The U.S. has been in several wars and other foreign entanglements since its founding in the late 18th century. Some have turned out well and beneficial to our interests while others have had disastrous results. (Think the bombing of Pearl Harbor.) Today, however, we stand on the brink of what could be the most colossal blunder of all time, and that would be letting the terrorist state of Iran develop nuclear weapons, if we fail to act militarily in taking out Iran’s nuclear development plants. That doesn’t appear to be in the cards, however, no matter who is elected president in November. So lets recap a history of our foreign affairs exploits and failures.
Throughout the 19th century the U.S. adopted mostly an isolationist stance when it came to dealing with foreign countries. We were protected on 2 sides by huge bodies of water, which were considered too big for any foreign aggressor to overcome if they considered attacking us. Canada, to the north, was believed to be just like us (and would have been part of us if not for the betrayal of Benedict Arnold) so there was no worry on that front. We did have conflict with Mexico to our south, during which Mexico lost a chunk of their territory to us, and there was a dust up with Spain during which we acquired (and subsequently relinquished) the Philippines, but by and large we managed to stay out of all the messy entanglements Europe was continually involved in. Our only real serious engagement in the 19th century was when we decided to kill each other during the Civil War. Over 600,000 Americans lost their lives in that debacle, which would be equivalent to the loss of over 6 million American lives today.
So we entered the 20th century with pretty much a strong belief in isolationism. All that would have worked out well, except all those messy European entanglements I mentioned above finally burst out into shooting affairs and came to be known as World War I. Our policy was that this was Europe’s problem, and we were determined to remain isolationist and stay out of the war. In fact, President Woodrow Wilson ran for re-election in1916 on the slogan: “he kept us out of war.” However, the war soon stalemated as France with England’s support dug huge trenches in Eastern France, and Germany did the same on their side. Both sides kept firing at each other from these trenches killing soldiers by the thousands, while tens of thousands more died in these trenches from cold, hunger or disease. Woodrow Wilson was no sooner re-elected in 1916, then he decided to break the stalemate by sending U.S. troops “over there” to fight for the first time in a European war. It worked and the Allies were successful in defeating Germany. And no sooner had the the troops returned after the war, than much to our subsequent regret, we retreated back into a policy of isolationism.
The 1920s and 1930s saw the rise to power of of brutal and aggressive dictatorships with a thirst for conquering their parts of the world, such as Hitler”s Nazi regime in Germany, and Tojo’s warrior regime in Japan. There was little doubt early on, that both of these savage dictatorships had a lust for power and military aggression, but, we nevertheless, were determined to remain to remain strictly neutral and isolationist, as if we could some how avoid been dragged into the coming conflicts. President Roosevelt was an internationalist, and did manage to ship large quantities of armaments to England which enabled its survival, but he could not convince an isolationist Congress to declare war on Germany and Japan, even after the outbreak of hostilities started in 1939. It finally took the bombing of Pearl Harbor late in 1941, for us to enter World War II, and even at that we were woefully unprepared. We labored for 2 years, or until 1944, to amass the military strength in manpower and armaments needed to finally start turning back the Axis powers in Europe and the Pacific. Millions of additional lives were lost due to our unpreparedness, which was in turn due to our policy of isolationism.
After WWII, isolationism as a foreign policy was thoroughly discredited, as we instituted the Marshall Plan to help rebuild Europe, an also took the necessary steps to institute democracy in Japan. But soon the pendulum swung completely in the opposite direction, as a huge fear of the Soviet Union and Communist China (our allies inWWII) gripped the nation. As the USSR took over most of Eastern Europe, and the Red Army was triumphant in China, it looked like communism was on the march throughout the world. Then when Russia successfully tested a nuclear bomb, the fear in this country of the spread of communism became hysterical and neurotic. It gave rise to shameful events such as McCarthyism, as people were hauled before Congressional committees and designated as traitors, if they ever showed sympathy for our WWII allies, or ever had communist tendencies. I won’t get into all the horrors of the McCarthy era, but it certainly was one of the more disgraceful episodes in American history. It was a time when anti-communist extremists established the slogan of “lets kill a Commie for Jesus.” All this resulted in the “Cold War” between us and Russia, which was particularly exploited by President Reagan in the 1980s. The Cold War lasted over 40 years or until about 1990 when the USSR collapsed under the burden of its own weight. Experts have estimated that we spent an estimated one trillion dollars in arms that we didn’t have to (more like 2 or 3 trillion in today’s dollars), fighting the Cold War instead of letting the communist regimes collapse on their own.
After the Cold War our foreign policy seemed to be getting back on an even keel, except that we were ignoring the rise of militant Islamic terrorist groups. Again, our unpreparedness in the face of this new form of evil led to the loss of 3,000 lives on 9/11. As I mentioned at the outset, today our main foreign policy threat is the growing power of the terrorist state of Iran, which is feverishly working to develop a nuclear arsenal. Will President Obama, or President Romney (as is more likely), take action to foil Iran’s nuclear ambitions. Or will no military action be taken against Iran, as the French and British failed to take action against Hitler when they could have, before 60 million lives were lost in Europe. If no action is taken what are the odds that Iran will one day hand off a small nuclear device to some terrorist group, who could then plant it in a hotel rome in Tel-Aviv, or Houston, or Atlanta, or New York, or Washington before detonating it. It would kind of turn the world upside down, wouldn’t it.
