4. The Progressive Era Triple Alliance: Government as Cartelizer continued – Murray N Rothbard

20th Century American Economic History

4. The Progressive Era Triple Alliance: Government as Cartelizer continued

Lecture by Murray N. Rothbard

The state must invest in human beings the same way you invest in cattle on a farm. This progressive corporatist view was behind the creation of the Rockefeller Foundation. Industrial solutions were to be strictly scientific, e.g. minimum wage laws, public works, and government concentration camps (CCC).

The Federal Reserve system followed the national banking system. The free banking system had had the least inflation. Government has had a long history of bailing out big banks that might fail. Benjamin Strong was the head of the Federal Reserve system throughout his life. He was a Morgan man. The Fed had the monopoly to issue cash.

Puritanism is the haunting fear that somebody somewhere might be happy. Prohibition was just part of the progressive platforms.

4 of 8 from Murray Rothbard’s 20th Century American Economic History lecture series.

This lecture as a Podcast: http://enemyofthestate.podomatic.com/

Sourced from: https://mises.org/library/20th-century-american-economic-history

Source: 4. The Progressive Era Triple Alliance: Government as Cartelizer continued – Murray N Rothbard – YouTube

http://www.readrothbard.com/4-the-progressive-era-triple-alliance-government-as-cartelizer-continued-murray-n-rothbard

TRANSCRIPT

00:00
so the Federal Trade Commission that
00:03
preferred a cocoa for moving on detail
00:05
this makes me answering the important
00:07
legislation and then the corporatist
00:09
development Senate as such and at the
00:13
outlaw fries the ICC fell over system a
00:16
cultural something etc and also were
00:21
this interesting developments me
00:22
relevant during the most
00:24
administration’s start out during the
00:25
Taft administration this is pushing the
00:27
social welfare and the welfare corporate
00:29
state this is the Commission on
00:32
industrial relations United States to
00:34
mission and the Sun industrial relations
00:35
which was set up in late 1912 by TAF but
00:39
really how they got started before you
00:41
know Wilson takes over and Wilson points
00:43
the people and so forth the u.s.
00:46
Commission on dust relations which are
00:49
stimulated by industrial violence look
00:51
what the violence and what to do about
00:53
it
00:54
yes hands get it the first time really
00:57
in federal scale we have this tripartite
00:58
arrangement of oranges free labor
01:00
representatives to incorporation
01:02
representatives oil home is only were
01:04
not national civil Civic Federation
01:05
types the Anthony n am was squeezed out
01:08
this arrangement and three so-called
01:10
public represent as well our public
01:12
busybody bikes the social social social
01:14
engineers among the public
01:19
our old friend John our comma plays
01:22
extremely important rule old business
01:25
also mrs. AJ Borden Harriman
01:28
famous Harriman families it becomes one
01:32
of the I’m a child for a little later
01:33
into tonight as one of the upper-class
01:37
female social worker but a bunny types I
01:39
mean gonna proliferate in this period
01:43
the chairman of the permission was he
01:47
I guess a genuine left-winger need Frank
01:49
Walsh I me to the left of the culprit
01:52
common types a on social worker and he
01:57
was put on because he was supposed to be
01:59
a friend of John aren’t common that was
02:01
the cachet in this thing so he was
02:04
trusted by easily the National Civic
02:06
Federation proposal and it turns out
02:08
he’s foot later on during a work of
02:09
commissioners bosses want to let us
02:11
the rest of them and comments put sent
02:14
of the research director at a research
02:16
of the Commission Charles being coffee
02:18
most often progressive McCarthy
02:23
graciously gar McCarthy did essentially
02:25
student of comedy he was but he had a
02:28
legislative Reference Bureau of
02:29
Wisconsin engaged in activity he helped
02:34
collaborate on the drafting of the
02:35
Federal Trade Commission Act he hailed
02:38
Germany is the great set of the great
02:40
example of planning that he called it
02:42
quote a wonderful example in the rest of
02:43
the world and particularly the world
02:48
business market agree one of the great
02:50
economists are so-called economist
02:52
theoretician that an old vogner movie
02:54
star holds school economists and he he
02:59
thought of the did his work on the
03:01
Industrial Commission probably does for
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permission as trying to bring the German
03:05
model doesn’t work vial to the United
03:06
States he’s one of the big figures in
03:09
workmen’s compensation pushing workmen’s
03:10
compensation pushing Wisconsin ideas and
03:12
so forth one of the McCarthy’s the
03:17
corporations are farm some interest was
03:20
in when he was reminiscing one day so
03:21
called the backbone back on I was a sort
03:24
of political economy my father my father
03:25
was economy is the state must invest in
03:28
human beings in the same way as you
03:30
investment cattle our farm cute sort of
03:35
expressive pretty directly the
03:37
progressive and lecture without
03:38
literally some of the Masters out there
03:44
having been a longtime common things he
03:49
was the research director a missionary
03:51
bring in numbers and trevally should say
03:54
by the way the dawn are coming along
03:56
with has friends and allies healing
03:58
Perlman University Wisconsin to the two
04:00
great labor historian the early part of
04:02
the century there would be the only as
04:04
far as an American labor unions a nice
04:06
place but the official centers down
04:08
before you completely pulled the
04:09
official AF of L or cracked Union
04:11
monopoly unionism the kind of corporate
04:15
and by monotonic corporatist
04:18
framework composition I guess the more
04:20
to that we get more than human labor
04:22
more Charlie McCarthy is this should be
04:24
a corporate district
04:25
coming to associate everything else also
04:27
travel the best friend a classmate of
04:29
john d rockefeller jr. at Brown
04:31
University classmates keep popping up
04:34
all the fonts will be saying problem
04:36
can’t be a coincidence
04:37
don’t believe me
04:40
by this time Rockefeller maybe he’s a
04:44
woman
04:44
this is kind of spike a little bit maybe
04:45
I think I know the hammer blows of
04:48
Morgan ISM hammer blows wall of
04:50
corporatism center begins it begins to
04:52
adapt to the situation and we get a more
04:55
of a more of social work progressive
04:58
progressive commerce votes coming in
05:01
Rockefeller sets up an industrial
05:03
relations department armor of a fairly
05:05
newly set up Rockefeller Foundation one
05:07
of the one of the big shots in this
05:09
final angles that certainly in Lyon
05:11
Mackenzie King who’s usually Rutherford
05:14
foundation person and some somehow pops
05:16
up as Prime Minister of Canada 50 years
05:19
least when I was growing up he was
05:21
always lead on this James and the the
05:30
relationship between Rockefeller
05:32
Foundation for things like close to Rome
05:34
Rockwell in general register in green
05:36
with the personal Rockefeller a he
05:38
writes the McCarthy October 1914 he says
05:41
he says under William Lyon Mackenzie
05:44
King is direction the Rockefeller
05:47
Foundation might gradually convinced the
05:49
public alcohol our this interest in this
05:51
and of our strictly scientific memory
05:53
then you have this idea of Lee and
05:56
essentially Rockefellers okay okay I’m
05:59
going to turn the science to unquote you
06:01
guys for doing I can do it
06:06
which I guess is the beginning of a
06:08
great Rockefeller Foundation career
06:09
early career of finding and developing
06:13
promising scholars in early the last the
06:16
latest fruits of the microphone rock
06:19
upon interest in scholarship of course
06:20
with Henry Kissinger all over there are
06:23
multi floor so
06:31
the what happens is the split of the
06:36
Commission McCarthy has kicked out I’m
06:40
washin aegis and we have three reports
06:45
basically they have several reports
06:47
Commons writes a report other than the
06:48
price independent reports of the
06:51
clinician one of the kids naughty one of
06:53
the key people the permission one of the
06:54
things about Cummings is he becomes a he
06:57
promotes the commons report Prasad is a
07:00
new deal almost almost worn by long he’s
07:02
seen he sets forth of like my situation
07:05
which will later become and some are dry
07:07
some of the later international are a
07:09
the Wagner and WPA and CCC all these
07:12
