Tag Archives: Franklin Delano Roosevelt

Look!

Cartoonist John Knott illustrates the power struggle between Franklin Delano Roosevelt (FDR) and the United States Supreme Court regarding the implementation of the New Deal.
Cartoonist John Knott illustrates the power struggle between Franklin Delano Roosevelt (FDR) and the United States Supreme Court regarding the implementation of the New Deal.

John Francis Knott’s political cartoon titled, “Look!” published on Wednesday, March 31st, 1937, depicts eight anthropomorphized scrolls outside of a building labeled “Supreme Court”. All eight scrolls are seen outside this building, however, three are walking out of the building with a smile on their faces and a big “OK” stamped on their sides, whereas the other five, battered and bruised, incredulously peer up from the side of the stairs. Each of these scrolls, made to look like people, are labeled. Among the injured scrolls, the words “NRA”, “AAA”, and “Guffey Act”, with the others reading: “RR. Labor Act”, “Frazier-Lemke Act”, and “Minimum Wage Law” (Knott 2). In his political cartoon, John Knott is depicting some of FDR’s New Deal acts and administrations that were ruled unconstitutional in contrast to others that were upheld. The cartoon also illustrates the power struggle between Franklin Delano Roosevelt (FDR) and the United States Supreme Court regarding the implementation of the New Deal. The cartoon indexes to the dynamic between the Supreme Court, FDR, and his attempts at court-packing by increasing the number of justices in the Supreme Court that would sway the balance of opinion (“Court Packing Plan”).

The accompanying editorial, “The Court Decides,” provides background information and context for the cartoon in regards to the decisions made by the Court the previous Monday, March 29th, 1937. It explains how the Supreme Court had been reviewing cases involving the New Deal and had actually sustained and upheld over 60% of the New Deal legislation, contrary to the popular belief that it had struck down most of the laws and acts of FDR’s national recovery plan. It further describes the American public’s trust in the Court and the Court’s dedication to “interpret the Constitution as it stands” as they “do not have their ears to the ground, they keep their feet on it.” (“The Court Decides” 2).

As a result of the Wall Street stock market crash on October 24th, 1929 and widespread panic that ensued, The Great Depression of the 1930s was an economic breakdown that began in the U.S. and ultimately led to a worldwide economic collapse. It is the most severe depression of the Western world to date. The United States alone suffered a 30 percent decline in real gross domestic product and unemployment rate was at around 20 percent at its highest point. The American public was desperate for work and the American spirit was at an all-time low (Romer and Pells).

Upon becoming the 32nd president of the United States in the midst of the Depression in 1933, Franklin D. Roosevelt did not hesitate to begin working towards nationwide recovery. The United States was in shambles and needed political and economic reform as most of the nation’s banks came to a close, industrial production plummeted, and as many as 15 million people were unemployed. Roosevelt was burdened with responsibilities as he had been elected president to solve the worst economic problem in the history of the United States (“The Great Depression and World War II (1929–1945)”). In his first 100 days in office, known as his great productive opening period, FDR worked with the new democratic congress to enact bills that would begin to stimulate the economy and increase public confidence (Freidel and Sidey). With his New Deal legislation, Roosevelt hoped to put an end to deflation, lighten lower-income group debt, and provide employment to those who had become unemployed as a result of the depression (Dickinson). However, the Supreme Court ultimately stepped in between 1935 and 1936 and struck down eleven pieces of New Deal legislation, explaining that they violated the separation of powers and intruded on states’ reserved powers (“The Great Depression and World War II (1929–1945)”).

These decisions made by the Supreme Court are ultimately what John Knott is referring to in his political cartoon. The three pieces of legislation depicted on the side of the steps of the Supreme Court building in the cartoon, battered and bruised, are the NRA (National Recovery Administration), AAA (Agricultural Adjustment Act), and Guffey Act. The National Recovery Administration or NRA, was a government agency established to work to implement codes promoting fair-practices. The NRA was an element of the National Industrial Recovery Act (NIRA) of June 1933 that was intended to work to eliminate unfair trade practices and reduce unemployment. The agency established codes that affected around 22 million workers across several workforces, but came to an abrupt end in 1935 when the Supreme Court invalidated it when ruling it unconstitutional beginning with a specific provision dealing with petroleum industry regulations, but ultimately coming to the conclusion to invalidate the entire act and administration, stating that the NIRA “unconstitutionally extended the power of Congress to regulate commerce among the states to intrastate commercial transactions-that is, business dealings occurring entirely within the boundaries of a state” (Brand).

