. Lord Rutherford told a meeting that people who foresaw large-scale release of atomic energy were “talking moonshine.” Albert Einstein, then en route to asylum at Cal Tech, agreed that the idea was “fantastic.” The only practical use for uranium worth mentioning was to paint luminous figures on clock dials. Here it served as a substitute for radium, abandoned in the spring of 1932 when the owners of a New Jersey clock factory discovered that their dial painters were dying. Imbibed radium, they were shocked to learn, accumulated in the bones and led to certain death. The clockmakers turned in relief to uranium. It was so safe, so benign; no one could possibly associate it with death or even illness.
TWO
Roosevelt!
Shortly after the presidential election a band of Communists had arrived unheralded at 49 East Sixty-fifth Street. The President-elect received them, but when one said, “We want you to tell President Hoover that the federal government must—” Roosevelt broke in sharply. “I can’t tell the President to do anything,” he said. “I’m simply a private citizen as far as the federal government is concerned.” He meant it. Until he had the power to act, he would not intervene. Meantime he went fishing on Vincent Astor’s yacht, picked an unimpressive cabinet, and appeared to agree with everyone who saw him. Huey Long, battling the conservative influence of Arkansas’s Senator Joseph Robinson, said of the President-elect, “When I talk to him he says, ‘Fine! Fine! Fine!’ But Joe Robinson goes to see him the next day and again he says, ‘Fine! Fine! Fine!’ Maybe he says ‘Fine!’ to everybody.” So rapid had the processes of social disintegration become (even Eleanor Roosevelt wondered whether anyone could “do anything to save America now”) that FDR’s genial, vague, not-my-problem attitude seemed irresponsible. People thought that he ought to do something—and no one felt this more keenly than the outgoing President.
In November the President telegraphed the President-elect, suggesting that they confer. Roosevelt called at the White House on the way to Georgia, but although the meeting lasted the better part of an afternoon, it settled nothing. Word had reached Roosevelt that a member of the Hoover cabinet had said, “We now have the fellow in a hole that he is not going to be able to get out of.” The hole had yet to be dug that FDR could not get out of; hour after hour he parried invitations to board the administration’s sinking ship. After his visit he felt strengthened in his conviction not to commit himself, the wisdom of which grew upon him as he read the newspapers in Warm Springs. Hoover had sent the Hill his farewell State of the Union message, a recital of all his shibboleths. More taxes were needed. Europe should pay its war debts. “We have built a system of individualism. The background of our American system is that we should allow free play of social and economic forces.” The country
must have “confidence in the future.”
America’s patience was running out. So was its cash. On St. Valentine’s Day 1933—Hoover was singing his swan song at ten o’clock that evening before the Republican National Committee—the nation’s banking system began its final collapse. That afternoon Governor William A. Comstock of Michigan had received an urgent telephone request to join a conference of bankers in downtown Detroit, and he had been there ever since. Detroit’s Union Guardian Trust Company was in straits. If it failed it would probably take every other bank in the city with it, and the financiers were asking Comstock to declare a banking moratorium throughout Michigan. At midnight he agreed, drove to the state capitol at Lansing, and issued a proclamation closing the state’s 550 banks for eight days. He called it a holiday.
In Washington, Hoover scribbled a letter to FDR; he was so distraught that he misspelled his successor’s name on the envelope. The President-elect was becoming accustomed to jolts (the week before, an unemployed bricklayer had shot at him and fatally wounded Mayor Cermak of Chicago), and this communication was among the more outrageous. He read it carefully and then called it “cheeky.” It was certainly that. Hoover said flatly that the country was afraid of what the new administration might do. In the name of patriotism (and of “confidence”) he demanded that Roosevelt publicly promise not to change government programs. The outgoing President was fully aware of what he was asking; to Senator David A. Reed of Pennsylvania he wrote, “I realize that if these declarations are made by the President-elect, he will have ratified the whole major program of the Republican administration; that is, it means the abandonment of 90 percent of the so-called new deal.” He had already told friends he thought FDR an amiable lightweight. Now he was treating him as a fool. When the declarations were not forthcoming, he changed his mind again; to Henry Stimson he said that Roosevelt was “a madman.”
