The United States Faces the Future
Publication:
The Empire Club of Canada Addresses (Toronto, Canada), 23 Mar 1933, p. 129-142


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Gibbons, Dr. Herbert Adams, Speaker
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Text
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Speeches
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The speaker's frequent role as interpreter of his own country to other countries. Bringing word from the United States. Some personal references to the speaker's travels and family. The United States' participation in the World War and reasons for the timing of their involvement. The current crisis in the United States and how it is being handled. The role played by the radio in Mr. Roosevelt's handling of this crisis. Measures taken by the Federal Government. Reasons for closing down the banks. The expected continuation of hard times in many localities in the U.S. The situation with the gold standard. The U.S. still not having fully paid for the War. Some comparisons with other countries. A confident prophecy from the speaker with regard to what will and will not happen in the United States and to the American people in this economic crisis. Using events of the current month to justify such a prophecy. Difficulties and attitudes that led to this crisis. A look at the attitude of the U.S. and her foreign policy with regard to Europe. The effects of raising tariffs after the War. Taking the initiative in repairing this error. Seeking an unchecked flow of trade throughout the world as the salvation of the world economically. The need for a drastic revision of tariff schedules in all countries. The need to do away with war debts and all kinds of intergovernmental obligations in the same spirit and to the same extent that the Conference in Lausanne proposed to do away with German reparations. The wave of false prosperity experienced in America. The folly of not facing issues. How the United States can serve the world. Ending on a note of optimism.
Date of Original:
23 Mar 1933
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English
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Full Text
THE UNITED STATES FACES THE FUTURE
AN ADDRESS BY DR. HERBERT ADAMS GIBBONS
March 23, 1933

LIEUT.-COLONEL GEORGE A. DREW, the President, introduced the speaker.

DR. HERBERT ADAMS GIBBONS: Colonel Drew and Gentlemen: A role that I have not very often been called upon to fill is the role of interpreter of my own country to other countries. It has been rather as an interpreter of other countries to my own country that I have been engaged in the lecture field, but I do feel particularly privileged to be able to come to The Empire Club of Canada at such a critical moment as this is and to bring you a word from the United States.

I am very glad that a little more than a month ago I had the hunch in France to come back to my own country and I arrived there only the week before the crisis became acute. I brought with me memories of recent experiences in other lands-in Europe, in Africa and the Far East, where this world crisis has been now for several years, ready to break forth-and I have seen its effect upon my own countrymen.

It is a great thing for an American-I use "American" in the narrower sense of the word, as a citizen of the United States of America-to come before an organization in a sister country so near to us, and, as your Chairman has said, so closely bound up with us anal interested in our problems, and to speak of how the United States is taking this crisis and of what lies ahead of us in the future, because I feel myself, whenever I go anywhere within the British Empire that I am in a friendly atmosphere. (Applause.)

My travels have taken me almost everywhere that the British flag flies. I remember when I was a youngster at the jubilee of Queen Victoria, Canada got out a postage stamp-a Mercatorial projection of the whole world, and in red were the countries all around the world where the sun never sets and the British flag waves. Since that time it has been my privilege to be, not everywhere that the British flag waves but nearly everywhere, and I have always felt at home, just as T' feel at home here because I know, despite the little differences that we have from time to time in different parts of the world--perhaps, sometimes growing more acute because we are so closely related--that we are all members of one family and what affects one of us can not help but affect the others.

I have a daughter who is at school. She is a young girl of seventeen who has been for three years at school at Malvern, at the Malvern Girls' College at Worcestershire and she writes about her Debating Society and the problems she has to expound on the platform" relating not to the British Empire as a whole, but to England and I am surprised at how closely those problems come home to us.

Where I travel throughout different parts of the world and go to church, whether in Singapore or Shanghai, in Madras or Calcutta, in Mombasa, Nairobi or Capetown, or in the East Indies, or anywhere that is a British possession, I am almost moved to tears by the fact that, as a general rule following the mention of the name of His Majesty, King George the Fifth, they all make, before other potentates arid presidents, a special mention of the President of the United States. That is the custom throughout the British Empire, so I can feel that I am at home--in my own home church among people who speak the same language that I speak and who have the same thoughts and the same ideas.