The Agricultural Adjustment Act (AAA) of 1933 was deemed unconstitutional by the Supreme Court. A prominent feature of the New Deal alongside the NRA, the AAA aimed to aid the agriculture industry by restoring purchasing powers to farmers, as they had experienced before World War I. The act was “designed to restore parity prices for ‘basic agricultural commodities’—initially defined as wheat, cotton, corn, hogs, rice, tobacco, and milk—by reducing supplies in artificial scarcity. Benefit payments would compensate participating farmers who agreed to curb acreage or kill excess livestock” (Chen). This was made possible through a tax levied on processors of agricultural commodities. This tax increased commodity prices by reducing supplies and enhanced famers’ purchasing power, but faced invalidation as the Court stated that it, like the NRA, intruded on the reserved rights of the states to regulate production. The Court used the Tenth Amendment to the Constitution in their argument as it states: “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.” “Assuming that Congress could not directly compel farmers to reduce acreage or cull livestock” (Chen). However, the AAA was rewritten in 1938 and upheld by the Court in Mulford v. Smith in 1939.

The last of the unconstitutional acts portrayed in the cartoon is The Guffey Act of 1935. Originally named The Bituminous Coal Conservation Act, the Guffey Act was named after its sponsor, Joseph Guffey, a Senator from Pennsylvania, and was passed by congress to regulate and bring stability to the coal industry. The act outlined a minimum price for coal and protected the rights of those who worked for the industry. Additionally, this act worked to established wages and improve working conditions as coal mining had a reputation of being a “sick” industry with frequent worker strikes due to unhealthy and dangerous working conditions. However, the U.S. Supreme Court declared the act unconstitutional in 1936 as it interfered with private commerce, similar to the NRA and AAA (O’Neal).

Although many of FDR’s New Deal policies fell under the jurisdiction of the Court and bankers and businessmen turned more and more against his New Deal programs, fearing the way he allowed for deficits in the budget, he was re-elected by a large margin in 1936 (Freidel and Sidey). Because of the problems his New Deal legislation faced in the eyes of the Supreme Court, when re-elected, Roosevelt proposed a new plan to change the Supreme Court. His plan, later known as “Court-Packing” proposed that “for every judge over seventy who did not retire (there were five) the president could appoint an additional justice” (“FDR’s Supreme Court”) Roosevelt claimed the purpose in his proposition to be to expedite the Court’s work, but many believed it was an attempt to place justices that would support his programs. He was met with a heated debate and suffered a loss in credibility in the eyes of the public as they had supported the New Deal, but did not agree with the idea of interfering with the Supreme Court.

Although Roosevelt’s New Deal had suffered a lot by the hands of the Court’s rulings, there were some acts that remained as they were constitutional. The acts Knott decided to include in his cartoon are the R.R. (Railroad/Railway) Labor Act, Frazier-Lemke Act, and the Minimum Wage Law.

The Railway Labor Act (RLA) was a very important piece of labor legislation implemented prior to FDR’s New Deal; however, it was amended in both 1934 and 1936 during President Roosevelt’s first term, and later in 1951 and 1966. The act secured the rights of railway workers and employers in light of numerous strikes that began happening in the late nineteenth century. The1934 amendment to the act addressed concerns of railway workers and unions. Criminal penalties were introduced “in the case of violation of the act’s provisions related to collective bargaining” (McCartin). It allowed for workers to choose their collective bargaining representatives and also created the National Railroad Adjustment Board (NRAB), a board of 34 members that equally represented carriers and unions that corresponded with disputes before they advanced to the National Mediation Board. The amendment of 1936 extended the act to apply to common air carriers of both interstate and foreign commerce as well as transporters of the U.S. mail (McCartin). The decision the Court made on Monday, March 29th, 1937, sought to avoid interstate commerce from being interrupted as a result of strikes and disputes between employers and workers that concerned wages or working conditions on the railroads. It upheld and promoted the practice of collective bargaining in which negotiation could be held between an employer and a labor union as it was a “declaration of public interest and policy”.

