Evening star., 1938-04-15

ofobNSuct OS Ifootuehb AtOooccctt
last night from the White House:
Five months have gone by since I
last spoke to the people of the Nation
about the state of the Nation.
l had hoped to be able to defer this
talk until next week because as we
all know, this is Holy Week But
what I want to say to you, the people
of the country. is of such immediate
need and relates so closely to the lives
of human beings and the prevention
of human suffering that l have felt
that there should be no delay. In this
decision I have been strengthened by
the thought that by speaking tonight
there may be greater peace of mind
and the hope of Easter may be more
real at fresides everywhere, and that
1t is not inappropriate to encourage
peace when so many of us are think
ing Of the Prince of Peace.
Five years ago We faced a very
serious problem of economic and social
recovery. For four and a half years
that recovery proceeded apace. 1t is
only in the past seven months that it
has received visible setback
And it is only within the past two
months. as We have waited patiently
to see whether the forces of business
itself would counteract it, that it has
become apparent that government
itself can no longer safely Iail to take
aggressive government steps to 'eet
1t.
Nation Declared in Much
Better Condition Than in 1888.
This recession has not returned us
to the disasters and suffering of the
beginning of 1888. Your money in
the bank is safe. farmers are no longer
in deep distress and have greater pur-
chasing power; dangers of security
speculation have been minlmized. !
national income is almost SO per cent
higher than in 1882; and government
has an established and accepted re-
sponslbility for relief.
But know that many of you have
lost your jobs or have seen your |
friends or members of your families |
lose their Jobs, and I do not propose |
that the Government shall pretend |
not to see these things. I know that
the effect Of our present difficulties /
has been uneven; that they have /
affected some groups and some locaN- |
ties seriously, but that they have been .
scarcely felt in others. But l con-
celve the first duty of government is
to protect the economic welfare of all .
the people in all sections and in all !
groups l said in my message open |
ing the last session of Congress that /
If private enterprise did not provide |
jobs this spring, Government would |
take up the slack-that l would not !
let the people down. We have all |
learned the lesson that government |
cannot afford to wait until it has lost
the power to act.
Therefore. l have sent message
of far-reaching importance to the
Congress. want to read to you
tonight certain passages from that
message, and to talk with you about
them.
In that message I analy1ed the
causes of the collapse Of 1929 in
these words: Overspeculation in and
overproduction of practically every
article or instrument used by man
millions of people had been
put to work, but the products of
their hands had exceeded the Dur-
chasing power of their pocketbooks
Under the memorable law Of
supply and demand, supplies so over
ran demand which would pay that
production was compelled to stop
Unemployment and closed factories
resulted. Hence the tragic years
from 1929 to 1888"
National Income Reckoned
6S Billions Short Time Ago.
I pointed out to the Congress that
the national income-not the Gov
ernments income, but the total of
the income of all the individual citi-
zens and families of the United
States-every farmer, every worker,
every banker, every professional man
and every person who lived on income
derived from investments-that ma
tlonal income amounted, in the year
1929. to s8l ,00000O.0O0 BY 1882 this
had fallen to s38 ,OOOOOo,0OO Grad
ually, and up to few months ago,
It had risen to total Of $4,000 ,000,-
000-a pretty good comeback from
the low point.
I then said this to the Congress:
But the very vigor OF the re-
covery in both durable goods and
consumers goods brought into the
picture early in 1897 certain highly
undesirable practices, which were in
large part responsible for the eco
nomic decline which began in the ,
later months of that year Again
production outran the ability to buy.
There were many reasons for this
overproduction. One was fear-fear
Of war abroad, fear of imitation, fear
Of Nationwide strikes None Of these
fears have been borne out.
y" Production in many impor-
tant lines of goods outran the ability
Of the public to purchase them. For
example. through the winter and +
spring of 1887 cotton factl ries IN
hundreds of cases were running on
q three-shift basis. piling up cotton
goods in the factory and in the hands
OF middle men and retailers, For
example. also, automobile manutac-
turers not only turned out normal
increase of finished cars, but en-
couraged the normal increase to run
into abnormal figures, using every
known method to push their sales
This meant, of course. that the steel
mills of the Nation ran on a 24-hour
basis and the tire companies and cot
ton factories speeded up to meet the
same type of abnormally stimulated
demand The buying power of the
Nation Jagged behind
Thus by the autumn of 1887 the
Nation again had stocks On hand
which the consuming public could
not buy because the purchasing power
of the consuming public had not kept
pace with the production.
Prices of Many Products
Had Risen Too Fast.