The United States was very late in coming into the World War. There were a great many of us who lived an the Eastern, seaboard who were in contact with Europe or who as Americans had lived in Europe, who felt the underlying significance of the issues at stake and who thought from the very beginning that the United States should have aligned herself with the Entente Powers in the Great War raging over in Europe; but we could see the reason why the United States did not come in at the beginning. There seemed to be in the minds of the people as a whole in our country, no vital American interest at stake and no country ever goes to war without having the conviction that it is itself, in danger. It took three years for us to arrive at that conclusion, but once we did,, I think you will agree that we all went in, on the other side of the border, wholeheartedly, and did the best we could to finish up the job. However, the policy that the United States has followed, and it has been up to comparatively recent times a successful policy, has been the policy of non-intervention-the policy of isolation. We have been in the United States, the same as you in Canada, wrapped up in our own problems. We have used all our energies in the development of our country, as has been the case in this country and has not been the case in European countries, including Great Britain; our producing capacity has never kept up with our consuming capacity, either in agricultural goods or in our investment capacity.

But with the turn of the century, fifteen years before the World War, the world situation became different and we all became more closely bound together, stretching out and reaching out for world trade and it was the development of world trade and investment in foreign countries that brought the United States as well as Canada into conflict with those countries from which we came originally and from which we had not broken off contacts.

I remember how, as a youngster in my late teens when travelling through England, how riled I used to be-and I think that Canadians have had the same feeling as Americans--at the thought that we, the Americans, didn't 'have in our country quite the things they had there. This was especially true when we went through the cathedrals

My people originally came from near Hampshire which is not far from Salisbury. One of my ancestors was the organist at Westminster Abbey and my people had lived there from time immemorial. I remember when I was in the Cathedral at Salisbury arid the verger was showing me around. He had a supercilious smile which meant

"Over in your country, you have nothing like this." As I was young and hot-headed, I was tempted to say and I did say it to him: "Wipe that smile off your face". I said that my ancestors built this country; they built this cathedral and they lived under its shadow for hundreds of years-until they had enough sense to get out. It was not to build a new civilization-our culture and our civilization is simply a transplanted culture and a transplanted civilization from the Old Country, and to us" England means what it does to you. It is our home and our cultural ancestry. They may not think that we have a right to the share of everything over there, but we believe that we have and that is what counts with us.

I have never been so proud of my fellow countrymen as I have been during the past few weeks. I think that we have been through a tremendous test with the crisis coming, dramatically, on the very day that the new President of the United States was being inaugurateda crisis that couldn't be staged off that morning even to await the moment that he took the oath of office. Banks were closed throughout the nation; on every side a national bank holiday, and federal authority by most of the governors of the states following closely on the bank holiday order. And the calm way they took it! I have had lots of letters from my friends in France, Italy and Germany and England and I must say that the letters from England have been very different from those from Continental Europe. From all over Europe and from my French friends-and I love France and I have lived there a good deal of my time-I think the wish has been father to the thought, because they all speak of the terrible panic we must be in in America. I have tried to answer every one that there is no vestige of panic anywhere in the United States and there hasn't been during the banking holiday. From the first day the banks closed in New York State-I was in the State of New Jersey, in Princeton, my own town-there was no violence, no disorder, no real feeling among the people as a whole of gloom or pessimism. Everybody stood by in perfect order and everyone decided that no matter what their politics were, they were going to give the new President a chance to prove himself and see what he would do.

In this the radio played a very great role. Wherever one was throughout the country, one was able to listen, in and hear the ceremony of the Administration of the Oath of Office to the President, and following that, the wonderful Inaugural Address, made under dramatic circumstances-more dramatic than has ever occurred in the history of the United States with the possible exception of the inauguration of Abraham Lincoln. And that address of Roosevelt's, although the country is normally Republican and not Democratic-Roosevelt was elected through force of circumstances last December-created the feeling throughout the country that we had a pilot--a real he-man who was going to carry us through the storm. And he spoke to the nation again on Sunday night and every single step taken by the Federal Government was relayed over the air to all the nation through the network of the broadcasting systems, so that there wasn't a person in America who, if they wanted to, could not have turned in and listened to the President of the United States telling the people in the simplest sort of language what measures the Federal Government was going to take-and it did not end in talk! (Applause.)

From the very first day-he was inaugurated on a Saturday-steps were taken so that an Monday morning when the banks didn't open, when in New York State they didn't open, we were given the promise of the early resumption of business activities. I think that it is a marvellous thing for a hundred and twenty million people to be for several days without any money. No one could have ever foreseen that such a crisis would arise. If anyone had told me the Friday night before the Inauguration that I wouldn't be able to get my money out of my bank and that I wouldn't know what day I could get it out, I would have said, "You are dreaming". There might be some bank failures but that the banking system as a whole would close down, I didn't think possible. No one thought it possible. When it occurred, everyone was gay, happy, buoyant, confident, and on the day that the banks opened the spirit of the American people was shown in the fact that the deposits in the banks on that day were far greater than the withdrawals.