The Frazier-Lemke Act, also known as the Farm Bankruptcy Act, was named after its sponsors: North Dakota Senator Lynn Frazier and North Dakota Representative William Lemke. It was passed by congress in 1934 as part of FDR’s First New Deal, its purpose was to restrict banks as they began to repossess farms that faced hardship during the Great Depression. This act allowed the federal courts to lower a farmer’s debt to a level proportional to the existing value of his property. They, under certain conditions, could give these farmers a three year stay of foreclosure in which they did not have to begin debt repayment right away. This law was sustained by the Supreme Court on March 29th, 1937 as it was an amended version that secured creditors’ property rights (Bonner and Eriksson).

The Minimum Wage Law referred to in the editorial explicitly claims that it regarded women. In making this reference, one can conclude that Knott’s political cartoon refers to the Court’s decision on West Coast Hotel Company v. Parrish made that previous Monday. The court case involved the West Coast Hotel Company and Elsie Parrish, a maid who worked at the Cascadian Hotel in Wenatchee, Washington. Parrish sued the company due to a discrepancy in her pay and the decision the Court made was in her favor as the Court concluded that the state had an authority to interfere in labor contracts if it “appeared that the parties were not equal in bargaining power or where the failure to intervene would endanger public health” (Goble). The Court argued that in denying a woman a living wage was a danger to their health and community, and subsequently warranted the enactment of a minimum wage law for them.

Look! is a political cartoon by John Knott published in the Dallas Morning News that illustrated the constitutionality of different acts of President Franklin Delano Roosevelt’s New Deal. As FDR worked tirelessly to implement legislation for the betterment of the American economic system, he was faced with continual backlash from the Supreme Court in terms of unconstitutionality in regards to some of his acts. Knott’s use of portraying the individual acts as men dressed up as scrolls that have either been approved or kicked ‘to the curb’ can show how the “majority of conservative America” had the “utmost confidence” in the Supreme Court’s ruthlessness and dedication to uphold the constitution as well as the continuing power struggle experienced between the Courts and FDR (“The Court Decides” 2).

Bonner, Jeremy, and Erik McKinley Eriksson. “Frazier-Lemke Farm Bankruptcy Act.” Dictionary of American History, edited by Stanley I. Kutler, 3rd ed., vol. 3, Charles Scribner’s Sons, 2003, p. 457. Gale Virtual Reference Library, go.galegroup.com/ps/i.do?p=GVRL&sw=w&u=txshracd2598&v=2.1&it=r&id=GALE%7CCX3401801593&asid=cbc7cb890562d387a1b7746b03d7d431. Accessed 14 Nov. 2016.

 

Brand, Donald R. “National Recovery Administration.” Encyclopedia of U.S. Political History. Ed. Robert H. Zieger. Vol. 5: Prosperity, Depression, and War, 1921 to 1945. Washington, DC: CQ Press, 2010. 247-251. Gale Virtual Reference Library. Web. 17 Oct. 2016.

 

Chen, Jim. “Agricultural Adjustment Act (1933).” Major Acts of Congress. Ed. Brian K. Landsberg. Vol. 1. New York: Macmillan Reference USA, 2004. 9-13. Gale Virtual Reference Library. Web. 17 Oct. 2016.

 

“Collective Bargaining.” Merriam-Webster.com. Merriam-Webster, n.d. Web. 14 Nov. 2016.

 

“Court-Packing Plan.” The Encyclopedia of Civil Liberties in America. Ed. David Schultz and John R. Vile. Vol. 1. Armonk, NY: Sharpe Reference, 2005. 244-246. Gale Virtual Reference Library. Web. 16 Oct. 2016.

 

Dickinson, M.J. (1996) ‘Creating the resource gap: Bargaining costs and the First New Deal, 1933–5’, in Bitter Harvest: FDR, Presidential Power and the Growth of the Presidential Branch. Cambridge: Cambridge University Press, pp. 45–85.

 

“FDR’s Supreme Court: How did the Supreme Court Weather the Attempt by Franklin D. Roosevelt to Increase the Number of Justices in Response to Its Rescinding New Deal Legislation?” History in Dispute. Ed. Robert J. Allison. Vol. 3: American Social and Political Movements, 1900-1945: Pursuit of Progress. Detroit: St. James Press, 2000. 24-31. Gale Virtual Reference Library. Web. 16 Oct. 2016.

