Thursday, November 5, 2015

Pre-New Deal Art: Class Warfare

Above: This oil on cardboard painting was created by E. Stearns in 1931. The Smithsonian's Luce Center describes it in the following way: "E. Stearns created this painting two years after the Wall Street crash left many Americans unemployed and desperate. The image shows 'King Capital' raising his hand in a feeble attempt to stop the crowd of angry people... The mass of anonymous heads and arms represent all the people who suffered during the Depression, while the glamorously dressed figures symbolize the wealthy, watching in horror as the mob advances." Image courtesy of the Smithsonian American Art Museum.

Unlike today, where the Obama Administration is soft on white collar crime, and Hillary Clinton receives colossal sums of money from an industry immersed in fraud (Wall Street), and Republicans openly promote illegal tax evasion, and the public is constantly persuaded to vote against their own financial interest by right-wing millionaires & billionaires, Americans of the 1930s knew what was being done to them (thanks in part to the Pecora Investigation). That's why they elected Franklin Roosevelt in 1932. And when he came into office in 1933, FDR and his fellow New Deal policymakers began to implement reforms to handle fraudsters, white collar crooks, incompetent bankers, and market failures. These reforms included the Securities & Exchange Commission, FDIC, and Glass-Steagall. And the reforms worked. For example, from 1921 through 1933 there were 14,807 bank failures. But from 1934 through 1980 (before Reagan & Clinton-era deregulation became the fad, causing bank failures to increase) there were only 565 (find data here and here). The majority of Americans approved of these measures, of course, reelecting FDR three times.
Above: New Dealers like Franklin Roosevelt, William Douglas, and Ferdinand Percora didn't play footsie with well-heeled fraudsters and criminals. Today, with campaign cash flowing in from Corporate America and the super-wealthy, the story is quite different. For example, Republicans are currently trying to use the Highway Bill as a tool for deregulating the banks and undermining the Consumer Financial Protection Bureau; in essence, telling Americans, "You want good infrastructure? Sure, no problem... but you have to agree to let big financial institutions commit crime and run frauds against you." With this kind of mentality, it's little wonder that the American economy today has been described as the Golden Era of White Collar Crime. Political cartoon used by permission of the Estate of Rollin Kirby Post.

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