New Problems in National Affairs

WE MAY BE ABLE TO LAUGH LATER

Address by ERNEST K. LINDLEY, Washington Correspondent for Newsweek Author of Syndicated Column on National Affairs

Delivered at Institute of Public Affairs, University of Virginia, Charlottesville, Virginia, July 3, 1939

Vital Speeches of the Day, Vol. 5, pp. 620-23

WHEN your Director, Professor Dillard, and his privy council and I sat down to list the national problems which seemed urgent or interesting enough to demand consideration during the two weeks of the Institute of Public Affairs, we soon had what looked like an index for an encyclopedia or the first draft of a mail order catalogue. As a nation we have piled up the largest and most varied stock of unsolved problems in our history; and a new one seems to be born, or discovered every minute.

At second glance, however, most of our new problems are easily identifiable as old ones: the ugly pieces we stuck out of sight in the garret; the broken furniture we hastily glued

together and covered with bright pieces of cloth, with the fervent but futile hope we would always remember not to lean on it; the crack in the wall paper we had subconsciously noticed but never thought of doing anything about until the ceiling fell on our heads.

Or, we may compare ourselves with the motorist who, after a blowout had landed him in the ditch, thought it wise to check over his car, and found that the other three tires were worn to the last layer, his brake-bands were gone, his front wheels were out of line, his batteries were almost dry, the upholstery was full of holes—and that there was a leak in the gas tank.

So many of our toughest problems, we can see now, stretch back into our distant past. For example, the conservation of our roost important inanimate resource, the soil. For generations we have been plundering it—until 100 million once-fertile acres have been made worthless for profitable farming, and some three billion tons of soil annually are swept away by wind and water. The soil experts warn as that unless drastic measures are taken the United States will go the way of Asia Minor and the desert areas of China.

The slums, city and rural, are an old affliction—but a curable affliction. Why we have endured it so long passes all understanding. A colossal toll in premature death and needless suffering from preventable and curable diseases—on this front we have made progress, but only recently have we begun to realize how much we can save, in both human and economic terms, by making available to everybody the knowledge and skills of medical science.

Our failure, even as yet, to provide a good free education for every American child—an essential in a society which aspires to the ideal of equal opportunity.

If we hadn't been in a semi-comatose state of smugness we would long ago have taken most of our indigent old people out of the poorhouses and put them on pensions adequate to sustain life.

So many of the topics of discussion today—minimum wages, collective bargaining, the railroad problem, how to handle the "trusts"—were the standard subjects of debate in my high school days.

It was the World War, of course, which smothered a promising movement toward the correction of some of the most obvious defects of our social system and led us into a series of hallucinations from which we are now painfully trying to recover.

The hallucinations were quaint, but tragic. We thought that by fighting a war on the continent of Europe we were making the world safe for democracy and ending all wars.

Then we blew up the half-truthful but barbaric boast that any American had a chance to become a millionaire, into the monstrous thesis that every American could become a millionaire by buying stocks and waiting for the ticker to do its duty.

We thought it was sound economic and brilliant finance to give away billions of dollars worth of our materials and labor and ingenuity, through the post-war loans, while millions of our own people lived in surroundings unfit for cattle.

Then, at the beginning of the thirties, we seized upon another quaint illusion: the pillar saint illusion that if you on your post, raised your eyes to heaven, and intoned the statistics of the cyclical economist, all would soon be well with the world. This curious orientalism was declared to be thoroughly scientific by one branch of our economic priesthood. It held us spell-bound for a time, until the Pangs of hunger and cold revived the traditional American urge to action.

We have had a lot of action these last six years—too quick action and too-slow action, brilliant action and miserably confused action—but action. What have we to show for it?

First and foremost, we have preserved, and I think strengthened, our democratic institutions of government and their inseparable civil liberties. Faith in our democratic processes was wearing dangerously thin not so long ago; even our "best people" were muttering that what this country needed was a Mussolini.