Now, of course we don't want to fool ourselves and we don't intend to fool ourselves as regards the situation, financially, in the United States. Perfect frankness is the only possible safety for the people of our country and they realize that, and if you will remember when Mr. Roosevelt explained the reasons for closing down the banks and for keeping the bank holiday going for several days, he never promised to the people that all of them were going to get their money out of all the banks that had been closed. He didn't say that. What he said was that there had been an unprecedented withdrawal of funds from the banks during the few days previous to the national bank holiday and that was the result of a long period of uneasiness and unrest, and that as soon as it was possible the banks were going to reopen-those which were strong and solid, and others could reopen which had assets, though frozen, that were bona fide assets and they would be reopened as soon as possible. He promised no date but he let it be understood very clearly by the people of the country that there would be some banks which would not reopen-and we have that still to face in our country. There is no doubt that many banks were closed down as a result of the bank holiday which will not be able to recover, but what we feel as we face the future is this: that if we had not had the bank holiday, many more banks would have gone under than will go under. We are going to go through a very hard spring and early summer in the United States, financially. There was in this bank holiday a little bit of the administration of oxygen to the patient in the whole process and some of the patients-that is the banks to whom this oxygen was administrated-will not recover.

There is going to be, as there has been for the past two years in the United States, a continuation of hard times in many localities and we haven't yet, perhaps., touched bottom in certain parts of our country.

More than that, I might say very frankly, when we speak of the gold standard and our maintenance of the gold standard, that we really didn't do it. Several years ago Japan was criticized very severely for an embargo on the export of gold from the country and the statement was made by some of our leading financial experts in New York, in banking circles, especially, that because the free export of gold had been forbidden by Japan that Japan was not really on the gold standard. Now, no country is really one hundred percent on the gold standard that forbids the export of gold or that interferes with the free flow of international exchange. In that sense, we in the United States, today, are not one hundred percent an the gold standard and we have to admit it very frankly. The sooner we admit it to ourselves, as well as to others, perhaps the better.

More than that, we realize in the United States that we have been a little bit too superior in our attitude toward other countries in regard to our solvency, in regard to the intrinsic worth of our currency, in regard to our ability to pass through a crisis that has affected all of humanity.

We haven't realized yet in the United States that we haven't fully paid for the War. Germany deflated her currency to the point where her debts were wiped out anti there was a new deal all round. In France, eighty percent of the assets of the nation, in savings and so forth, were wiped out when a stabilization was made at the point of three and ninety one-hundredths cents on the franc. In other countries it was the same way. Great Britain went off the gold standard, went back on the gold standard and again and with the greatest courage any nation has shown since the World War, deliberately went off the gold standard. And I think that we, in the United States, despite the high talk we hear in various circles, are going to find in the next few months that we cannot adopt, in regard to the rest of the world, an air of superiority and we cannot make the dollar the standard for the whole world. We have got also to realize the necessity of a certain amount of inflation" however much we may deplore it and I think that the probabilities are that before the end of the month of June, in the United States we will begin to see that the British policy, adopted a couple of years ago, is a policy that we would do well, ourselves, to follow. I think that is probably going to come. I know that I am on risky ground here--very risky ground in risking a prophecy--but you know the oldest organization of gambling in the world is Lloyds in London, and when they were taking the bids that the United States is not going to abandon the gold standard, they said up to June. Up to that time they were willing to give five to one that the United States would remain, technically, on the gold standard. After that, they don't know. And none of us know what is going to happen after that.

Whatever we do in the United States in regard to our currency, whatever we may be forced to do, there is one thing we may be sure of, here in Canada as elsewhere, and that is that the people of the United States are not going to lose confidence in their government. There is going to be no disorder; no revolutions, even locally; no upset of any kind; no Communistic uprising. Whatever process follows will be clearly and wholly orderly. The people of the country as a whole, though certain interests may suffer, the people of the country as a whole are rot going to suffer unduly and we are going to pull out and pull out at the earliest possible moment. (Applause.)

I think that what has happened in the last month is guarantee enough for a man like myself to make a prophecy of that kind concerning his own country.

