Mick:
I wouldn't disagree with the general trust of that. I know there's a lot of corruption in government and corporations, and the "revolving door" is quite horrific.
However I'm still unclear what it means for the banks (or rather this "financial element") to "own" the government. That suggest an adversarial relationship, especially as FDR goes on to discuss the government "fighting" the banks. Yet you portray it as the banks, the government, and corporations all being in bed together? Is that really what FDR is saying?
External Quote:
Content from external source:
Letter to Edward M. House
Warm Springs, November 21, 1933
My dear Friend:
Dan showed me your letter, and the next day I sent for the Sprague person. To tell you the honest truth I had had no intention of hurting Sprague's feelings by not sending for him, but equally honestly I did not send for him because of the very simple reason that I had entirely forgotten his existence for at least a month.
On several occasions after his return from London, I had long talks with him and tried to get from him some concrete proposal or suggestion which would help us to lift the price level and therefore the debt burden under which the Country, especially the West and South, was staggering. He gave me me absolutely no constructive thought— only the same old suggestions about open market purchases and stabilization of the dollar with the pound. Everyone who is not blind knows that the open market purchases have practically no immediate effect and only a very doubtful long-range effect; also that every time stabilization on the old level of about $4.50 was mentioned, cotton, wheat, corn and everything else started to go down. A continuation of the fall of the price level which ran from the middle of September to the middle of October would have brought the whole Recovery Program toppling about our ears.
Sprague is a nuisance. He carries no real weight except with the Bank of England crowd and some of our New York City bankers, and I regard his suggestion of a meeting as absolutely disloyal. In any event, I kept him from formally delivering a silly letter to me, had Woodin talk with him and subsequently Morgenthau, Jr. Sprague has said that if he resigned, Government bonds would go down five points! Now let me tell you something cheerful.
This Southland has a smile on its face. Ten cent cotton has stopped foreclosures, saved banks and started people definitely on the upgrade. That means all the way from Virginia to Texas. Sears-Roebuck sales in Georgia are 110 per cent above 1932.
Another angle: Hugh Johnson has just telephoned me to be sure to read the latest Dun & Bradstreet Report. He says every section of the country is showing definite gain.
I had a nice talk with Jack Morgan the other day and he and he seemed more worried about Tugwell's speech than about anything else, especially when Tugwell said, "From now on property rights and financial rights will be subordinated to human rights." J.P.M. did not seem much troubled over the gold purchasing, and confessed that he had been completely misled in regard to the Federal expenditures. The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson— and I am not wholly excepting the Administration of WW — The country is going through a repetition of Jackson's fight with the Bank of the United Stated - only on a far bigger and broader basis. I am having a grand rest and am catching up on much needed sleep. Take care of yourself and do write me soon
Funnily enough, this quote from MikeC isn't a bad analogy at all:
Does this mean "owned" in the way that I own a car? No it doesn't of course.
If I could run with that - and not to forget this is all conjecture, obviously.
The govt is a large limousine with blacked out windows in the back. Driving the car is FDR, we can see him because he's up front. FDR is a figure representing the visible part of govt. - the politicians and their secretaries, advisors etc. (though the advisors can jump between the front and back seats, and do). In the back seat, and for the most part invisible to the public, are Jack Morgan, a Rockefeller or two, a Rothschild or two, DuPont, Remington etc (it's a big limo). Sprague is one of those characters who operates between the front and back seats -
Dan showed me your letter, and the next day I sent for the Sprague person. To tell you the honest truth I had had no intention of hurting Sprague's feelings by not sending for him, but equally honestly I did not send for him because of the very simple reason that I had entirely forgotten his existence for at least a month.
On several occasions after his return from London, I had long talks with him and tried to get from him some concrete proposal or suggestion which would help us to lift the price level and therefore the debt burden under which the Country, especially the West and South, was staggering. He gave me me absolutely no constructive thought— only the same old suggestions about open market purchases and stabilization of the dollar with the pound. Everyone who is not blind knows that the open market purchases have practically no immediate effect and only a very doubtful long-range effect; also that every time stabilization on the old level of about $4.50 was mentioned, cotton, wheat, corn and everything else started to go down. A continuation of the fall of the price level which ran from the middle of September to the middle of October would have brought the whole Recovery Program toppling about our ears.
Sprague is a nuisance. He carries no real weight except with the Bank of England crowd and some of our New York City bankers, and I regard his suggestion of a meeting as absolutely disloyal. In any event, I kept him from formally delivering a silly letter to me, had Woodin talk with him and subsequently Morgenthau, Jr. Sprague has said that if he resigned, Government bonds would go down five points! Now let me tell you something cheerful.