Our elections have been held on schedule and more people have voted in them than ever before. We still have our triangular Federal Government—and anyone who still thinks that the Presidency has been converted into a "dictatorship" ought to be compelled to watch Congress for one day. We still have a Federal system: although the lines of demarcation between Federal responsibilities and State responsibilities have changed, as they will continue to change so long as we remain a practical people.

Our rights of free speech have been bolstered by a series of enlightened and forthright Supreme Court decisions and by the work of the La Follette Committee. The press is so free—of governmental influence, at least—that eighty or ninety per cent of its lambastes the party in power.

And certainly not in my time have there been such lively and widespread discussion of public questions and an electorate so eager to be informed. This is apparent all the way down to the cross-roads stores, where you can hear more intelligent talk about political and economic questions than you could hear in Wall Street ten years ago—or can now, perhaps.

For the first time a serious effort has been made to guarantee to labor generally its fundamental rights to organize and to bargain collectively with employers—rights to which both major political parties had paid lip homage for fifteen years before the present National Labor Relations Act was enacted; rights which are not yet fully established in some industries and some localities.

In the field of government, progress has been made in improving administration, in expanding the Civil Service, in modernizing the machinery of justice and purifying the personnel of the appellate courts. Much remains to be done, notably in developing a merit system based on a principle nobler and more conducive to efficiency than the mere provision of security for petty job holders.

One problem in this group has been solved, at least for the present: a problem which caused delays and confusion at incalculable cost: the conflict between the Supreme Court and the other two branches of the Government. The judicial barrier to orderly growth has been shattered. The Supreme Court justices are rapidly clearing away the debris of the stone wall in which their recent predecessors had encased the Constitution.

Our machinery of democratic government still creaks and groans and sputters as it always has done and probably always will do. But it operates despite the heavy loads we have piled on it, and it is in incomparably better working order than it was a few years ago. Moreover, I believe we treasure it more than we used to—thanks to the contemporary dictators. Their flashy, speeded-up models and high pressure salesmanship have left us cold. Most of us, I suspect, have the comfortable—perhaps too comfortable—feeling that our machinery will still be chugging along when theirs has burned out or exploded. (We can only hope that the explosion doesn't destroy too many innocent spectators.)

Many other items belong on the credit side of our ledger for the last few years. We, as a people, have faced and at last begun to deal with many old problems and a few new ones.

We have begun to salvage the wreckage of the era of heedless exploitation of natural resources, and to conserve some of the resources which we have left. In this, it may be noted, we have thought and done more about land and water resources than about our exhaustible mineral deposits.

We have tried to cut out or purify some of the parasitical financial growths on our productive system—not without protests from the patient, it must be acknowledged. But we know from past experience that our financial leaders are tougher than they think they are, or pretend to be. When they have recovered from their operations they frequently boast about them. Witness the pride of the American financial community in the Federal Reserve system. You never would suspect that it had to be hog-tied and knocked half-unconscious while that reform was grafted onto it a generation ago. Within the short space of four or five years we have seen Wall Street's attitude toward the Securities and Exchange legislation change from rage and defiance to a mixture of respect and shy fondness.

Through social insurance we have made a beginning toward providing the wage and salary earner and his dependents with a minimum of security against some of the common hazards of life. But large parts of the population and certain insurable hazards have not yet been brought within the system, and the benefits to be paid are in many instances too small. Legislation now pending in Congress would improve and expand the social insurance system: notably by making provision for the children and young widows and for the aged wives of insured workers who die before reaching the age of retirement.

Social insurance is here to stay, and the demand from all sides is that it be expanded. It is only a matter of a short time, I think, before it is made to cover other groups of productive workers and such hazards as permanent disability, loss of income during illness, and the costs of medical care. How far to expand the social insurance system and how to finance it are problems which will remain with us for a long time to come.

We have accepted a collective responsibility for providing the essentials of life for those who through no fault of their own are unable to make a living in private employment: dependent children, the blind, the indigent aged, and the able-bodied unemployed. We have come a long way in the few years since it was officially held to be proper and sound to use Federal money to buy feed for starving mules but wrong to use it to buy food for starving men, women, and children.