things are prefigured in the commons
07:15
report 1915 Commission the National
07:16
Commission reports are written linking
07:18
15 sidekick it since the director of
07:24
research of the system of courtly but
07:26
another guy who appears among our rulers
07:29
from now from then on well amazing
07:31
number of people start around this
07:32
period and continued ever since I sort
07:34
of listen agent hundred in 10 or
07:35
something I think they’ve only died out
07:37
fairly recently and and they start with
07:40
World War around this world war one
07:41
Perry one of them Billy lysosome was the
07:43
labor economist still common post
07:46
associate McCarthy and pushing here say
07:50
Public Works for depressions and state
07:53
unemployment service he comes up a
07:54
median and during World War II and so on
07:58
well the largest
08:01
flour millers in the world at the time
08:03
and Ballard’s
08:04
report outlines the following steps that
08:06
should be taken securely industrial
08:08
problem and so far raising wages various
08:17
government steps to raise wages all
08:19
right money should restrict immigration
08:20
is the way raising wages very sound if
08:23
your interest is amazing work and wage
08:24
rates other ways to lose that keep my
08:26
money out to to have a national minimum
08:30
wage law to raise wages three workers
08:34
compensation one for factoring selection
08:36
wars let’s get for some proposals we’ve
08:38
seen with meatpacking impose higher
08:39
costs on caramelizing system and both
08:41
higher costs and propeller roof
08:45
next the federal our day law to make
08:48
sure that those files are sure that your
08:52
unaesthetic enough to have a 10 hour day
08:54
or 12 hour days weeks force them behind
08:56
other eight hours at competitors if I
08:58
don’t want pointless service the federal
08:59
public works going recessions also well
09:04
this is probably need final deal not
09:06
only 33:35 but really also
09:09
33:38 who they can set out in the
09:12
commons report the dollar report etc one
09:15
of the things kind of keep saying which
09:17
prefigure of the CCC we need for other
09:19
institutions in the world over calls for
09:21
quote government concentration camps
09:23
well where workers where what a small
09:27
wage will be provided supplemented by
09:30
agricultural and industrial training and
09:32
you see here beginning in the great CCC
09:34
concept of out there and with forestry
09:37
or means well idea for Swiss government
09:42
laborers they use the word concentration
09:46
camps those I have not yet been so who
09:58
runs against someone’s against Wilson a
10:00
1916 year from the attractive pass that
10:02
corporate is performing even put in I am
10:04
watching the photos versa for me because
10:06
I’m gonna go back can be found a run
10:13
against this great man Charlie don’t use
10:16
1916 Wall Street lawyer who turns up at
10:20
least after the feet as they has the
10:22
attorney for Standard Oil Company in New
10:24
Jersey I cannot stop myself in saying
10:29
that you’ll also remember the st.
10:32
Baptist Bible classes john d rockefeller
10:34
jr. and he was foreseen he’s only almost
10:41
one but he was finally make sure the
10:44
Morgans
10:45
a little more than a continuation power
10:52
chemically solar system um come back to
10:56
that first we don’t want the thing about
11:12
the Federal Reserve System basically
11:13
wasn’t succeeded well first of all was
11:15
backed by almost every banker I really
11:16
don’t know I don’t know why there might
11:19
have been bankers as opposed that detail
11:21
certainly with the concept certainly the
11:23
big bankers world favorite it the
11:25
repressions few people that were against
11:26
that anyway
11:27
in general the I think the major reason
11:30
for that is the fact that the Federal
11:31
Reserve System succeeds a national
11:33
banking system a national banking system
11:34
was sort of its kind of an abortion
11:37
National Bank system of a halfway house
11:40
from free banking hard money free
11:42
banking least free banking system which
11:44
we had before the Civil War two central
11:47
bank on the other hand other words we
11:48
have basically what we have for the
11:55
exception of the first and second Bank
11:57
United States but after Jackson
11:59
guerrilla second magnen I think we had a
12:00
nice centralized banking system much of
12:04
it was hard money the free blue we have
12:07
free entry into the banking system and
12:10
some western states thanks for the clay
12:11
unconstitutional and they put some new
12:14
banks in the area but there were they
12:16
were it was considerably less inflation
12:20
under the free banking system even
12:21
though while quote wildcat unquote and
12:23
there has been there was lighter on the
12:26
anyway this is one system and there in
12:28
the free banking half system the hard
12:29
money position means a pure gold
12:31
position the year Jacksonians
12:34
on previous events the Jeffersonians
12:36
really at least at least have a fighting
12:39
chance and what you have you have a
12:41
continuing drive by the junk that means
12:42
for for outgoing banks altogether or
12:46
insuring if they if they pay species
12:48
immediately one of the reasons why it’s
12:53
always been said of free banking least
12:54
the wild cat isn’t mark have banking
12:55
runaway inflation
12:57
one of the reasons why there was one of
12:59
the reasons why there was more inflation
13:01
they would have been under real free
13:02
banking system it
13:04
every time the banks got in any kind of
13:05
real trouble for massive trouble brought
13:08
about by their over expansion the
13:09
government state and federal allow them
13:12
get got them off the hook by allowing
13:13
allowing them to suspend species aemon’s
13:15
in other words the stop paying their
13:16
debts until this crisis is over and
13:19
meantime for I think it collected that
13:20
they can enforce the question of their
13:22
debt so that’s the name in the courts
13:23
but while all this was going on they
13:25
couldn’t they they were suspending the
13:27
moratorium of the Claire so they
13:28
wouldn’t have to pay their own debts to
13:31
their depositors there’s no Holger
13:32
sessions much like this this great
13:36
tradition letting the banks off the song
13:38
begins farías I don’t want deal too
13:41
much work I’m gonna go be further back
13:45
but the the the nefarious tradition
13:49
begins with me in the war of 1812 and
13:52
were the largest cetera capital
13:55
investment and wealth of New England was
13:57
shipping all over the post the war of
13:58
1812 against Britain so in order to
14:00
finance the war effort the number of the
14:02
administration had to turn to the new
14:04
banks popping up the new banks inflated
14:06
like man the government spends the money
14:08
on munitions and so forth ordinary
14:09
manufactured goods produced in New
14:11
England
14:12
the New England thanks call upon the new
14:14
banks were cut Sylvania and Kentucky
14:15
etcetera for redemption ain’t got the
14:17
money think up a goal so they go but it
14:19
has to go back proper this is only
14:21
modern banking system the origins are
14:25
the federal government says okay we
14:27
suspend speaking like the black month
14:29
August 1814 happen not only this those
14:33
continue of the duration of the war but
14:35
it went on from then article early in
14:37
1817 so for two and a half years the
14:41
banks were little hook there were two
14:45
ways out I’m going to detail two ways
14:48
out safe at the time by the congressman
14:52
theoretician one way was this get rid of
14:54
the banks the fraction ranks of couldn’t
14:56
pay bankrupt banks and go back to a gold
14:58
system our gold silver sufficiency and
15:01
the other was to set up a new bank in
15:03
the United States which would inflate
15:05
enough but keep these banks of flows
15:07
which was the solution that was adopted
15:09
any rate but after the bank second
15:12
mechanization women we have a free
15:15
banking system but hard money is a
15:17
viable
15:17
trend outside after the Civil War the
15:21
whole condition change the whole the
15:22
whole system changes but two things one
15:24
the greenback’s which are their fire at
15:26
money not redeem we’re gonna go with
15:27
silver and took them I took from 14 more
15:30
years ago rather green bag I got the
15:31
greenbacks back on gold basis and the
15:33
National Banking Act which one how bored
15:36
state bank notes there was bank notes
15:38
hunt produced by state banks following
15:42
by producing but upon the exit tax of
15:45
pepra Sunim played bank notes and
15:48
sending up a whole new national banking
15:49
system well there’s no requirements etc
15:52
