What's Wrong with Franklin Roosevelt's
Economic Policies?

Karl B. Mickey

[A letter to the editor published in the Cleveland Press.
Reprinted from Land and Freedom, July-August, 1935]

In your editorial on the President's tax message you conclude with the assertion that "with the general philosophy set forth there can be, in our opinion, little for any fair-minded citizen to challenge." It seems to me a new idea of fairness, to impute in advance unfairness to anyone so brash as to disagree with you. Despite my natural trepidation under the circumstances, I shall brave the imputation.

To avoid the charge of misrepresenting the President, I shall in each case set down the verbatim quotation from the address before my comment on it.

"The movement toward progressive taxation of wealth and of income has accompanied the growing diversification and inter-relationship of effort which marks our industrial society."

In other words, as the arts of production and exchange have improved, government has tried to discourage the improvement by progressively fining the improvers.

"Wealth in the modern world does not come merely from individual effort; it results from a combination of individual effort and of the manifold uses to which the community puts that effort."

Mr. Roosevelt ought to tell us what he means by wealth; he doesn't use it in the sense of any coherent definition I have ever run across. Wealth, as defined by reputable economists, is, and must be, the product of the individual; and that fact is not altered by co-operation, voluntary or involuntary, between individuals. What he means by "a combination of individual effort and of the manifold uses to which the community puts that effort," stumps me entirely.

"In the last analysis such accumulations (of wealth) amount to the perpetuation of great and undesirable concentration of control in a relatively few individuals over the employment and welfare of many, many others."

How in the name of common sense can wealth perpetuate concentration of control? Wealth can't even perpetuate itself. Wealth is the most transient, ephemeral thing in the world. It is continuously being diminished by deterioration, rust, decay, and obsolescence. In the form of consumption goods it is constantly being destroyed by consumption; in the form of capital goods, by use. Something entirely different gives the few the power of economic tyranny over the many; something which Mr. Roosevelt mentions in a later paragraph.

"A tax upon inherited wealth is a tax upon static wealth, not upon that dynamic wealth which makes for the healthy diffusion of economic good."

I quote this sentence for comic relief. I can imagine no more side-splitting spectacle than that of Mr. Roosevelt attempting to define what he means by "static wealth" and "dynamic wealth."

"People know that vast personal incomes come not only through the effort or ability or luck of those who receive them, but also because of the opportunities for advantage which Government itself contributes."

Now the cat is out of the bag. The power of economic tyranny is never due to productive effort and the possession of wealth, but always to opportunities for advantage which Government sets up by legislative enactment to rob the people of their heritage. In other words, the economic bondage of the people is not due to wealth, but to the malfeasance of their own Government.

Isn't the remedy, then, to stamp out the unjust advantage which Government gives to a few men over their fellows? How can the President talk of "social justice" while complacently permitting the existence of this condition to go unchallenged? If Mr. Roosevelt sincerely wishes to kill this evil, he will ask Congress to abolish governmental interference with equality of economic opportunity, instead of indiscriminately to tax wealth regardless of whether it is legitimately or illegitimately acquired. He will strike at the root, instead of hacking at the branches.

I submit this for publication on the assumption that there still is sufficient freedom left to permit a humble subject to utter a word of respectful criticism of his masters.