MORE IMPORTANT THAN GOLD
Eighty years ago Franklin Delano Roosevelt faced one of the biggest and most pressing growth challenges the US had known in its 150 year history – The Great Depression. The country and the world were thrown into a downward spiral.
Most people feared the decline and viewed it as a possibility that signalled the worst of times. In the US alone, nine million savings accounts had been wiped out, the unemployment rate was above 25% and things were only getting worse. There was another run on the banks in February of 1933, which further eroded the stability of the financial system.
When a visitor to the White House said to FDR: “You’re either going to be our greatest President or you’re going to be our worst President,” Roosevelt boldly responded:
“No, if I fail, I’ll be our last President.”
It was around the same era that John Maynard Keynes, of the British economist, was asked if anything like this had ever happened before. He responded:
“Yes, it was called the Dark Ages and it lasted 400 years.”
The President became decisive.
To stave off collapse of the financial system he instituted a bank holiday, closing the banks for a full week. The evening prior to reopening the banks, the President went on the radio and gave his first Fireside Chat, engaging the country with sincerity and passion. Lasting fourteen and a half minutes, the President closed his historic broadcast with the following words:
“There is an element in the readjustment of our financial system more important than currency, more important than gold, and that is the confidence of the people themselves. Confidence and courage are the essentials of success in carrying out our plan. You people must have faith; you must not be stampeded by rumors or guesses. Let us unite in banishing fear. We have provided the machinery to restore our financial system; and it is up to you to support and make it work… It is your problem, my friends, your problem no less than it is mine. Together we cannot fail.”
-March 5 1933
The day after inspired citizens all over the country made another run on the banks.
Although this time it was not to withdraw money, but to return the hoarded cash.
People wrote thousands of letters to the White House the days after FDR’s ‘more important than gold’ message and kept doing so at a rate of eight to nine thousand letters a day during FDR’s 12 years in the White House.
FDR’s words and actions inspired a nation to grow out of fear and build their own confidence. He helped transform the challenge of his time, the Great Depression, into an opportunity to practice courage and create the foundations of the relative prosperity we enjoy today.