centralized deliberately centralizing
15:54
Wall Street of the moving national
15:56
national banks of Wall Street and then
15:58
permitting on properly smaller city
16:01
banks having deposits in the settlement
16:03
Wall Street banks and rural banks having
16:05
deposits on me and it’s more Citibank so
16:08
it’s got a permanent expanded credit
16:10
class system based international only
16:12
central Wall Street banks of the major
16:14
reserve separate nerve cities and their
16:18
reserves their money supplies they’re
16:20
all out the issue was basin and turn
16:22
upon government different federal
16:23
government bonds right the queue your
16:25
system in other words the more
16:29
government bonds they bought the more
16:30
more credit they can issue so this is
16:35
the Paris this is a system which didn’t
16:37
satisfy really anybody so well the the
16:44
for one thing and so they looked around
16:47
for reform was very different all this
16:49
point to go back to prison what if
16:51
unless I’m 14 years to get my kago leave
16:53
get back to her gold standard so this
16:56
sort of exhaust of the hard money people
16:57
besides the harmonica was are dying out
16:59
by this time and it becomes great to go
17:02
back to the free banking system in for
17:04
the Civil War would have would have made
17:05
it Titanic revolutionary kind of
17:07
changing the system issue which though
17:09
whatever gold bugs were left were not in
17:12
the position to trying to accomplish so
17:14
but this sort of alternative kind of
17:17
been in the functor forgotten
17:19
increasingly forgotten of a general
17:21
public by economists by bankers moving
17:25
up with fleas only pressing almost fully
17:27
centralized banking systems or the
17:31
Taoiseach living which pioneered so
17:34
forth most of us like looking back most
17:39
textbooks think of they say the central
17:43
bank is extremely important we must have
17:45
a central bank in order to restrict the
17:46
banks through the commercial banks from
17:48
expanding credit inflating a credit
17:50
excessively this is the usual way in
17:52
which the this kind of thing is sold
17:54
with the general public should be I’m
17:56
surprised by this time that this is sort
17:57
of an Orwellian system in Reverse this
18:00
is not the way that Bank Lee this is not
18:02
the arguments of the bankers themselves
18:03
and economists themselves promoting it
18:05
used for the Federal Reserve System the
18:07
argument was this darn natural banking
18:10
systems – inelastic the money supply is
18:12
quote inelastic equipment known as we
18:13
ain’t got enough of it we haven’t banks
18:16
and not on I’ll expand credit enough
18:18
especially during recessions so we need
18:20
some kind of instrument to ensure more
18:24
and more better inflation more and
18:26
better expansion I mean bank credit the
18:29
several problems one was we need water
18:33
budgets in the Memphis the Fenian figure
18:35
was a big theoretician of Mangum in the
18:36
19th century so the central bank as one
18:40
of the four important function of being
18:41
wonderfully called lender of last resort
18:43
under last resort meaning that that
18:45
always should be a government a
18:46
government sponsored bank out there in
18:49
the as in sort of a deus ex machina on a
18:51
bailout any bankers really getting the
18:52
problem so every bank knows deep in its
18:57
heart there’s always a central bank they
18:59
had a bailing out the lenders money and
19:01
so forth ones that I did over any kind
19:02
of emergency
19:03
this was accepted as a brilliant stroke
19:06
master stroking and banking theory the
19:11
and then they felt was necessary also
19:14
has this whole point that he really the
19:16
natural under the national banking
19:17
system is these centralization was
19:19
popping out there
19:20
Chicago banks are becoming foreign
19:22
central reserve and the more and more
19:23
state banks in other words it had less
19:26
less and less centralization and was
19:27
felt by the large bankers he had the
19:29
resent relies he and impose a central
19:32
control which is seen in the any out of
19:34
hand also we have the growth of the Bank
19:38
of America state bank which is
19:40
completely outside
19:46
so we had in this in this situation once
19:53
again the economist says Punk that on
19:54
were the economists which previously to
19:56
this period had been hard money people
19:58
and they’ve also been gold-bug one
20:02
extent or another by this time the heart
20:06
the old part money economists have
20:07
dropped that had died off and then was
20:11
just the question of sort of jockeying
20:13
with which kind of central bank should
20:14
we have accepted almost on every hand we
20:16
need we have to imitate advanced
20:18
countries like England of Germany never
20:20
have our own central bank the and
20:28
there’s a whole litany here which I need
20:30
not repeat the Coco mentioned all the
20:31
guys who were pushing for this for Cairo
20:34
Reserve Bank and all sorts of jockeying
20:36
back and forth I don’t think there’s the
20:38
long run they were very important the
20:40
point is almost everybody had one of
20:41
their own concepts of Bank and we wind
20:43
up with something the some of the key
20:46
figures again in this the the famous
20:50
Jekyll Island Jekyll Island conference
20:52
which which but you figured and
20:54
Westbrook Pegler is the food demonology
20:56
from then on Phillies the other day he
20:58
died one of the things which was one of
21:00
the sources of writing eternal nervous
21:01
system at this conference with Paul
21:04
Warburg from King mo of Frank Vanderlip
21:06
dimensional Citibank I was very
21:08
important throughout this thing is a
21:09
great theoretician of inflation Henry P
21:12
Davison and Morgan partner Charles
21:14
Norton in the First National Bank and of
21:16
course notes and Aldrich and anyway with
21:19
all this jockeying back and forth we
21:21
wind up with a foe for a reserve system
21:26
[Music]
21:31
when I get to the estimates of what
21:34
happens there for the final deserve
21:37
system when I mentioned a few words
21:40
about the man whom I will turn to later
21:41
later lectures
21:43
the Nangal becomes the ritual king of
21:46
the Federal Reserve System holiday he
21:47
died not exclusively the beginning but
21:50
enough to establish working control by
21:52
the mid-twenties the early Chinese II
21:53
have absolute control whom he dodged the
21:56
end of 1928 Benjamin strong governor of
21:58
the photos are back in New York and it
22:02
was all during the 20s by the way is a
22:03
constant battle between the Federal
22:05
Reserve Board in Washington which one
22:07
would have thought would be the head of
22:08
the system and strong was the head of
22:10
the Federal Reserve Reserve Bank in New
22:12
York
22:12
strong winds at ease this isn’t having a
22:16
lot of cloud and being in New York and
22:17
buying and selling bonds and the rest of
22:20
it close to the source he also had a lot
22:22
of clinical and economic clout this
22:26
should be in charismatic figure I don’t
22:28
think we should usually the story
22:29
interpret the Sepik Strong’s ascendancy
22:32
in the Federal Reserve System through
22:33
his charisma you should probably know by
22:37
now that I don’t find charisma
22:38
sufficient explanation
22:41
Benjamin’s who was Benjamin strong
22:42
personally had been head of Bankers
22:44
Trust Company which was a Morgan Trust
22:46
Company she’d been set up a few years in
22:49
1903
22:52
second of all his closest friends in the
22:55
world I mean not only business friends
22:57
and people who had pushed him away but
22:59
also social friends when Golf Club pals
23:01
and all the rest of it or Henry P
23:04
Davison Morgan partner and Dwight Morrow
23:06
Morgan partner strong when he got the
23:09
call of the head of the Federal Reserve
23:10
System
23:11
if there’s an old pal of Elihu root just
23:14
to sort of cement the whole thing and
23:15
Thomas over the only bought another
23:16
Morgan partner any rate humbly come to
23:20
the call from the most administration
23:22
appoint Benjamin strong and telephoto
23:23
g40 Bank in New York he sort of hangs
23:26
back and shyam honest manner very
23:29
competent do this he was he was
23:32
completed was and so forth so on my
23:35
davis an immoral to accept this accept
23:38
the post
23:39
okay so our hypothesis from now on which
23:42
we will pass through you along as the
23:44
Benjamin strong essentially practices
23:46
Morgan essence of federalism here I
23:52
refer to a great book which is which was
23:55
published by macmillan published by
23:57
several distinguished so co-workers the
24:00
the senior walking home was one of most
24:01
distinguished banking theoretician of
