William Rees-Mogg: Could Obama be the new Roosevelt?
[William Rees-Mogg has had a distinguished career with The Times and The Sunday Times. He was Deputy Editor of The Sunday Times before becoming Editor of The Times in 1967, a position he held until 1981.]
No one can yet know when the world economy will reach its low point and begin what may be a long climb to recovery. In the past week we have seen a couple of political events that have already proved not to be turning points: the summit meeting in Paris and the passage of the Paulson plan through Congress. These were no more than village halts on the railroad to depression.
However, we do know when the last global banking crisis was turned round, when confidence started to recover. Indeed, the Great Depression has precise dates for its beginning, which was the Wall Street panic on October 24, 1929, and for its recovery point, which came with Franklin Roosevelt's inaugural address on March 4, 1933.
In his 1,000-page biography of Roosevelt, which has become one of my most valued works of reference, Conrad Black observes that there are only two other inaugural addresses that are as well known to Americans, John F.Kennedy's in 1961, and Abraham Lincoln's second inaugural on March 4, 1865. American schoolchildren are still taught Lincoln's great pledge: “With malice towards none; with charity for all; with firmness in the right as God gives us to see the right.” That was Lincoln's commitment to reconciliation after the Civil War. Only assassination prevented him from fulfilling it.
Roosevelt's inaugural address has been quoted repeatedly in the past few weeks. “This great nation will endure as it has endured, will revive and will prosper. So first of all let me assert my firm belief that the only thing we have to fear is fear itself - nameless, unreasoning, unjustified terror which paralyses efforts to convert retreat into advance.”
There have already been many comparisons drawn between the Great Depression of 1929-1933 and the current credit crisis. Most of these comparisons have concentrated on economic similarities, or the long standing academic debate on the causes of the Great Depression itself.
Both Ben Bernanke, the Chairman of the US Federal Reserve Board, and Mervyn King, the Governor of the Bank of England, have been serious scholarly students of the Depression, so one may reasonably hope that central bankers will avoid a repetition of the mistakes of the early 1930s. They will not tighten the money supply at the very moment when it ought to be loosened.
There has been less discussion of the similarities of the US political situation in the election years of 1932 and 2008. It cannot be said that the presidential debate has so far shown much intellectual rigour. Of the four candidates in these elections, the incumbent Republican president in 1932, Herbert Hoover, probably had the best grasp of economic theory, though it could be said that the existing theories were inadequate for the crisis.
The Democratic candidates were Franklin Roosevelt in 1932 and Barack Obama in 2008. Neither man had qualified as an economist, both had trained as lawyers, both went to Harvard. In 1904 Roosevelt stayed on an extra year to edit the Harvard Crimson; Obama became the editor of The Harvard Law Review. Both were, or are, gifted orators, relying as politicians on an ability to communicate to the public, and move them...
Read entire article at Times (UK)
No one can yet know when the world economy will reach its low point and begin what may be a long climb to recovery. In the past week we have seen a couple of political events that have already proved not to be turning points: the summit meeting in Paris and the passage of the Paulson plan through Congress. These were no more than village halts on the railroad to depression.
However, we do know when the last global banking crisis was turned round, when confidence started to recover. Indeed, the Great Depression has precise dates for its beginning, which was the Wall Street panic on October 24, 1929, and for its recovery point, which came with Franklin Roosevelt's inaugural address on March 4, 1933.
In his 1,000-page biography of Roosevelt, which has become one of my most valued works of reference, Conrad Black observes that there are only two other inaugural addresses that are as well known to Americans, John F.Kennedy's in 1961, and Abraham Lincoln's second inaugural on March 4, 1865. American schoolchildren are still taught Lincoln's great pledge: “With malice towards none; with charity for all; with firmness in the right as God gives us to see the right.” That was Lincoln's commitment to reconciliation after the Civil War. Only assassination prevented him from fulfilling it.
Roosevelt's inaugural address has been quoted repeatedly in the past few weeks. “This great nation will endure as it has endured, will revive and will prosper. So first of all let me assert my firm belief that the only thing we have to fear is fear itself - nameless, unreasoning, unjustified terror which paralyses efforts to convert retreat into advance.”
There have already been many comparisons drawn between the Great Depression of 1929-1933 and the current credit crisis. Most of these comparisons have concentrated on economic similarities, or the long standing academic debate on the causes of the Great Depression itself.
Both Ben Bernanke, the Chairman of the US Federal Reserve Board, and Mervyn King, the Governor of the Bank of England, have been serious scholarly students of the Depression, so one may reasonably hope that central bankers will avoid a repetition of the mistakes of the early 1930s. They will not tighten the money supply at the very moment when it ought to be loosened.
There has been less discussion of the similarities of the US political situation in the election years of 1932 and 2008. It cannot be said that the presidential debate has so far shown much intellectual rigour. Of the four candidates in these elections, the incumbent Republican president in 1932, Herbert Hoover, probably had the best grasp of economic theory, though it could be said that the existing theories were inadequate for the crisis.
The Democratic candidates were Franklin Roosevelt in 1932 and Barack Obama in 2008. Neither man had qualified as an economist, both had trained as lawyers, both went to Harvard. In 1904 Roosevelt stayed on an extra year to edit the Harvard Crimson; Obama became the editor of The Harvard Law Review. Both were, or are, gifted orators, relying as politicians on an ability to communicate to the public, and move them...