 

Freidel, Frank and Sidey, Hugh “The Presidents of the United States of America,” Copyright 2006 by the White House Historical Association. Web. 16 Oct. 2016. https://www.whitehouse.gov/1600/presidents/franklindroosevelt

 

Goble, George W. “West Coast Hotel Company v. Parrish.” Dictionary of American History, edited by Stanley I. Kutler, 3rd ed., vol. 8, Charles Scribner’s Sons, 2003, p. 445. Gale Virtual Reference Library, go.galegroup.com/ps/i.do?p=GVRL&sw=w&u=txshracd2598&v=2.1&it=r&id=GALE%7CCX3401804515&asid=9a8e9208da11f626b34fcb4d75776ce2. Accessed 15 Nov. 2016.

 

McCartin, Joseph A. “Railway Labor Act.” St. James Encyclopedia of Labor History Worldwide, edited by Neil Schlager, vol. 2, St. James Press, 2004, pp. 166-171. Gale Virtual Reference Library. Web. 14 Nov. 2016.

 

“National Recovery Administration (NRA)”. Encyclopædia Britannica. Encyclopædia Britannica Online. Encyclopædia Britannica Inc., 2016. Web. 07 Nov. 2016.

 

O’Neal, Michael J. “Guffey Act.” St. James Encyclopedia of Labor History Worldwide. Ed. Neil Schlager. Vol. 1. Detroit: St. James Press, 2004. 407-410. Gale Virtual ReferenceLibrary. Web. 17 Oct. 2016.

 

Romer, Christina D. and Pells, Richard H.”Great Depression”. Encyclopædia Britannica. Encyclopædia Britannica Online. Encyclopædia Britannica Inc., 2016. Web. 08 Nov. 2016 <https://www.britannica.com/event/Great-Depression>.

 

“The Great Depression and World War II (1929–1945).” Gale Encyclopedia of U.S. History: Government and Politics, vol. 2, Gale, 2008. Gale Virtual Reference Library, go.galegroup.com/ps/i.do?p=GVRL&sw=w&u=txshracd2598&v=2.1&it=r&id=GALE%7CCX3048400016&asid=591a52c4bb42666249bf026343a3ecd3. Accessed 20 Nov. 2016.

 

“Virginian Railway Co. v. Railway Employees 300 U.S. 515 (1937).” supreme.justia.com, 15 Nov. 2016, https://supreme.justia.com/cases/federal/us/300/515/

Caveat Emptor: or How I Learned to Stop Worrying and Love Political Corruption

Two men waiting in line for a handout from a government official while behind a fence around the Capitol
Two men waiting in line for a handout from a government official while behind a fence around the Capitol.

Economic turmoil created heavy doubt in civil servants in 1930’s Dallas. Political scandals didn’t help the federal government’s case when trying to win over the good hearted people of Dallas, Texas. The Dallas Morning News’ 1933 editorial “Civil Service Needed” is an outcry against the job buying problem in political machines. Knott’s political cartoon, “Caveat Emptor,” perfectly captures political bosses ripping off Congressmen in a back alley deal. Knott’s humorous insight and the Dallas Morning News sheds light on corruption at the federal level.There are many factors that prelude to the punchline in Knott’s cartoon. Political machines created problems long before 1933, such as the Tweed Ring of the late 19th century (Kennedy 473). Progressive legislation from the Theodore Roosevelt Administration simmered down political machines (Jackson); however, with FDR’s New Deals creating about three million empty jobs at the state and local levels (Kelber), the system began to pick up some more momentum. Traditionally with this form of corruption, people at the lower rung of the machine would give funds and votes to a certain candidate. A newly elected and corrupted official would then rig legislation to give jobs and contracts to contributors to his campaign, cutting out the poor souls who believed in hard work over money. Now with such a large increase in government owned jobs in Depression era America, who was to determine the allocations of these jobs? Enter newly surcharged political machines, ready to give out jobs to the highest bidder.

The good folks of Dallas, Texas weren’t so keen on government handouts made by the political machines. An November 3rd 1933 editorial in the Dallas Morning News titled, “Civil Service Needed” strongly urges, “the wider need of civil service in state employment” The editorial serves as a response to new revelations of campaign solicitation within the Treasury Department (Dallas Morning News 18), which slides perfectly into the definition of political machines. According to the Editorial, corruption can’t be eliminated until change has been brought at the highest level, a burning need for legislation that penalizes political machines higher and higher. It’s also pretty safe to say the, “evil revelation” of job buying is also shared by the mass majority of Americans, a time where nobody found new jobs in a broken economy.