24:03
the 20th century Charles a fallible yet
24:07
his book published in the 30s by
24:09
Macmillan distinguished publishing
24:11
company yet the book bomb totally means
24:13
has never heard from again
24:14
either by economists or buying anybody
24:15
else he has one of the best books on
24:17
this whole period story both
24:19
theoretically and empirically starting
24:21
with 1914 continue when you on you know
24:23
down through the twenty in the early
24:25
thirties so I refer you to this for
24:28
further you know elucidation this whole
24:30
thing plus what other books than we are
24:31
Murphy the banking a business cycle by
24:38
Felix McManus and what we do here we
24:43
have a situation this way we have
24:50
independent bank’s forget a minute about
24:51
the National Bank permitting I makes it
24:53
just more complicated we have a bunch of
24:55
independent banks et which will require
24:58
the average reserve requirement for
25:02
[Music]
25:06
damages your requirement was 10% in
25:13
other words the banks the pyramid
25:17
national bank notes Commission notes a
25:19
National Bank station notes they confirm
25:21
that those are the positives
25:24
tend to wanna pop up in reserves which
25:28
gold or you know government bonds or
25:31
other banks preying on whether we have
25:39
one to one
25:46
and I see they wouldn’t 25th giving away
25:51
the punchline 20% since five to one so
25:58
these banks are allowed in the average
25:59
of was only 21 the make up 20s up like
26:02
barely allowed five to one permanent
26:04
funny speech back something we penalize
26:09
reserve we take all the variant forces
26:11
come out for in due season coming in
26:14
many other ways
26:21
let’s say they get a little reserves and
26:23
how they reserve the national banks
26:27
become the deposits with the homeowner
26:29
checking accounts are speaking phones
26:32
River so now we have a vocalizing throw
26:38
reserve this is one of the arguments is
26:39
costly being used not only because the
26:41
throw the national banking system is too
26:43
in the last thing in other words not
26:44
enough money not a place you know yeah
26:46
but also a need centralization of
26:48
reserve economize on reserve the reserve
26:56
well here we have the reserves in some
27:00
sort of been here we still have a 20 to
27:04
1 or 5 to 1 ratio however now we have
27:09
the sort of reserve system so we make
27:11
themselves are allowed to expand three
27:14
to one thirty five percent so it’s like
27:16
freedom one if you want on top of their
27:18
goals
27:19
so now other words of the goal let’s say
27:21
that even as old several lines is the
27:22
same to look special you want to come
27:27
back so this means that by this process
27:32
secularizing and having a thirty five
27:33
percent limit we haven’t allowed three
27:36
to one expansion of money and credit the
27:38
bank credit supply can go up by three to
27:40
one permitted to go up and usually in
27:43
banking history if you prefer government
27:45
permits banks to expand money on top of
27:47
reserves they do it except in very you
27:49
know something deep depressions when we
27:50
can’t find anybody lend money to because
27:52
they might go bankrupt but generally
27:54
look immediately or a couple of years
27:57
they commit a single one expecially
27:59
they can expand for the one so this
28:02
allows for three to one expansion I’m
28:05
bankrupt the money in that crack edition
28:08
of that this is one I’m not engineered
28:11
inflation inflation rate potential 3 1
28:13
by inflation Matt Meyer lemon increasing
28:15
money supply it’s five money thank the
28:18
pocket and initiative that the Federal
28:20
Reserve Act reduces the average reserve
28:22
requirements by statute in half from 21%
28:24
of 10% I actually use 11% 90/14 Pakistan
28:28
later but basically it was reducing it
28:31
happened approximately 20 beside the
28:32
prostate episode which which means that
28:35
I said before you permit the banks to
28:38
Kermit fight the one on top of is there
28:40
that I can firm a ten-to-one hoppers
28:41
reserve we have we now have a an extra
28:43
two fold the mechanism of the preserve a
28:53
chameleon store in the potential of six
28:54
to one inflation on top of the previous
28:56
supported money the normally enormous a
28:59
firing engine sold of the public so low
29:02
down papaya andsome to diluted college
29:07
student in the sense as a restriction on
29:09
inflation as a way of combating the evil
29:14
commercial banks the private banks are
29:15
out there and fighting we need this
29:17
federal versus them the whole them in
29:19
actually just the other way around the
29:21
bankers needed it to push them along
29:28
this starts off fortuitously
29:31
the end of 1913 so it’s just about time
29:35
for the war effort and only a couple of
29:37
years or into the war effort the six to
29:39
one potential is limited by money in
29:41
circulation on the public Mike
29:42
Republican take some money out on
29:44
someone this is a limiting factor it’s
29:46
always a limiting factor in bank rate of
29:47
inflation if all of us for example if
29:50
the entire country suddenly catch them
29:51
their bank and positive tomorrow always
29:52
be an excellent this would be enough if
29:54
I if I were asked to give advice to the
29:56
general public how can we stop inflation
29:57
I wouldn’t say don’t even say cash on
29:59
your mag deposits being very effective
30:01
if a little disturbing way
30:07
get your money out of the banks and 40%
30:18
Federal Reserve now anyway these are
30:19
these are minor consideration the other
30:23
problem is that the serving potential we
30:28
still on the gold standard still a
30:29
disturbing potential of the public my
30:31
cash in all this stuff
30:32
not only the Federal Reserve notes an
30:34
international banks deposit for gold
30:36
this could write the whole thing so a
30:39
big campaign isn’t watched by the
30:41
Federal Reserve systems in various ways
30:43
to get the public not to use gold
30:44
anymore the reduced gold of the sort of
30:46
thing gold coins they go the sort of
30:49
thing that you get the kids on Christmas
30:50
like one gold coin or a gold dollar in
30:53
the final it reduces the sort of
30:56
ceremonial status one of the things they
31:00
did is to stop issuing gold certificates
31:04
and replacing gold certificate
31:06
certificate have been issued by the
31:08
Treasury there were 100 % backed by gold
31:11
so they were extremely sound and art
31:12
etcetera etcetera these were replaced by
31:15
Federal Reserve notes and which then
31:21
replaced those and there’s a general
31:22
cash in circulation houston olivia’s
31:26
were retired and replaced by the reserve
31:28
notes and what incidentally one of the
31:30
ways by which I don’t know how does the
31:34
government get get us get us power of
31:36
the commercial bank how does it ensure
31:38
the Federal Reserve has almost powered
31:39
up to regulate control and inflate
31:41
together basically two ways one of the
31:44
older national banks were forced to
31:45
become members of the Federal Reserve
31:46
System but more important than that
31:48
estate banks were not but more important
31:49
that the real guts the real heart of the
31:51
further movement always the photos or is
31:53
now had a monopoly in the issuance of
31:54
cash missions of paper money before that
31:57
I said the National Bank’s the private
31:58
National Bank like chase National Bank
32:00
could issue their own banknotes
32:02
now this was prohibited it becomes
32:04
illegal on the pain of death torture and
32:06
whatever for any private magnets you
32:08
back no only the pros are banks can do
32:10
that
32:10
so this meaning that’s why get your
32:12
money from the gonna change or ten bag
32:15
whatever and they carry bag has to use
32:16
their reserves that go
32:17
the fair observe and by their by cashing
32:19
zone for versus this becomes the control
32:22
so this means that everything telling
32:24
with a couple of throws room and it has
32:25
this appointment cache and it’s Mitch
32:29
fixed of one’s attention warranted out
32:32
there was another place sharing advice
32:33
that occurred and Federal Reserve System
32:35
before 1913 the same 21 percent
32:40
requirement was levied by the federal
32:41
government to time deposits as it was
32:44
the demand deposits this was changing
32:46
them and the leave time deposit remember
32:49
requirement was lower at first a five
32:51
percent another three percent by 1917
32:53
which is almost zero now the whole
32:57
controversy among economist about time
32:59
to father is it really part of money
33:00
supply isn’t that I contend that it is
33:03
Parliament one reason you can put that
33:05