The above part of the correspondence deals with this Sprague character. It appears from what FDR is saying 1) that Sprague is not a figure well liked by FDR and 2) that Sprague is trying to push him towards (through 'several long talks', meaning that he has, for the most part, unfettered access to the President's office) 'the same old suggestions about open market purchases and stabilization of the dollar with the pound'. FDR thinks that the debt burden will not be eased by such action and rejects it as he believes it would scupper the recovery which his current figures are saying is moving in the right direction. He then appears to indicate that Sprague is only influential among bankers and that there might have been a vague hint of a threat in
'Sprague has said that if he resigned, Government bonds would go down five points!' During this, Sprague is riding up front with FDR - every now and then he leans into the back and takes instructions. FDR is driving and wants to keep going straight - Sprague is trying to persuade him to turn off and take another route. It all indicates there is at least some kind of struggle going on for which direction to take.
Now for the meat course:
I had a nice talk with Jack Morgan the other day and he and he seemed more worried about Tugwell's speech than about anything else, especially when Tugwell said, "From now on property rights and financial rights will be subordinated to human rights." J.P.M. did not seem much troubled over the gold purchasing, and confessed that he had been completely misled in regard to the Federal expenditures. The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson— and I am not wholly excepting the Administration of WW — The country is going through a repetition of Jackson's fight with the Bank of the United Stated - only on a far bigger and broader basis. I am having a grand rest and am catching up on much needed sleep. Take care of yourself and do write me soon
That FDR had a 'nice' talk with Jack Morgan is quite interesting and I'll come to that. But again, he has the ear of the President - and I'm sure they didn't just have the one talk.
That Morgan seemed more worried about Tugwell's speech than anything else isn't surprising - Tugwell said something contrary to Morgan's interests in "From now on property rights and financial rights will be subordinated to human rights." That's pretty clear.
This bit is far more interesting:
J.P.M. did not seem much troubled over the gold purchasing, and confessed that he had been completely misled in regard to the Federal expenditures. The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson— and I am not wholly excepting the Administration of WW — The country is going through a repetition of Jackson's fight with the Bank of the United Stated - only on a far bigger and broader basis.
I think the first sentence is quite important here - for the context on what follows - FDR indicates that Morgan wasn't too bothered about gold purchasing and says he was misled about Federal expenditure. FDR, in the next sentence appears to give the lie to that, ie. he is gently indicating that Morgan was lying, playing dumb, not being honest for some reason. Because he then says:
The real truth of the matter is... which would indicate some degree of doubt around Morgan's input, if not Morgan himself...
as you and I know, that a financial element in the larger centers has owned the Government ever since the days of Andrew Jackson - I think the larger centres are the ones previously referred to, London and New York, they were and they still are the larger centres (of financial activity). Andrew Jackson famously warned that a repetition of allowing a private bank to own the presses was a route to a more modern day slavery for the general population.
The country is going through a repetition of Jackson's fight with the Bank of the United States - only on a far bigger and broader basis.
This gets us back in the car. FDR is at the wheel and the big boys are in the back. The big boys own the car and generally dictate the route, but they've given the driver's job to someone with his own idea of the best route. There's not an awful lot the guys in the back can do to the all too visible driver if he decides to go straight on instead of left, as they required him to. An argument - a fight - will ensue. FDR understands that his car is owned by those riding in the back, and that he is but a stepping stone along the way - his driver's job is limited by the factor of time. The fight is a power struggle and it is on a far bigger and broader basis than Jackson's as a result of the development of the financial sector and its influence (much greater than in 1865) now becoming more global and integrated. The financial sector had gained, and was gathering, force and influence - power. It appears the struggle/fight whatever you want to call it, was for the levers of power over policy. At this juncture there was still a fight to be had - those days are over. That fight was lost by the government - maybe it's about time for a new one?
And there's something related below:
Jack Morgan. JP Morgan was one of several mega-wealthy co-conspirators in an attempted coup plot against FDR in 1934. They were great mates with the Nazis and wanted to install a Nazi style govt in the US. Prescott Bush, W's grandaddy, also became one of those. An investigative journalist by the name of John Buchanan was the first to go to the Library of Congress and uncover the documents that confirm it - along with the Bush family's Nazi money laundering business which continued even after the US had entered the war. The plotters made the mistake of asking a General Smedley Butler (from memory) to lead the coup and he stuck around long enough to find out who the plotters were and then he went to Congress and blew the whistle. Not one of the plotters was prosecuted, nor even questioned by Congress. They should have been tried for treason. Go figure.