History and the Economy

As this blog has always made clear, the things that fascinate me about history are the lessons history has for the present.  I believe that sharing the story of Isaac Werner, his community, and their connection with the Populist Movement of their time has lessons for our own time.  The trick is, of course, understanding how to apply those lessons.

This blog post contains cartoons published in the County Capital in St. John, the newspaper to which Isaac subscribed.  Remember, you can click on the images to enlarge them.  

King Grover with Boodle and Wall Street

Then, as now, sometimes politics causes all of us to avoid conversations with each other, and I hope you don't stop reading because you think I am about to express political opinions.  I'm not.  The three men I quote in this post are not politicians, and what they are urging is the importance of getting politics out of the way to solve issues important to all of us--issues that were important to Isaac's generation and which never seem to go away.

An article published July 18, 2018 in USA Today reported on a meeting at the Brookings Institution in Washington, D.C. at which Former Fed Chairman Ben Bernake and former Treasury Secretaries Henry Paulson and Timothy Geithner spoke to reporters.  They focused on the reforms enacted in the wake of the banking and housing meltdown in 2008, a financial situation inherited by the new, incoming administration, which came dangerously close to collapsing the global economic system and bringing America down with everyone else.

That history is only a decade ago, but as I grow older I realize that what seems recent to me is ancient history to a significant part of the population, and how short some of our memories are!  One of the concerns expressed by these three men was whether today's political climate would allow the bipartisan action that confronted the economic crisis in 2008.

Politics and the economy were a divisive combination in Isaac Werner's time as well, as the political cartoons from the 1890s show.  The issues printed on the steps leading up to the "Throne of Plutocracy" in the cartoon above describe some of the same issues of today.

The point the three men sought to make in their press conference was that the current drop in unemployment and other positive economic trends should not create such a sense of economic security that we ignore long term issues. 

"Today, when we are growing, this is the time when we need to deal with some of the persistent structural issues that are going to determine our long-term economic competitiveness," Paulson said.  "We have the fiscal deficit, dealing with immigration, the income disparity and what automation and globalization are doing to wages.  They need to deal with all those."

Reading the USA Today article I could not help but compare the issues portrayed in the old cartoons with the issues concerning Bernanke, Paulson, and Geithner, men who are not politicians and who served under Republicans and Democrats.

In the above cartoon, notice what is in threat of being submerged by the Wave of Prosperity, as Uncle Sam waves a sign reading "Wanted:  Competent sailors to run this craft."  The weight of "Public Debt" overloads the "Ship of State," and foundering in the water are "Labor," "Farms," and "Factories."

As this blog has often said, we can avoid mistakes if we learn from history.  The challenge always remains, however, just how to interpret those lessons.

You Can't Please Everybody!

Did you realize there is no woman pictured on U.S. paper currency?  If you haven't realized that, others have, and for the first time in more than a century plans are underway to select a woman to appear on the $10 bill, the next denomation scheduled for an update.  While some are pleased to see that a woman will finally be recognized, not everyone is happy.  In fact, former Federal Reserve Chairman Ben S. Bernanke is among those "appalled" that the founding father currently pictured on the $10 bill is being replaced.

Do you know whose image appears on that bill?  The answer is Alexander Hamilton, whose portrait at right was done by well-known artist John Trumbull.  Do you know the historic role Hamilton played?

This country will never be prosperous again until Silver is reinstated...

Hamilton was an active participant among America's Founding Fathers, but probably his most important role was serving as the 1st U.S. Treasury Secretary.  Bernanke supports leaving Hamilton on the bill because in his opinion, Hamilton was "...without doubt, the best and most foresighted economic policymaker in U.S. history."

Hamilton was an often-cited hero of the Progressive Movement in urging a return to bi-metalism.  For a discussion of that movement, visit "The People's Party Urged Silver," at 7-15-2013 in the blog archives.  In Hamilton's role as the Treasury Secretary, he submitted to the House of Representatives in 1791 his Report on the Establishment of a Mint.  In forming his ideas, he looked to European economists, as well as other founding fathers, such as Thomas Jefferson and New Yorker and Pennsylvania representative to the Continental Congress, Goueurnor Morris.  Although he is said to have favored the single gold standard, what he actually initiated was a bimetallic currency, and the initial bimetallism established under Hamilton is what made him a hero to the Progressives.  The caption under the above political cartoon from the 1890s reads "This country will never be prosperous again until Silver is reinstated to full and unlimited coinage."  

Here is my challenge to you:  First, let me know with your comments (here, on face book, or by e-mail) how you feel about replacing Hamilton on the $10 bill.  Second, if you favor the idea of a woman on the $10 bill, (or on a different choice of US paper currency), what woman from our American history would you prefer.  I hope some of you will participate in this challenge...it will be fun to see how you feel!