you can get your money out and you know
33:09
right away means there might be a little
33:11
claws they’re fine present banking wait
33:13
30 days but if a bank ever really trying
33:15
the Savings Bank trying to make you a
33:16
rush of mine trying to make you wait 30
33:18
days they’d be bankrupt very quickly
33:20
that’d be a big run on the night would
33:22
have been before 1933 you and the whole
33:24
ball game changed into the car cause an
33:26
insurance corporation penny right so
33:28
they couldn’t really do that this is
33:29
really a dead letter and you have a
33:31
situation kicked you can take your
33:32
passbook
33:33
down all the bank and get your money out
33:34
and you expect that you can do it I
33:36
think the money is there even though of
33:38
course you’re dilute isn’t thinking that
33:40
any right so so the time deposit method
33:43
becomes a very interesting by old during
33:45
the World War one and during the 20s by
33:48
which the commercial banks gonna say
33:50
even more than the you know five to one
33:52
the present one like trying to shift
33:54
people from the man of positive signs of
33:55
problems every time they did that let’s
33:57
give more than inflation sharing
33:58
potential okay there was none of this
34:03
Titanic change in federal in the banking
34:06
system as I say came along very
34:10
fortuitously to finance our of a war
34:12
effort and the coastal world one more
34:14
reference far aside a lot of the work
34:16
equipment comes back after the war we
34:19
have
34:32
19:14 bank deposit I think it’s fairly
34:36
the menopause effect sucked on that
34:40
table with the return deposit thing
34:48
great thank you Paul total bank deposits
34:51
remember max file such a total
34:55
mega-projects 1914-18 point six billion
34:58
dollars nineteen twenty thirty seven
35:01
point seven billion dollars in other
35:03
words of bubbling practically a doubling
35:05
of the total money supply bank the bank
35:07
deposits heck of a lot so we wholesale
35:19
price level using 1913 or setting 1913
35:25
equal one hundred 1914 was ninety seven
35:31
nineteen twenty two hundred and forty
35:33
three which means that two and a half so
35:36
increasing so we have a inflation of
35:49
prices fuel in the classic manner by an
35:51
inflation of money suppose the poor well
35:55
one was badly very badly for NASA I
35:57
think and any kind of conservative or
35:59
sign criterion and in fact the the usual
36:02
conservative criterion for financing a
36:04
war effort is you’ve got a faster war
36:05
effort you should finance most of it at
36:07
least by taxes by loving in taxes
36:09
because we all doing that you can
36:10
advance it by inflation
36:12
considered to be a bad thing to do then
36:15
the pollyana quartz to give them give a
36:17
kind of hmm
36:18
comparative analysis here and England
36:21
faceted when polio Awards went off for a
36:23
long long time for us so 63 percent my
36:25
tax revenue and loving taxes for the
36:28
expenditure World War one the United
36:31
States where one more war once and I
36:33
have twenty five percent of expenditures
36:34
by taxes the rest of us by inflation
36:36
rate that
36:52
there are other details about what
36:54
happens each couple of years at Sakura
36:56
but I don’t really think that’s
36:57
necessary to go into it because I think
36:59
this is kind of a basic basic framework
37:04
the tallest such the slightest life
37:13
event where we learn inflation and the
37:15
post-war period coming on I think this
37:19
was some time to run a little bit least
37:21
to Lee another aspect we progressivism
37:24
very important has been alluded to here
37:26
in there the local progressivism a
37:30
municipal or urban City local principles
37:33
here I refer you to the classic just a
37:35
classic article by Samuel Hays called
37:37
the politics of reform of municipal
37:39
government the Progressive Era which has
37:42
been apologized all over the place and
37:45
several other things which are mentioned
37:47
the what you have here and this is
37:51
something for students only the essence
37:53
of John Lindsay I really think it’s fits
37:55
in beautifully in this whole setup
37:56
what you have basically is a great drive
38:01
for an urban reform really to smash this
38:04
was runs through the whole set up to
38:06
smash the power of a local Ward Heeler
38:08
machine pie politician the old politics
38:11
smash their power and replace this
38:14
Barnard my new tech Technic technician
38:17
expert upper-class centralized
38:20
supervised government it’s compared to
38:22
the older politics was essentially
38:24
decentralized Ward oriented neighborhood
38:26
community control would be calling that
38:28
kind of set up replace this by out of
38:32
politics taking municipal government and
38:34
politics and into this loop grating into
38:36
the light or the levitated light the the
38:41
essence of this before getting to any
38:42
detail on this lonely incidentally an
38:46
edition of being a you cannot make the
38:47
terminus which I proclaim I’m also let’s
38:49
make the terminus Susan walking force
38:52
drive
38:53
the what you have here and then during
38:57
this this whole period of course one of
38:59
the things you have is a massive massive
39:00
immigration from Southern and Eastern
39:03
Europe and as horses mentioned the
39:06
original native people are lost the lost
39:09
he wants to have been here or kind of
39:12
scared by this whole set up new invasion
39:16
so speaking in every and many aspects of
39:18
life that I’ll be getting late a lot of
39:20
Halloween and not only tomorrow night
39:21
the public school revisionism which is
39:23
also fun a great new single just popped
39:25
up last couple of years public school
39:27
revisions the rest of the period mission
39:30
the whole thing is to take urban
39:35
politics out of the hands of the of the
39:38
new immigrant weeks my whole element was
39:40
Irish Italian Jewish it’s something
39:42
they’ll take a design hands and into the
39:45
hands of the upper-class wasp
39:47
establishment so to speak I mean one of
39:52
the things which were one of the kind of
39:55
the basis is I’m going to get the
39:56
prohibition in one night and one of the
39:58
bases are the key phases of neighborhood
40:00
control our little Ward Heeler
40:02
politicians of the saloon they brought
40:04
saloons of a key social Center another
40:07
thing is a kind of like popping I’m
40:09
against drank a lot at least in contrast
40:11
with Protestants exact hardly at all
40:13
least a third lecture publicly this
40:15
whole this whole thing about drinking
40:17
which coming all the way back to the
40:18
18th 19th century powers were sort of
40:20
off at any rate this whole thing about
40:23
drinking in the only and the Catholic
40:25
usually dragon also Germans drank I
40:27
guess in general about evil Germans evil
40:32
Ric want onion in there drinking and
40:34
here you have the you have a loss to
40:36
don’t drink of these supposedly don’t
40:38
make and fortuitous playing along with
40:42
us have a neighborhood saloon or saloon
40:44
teeth there is being the keyword
40:45
politician they go to him for favor and
40:47
he’s sort of a beloved figure and they
40:48
all saying hi Jojo nicer stuff you
40:51
hoping aside like the ceilings of the
40:52
portable women and so part of the idea
40:54
of Smashing a local neighborhood the
40:56
idea of Smashing the saloon and the
40:58
brewery industry which anyways in the
40:59
hands of the evil German from the NY
41:01
second can bust them along with people
41:04
some had a
41:06
grace so all these things were happening
41:10
together really almost like a systemic
41:12
systemic kind of a protein every level
41:15
social when some on the house level and
41:17
the city can the city commissioner
41:19
government our concept which comes in
41:21
and like city manager concepts comes in
41:23
a prohibition which comes in and gala
41:25
guide prohibitions really want so far in
41:27
separatist framework and a public school
41:30
tightening out of the public school
41:32
thing which comes in and pushing the
41:34
immigrant also comes in this history the
41:40
part of this I was I was very interested
41:43
on ok religio after forest the talk this
41:46
morning as he mentioned the whorehouse
41:48
question and it’s season thing I got and
41:51
II know I had a flash of insight create
41:56
a flash of insight for this whole thing
41:58
because this is a saloon which was we
42:01
all working even more important than the
42:03
warrant house but also more houses
42:04
Okara neighborhood ethnic politics kind
42:09
of set up and I have thought that my in
42:14
my analysis of the Mann Act but here I
42:16
have two guys I feel there’s a
42:17
correction I mean I’ll deal with more of