We have been singularly blind in the United States, both as to our obligations and our opportunities as a member of the family of nations. That is a confession we must make at the beginning of 1933, and if we make that confession sincerely and whole heartedly and endeavour to repair the errors of the past, I think the government at Washington, more than any other government in the world, can hasten the return of economic well being throughout the world. (Applause.)

The difficulty with the American people has been that we are hardly aware that the great wide world outside of our own orbit exists. We went into the World War, of course, eventually, and we did our bit and did it well, but at the end of the War we were just as anxious to get home as we had been a year and a half earlier to get "Over there, Over there", as we called it in our song, and there was a revulsion of feeling in America and a desire on the part of the people in the country to wipe their hands of all European. affairs. We hadn't been in the War long enough; we hadn't suffered enough; we hadn't made enough of a sacrifice to realize what there was ahead of us in the future if we had made the proper choice of remaining in world affairs after 1919 as we undoubtedly were in world affairs during that year.

I have often, to audiences in my own country, compared the attitude of the United States and her foreign policy to that of the mother-in-law in the home. We have been sort of like a mother-in-law to Europe. We have been very willing to give advice, but to accept no responsibility. During the course of the last twelve years I think the most amazing thing has occurred-unique in all history has been the presence of American unofficial observers at Geneva, Lausanne and elsewhere at Economic Conferences, at political conferences, always ready and willing to give advice to other nations but at no time has our Government at Washington shown a disposition to accept responsibility following that advice and that is the reason we are in trouble now. We might as well admit it and I have no hesitancy in saying it right here in Toronto, just as I would say it in New York or any other American city.

During the year 1932 it was felt that a great step forward had been made in bringing the world back to an equilibrium, economically and politically, by what was accomplished at Lausanne when German reparations were cut down to almost the vanishing point and when even France, who had the most to suffer by it, showed at least her willingness to take three and an eighth cents and to kiss the rest of the reparations "Goodby".

Now, that was done largely, I think, out of the, sound advise that was given from America. The Europeans acted upon it and in perfect good faith went ahead and, did what was essential; that is, they wiped out in a very large measure the whole problem of reparations that has been disturbing Europe ever since the World War and that had made impossible the recovery of economic equilibrium.

But, as Mr. Laval said after his return to France there has been a placid acceptance on the part of President Hoover and his counsellors and the American State Department of the thesis that reparations and war debts went together and Mr. Laval returned to France and communicated with other statesmen there and got across to them the proposition to reduce the reparations due from Germany, with the understanding that immediately after that was accomplished the United States would be willing to talk about a reduction of intergovernmental debts, of the war debts of the European powers due to the United States.

Now, of course, there is a difference of opinion as to exactly what Mr. Hoover meant and as to what Mr. Laval meant. They were both high minded gentlemen acting in perfect good faith and I think that our State Department was acting in good faith also and the men surrounding Mr. Laval were acting in good faith but one essential fact remains: you can not draw a distinction between reparations and war debts for the simple reason that both have to do with the same economic problem which is the transfer of wealth from one country to another. How can it be accomplished? Ever since 1919, in all I have written, in all the speeches I have made in various parts of the world, I have asked those Americans who are opposed to a drastic reduction, if not entire cancellation of war debts, to show me how money can be transferred from one country to another in any other way but by services and goods. (Applause.) And I tell you, Gentlemen" I never have had an answer to that question satisfactorily given to me. The war debts were contracted through the purchase of goods originating in the United States. The large portion of this money-the so called billions of dollars owed to us in America-would be simply payment for supplies which we Americans gave or sent over to Europe.

Immediately after the war the Republican administration came into power and started to raise tariffs higher and higher and higher. All this mad rush of tariffs in all the countries of the world, including England, originated in Washington in the error made first by the American Government and the American Congress. We have to take the initiative in repairing the error; when we do so, we are going to find an unchecked flow of trade throughout the world which will be the salvation of the world, economically.

We can't possibly go on as we have gone on and I believe that the experiences of the past decade, leading up to and culminating in the American financial crisis in 1929 which became a world crisis, affecting the whole world, have shown that the principle fault lies in that very thing-the fact that we didn't liquidate the World War at the end of the World War, but have allowed it to drag through a decade and the American Congress, by its action, made impossible the liquidation of the World War. We have been principally responsible, and unless we accept the responsibility and attempt to repair the error, we are not going to have the new world that we hope to live in in the course of a decade ahead.