Knott’s cartoon repeats this message against job solicitation, but allows the audience to laugh at the powerful individuals involved. The young man with his hand in his deep pocket portrays congress. His happy-go-lucky face clearly describes he has no idea what is going on. His counterpart to his left has a better idea of a bigger picture. The cigar, large gut, and authoritative demeanor of the man to the left makes him literally large-and-in-charge in the transaction. Cigar man can easily be related to the political bosses who ran the machines, holding a parchment titled state jobs. He’s not the only boss, the next guy behind him is expecting the same treatment and handout from congress on the right. The fence in the background makes the action in the foreground very wrong, like some back alley drug deal. So clearly Knott is saying political machines are shady, and this process is happening again and again. What’s humorous comes from the relationship between the two parties. In a political machine, the representative is meant to be seen as the guy in charge, as he is the one giving the jobs to the highest bidder. Though the other guys look more aware of what’s going on, after all, “the job buyer is no less guilty of political corruption than the job seller” (Dallas Morning News 18). Very much akin to the image of the communist spy in the war room in Kubrick’s Dr. Strangelove; two parties who think they have the upper hand, but in the end are still the loser. Knott flips that around because the bosses are ripping off the corrupt congress, instead of politicians apparently selling to the highest bidder.

Can there be any benefits to job distribution? Or does Knott’s cartoon serve as the ultimate warning to corrupt politicians? The cartoon title, “Caveat Emptor” translates from Latin to “Let the buyer’s beware” Although, the machines weren’t so wary against they’re actions, they believed corruption was in the right. The political machines did manage to benefit those who were a part of it, and they were the only way to, “ultimately provide stable and reliable government,” in an already corrupt system (Ehrenhalt). Take Mayor Daley’s Chicago in the 1950s, where his political machine built many jobs in and around the city (Ehrenhalt). So to some Americans, and I guess some politicians, in order to move forward as a nation, jobs must be bought, and loyalty must be seized, and men must appear with big guts and cigars behind fences. There are definitely men such as Mayor Daley who oppose Knott’s opinions, saying he’s just Knott funny. According to machine supporters, if you corrupt an already corrupt system, then two wrongs can make a right.

Political Machines bought and sold jobs like hot commodities during the Great Depression. The desperate American people and general apathetic feelings toward government allowed corruption to spread. Nevertheless, the people at the Dallas Morning News weren’t afraid to show their true colors. Knott’s cartoon made politicians look like the fools that they are, creating humor in an otherwise dark subject.  The impact of the article at the time may have been small, but in today’s world of information, the archives help show how Americans thought in 1930s Texas. Knott was a forefather in political satire, a sign of not only more mistakes made by politicians, but great satirists such as Stanley Kubrick. Both the editorial and Knott’s cartoon make America’s voice heard in an otherwise silenced nation, crying against any form of political corruption, and making fun of those who do.

Sources:

Dallas Morning News, ed. “Civil Service Needed.” Editorial. Dallas Morning News 3 Nov. 1933: 18. America’s Newspapers [NewsBank]. Web. 26 Oct. 2015.

Ehrenhalt, Alan. “Why Political Machines Were Good for Government.” Why Political Machines Were Good for Government. Governing, July 2015. Web. 03 Nov. 2015. <http://www.governing.com/columns/assessments/gov-political-machines-positives.html>.

Kelber, Harry. “How the New Deal Created Millions of Jobs To Lift the American People from Depression.” How the New Deal Created Millions of Jobs To Lift the American People from Depression. The Labor Educator, 9 May 2008. Web. 26 Oct. 2015. <http://www.laboreducator.org/newdeal2.htm>.

Jackson, Bill. “Political Machines.” Political Machines. The Social Studies Help Center, 2015. Web. 26 Oct. 2015.

Kennedy, Robert C. “Nast, Thomas (1840–1902).” Encyclopedia of the Gilded Age and Progressive Era. Ed. John D. Buenker and Joseph Buenker. Armonk, NY: Sharpe Reference, 2013. 473-474. Gale Virtual Reference Library. Web. 5 Nov. 2015.