42:18
tomorrow night correction my of my
42:20
revered mentor a child might get in this
42:21
whole period
42:22
hmm for example sorely man act and
42:24
prohibitions a purely moral morality
42:27
thing as well but he called cow country
42:30
Baptists of Protestants rising up from
42:35
their ranches and dung heaps or whatever
42:37
to impose impose these moral morality
42:46
laws on their betters on the urban urban
42:48
folk the in this context of course
42:52
making the define Puritanism and one of
42:55
the great definitions of Puritanism in
42:56
our up talk which is the Puritanism
42:58
Puritanism is the haunting fear that
43:00
somebody somewhere might be happy and i
43:05
think i think more there wasn’t i
43:07
picking on he got me he had a second any
43:08
job analysis of that too especially what
43:10
he’s I think what he said about the Mann
43:11
Act well so well this is a formula in
43:15
agrarian former Methodist Baptist in
43:18
position that
43:19
with the but the farmers are saying is
43:21
they don’t have the money you see the
43:23
transport women across state lines for
43:24
immoral purposes they have not the cars
43:26
or whatever they leave oh and there were
43:30
there
43:31
their immoral purposes of their own
43:33
intrastate there on the form so the Mann
43:37
Act becomes the former a farmer’s
43:40
smashing of urban no wealthier and more
43:42
optimism more cosmopolitan more mobile
43:45
Orlin pipe and this is that he also had
43:48
an economic analysis of the farm on
43:49
prohibition that he said was the the the
43:52
you know the urban person has to buy his
43:53
liquor from somewhere this is you know
43:55
interstate and so forth someone’s
43:56
visible and can be out low the farmer
43:58
makes his own moonshine you can never
43:59
really out know what every successfully
44:01
so we’re out there in the backyard so
44:04
now you’re so here again you have this
44:05
sort of farm orientation if I think
44:08
there’s more to it than that it’s not
44:09
just for farmer it’s also for various
44:12
reasons we we you know our supervisors
44:15
again our corporate the form types
44:18
moving in an alliance obviously
44:23
ideologists moving in for their own
44:26
purposes the smash the saloon dispatch
44:28
the Brewers sauce to the evil German
44:30
conspiracy certainly doing world well
44:32
why not a little more research on this
44:34
and I had very well while one of the
44:35
whole thing not only about it’s a story
44:37
about your squeal etc loosely but the
44:40
German conspiracy also the German
44:41
conspiracy is part of the brewing
44:42
industry in general was part of a German
44:44
international Kaiser conspiracy the very
44:47
act of drinking beer you know the sign
44:49
of loyalty to the Kaiser and therefore
44:51
you stamping it out as part of the
44:53
patriotic war roughly the question
44:56
really comes in during during when one
45:01
[Music]
45:03
star would publish anyway let me let me
45:06
do the prohibition thing Samuel Hastings
45:08
Howard we got more into this here are
45:12
three of the James Timberlake’s working
45:13
prohibition for wrestling movement but
45:17
you’re hearing prohibition and
45:18
presumably also on this man actually the
45:22
prohibition we have off alliance of
45:25
forces what what Megan always refer to
45:28
as the opposition we some refer to the
45:31
opera the idea that
45:33
a new healing you are there to being
45:34
uplifted if you don’t like to be awful
45:36
if they don’t like the idea being free
45:38
of the curse of demon John Barleycorn
45:41
you know jolly well because personally
45:43
uplifted ah this idea for William Graham
45:47
Sumner and aside one social classes will
45:49
do each other and his concept was
45:52
forgotten man I think it was a statement
45:54
on this his description of the moral
45:58
uplift was an A&B; put their heads
46:01
together to the side what see should be
46:03
made to do for D and Anna prohibition
46:07
case it works something like this a and
46:08
B are there are are reformers all moral
46:10
uplifters they get the head together I
46:12
say look a residual or you know you have
46:14
more accidents and loss or stopping
46:15
people getting liver ailments etc
46:17
therefore because a lot of people become
46:20
alcoholic
46:21
therefore we should outlaw liquor so the
46:23
essence of this is both a and B will
46:25
drink anyway our forcing see we have
46:29
forgotten he’s no good takes a drink
46:31
once in a while first depriving him of
46:33
liquor in order to say be the minority
46:35
small minority of alcoholics or
46:36
potential alcoholics so he goes on from
46:39
the other side well what happens is a
46:40
and B for you past the prohibition
46:42
whatever other similar legislation and a
46:45
and B force are very happy they don’t
46:46
break anyway they were imposing their
46:48
moral standards everybody else so
46:49
they’re in great shape
46:50
the the a potential alcoholic and get
46:52
the liquor anyway me noses of sources
46:54
you know your knock on the window three
46:55
times and Joey you know suddenly he gets
46:57
a liquor
46:58
so he gets his liver ailment or anyway
47:01
okay so the person who is really the
47:03
person is really harmed by this was a
47:05
poor schmuck see the forgotten man of
47:06
course from the average American middle
47:08
America we can call well I said like
47:10
once in a while I can see doesn’t know
47:11
the illegal sources there’s no how I can
47:13
speak either you know and he’s the one
47:15
who’s was it was not being helped anyway
47:18
even though they terms of reformers you
47:20
can want to get shafted by this whole
47:22
system anyway we have them wop lifters
47:26
[Music]
47:28
we have the particularly less
47:29
particularly led incidentally think
47:31
again of
47:32
prohibitionists we think of Pro bitch is
47:34
being some right-wing fundamentalist
47:35
enemies personally in these days the
47:37
prohibition parties of the right-wing
47:39
prohibitions party those days are very
47:40
different we have example the social
47:44
gospel movement which everybody knows
47:46
the
47:46
left ring in quotes of the Protestant
47:48
movement bringing a message a client
47:51
message of Christianity to social
47:53
affairs it’s almost always socialistic
47:54
and nature these guys are very hip on
47:57
prohibition outgoing liquor industry
47:58
this is part of the social gospel Walter
48:02
Rauschenbusch has great work
48:05
Christianizing reporter I told Matt
48:08
Christian alright a 19-12 water ration
48:13
bucket approaches again he’ll not buying
48:14
any whole discussions of the social
48:16
gospel being the big fear additionally
48:18
and the left-wing thousands of this
48:21
period well the Russian Bush and
48:23
Christian as a social water rights of
48:24
the liquor industry folks is seeking to
48:26
fasten on an angry people a row like a
48:28
barber of liquor oh you win seeking your
48:32
rational angry people a relic of
48:33
barbarism which the awakened conscience
48:35
and the scientific intellect of a world
48:37
or combining the condemned afraid this
48:41
great Alliance you see of the awakened
48:43
conscience that’s but that’s the
48:45
fundamental is crazy citizen city let’s
48:48
see that’s the the moral argument is
48:50
whether combined with a scientific
48:52
answer like this is a new scientific
48:53
technicians because the scientific
48:54
technicians while all this was making
48:56
price we’re also a favor of prohibition
48:58
using scientific arguments using
49:01
statistics in the more alcoholics
49:03
diameter or alcoholics get blind and you
49:07
can say if statistically is very true
49:08
more on college have cirrhosis of the
49:10
liver more alcoholics well they know
49:12
what I mean as much in the more lines
49:13
have one a real accidents and on and on
49:15
walk on although born will go crazy and
49:18
so here we have a scientific reformer or
49:21
extra technician or social worker or a
49:23
social scientists combined with the
49:26
social gospel have this magnificent
49:27
fusion of Christian theology and science
49:30
and science what could be working me
49:32
more powerful than that
49:35
the Reverend Joseph is strong for
49:36
example another eminent social gospel
49:39
1909 writes the industrial work they’re
49:43
coping industrial system they came
49:44
conclusion that’s true at work
49:45
increasing desire for alcohol there’s
49:48
only what they mean by the city your
49:49
working hours of ten hours coming in
49:51
somebody party it kind of tired you like
49:53
to have a drink and so he says so it’s
49:59
very important to in order to stop I
50:02
know it’s not bourbon congestion and the
50:04
shame of the city’s not sure it working
50:07
some prefer the congestion well you have
