Dictators and the New Deal

Robert B. Brinsmade

[An excerpt from the fourth edition of a pamphlet titled, "What's the Use of Working" by R.B. Brinsmade of San Luis Potosi City, Mexico. Reprinted from Land and Freedom, November-December, 1933]

Since Jan. 1933 Germany has quit Marxian pseudo-liberalism for a Fascist dictator and the new U.S. Democratic Congress has made Pres. Roosevelt a dictator, for curing depression by a New Deal (ND) in 10 acts, designed by a Brain Trust (BT) composed mostly of college professors.

The 1st or Natl. Monetary act (NMA) reorganizes the money and busted banking systems. The 2d. or Federal Security act wisely curbs fraud in interstate investment offerings. The 3d. or Civil Conservation act forms camps for public forest work, paying soldier-subsistence wages to 300,000 men. The 4th. or Tenn. Valley act enables the completion of Federal plants at Muscle Shoals and public supply of their power for regional development a laudable attempt to make a war-elephant self-supporting. The 5th. or Railway Coordinating act permits Govt. to unify discordant systems and restrict competition so wasteful for natural monopolies.

The 6th. and 7th. acts create Farm and Home Owners Loan corps, empowered to loan billions to save land-speculating fools from the results of their own folly; they broaden the field of Reconstruction Finance Corp. started by Pres. Hoover to loan $1.5 billions of Federal money to private enterprises. The 8th. or Public Works act provides $3.3 billions, either for Federal works and war, or for loans to local govts. agreeing to pay back 70% of their projects' cost. Such relief was long ago discarded by England as too costly; it must pay the robber wages of labor monopoly, instead of subsistence, and doubly enrich landlords, first by buying sites and later by raising value of contiguous lands. The 9th. or Natl. Industrial Recovery act (NIRA) provides more jobs, by shortening working weeks, and raises wages to suit the fallacy: "High wages make prosperity." The 10th. or Agric. Adjust, act (AAA) aims to boost food prices by taxing consumers to pay farmers for keeping land fallow or destroying crops. Already much of cotton crop has been plowed under and millions of pigs butchered for fertilizier. Such wicked waste, to lift prices, is a new sin for Uncle Sam (6).

NMA permits a scientific Natl. Managed currency (NMC) using an average-commodity price for a standard instead of gold. Its depreciated dollar raises domestic prices of rural products largely exported. In 1932, rural earnings were below the 1913 level but urban wage-rates were still 100% above it. The NMC reduces cost of mfd. goods (by lowering gold value of wages) and so fosters their consumption by farmers and miners, lessening unemployment, mostly urban.

But NIRA boosts urban wages, raising mfg. costs, and counteracts employing action of NMC; it removes the Sherman Anti-trust shield and grants no equivalent for consumers, even allowing higher tariffs to stop foreign competition; and it menaces liberty and favors Fascists by combining all industries under Federal control. Thus, after a benign, frugal, first half, ND launches 5 abortions, repudiating cherished Democratic doctrines of free trade, disarmament, state-rights, individualism, etc., and conceived by a BT either ignorant of political economy or afraid to tell for fear of losing prestige among college "economists."

Dictator R. first pared the budget of $300 millions of Legion plunder, but Congress must soon yield again to Legion raids unless protected by Proportional Representation. Besides, this saving is tiny compared to ND which may cost $12 billions and forever postpone reductions of huge war debt and bureaucracy. ND swallows the lie: "Govt. owes everyone a living" postulated by English landlords to defend workhouses for feeding paupers (robbed of their farms and commons by enclosures) and now urged by Marxians to justify the ruination of bourgeois by excessive taxes for doles. But Georgism rejects such sophistry and provides a costless way for automatically restoring all unused land to the public domain, where "paupers" can easily support themselves. The only approach to this natural remedy, among all the prodigal potions of ND, is a grant of $25 millions by AAA to establish subsistence farms for workless, but this also hushes scandals of land monopoly, so practical benefits will be small. All ND's costly plans to cure depression, while blinking monopoly profits, are as absurd as the plastering of a bullet-wound without first extracting the ball. Yet these blunders may prove disguised blessings if they react for the moralizing of capitalism before the nation has been bankrupted or enslaved by dictators.