DEPRESSION AT ITS ROOTS
I thought that, for a change of pace, we would discuss a really fun topic like depression. No not the mental breakdown type, but the fiscal meltdown type instead. Although if you have a financial breakdown, it’s sure to cause a plethora of the mental type, so maybe we’ll wind up talking about both. They say that money can’t buy happiness, but tell that to the homeless guy sleeping in a cardboard box in a back alley or under a bridge somewhere. Or to the recent winners of the mega-millions jackpot as they were popping the champagne corks. It’s hard to imagine any individual or family where money doesn’t play a central role.
Throughout American history there’s been at least a dozen major depressions, or panics as they were sometimes called, starting as early as 1807. There was also a few milder recessions thrown in for good luck. (Ronald Reagan used to say that a recession is when your neighbor loses his job, and a depression is when you are thrown out of work. Not a bad definition.) But the depression I would like to focus on is the one back in the thirties. Not the 1930s, but the 1830s, or 1837 to be exact. It’s hard to believe they could have a depression back then when the entire U.S. population was only about 17 million. But not only did they have a depression, it was just as severe and destructive to people’s lives as the 1930s joyride. Those that are such strong advocates of capitalism somehow never get around to talking about capitalism’s failures, and how numerous they have been.
The U.S. government in 1837 was a modern day tea party’s dream come true in that it hardly did anything and hardly spent any money. It had a small Army and a few ships they called a Navy, a State Department that conducted a limited amount of foreign affairs, a small Attorney General’s office, and perhaps something that looked like an agriculture department to help out farmers. Even then people recognized that food was too important to deny at least some government involvement to help offset the hardships that droughts or flooding rains may have caused farmers. But outside of these limited functions there was little government activity. Revenues came primarily from tariffs on imported goods, so tax rates on rich or poor was a non-factor.
In November of 1836, the only man in U.S. history to be elected from the House of Representatives directly to the White House, Martin Van Buren, became president in the following year, succeeding the the 8 year presidency of Andrew Jackson. Economic times were good at the start of the Van Buren presidency, as land values started to sky rocket in value because of increasing numbers of people pushing west. One might say there was a growing real-estate bubble, not unlike the one that has led to our current economic down-turn. Banks were eagerly encouraging people to borrow money and invest in real estate to keep land values rising. Sound familiar? However, with all the cheap money flooding the market, inflation started to soar, and the government, in its infinite wisdom, declared that outstanding debt would have to be repaid in gold or silver, which made all the paper money on the market almost valueless. Instantly, there was widespread panic, as people rushed to their banks to withdraw their life’s savings while they could. Almost overnight, 40% of the banks in the U.S. had to close their shutters, since they were unable to meet their financial obligations. Financial destruction and ruin ensued on a massive scale in most people’s lives, from which they would never recover.
Since governments in those days didn’t do much of anything outside of defense and foreign affairs, Van Buren was clueless as to what remedial actions the government might take to alleviate the hard financial times. So in the end he did nothing, and the unrelenting depression dragged on for 6 years until finally the economy started to improve in 1843. The depression caused Van Buren to lose his re-election bid in 1840, and he probably went to his grave insisting it was not government’s role to bail out the economy. Sort of like today’s far right, who are still monumentally upset that the current administration bailed out General Motors and Chrysler in their time of need, instead of letting them go out of business, with a few hundred thousand more jobs going down the drain.
What is the relevance of the 1837 depression to our current world affairs? It’s not that capitalism is bad. Indeed, it’s probably the only real workable economic system at this stage of man’s evolutionary development. Even Communist China recognized that when they went to a market economy. But capitalism does have some deep fault lines that are ripe for exploitation by the unscrupulous. For example, when my wife and I bought our first house, people acquired real estate primarily for living purposes. We were required to put 20% of the purchase as a down payment. But early in the 21st century the fast-buck artists felt there was a quick killing to be made by constantly inflating real-estate values through convincing potential home-buyers to secure mortgages they could ill-afford with virtually no down payment. Real-estate prices could only go up, they told dubious buyers, before the crash came and all the foreclosures with it. And all the people now sitting in their homes with mortgages that are under-water. The 1930s depression was caused by the same-type of fast-buck artists that were exploiting the stock market, causing ever-increasing and unsustainable stock prices until the crash came.
So in the end it doesn’t matter whether it’s capitalism or socialism, or any other ism. What matters is the honesty and integrity of the people participating in what ever system is put in place. What’s important is to have the safeguards necessary to prevent the dishonest, the unscrupulous, and the out-and-out scammers from perverting whatever the chosen system of economics is. One final note. Mitt Romney has secured the GOP nomination, but during the primaries he referred to himself as a “severe conservative.” I wonder if that’s like a severe depression. Maybe it’s just a severe mental breakdown.