50:10
to do or two so what happens to them is
50:18
they get high wages of course they
50:19
they’re suggested they’ve tired after a
50:21
hard day’s working late somebody live
50:22
and they have unfortunately have high
50:24
wages Rangers they’ve their left wing
50:25
Suzanne lost bowler and their high wages
50:27
leave them to be a little more affluent
50:28
and so they buy their led then quote to
50:31
buy drink and acquire the liquor habit
50:33
before they had developed a more refined
50:35
taste of a higher civilization so
50:38
obviously with the conclusion for this
50:40
is just stop I mean how are the liquor
50:41
and refine them up it’s sort of like
50:43
this is Galbraith and the ministerial
50:44
pork will find them up where there may
50:47
be after that you know first centuries
50:50
you can allow them to drink even though
50:52
of course they wouldn’t want to make a
50:53
point and I need for insanity and then
50:58
pushing for prohibition urban strong
51:00
force also the gospel of the kingdom
51:02
magazine writes in 1914 hailing this
51:06
great drive through prohibition which is
51:08
spreading to the states in our here
51:10
it’s obviously moving up in the federal
51:11
government the gospel of the kingdom
51:13
magazine rights both personal liberty
51:15
and they say this was in close obviously
51:18
deep contempt personal liberty they say
51:21
is at last the uncrowned be thrown King
51:24
but no one that do him reverence thought
51:27
thought thought we are no longer
51:28
frightened by that ancient boogie
51:30
paternalism and government we are firm
51:33
boldly it is a business of government to
51:34
be just that eternal nothing human can
51:37
be fallen to a true government I like
51:39
that and one of the problems is perhaps
51:47
fortuitously that first of all they say
51:49
you know you can’t like tender drink and
51:51
moderate amounts them and then we have
51:54
this part of this whole thing as I can’t
51:56
play drawing the Catholics we’re not
51:57
shaping up in this it was great great
52:01
drive so it’s pure tea and temperance
52:05
I can’t think the margin immigrants
52:08
largely true
52:11
so then we have so additionally up left
52:13
for the gospel the kingdom magazine will
52:14
eruption whichever one Josiah Stowell
52:16
them on some of my other favorites we
52:18
have the scientific arguments the the up
52:22
eleven organ and the harmful effects of
52:23
alcohol only supply in the poverty at
52:25
the center and just only enough we have
52:27
this interesting twist I wonder how some
52:28
of these occurred socialism sort of
52:31
cotton with it they had this final
52:33
attitude was the science of the
52:34
scientists its honking social will good
52:36
types I said the man is determined by
52:38
the warm person was poor and unhappy and
52:41
so when someone it’s not because they
52:43
have a job whatever not because he’s
52:45
personally at full it’s an ancient
52:46
reactionary 19th century was a fair my
52:49
personal character was before no no it’s
52:51
as environment those before all right so
52:54
it was born he he is determined by
52:55
lukewarm and he’s a puppet creature of
52:57
the environment so so the way to help
52:59
him out of the way to cure his poverty
53:01
in a slum conditions and unemployment of
53:03
Cyprus after has to change the
53:04
environment what’s the environment
53:05
Varma’s liquor the solely absolutely
53:09
standing there with evil temptation
53:10
separate cetera and so therefore the
53:15
waiter health is environment that was
53:17
something that lonely girl so forth the
53:20
really progressive social scientists our
53:21
beloved friends from other from other
53:23
are others our meetings here Edward a
53:26
Ross when a great founders of scientific
53:28
sociology fun denote some patently
53:30
progressive economist Irving Fisher now
53:33
beloved remember lovin a compulsory
53:36
vegetarian as long as the grocery
53:38
prohibition all these people pushing the
53:42
idea how long like they’re as part of
53:44
this great new social science and
53:45
applying the lessons of social science
53:46
for so long for the public and and the
53:51
social workers as I said going very
53:54
neatly with this these also an addition
53:57
of this interestingly enough you talk
53:59
about a religious or gos make it
54:01
feminine as women will build and so now
54:02
front of the social science again we
54:04
also have some he can make me tell me
54:06
any work more directly that’s many big
54:09
businessmen we back to our big business
54:10
friends again believe it wasn’t it
54:13
wasn’t and the brain that’s festive
54:14
isn’t necessary for workers that could
54:17
be sober there’s this whole traditional
54:18
and Western some relation you know what
54:22
hang on the market was not even looking
54:24
with statisticians in England 1718
54:25
century economy exactly we shouldn’t
54:27
have higher wages my wage is a bad why
54:29
because we increase wage rates we’re
54:31
going to just get drunk on Monday as
54:32
well as Sunday and Friday is unless – no
54:34
that just won’t work and the economics
54:36
is knowing theory the backward sloping
54:38
supply curve of Labor far as I know has
54:40
never been substantiate now you’re right
54:43
so they just won’t work I just worked
54:45
Leslie may as well you know pay them
54:47
lower wages and make them work harder
54:48
and part of them and find those things
54:50
again this is evil and punk honest these
54:52
guys are go out there that be relaxed
54:54
all business will reduce their
54:55
hard-working and efficiency so some many
54:59
businessmen I get to the point of
55:00
favoring prohibition in order to some
55:02
other workers up and we’ll have the
55:04
sensation one on the liquor aisle be on
55:05
the job more rapidly at the end and
55:07
they’re working harder and so forth so
55:08
so on also to be more safety at work and
55:12
here we have here we have you seen a
55:14
triangle it’s compensation laws now that
55:17
employers are liable by a lower for the
55:18
accidents on the job
55:20
if keep liquor away from these guys they
55:21
won’t have some of the accidents it will
55:23
cut down on the cost the employer the
55:25
beautiful reinforcement of one state
55:26
isn’t piling up on top of another and we
55:31
begin to have a situation where many
55:34
businessmen engage in voluntary
55:35
prohibition worth the condition of
55:37
employment no workers should be personal
55:40
drinking on the job and many of the more
55:42
far out employers and no worker should
55:44
be linked iliad even off the job the
55:47
railroads were pioneering great effort
55:51
the railroads had negligence for was
55:53
again liability special liability even
55:54
was worried about to the railroads
55:58
begins together lay down the rule of no
56:01
worker can drink either on duty or off
56:02
duty ever period the next step of course
56:07
then if you really want to enforce this
56:08
with some of the employers it was kind
56:10
of expensive to do it as well glue the
56:11
messy the higher groups of agents the
56:14
Texas be no I didn’t whatever go around
56:15
and see whether guys drinking here now
56:17
otherwise what’s the point of having
56:18
purple and the found that you seen the
56:22
railroads it’s true I don’t have again
56:23
the double area to do here but then when
56:27
the railroads pass this rule when
56:28
thinking either on or off the job that
56:29
was the client or railway accident my
56:31
question about this was a sort of model
56:32
and inspiration for other employers and
56:35
manufacture
56:36
a scientific management movement which
56:41
comes in around this period Frederick M
56:43
Taylor pushing the idea oh so this is a
56:48
firming up they suddenly wanted so when
56:50
someone of eliminating alcohol because
56:52
alcohol lowers efficiency and so so you
57:00
have this other aspect to the
57:02
prohibition movement and the initiative
57:04
that we have special regional kind of
57:06
situation for example with dry
57:07
there are many dry states in the South
57:09
for example many states which have state
57:11
prohibition stores so are almost of any
57:14
right the businessmen in the dry space
57:16
one of them pull the National
57:17
prohibitions of what state people
57:18
wouldn’t have this we can we can you
57:23
know impose this throughout the country
57:29
and you know American business in
57:31
general also wanted national prohibition
57:33
in order to firm up the American labor
57:35
force and be able to compete against
57:36
these drunken people rockin workers
57:38
abroad
57:38
this increases increase our productivity
57:42
in the you know in rural markets and
57:45
addition is a sort of general business
57:47
