184 ChaPter^4
laws were necessary not to punish bankers, but to keep Wall Street stable and
keep Capitalism safe. Still, many bankers opposed them as government intru-
sion into a private market. So FDR got representatives of large banking and
brokerage houses such as James Forrestal of Dillon, Read and Robert Lovett
of Brown Brothers Harriman, as well as commission brokers to endorse and
promote the Act. Those who opposed the new regulations believed, unneces-
sarily, that the New Deal would threaten banking, but that was never even
considered by FDR. No one ever considered nationalizing banks or punishing
brokers—just preserving the banking system and fixing problems that had
helped cause the 1929 crash and protecting investors against the huge losses
they had suffered when the depression hit. In fact, one need only to note that
the first Chair of the SEC, appointed by Roosevelt, was Joseph P. Kennedy, a
wealthy investor and merchant and patriarch of America’s most famous polit-
ical family, to recognize that it was a conservative institution that posed no
threat to Wall Street. Like the NIRA and AAA, the Securities laws had the
same goals, to prevent radicalism, to give benefits to the biggest industries, and
to make the corporate liberal state work even better.
Even today, FDR’s New Deal is still criticized as being too liberal or even
radical, but, much like Barack Obama’s programs in his first term as president,
his policies were established to strengthen the bonds between the state, cor-
porations, banks, and other huge economic concerns. The goal was to have
the government involved in the economy, as Capitalists wished. As one critic
of the NRA explained, Roosevelt based his programs on the desires of the
ruling class to have the government enforce price control, production, and
trade practices. “Industry wanted not freedom from regulation,” he explained,
“but the right to enjoy regulation.” By suspending many laws that would have
prevented collusion and trust laws, the bosses could join together and gain
more control over their industries, especially their labor, in their trade asso-
ciations. Big business did not have the NRA, AAA or SEC forced upon it,
but in fact wanted those programs so it could run off smaller firms that cut
corners and cut costs just to stay alive and could not afford the regulations
required by New Deal plans. The “new Capitalism” or “corporate state” was,
as intended, even more fully developed in the First New Deal as Roosevelt
and the wealthy bosses tried to address the problem of the depression by alter-
ing production and eliminating smaller competitors. As for the depression,
conditions changed little. Unemployment in 1935 was still above 20 percent;
over 5 million families, which included over 20 million men, women and