We have made some attempts—rather crude, perhaps, but earnest—to get a better balance among the incomes of various producing groups. Under this heading can be put such items as collective bargaining, wage and hour legislation, and the effort to bring up agricultural income. If the farm problem had been taken up fifteen years or more ago when it began to cry for attention, we might have been spared the worst of our depression. It has been made immensely more difficult, of course, by the loss of foreign markets during the last several years and, I believe, by too much optimism about the possibility of recovering those markets.

We have tried to stimulate private industry with a variety of tonics, ranging from low interest rates to spasmodic "pump-priming" expenditures on public works.

In looking back over the last few years, we must regretfully acknowledge that few problems have been solved. For dealing with others, beginnings have been made by methods which seem to be generally accepted as sound, although open to further argument on matters of detail. But on other fronts we are still floundering.

In general, we have made much more progress in matters of social policy than in matters of economic policy. The last few years have been a period of fine humanitarianism. We have hoisted and kept flying the flag of social and economic

justice. Reforms long overdue—that were dangerously pent up for a generation or longer—have been effected or begun. We have begun to do something about such long range problems as the conservation of our resources. But we have been unable to get our economic machine into high gear. The indictment that cannot be escaped is that after nine years of depression and half-recovery, we still have about eleven million unemployed and that we are not yet even within striking distance of the height of activity we must reach if we are to make full use of our economic resources.

In adding up the economic score of the New Deal, it has to be remembered that the depression in this country was extraordinarily severe. Our industrial production was cut in half. In comparison, at the pit of the depression in Great Britain and Sweden industrial production was down less than twenty per cent. Only two nations experienced industrial depressions as severe as ours. They were Poland and Germany. In addition, we had an extraordinary severe agricultural depression. Moreover, we were slower than most other nations in attempting to lift ourselves out of the depression. Ours seems to have been the only nation where suffering in silence and waiting for so-called "natural" forces to work was regarded as a sound, or even defensible, policy.

As to what ought to be done to bring about economic recovery there have been, and still are, the sharpest differences of opinion in the country generally, within the party in power, and even in the inner circle of the Roosevelt Administration. It seems plain that everybody will have to do a lot more hard thinking in economic terms and that somebody will have to work out and put into effect a coordinated economic program. At present, our economic dough contains plenty of shortening, but not enough yeast.

So much that has been done during the last few years has been only stalling for time, only keeping ourselves from being too uncomfortable while we sit waiting for something to turn up. We have not yet completely escaped from the pillar-saint illusion.

The reaction that has set in against the heavy costs of relief is understandable and, I think, based on sound instincts. Relief connotes failure. At best it connotes an emergency. An emergency that has lasted ten years is worthy of another name, and another treatment.

The whole idea of continuing relief on a large scale is, to say the least, dreary, disheartening and a bit maddening. Consider the experience of an ordinary middle-class citizen. He contributes to the Community Chest, which has set its financial needs at a new high for all time. The Community Chest drive falls short of its goal, and he makes a second contribution. Then he is besieged by various worthy charitable enterprises which are not covered by the Community Chest. He scrapes together the money for his income tax payment, which comes about the time Congress is considering another enormous deficiency appropriation for WPA. He notes that in spite of his income tax payment, the Federal budget is still a few billion dollars out of balance. Then he finds out that his property tax has been boosted to obtain funds for taking care of the unemployed who can't get on WPA. He finds that he must cough up a few dollars a month to keep Cousin Susie from going on relief. He has a mortgage on his house, and he is wondering whether he can save enough money to send his children to college. On his way to work he passes a gang of WPA workers with their shovels—no, not leaning on them, but, what is not much better, using them to dig a ditch which could be dug in one-quarter of the time and for one-half the cost with a ditch-digging machine. Finally, at the entrance of his office-building, he is accosted by a pan-handler.