sympathy not prohibition we have certain
57:50
specific businesses which are you more
57:52
economically determined in favor of
57:53
prohibition in other words an economics
57:55
is known substance observe I would say
57:57
close the farthest like for the
57:58
substance but sort of substitutes a
58:00
closest thing is I got the liquor ah
58:02
grape juice and coca-cola most grape
58:06
juice company and coca-cola company
58:08
pushed very hard for prohibition and and
58:11
I will I again I think it’s couldn’t
58:14
cannot be he’s really going something
58:15
for they were the most least colors of
58:17
substitutes we have a liquor the
58:22
anti-saloon league for example of course
58:24
what we all know is the major was a
58:25
major pressure group for prohibition had
58:28
a committee of industrialists on it and
58:30
and many of these people were enlisted
58:33
possible system and the other hang you
58:36
see there their workforce certain
58:39
businesses which are strongly anti
58:41
prohibition nothing I got for the
58:42
majority will probably a favor of
58:43
profesh
58:44
there’s few businesses are opposed to
58:46
probe every Apple obviously the brewing
58:48
industry there’s the other rest of what
58:49
your this trick question
58:51
and also the du Pont’s a report on who
58:54
being Catholic again we’re very
58:55
unsympathetic a prohibition on the
58:58
lynches grounds and so we had this
58:59
that’s kind of at this time of the
59:00
breakdown labor unions tended to be a
59:04
favor of prohibition well they had a
59:06
problem that rosa Brewers they’re
59:07
brewing brothers would be thrown out of
59:09
work that wasn’t it wasn’t too much
59:11
distilling going on almost they must
59:13
look at industry in that in those days
59:14
it was beer brewing so yeah well labor
59:18
unions but I for the first the problem
59:20
about the brewing brothers when we
59:21
kicked out of work labor unions also
59:23
tend to be probed favor prohibition some
59:25
of the arguments are kind of cute will
59:27
be reminiscent of slugging current
59:28
current trends only a Maoist a Maoist
59:31
left
59:31
example one of the union’s claim that
59:36
many of the union’s claim an alcohol
59:38
quote those class consciousness unquote
59:40
on part of the workers and alcohol abuse
59:46
and if those that fighting spirit so if
59:49
you have prohibition that this means
59:50
that weirdos me on a TV Mabel will fight
59:53
the boss of the better drinking in other
59:55
words of the class enemy the Knights of
60:01
Labor or I guess let’s go run the
60:04
nothing around fire organizers any
60:08
organizers and rank on the job morph but
60:11
excluded any liquor traffickers or
60:13
liquor industry workers from membership
60:17
the railroad the railroad Brotherhood
60:20
for one favor with prohibition the the a
60:27
phenomena take it stand because of the
60:28
split the liquor industry at sucker of
60:30
liquor workers for is right we but there
60:36
are some there were many unions however
60:38
which opposed in other bases they
60:39
probably they didn’t like the whole idea
60:40
some of them actually worried about
60:42
personal liberty pups and the loss of
60:45
the saloons especially the foreign-born
60:47
workers and those beyond the ethnic they
60:49
were other types the Catholic will have
60:50
a separate or in this for in this thing
60:52
there were members of unions
60:57
the Socialist Party as usual was split
61:00
with somewhere down the middle the
61:02
prohibition is the anti-prohibitionist
61:05
the John Spargo would later turn the
61:08
Greek irritation of social supported we
61:09
didn’t turn up in the pro-war socialists
61:11
listen this one who listened to a
61:13
thousand war offered for the favor of
61:16
prohibition is he considered a parasitic
61:18
and inefficient and lowering
61:19
productivity go forth another another
61:24
interesting argument my spargle in favor
61:26
prohibition was this ok you guys are
61:27
worried because because the prohibition
61:30
interferes of personal liberty bases
61:32
also own legislation interferes of
61:33
personal liberty so what are you great
61:35
right back well this most Socialist
61:39
Party members are probably against
61:40
prohibition against the German influence
61:42
with those Germans Germany very heavily
61:45
in long the Socialist Party and then
61:47
from the great brewing tradition or
61:50
opposed to it but the okay the brew is a
62:00
saloon set up as I said so means with a
62:02
basic liberal for local control saloons
62:05
setups were largely owned by the Brewers
62:09
the brownie industry the situation there
62:11
was like mine go on there so long you
62:12
can peel it on its own and so forth and
62:15
when Norma’s number retail outlets are
62:16
all over the place and especially those
62:18
cities and they had they had they were
62:24
they’re closely involved again tomorrow
62:27
night we’re talking about urban crime
62:29
and that’s making bourbon and crime and
62:30
ethnic problems etc one of the problems
62:34
is that usually the Brewers the saloons
62:37
were tightly license you have a get
62:38
license to the server and so in order to
62:40
get the licenses and pay the taxes and
62:41
all the rest of it yet a dicker with
62:43
local politicians so the symbiotic
62:45
relationship of ordinary politicians and
62:48
local saloons and then the on the
62:50
brewing industry and the other which we
62:51
have so-called corruption and crime lab
62:53
you know you have to in order to get it
62:55
be in business you have to get the pipe
62:57
a local politician and want to keep you
62:59
a competitor out somewhere and so on the
63:01
whole kind of abuses also most of these
63:05
Brewers most of the saloons confront of
63:07
the sunday closing wars
63:08
which is one of the remnants are the
63:10
elements of Puritanism here and the
63:13
brewing Brutus moons wanted to stay open
63:15
on Sunday which is not part of the mud
63:17
part of the Germans are ethnic camp I
63:19
got a position how many things some they
63:20
closing in order to stay open up
63:22
something have to pay with the
63:23
politicians and then close your now this
63:25
whole this whole thing we’re all doing
63:27
this also and you had to pay off the
63:29
police of course of the whole police and
63:31
local government machines were wrapped
63:32
up on the Mussolini caper
63:35
and in return for the first of those for
63:38
the politician favoring the local saloon
63:42
keeper the saloon keeper position of
63:43
pain won’t have another force very
63:45
important functions to collab the votes
63:46
the reelect the politician with his
63:48
friend and the saloon keeper being
63:50
looked up to by the phonetic in the
63:52
neighborhood was was able to pull out
63:54
votes fairly steadily as a farce of the
63:57
machine polish McCann estimated
63:59
eventually close like many of the saloon
64:02
keepers became older than themselves or
64:03
city councilmen and so forth another
64:06
thing of course which increased the
64:07
symbiosis with a little corrupt machines
64:10
in quotes and increases the political
64:12
incentive for the for the upper class
64:14
lost booze establishment resuming
64:16
corporate establishment of smash listen
64:18
hmm another another element here is a
64:22
system saloons were sort of very
64:24
Knightly illegal books are quasi illegal
64:26
cuz it will be from they closing and
64:27
license no enough in any way along with
64:29
other services which which ethnics urban
64:34
ethnic immigrants etcetera
64:36
enjoy openly website which which drove
64:40
Baptist Methodist washed up the wall
64:43
mainly gambling a prostitution
64:45
so this means became sort of specters of
64:47
gambling and prostitution online to its
64:48
we have this whole kind of moral
64:52
conflict symbiotic with political ethnic
64:56
and all the rest constantly emerging the
64:58
progressive period the Progressive Party
65:02
naturally naturally of course with
65:07
wholeheartedly in favor of prohibition
65:09
and finding in the Knesset war the
65:11
prohibition over-the-top I mentioned
65:14
about the anti German thing in the war
65:16
the specific one to folks to Croton on
65:18
these finished
65:19
the anti-saloon late right there in the
65:22
war quote the Germans Brewers in this
65:23
country have rendered thousands of men
65:25
inefficient about crippling the Republic
65:27
in its war on Prussia militarism better
65:32
quotes of the Year for the week another
65:36
one another prohibitionist writes quote
65:38
we have German enemies in this country
65:40
in this country too it’s not just abroad
65:43
and the worst of all our German enemies
65:45
the most treacherous the most menacing
65:48
or perhaps Swift Miller

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