A Timely Shower Down on the Farm

"A Timely Shower Down on the Farm;" depiction of a farmer and his family looking up to a rainy sky. The cloud has the words "Soil Conservation" in it, while the words "$500,000,000" are in the rain. The farmer says, "The soil sure needs it."
Knott’s cartoon predicts the effects of the Soil Conservation Bill on the farmers that it will assist.

A Timely Shower Down on the Farm by John Francis Knott –
Saturday, February 29, 1936

This political cartoon pictured above and entitled “A Timely Shower Down on the Farm” is in reference to the Soil Conservation Bill, which is also known as the Soil Conservation and Domestic Allotment Act of 1936, which was passed on February 29 of 1936, the same day that this newspaper was first printed (“Soil Conservation Bill”). This bill was passed by the President of the United States, Franklin D. Roosevelt, also commonly called “FDR.”

President Roosevelt was known for his vast expansion of government aid programs, in particular the New Deal, which was a series of federal aid programs intended to help the public recover from the economic downturn in the United States during the 1930s known as the Great Depression. Some of these programs include the Social Security act, which helped the unemployed by giving them money to live on in the form of pensions; the CCC or Civilian Conservation Corps, which helped to remove the excess amount of people looking for work that were in cities at the, as well as provide money for families; and the AAA or Agricultural Adjustment Act, which protected farmers from the cost of their crops dropping by providing subsidies to them.

The Soil Conservation Bill was largely put in place as a replacement of the Agricultural Adjustment Act, which was ruled unconstitutional in the month prior to the passing of this bill (“Seventy-Fourth Congress”); as such, the goal of the Soil Conservation Bill, much like that of the Agricultural Adjustment Act, was to financially support farmers so that they would grow more soil-conserving crops to help prevent more soil erosion, a great problem in the 1930s due to the Dust Bowl (Gregg), a series of severe dust storms and droughts that plagued farmers throughout the 1930s.

The article which accompanies this cartoon, simply entitled “Soil Conservation Bill,” talks about the bill and its goal to prevent further soil erosion by reducing the farmers’ crops and compensating them for the resulting loss in income. Because the newspaper that this article and cartoon were printed in was first run the day the Soil Conservation Bill was passed, the writer and cartoonist could not have known whether President Roosevelt would sign the bill. However it seems clear that he will, considering the sort of government aid programs President Roosevelt has approved in the past. The author of the article even goes as far as to say that it is “doubtless” that President Roosevelt will sign the bill (“Soil Conservation Bill”).

The humor of this cartoon is derived from the use of metaphors.

The political cartoon depicts a farmer and his family on their farm, which serves to represent the farmer’s livelihood, which seems to be experiencing a drought as shown by the leafless and perhaps dead tree in the background as well as the apparent lack of grass (Knott). This is representative of the farmers’ lack of income as well as the more literal effect of the Dust Bowl. The farmer remarks that the soil needs the rain (Knott), which is used to represent the money given to the farmers by the Soil Conservation Bill “cloud.” The name of the cartoon, “A Timely Shower Down on the Farm,” refers to the good timing of the bill in order to improve the state of not only the farmer, but also the soil.

 


Works Cited:

“Seventy-Fourth Congress.” Landmark Legislation, 1774-2002: Major U.S. Acts and Treaties. Stephen W. Stathis. Washington, DC: CQ Press, 2003. 205-208. Gale Virtual Reference Library. Web. 30 Nov. 2014.

GREGG, SARA M. “Conservation Movement.” Encyclopedia of the Great Depression. Ed. Robert S. McElvaine. Vol. 1. New York: Macmillan Reference USA, 2004. 203-206. Gale Virtual Reference Library. Web. 30 Nov. 2014.

Author Not Listed. “Soil Conservation Bill.” The Dallas Morning News [Dallas] 29 Feb. 1936: n. pag. Dolph Briscoe Center for American History. Web. 30 Nov. 2014.

Knott, John F. “A Timely Shower Down on the Farm.” Cartoon. The Dallas Morning News [Dallas] 29 Feb. 1936: n. pag. Dolph Briscoe Center for American History. Web. 30 Nov. 2014.

