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This Week in History
December 30 1935 - January 5, 1936:
FDR Warns America about Fascism Abroad —
And Its Domestic Corollary: Economic Austerity

December 2012

Franklin Delano Roosevelt.

When President Franklin Roosevelt delivered his annual message to Congress on Jan. 3, 1936, the threat of war being launched by fascist regimes was already looming in Europe and Asia. In the United States, the complex of investment firms and banks that had monetarily supported those fascist takeovers was now regrouping to attack Roosevelt's New Deal. The particular targets were those measures which defended the general welfare of America's citizens.

President Roosevelt began his message to Congress by citing his Inaugural Address in 1933, where he spent only one paragraph on world affairs, and the rest on the economic crisis facing America. Now, in 1936, he talked of the happy results of his Good Neighbor Policy in the "mutual understanding" and "common helpfulness" that existed between the nations of North and South America. Then he added, "The rest of the world—Ah! There is the rub."

"Were I today to deliver an Inaugural Address to the people of the United States, I could not limit my comments on world affairs to one paragraph. With much regret I should be compelled to devote the greater part to world affairs. Since the summer of that same year of 1933, the temper and purposes of the rulers of many of the great populations in Europe and in Asia have not pointed the way either to peace or to goodwill among men. Not only have peace and goodwill among men grown more remote in those areas of the Earth during this period, but a point has been reached where the people of the Americas must take cognizance of growing ill-will, of marked trends toward aggression, of increasing armaments, of shortening tempers—a situation which has in it many of the elements that lead to the tragedy of general war....

"I realize that I have emphasized to you the gravity of the situation which confronts the people of the world. This emphasis is justified because of its importance to civilization and therefore to the United States. Peace is jeopardized by the few and not by the many. Peace is threatened by those who seek selfish power. The world has witnessed similar eras—as in the days when petty kings and feudal barons were changing the map of Europe every fortnight, or when great emperors and great kings were engaged in a mad scramble for colonial empire."

A demonstration in May 2011 against the Greek-EU austerity for bank bailout deal.
Repression of a peaceful demonstration in Greece, late 2011, with tear gas. The demonstration is against the ongoing deals that the government of Greece is making with the European Union, to implement austerity demanded by the EU in return for continued membership in the EU and continued bailouts of thxe Greek banks by the European Central Bank.

President Roosevelt then made the connection between the fascist takeovers abroad and those who were planning a similar fate for the Americas. "The evidence before us clearly proves that autocracy in world affairs endangers peace and that such threats do not spring from those Nations devoted to the democratic ideal. If this be true in world affairs, it should have the greatest weight in the determination of domestic policies.

"Within democratic Nations the chief concern of the people is to prevent the continuance or the rise of autocratic institutions that beget slavery at home and aggression abroad. Within our borders, as in the world at large, popular opinion is at war with a power-seeking minority.... That is no new thing. It was fought out in the Constitutional Convention of 1787....

"In these latter years we have witnessed the domination of government by financial and industrial groups, numerically small but politically dominant in the twelve years that succeeded the World War. The present group of which I speak is indeed numerically small and, while it exercises a large influence and has much to say in the world of business, it does not, I am confident, speak the true sentiments of the less articulate but more important elements that constitute real American business.

"In March, 1933, I appealed to the Congress of the United States and to the people of the United States in a new effort to restore power to those to whom it rightfully belonged. The response to that appeal resulted in the writing of a new chapter in the history of popular government. You, the members of the Legislative branch, and I, the Executive, contended for and established a new relationship between Government and people.

"What were the terms of that new relationship? They were an appeal from the clamor of many private and selfish interests, yes, an appeal from the clamor of partisan interest, to the ideal of the public interest. Government became the representative and the trustee of the public interest. Our aim was to build upon essentially democratic institutions, seeking all the while the adjustment of burdens, the help of the needy, the protection of the weak, the liberation of the exploited and the genuine protection of the people's property....

"To be sure, in so doing, we have invited battle. We have earned the hatred of entrenched greed. The very nature of the problem that we faced made it necessary to drive some people from power and strictly to regulate others. I made that plain when I took the oath of office in March, 1933. I spoke of the practices of the unscrupulous money-changers who stood indicted in the court of public opinion. I spoke of the rulers of the exchanges of mankind's goods, who failed through their own stubbornness and their own incompetence ... but now with the passing of danger ... they seek the restoration of their selfish power.

"Yes, there are still determined groups that are intent upon that very thing. Rigorously held up to popular examination, their true character presents itself. They steal the livery of great national constitutional ideals to serve discredited special interests. As guardians and trustees for great groups of individual stockholders they wrongfully seek to carry the property and the interests entrusted to them into the arena of partisan politics. They seek—this minority in business and industry—to control and often do control and use for their own purposes legitimate and highly honored business associations; they engage in vast propaganda to spread fear and discord among the people—they would 'gang up' against the people's liberties...."

After asking rhetorically whether all the gains made by the passage of farm-price supports, unemployment compensation, child-labor laws, Social Security, and public-health measures should now be reversed to please this autocratic minority, Roosevelt added a chilling warning: "But the challenge faced by this Congress is more menacing than merely a return to the past—bad as that would be. Our resplendent economic autocracy does not want to return to that individualism of which they prate, even though the advantages under that system went to the ruthless and the strong. They realize that in thirty-four months we have built up new instruments of public power. In the hands of a people's Government this power is wholesome and proper. But in the hands of political puppets of an economic autocracy such power would provide shackles for the liberties of the people. Give them their way and they will take the course of every autocracy of the past—power for themselves, enslavement for the public.

"Their weapon is the weapon of fear. I have said, 'The only thing we have to fear is fear itself.' That is as true today as it was in 1933. But such fear as they instill today is not a natural fear, a normal fear; it is a synthetic, manufactured, poisonous fear that is being spread subtly, expensively, and cleverly, by the same people who cried in those other days, 'Save us, save us, lest we perish.'

"I am confident that the Congress of the United States well understands the facts and is ready to wage unceasing warfare against those who seek a continuation of that spirit of fear.... The Congress has the right and can find the means to protect its own prerogatives."


The original article was published in the EIR Online’s Electronic Intelligence Weekly, as part of an ongoing series on history, with a special emphasis on American history. We are reprinting and updating these articles now to assist our readers in understanding of the American System of Economy.