He cannot be blamed if he ceases to be stoical. He feels that the relief and salvage bill for our society is extravagantly high. It is, I suspect that most people on relief feel the same way about it. I don't believe this country can be reconciled to the thought of carrying permanently a large number of people on relief, either in idleness or on various kinds of low-geared busy-work.

It is time to calculate our latitude and longitude again, to take new soundings, and to decide how much longer we can afford to wait for a breeze to spring up. There are some who say that the breeze is there but that the sails aren't set right to catch it. They complain of deterrents, of lack of confidence. Thousands of our so-called men of enterprise proclaim, almost proudly it seems: "We lack confidence. We are afraid." Do they ever wonder what their grand-children will think of them? It must be acknowledged, I think, that the sails have not been perfectly set. But it may be that our old salts are frightened because we have entered an unfamiliar sea. We must consider the possibility that we have passed out of the belt of strong trade winds, where they learned all they know about seamanship, and into an area where, if we are to forge ahead, we must rely less on sail and more on propellers.

In taking account of our economic situation, we should try to clear our winds of slogans and precepts and try to think clearly. We have the raw materials and processing techniques to provide a decent standard of living for every person who is willing and able to work. Moreover, nearly everybody knows that—which is a fact of explosive political importance. It means that we can't satisfy ourselves by boasting that we are better off than someone else, or that we are better off than our forefathers were. It means that we must aim at, and make measurable progress toward, the full use of our resources.

We must diligently seek the answers to such questions as these:

What useful new activities need to be taken—what outlets are there for our collective savings?

Are they ventures which can be undertaken best by private enterprise? If so, why hasn't private enterprise undertaken them? Or are they ventures in which the government must take a hand? If so, what kind of hand? By setting up an insurance system, to spread the risk, as has been done for private housing under the Federal Housing Administration, with good results? With subsidies, as is done with our merchant marine and our aviation industry? Or by other means? We have lying around all kinds of useful but barely used devices for cooperation between private enterprise and the government.

Are we saving more of our national income that is needed for new investments, including new investments by the government or by the government and private interests in cooperation? Every dollar that is saved, or an equivalent dollar, must be put back into the economic stream or the stream dries up. In examining this question we may get some useful hints from the experience of other democratic capitalistic nations. Great Britain handled the depression much better than we have done. Is it significant that the rate of saving has been greatly cut down in Great Britain—that a larger percentage of the national income is pumped into direct consumption? Is it significant that Great Britain had a big housing program which was accelerated when the depression arrived?

How much is recovery being held back by artificially-sustained prices? How much by our crazy-quilt tax pattern?

The list of questions could be expanded indefinitely. In trying to answer them we cannot afford to jump to conclusions, or to suppose that they have been answered by the economic precepts of an earlier age. But we don't need to look far to realize that many of our problems are also opportunities. There is probably a decade of prosperity for all of us in the clearing of the slums and in the economic regeneration of the South.

Finally, and imperatively, is the problem of preventing our attention and energies from being diverted to an excursion abroad. With this are bound up our problems of national defense and of foreign policy. These are no longer distant, academic problems. In dealing with them we are literally up against the guns. It is sometimes asserted that if a major war breaks out in Europe, we will find it impossible to keep out. Maybe we won't keep out; maybe we shouldn't keep out; but to say "can't" is a slander on our ability to conduct our affairs with intelligent regard for our own interests.

What should we fight, if necessary, to defend? What kind of navy, army, and air services do we need? Can we do anything effective to avert a cataclysm in Europe without so entangling ourselves that we will be drawn in if our efforts fail and the cataclysm occurs? However we answer these questions, it would be idle to deny that there is grave danger that we will be drawn away from our important tasks at home—perhaps lose our chance to deal with them by democratic means.

Our problems at home are not easy to solve. But it is impossible not to have faith that we can solve them if we put our minds to them. A few years hence, let us hope, we will be able to laugh at our timid fumbling during the nineteen-thirties.

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