We need, first of all, a drastic revision of tariff schedules, not only in the United States, but in Canada, France, Germany and all the other countries. And we need to do away with war debts and all kinds of intergovernmental obligations in the same spirit and to the same extent that the Conference in Lausanne proposed to do away with German reparations. When we arrive at that point and are willing to do it, then the Roosevelt Administration in going to find what the previous administration in the United States in the last three terms did not find-a way to solve the economic crisis.

We were carried along for eight or nine or ten years on a wave of false prosperity in America. We didn't face issues. Now, we hope to God that the experiences of the past months and what we still have to pass through in March, April and May of this year-perhaps on into June-is going to teach the lesson that we, on the other side of the border,, need to learn: that we can't stand by ourselves and we have to stand, to sink or swim, with the rest of the world and by going along with the rest of the world we will find salvation for all the world and a better world. to live in for everybody in every continent. We know that we have the warmest sort of sympathy and understanding from our Canadian friends. (Applause.) We, on the other side of the border, are not being damned in Canada as we are in Europe because Canadians are facing the same problems that we have to face. You have the same type of composite population, the same open spaces, the same history and background of development across the continent. Canadians know, as well as Americans, just to what length this doctrine of isolation carries us and how difficult it is to overcome, because you have your work to do here as well as we have in the United States to snake the world realize that the world is one and we are all together.

International co-operation is something that we have to face-that we have to decide to take part in. I know that the feeling here in Canada is very strong that the United States should be a member of the League of Nations. It is equally strong among certain elements in America who are working with that end in view. There are, however, Constitutional limitations--the form of government we have" that makes very difficult equal cooperation on equal terms in an organization like the League of Nations. Those are things which have to be worked out before we go in. on an equal footing in an organization of that kind with other nations.

That doesn't mean that we cannot accept our share of responsibility in problems that have arisen up to the present time. It means, also, that we in America can go ahead and take the initiative as we have not done in the past, actually take the initiative in a number of different things that are for the good of the whole world.

I think that as we started the business of the mad uprush of high tariffs, it is up to Washington to start the business of the downward trend of tariffs and I think that other nations have a perfect right to look to the United States for a beginning in this work. I think that other people have a right to look to the United States for initiative on our part. London has done all they could; Paris has done all she could. It is up to us to take a step in the reduction of war debts. So far, as x am concerned, I should like to see them wiped out altogether.

Now, this is the way, Gentlemen, I believe my country can serve the world. We are a pretty big nation-almost too big a unit in the United States. We are the largest division of the white race living under one flag and we have lots of regional problems to deal with in our own country which are very serious but we can not afford any longer to neglect our international opportunities and our international obligations.

I would like to end just with this note--a note of optimism. I believe that there is more interest being shown in the United States than ever before in world affairs. We are getting educated. We are coming to the point where we see what this interdependence is and how our own prosperity and our own well-being depends on it because, after all, it is perfectly true that, whether as a family or a nation" we are moved ire the final analysis by

"What are we going to get out of it?"

There must be an answer to that question in every country. What we need in America is an awakening to the fact that we are not going to pull out of our present economic depression until we do our "damndest" to help the rest of the world pull out of it. (Applause.)

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The United States Faces the Future


The speaker's frequent role as interpreter of his own country to other countries. Bringing word from the United States. Some personal references to the speaker's travels and family. The United States' participation in the World War and reasons for the timing of their involvement. The current crisis in the United States and how it is being handled. The role played by the radio in Mr. Roosevelt's handling of this crisis. Measures taken by the Federal Government. Reasons for closing down the banks. The expected continuation of hard times in many localities in the U.S. The situation with the gold standard. The U.S. still not having fully paid for the War. Some comparisons with other countries. A confident prophecy from the speaker with regard to what will and will not happen in the United States and to the American people in this economic crisis. Using events of the current month to justify such a prophecy. Difficulties and attitudes that led to this crisis. A look at the attitude of the U.S. and her foreign policy with regard to Europe. The effects of raising tariffs after the War. Taking the initiative in repairing this error. Seeking an unchecked flow of trade throughout the world as the salvation of the world economically. The need for a drastic revision of tariff schedules in all countries. The need to do away with war debts and all kinds of intergovernmental obligations in the same spirit and to the same extent that the Conference in Lausanne proposed to do away with German reparations. The wave of false prosperity experienced in America. The folly of not facing issues. How the United States can serve the world. Ending on a note of optimism.