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The Last Great Living American Has Died

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posted on Jun, 3 2006 @ 08:48 PM
John Kenneth Galbraith, 1908-2006 in April
A Memorial Service was held today at Harvard Yard

Rest In Peace

[edit on 6/3/2006 by donwhite]

posted on Jun, 4 2006 @ 07:34 AM
John Kenneth Galbraith was barely 25 years old when he was summoned to Washington to assist in the formulation of new economic policies to revive the nation’s economy. FDR knew two things. 1) The old system was not working. And 2) the country wanted action.

Prior to the 20th Amendment, the new Congress was sworn in on the 3rd of January, in the year following the election. The president was not sworn in until March 4. It is 60 days from January 3 to March 4. This hiatus was shortened to January 20 beginning in 1936. It was the case that in 1932, a very heavily Democratic Congress had been elected along with FDR. This congress began passing new laws as soon as it convened. Herbert Hoover, who was a product of the old school of minimal governance, vetoed most of their work product.

Galbraith, Harold Ickes, Henry Wallace, Frances Perkins and many others had begun to work on a new deal for the common man just after the November, 1932 election. Perhaps the most valuable single law they concocted was the Federal Deposit Insurance Corporation. Contrary to many accusations that FDR was a socialist, he was actually an enlightened capitalist. With rare exceptions, the US Government has never “given” away anything. Even those halcyon days of “free” land had strings attached.

Prior to FDIC, bank depositors all too frequently lost their lifetime savings when the local bank defaulted or as they said, “went belly up.” For a farmer who had worked hard all his life, to lose his nest egg at age 60, was not only personably traumatic, but very hurtful to the overall economy. Under FDIC, banks were assessed ½% of all deposits up to $5,000 - now $100,000 - which deposit was “guaranteed” regardless of the financial health of the bank. Our modern banking system rests on this bedrock confidence of depositors. Since 1933, no depositor has ever lost one penny. The system does not cost the taxpayers one dime.

So how do you get the archaic type thinking bankers to join in? Well, it looks simple now, but it was not then. Each bank that wants to join and publicize its participation in FDIC must conform to sound banking practices. Today, FDIC auditors regularly review banking practices and banks must conform. Bankers cannot loan money to their brother in law if he does not have good collateral. And so on. Banks are in effect trustees of other people’s money. The FDIC keeps them honest. The FSLIC takes similar care of the Savings and Loan associations. You can thank John Kenneth Galbraith for the FDIC. And etc.

Other momentous undertakings included the REA - Rural Electrification Authority. Prior to 1933, fewer than 5% of America’s farms were electrified. The REA arranged for rural co-operatives to borrow money to build the infrastructure needed to distribute electricity. At the same time the FPC - Federal Power Commission - set fair prices for electricity bought and sold in bulk. By 1941, over 90% of American farms were electrified, when revolutionized the life of farmers and gave city dwellers more food, at lower prices, and of better quality. All at no net cost to the taxpayers. People working together with no-nonsense goals for improvements in their own lives. And all aided by a friendly government.

I am compelled to recite one more achievement of the New Deal. The 1933 Wagner Act. Named for the NY senator who introduced the bill. Prior to 1933, worker’s strikes were often declared “illegal” by the courts. Strikes were known as a common law conspiracy, denying others the right to work. Unions were powerless if they could not withhold their labor. The Wagner Act made strikes legal in America.

The post 1933 union movement gave America the great middle class we have heard so much about, which was that great time from 1945 to1980. Since that time, unions have been neutered first by Nixon then by Reagan and the American middle class is fast disappearing.

Thank you Republicans. You do love “some” Americans but not “all.” These stories are just the tip of the New Deal and how it changed America from an agrarian economy to an industrialized giant. Anti New Deal forces waged an unending and relentless war against it. By the 1980s, when most Americans took for granted and had forgot why they had those “alphabet” agencies and assumed the good life would go on forever without exercising constant vigilance. Not so.

Since 1975, to pick a year, 30 million well paid blue collar jobs that were the backbone of the American middle class have disappeared. Who has any plans afoot to do in 2008 what the New Deal did in 1933? Who even wants to talk about it? Today’s politicians offer only one universal panacea, tax cuts. What’s next when the taxes on the rich reach 0%.?

[edit on 6/4/2006 by donwhite]

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