The President-elect would certainly have been of doubtful sanity had he associated himself with Hoover’s policy, for by then it was clear that under that policy the entire country was going stone broke.
***
Michigan’s plight had been especially aggravated by plunging real estate values, but the problem was nationwide. Since the Crash more than 5,500 banks had failed, and the public, understandably, was nervous. It responded by hoarding. Gold was vanishing from vaults at the rate of 20 million dollars a day, and depositors who couldn’t get metal were taking paper, so that the Treasury was called upon to expand its currency at the very time the gold upon which it was based was disappearing.
Bank panics are always suicidal. In this crisis, however, the situation had been complicated by the three years of deflation. Even the soundest institutions held mortgages and securities which had fallen to a fraction of their former value. America’s 18,569 banks had about six billion dollars in cash to meet 41 billion in deposits, and bankers forced to liquidate mortgages and securities to raise cash would suffer heavy losses.
Now that Michigan’s banks had fallen, the daily outflow of gold from the rest of the country’s banks abruptly jumped to 37 million; currency withdrawals to 122 million. Banks everywhere were swarming with breathless depositors taking out cash—in the Bronx a young mother rented her baby, at twenty-five cents a trip, to women who used it to claim preference at the head of withdrawal lines. During the week of February 20, while both houses of Congress were whooping through Prohibition repeal, the Baltimore Trust Company paid out 13 million dollars, nearly half of it on Friday. Late Friday night Governor Albert C. Ritchie declared a holiday for Maryland’s two hundred banks. The second state had gone under.
Rallying to the standard of confidence, responsible men made painfully self-conscious efforts to keep their heads. The Detroit News commented, “It is an experience we shall have to look back upon, and no doubt grin over,” and the Baltimore Sun said cheerily, “Life… will be filled with pleasant and unpleasant things as it was before. And it will have the additional advantage that everybody will have something to talk about.” The president of the Baltimore Association of Commerce saw no reason why business should not continue as usual; the Bureau of Internal Revenue issued a stern reminder that income taxes were due in two weeks.
Nothing from Hyde Park dispelled the illusion of unreality. Roosevelt, as Robert Sherwood put it, knew that he had the advantage of “a good act to follow.” Already a master of timing, he realized that the poorer Hoover’s exit, the better his own entrance would be. If his refusal to cross bridges before he reached them was irresponsible—it is hard to see what he could have done—it was also in keeping with an old tradition in American politics. As Charles A. Beard pointed out, until Lincoln’s hand was forced he “never adopted the system of unconditional emancipation. He understood it, but did not commit himself to it.” All the same, there was an almost pixie quality about FDR’s selection for Secretary of the Treasury—a puckish little railway equipment manufacturer who wore a gray toupee, loved puns, collected five-dollar gold pieces, and spent his leisure time composing on a guitar. A week later, when the new administration took office, the country was to know William H. Woodin as hard-driving and ingenious, but on the eve of office he was celebrated only as the composer of a song for children:
Let us be like bluebirds,
Happy all day long,
Forgetting all our troubles
In a sunny song.
In Indianapolis and Akron that Sunday, February 26, banks announced that withdrawals would be limited to 5 percent of balances. During the night institutions in a dozen other Ohio cities fell into line, and on Monday—as flames gutted the German Reichstag and Japanese troops marched into a Manchurian blizzard—the number grew to one hundred. Across the river from Cincinnati, five Covington, Kentucky, banks adopted similar restrictions. Monday evening Governor Gifford Pinchot of Pennsylvania signed a bill permitting individual institutions to close at will, and Thomas W. Lamont sent word to Hyde Park that in the view of J. P. Morgan, “the emergency could not be greater.”