How it Will Work

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How it Will Work 

John Francis Knott – October 1933

This cartoon comes in response to an address to the nation President Roosevelt made in October of 1933, in the midst of the Great Depression. He declared that the United States no longer should rely on outside countries to influence the value of gold in the US, and that the government would be setting up a market where the price of gold and the purchasing power of the dollar would be fixed.

In the previous March, the United States stopped using gold payments and effectively went off the gold standard, but gold was still relevant in trade, both domestic and international. Previously, the Federal Reserve was required to hold gold equal to 40% of the value of the currency it issued (the dollar), and to convert those dollars into gold at a fixed price of a little over $20 per ounce. The Federal Reserve held more than enough gold to convert to currency typically, and this was called “free gold.” In early to mid 1933, large quantities of gold left the Federal Reserve, both domestically and internationally. Experts say individuals and businesses preferred having metallic gold instead of paper currency, and that foreign investors feared that the dollar itself was devaluating. Both of these combined are reasons the Federal Reserve Bank of New York could no longer carry out its’ commitment of handing out gold instead of paper currency, and so the National Banking Holiday was created.

Throughout the next few months, the Roosevelt administration gradually weakened the US’s tie to gold through a series of actions. Beginning in April, the administration prohibited exports of gold and prohibited the Treasury department and other institutions from converting currency into gold. The next month, congress passed the Thomas amendment to the Agricultural Relief Act, which gave the president the power to reduce the content of gold in the dollar by as much as 50%. Silver was also added as an option to back the dollar, instead of just gold. In June, a resolution repealed gold clauses in contracts, both governmental and private. Gold clauses were guarantees in contracts that the parties involved would be repaid in gold or the monetary equivalent, as set by the value from 1900. These three initiatives together evolved the Roosevelt gold policy, leading up to the second phase, which was introduced in October of 1933 (for which the political cartoon is a reaction to).

In simple terms, the purpose of this second phase was to devaluate the dollar. The government authorized the Reconstruction Finance Corporation to buy gold at increasing prices, which raised the value of gold in terms of dollars, but lowered the value of dollars in terms of gold and foreign currencies. The ultimate goal of this was to raise prices of American commodities, which would counteract the deflation that pulled the economy into the state it was currently in. This reflation would hypothetically help those in debt, help banks, and businesses. The reflation would also hopefully lower prices of American goods internationally, which would encourage exports, and raise prices of foreign goods, which would discourage imports.

The cartoon by John Knott in the October 24th edition of the Dallas Morning News is a depiction of President Roosevelt flying and raising a gold dollar coin higher and higher, as if it was a kite. The editorial that accompanies the cartoon, A Market for Gold, says “the establishment of the gold market puts the President in position to push consistently toward a price level which may be acceptable as equitable to both creditors and debtors, without an unnecessary amount of interference because of manipulation abroad.” This quote quite possibly depicts most clearly what the cartoon is trying to show. While the editorial seems to be supportive of the new gold market, it is also skeptical in some ways, mostly about the President mostly ignoring the devaluation of the dollar. The United States had been under the gold standard for so long, and so as it weaned off it, many were nervous and dubious about the results. The editorial ends by saying “All that remains to be done is the announcement and the stabilization that the President in due time will make.” So while the Dallas Morning News supports President Roosevelt’s idea, they are still waiting for more.

A reason the dollar coin is depicted as a kite is because of the uncertainty of the value of the actual currency. It is easy to think you’re flying a kite excellently, but all of a sudden a gust of wind could arrive, or anything of that nature, and the kite will crash to the ground. The editorial board acknowledges that Roosevelt can now control the price of their currency, but that the dollar in due time will devaluate, or fall to the ground (as a kite does).

Works cited:

Knott, John. “How it Works” Cartoon. The Dallas Morning News [Dallas] 24 October, 1933: n. pag. Dolph Briscoe Center for American History. Web. 23 November, 2014.

“A Market for Gold” The Dallas Morning News [Dallas] 24 October, 1933: n. pag. Dolph Briscoe Center for American History. Web. 23 November, 2014.

Gary Richardson, Alejandro Komai, and Michael Gou. “Roosevelt’s Gold Program – A Detailed Essay on an Important Event in the History of the Federal Reserve.” Roosevelt’s Gold Program – A Detailed Essay on an Important Event in the History of the Federal Reserve. 1933. Web. 2 Dec. 2014.