It could be, and soon was. By Wednesday, March 1, frantic governors had declared bank holidays in seventeen states. Pinchot acted so hurriedly he had to watch the inaugural five days later with 95 cents in his pocket. Governor Oscar K. Allen of Louisiana, on the other hand, withdrew his expense money for Washington and then entrained, leaving behind his dictated proclamation closing all banks. It was on Wednesday that the President-elect—who, Arthur Krock reported in the New York Times, was being asked by responsible men to seize power now—drove to his East Sixty-fifth Street town house and went into conference with Woodin. They did not emerge until Thursday afternoon, when, preceded by the screaming sirens of twenty motorcycles, they raced down Fifth Avenue and turned west toward the Hudson River ferry. During the morning a light snow had sifted over the city. New Yorkers stood silently in it, staring at the cavalcade. Outside Radio City Music Hall a cardboard King Kong, erected to dramatize his first Manhattan run, leered toothily. In the river the French Line steamer Paris lay quietly at berth, her cargo space reserved—though no one in the President-elect’s party knew it yet—for nine million dollars in fleeing gold. On the other side of the ferry a special B & O train was waiting, and that afternoon, talking now with Woodin of banks, now with Farley of religion, Franklin Roosevelt thundered southward through a cold fog, toward Washington.
***
It was sleeting when they reached Union Station. In the presidential suite of the Mayflower Hotel a sheaf of telegrams awaited Roosevelt: banks were closed, or closing, in twenty-one states and the District of Columbia, and Federal Reserve figures showed the week’s gold loss to be 226 million dollars. There wasn’t enough money in the Treasury to meet the federal payroll, not to mention the 700 million dollars in short-term certificates which would fall due March 15. The President-elect had scarcely unpacked when Woodin drew him aside. Secretary of the Treasury Ogden Mills and Eugene Meyer of the Federal Reserve Board had telephoned to suggest a national proclamation closing all banks. President Hoove
r felt less drastic action would do. FDR’s opinion was solicited. He shook his head; he still refused to advise anyone. Fair skies had been forecast for Saturday’s inauguration, but now the barometer was falling.
The last page of the New York Times of Friday, March 3, carried an advertisement showing “John Doe” and “Jane Doe” acclaiming the “Good Work” of the Bowery Savings Bank. Presumably its purpose was to reassure depositors. It failed. By noon long lines of New Yorkers had formed opposite Grand Central Station and were filing into the world’s largest private savings bank, demanding cash. At 3 P.M. the Bowery closed its doors with a huge crowd still unpaid. At the same hour Governor Henry Horner of Illinois sat in the Federal Reserve Bank of Chicago plucking nervously at his moustache, reading figures which showed that Chicago banks had paid out 350 million dollars in two weeks. After seventeen days in the hinterland, the storm was hammering at the nation’s two financial strongholds.
That morning Miss Catherine Shea, a messenger for the Treasury Department, had brought Herbert Hoover his last $500 pay check. He received it with a semblance of cheer; reports reaching him before noon suggested that the panic might be lessening. After lunch it was clear that this was only an illusion. Minnesota and Kansas were gone, North Carolina and Virginia were going. Hoover, too exhausted and too embittered for the traditional inauguration eve dinner with the President-elect, formally received the Roosevelt family for tea at 4 P.M. By his lights, he had every right to be angry. In his words, the country was “on the verge of financial panic and chaos”—and all because this fellow from New York lacked confidence. At tea he reviewed his figures and asked Roosevelt to join him in bipartisan action. Once more FDR said he would wait; tomorrow he would be President. Preparing to go, he adjusted his leg braces. “Mr. President,” he said, “I know it is customary to do so, but you don’t have to return our call if you don’t want to.”
The Glory and the Dream: A Narrative History of America, 1932-1972 Page 11
