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The KingfishLarry LaBorde Back in early part of the 20th century down in Louisiana a populist politician emerged on the state scene that would also emerge on the national scene to rival FDR. Huey Long started his public career in 1918 when he was elected to the public service commission at the age of 25. He ran unsuccessfully for governor in 1924 and then was elected in 1928. In 1931 (while still governor) he ran for the US senate and was elected. He had to wait until the next year after his term as governor was over before he took his seat in the US senate. He was assassinated in 1935 at the age of 42 while visiting the state capitol during a special session. After Long was sworn in as a US senator one of the members of the press asked him if they should call him Governor Long or Senator Long. Huey said, "Back home, they just call me the Kingfish". For those of you too young to remember, Amos and Andy was a popular radio show at the time. Both men belonged to a lodge called the Mystic Knights of the Sea. The leader of that lodge was addressed as the Kingfish. One of Huey's friends jokingly called him the kingfish one night and the name just stuck. Huey thought is was amusing and encouraged it. The Kingfish built up quite a political organization in Louisiana while he was governor. Before civil service, every job in the state was subject to political patronage. During the great depression every job in the South was highly valued. The governor asked that all state employees contribute to his political slush fund by deducting 10% of their state salary for several months at election time. The "deduct box" was always stuffed with ready cash for campaigning. (The deduct box was never found after he was assassinated.) Huey was the first politician in the South to campaign with sound trucks. He even ordered a special airplane for the 1936 presidential campaign. It was to be a sound plane. As he flew over a town it would announce that Long was on board and would shortly descend to speak. Long was also a skilled senator who could filibuster for hours on almost any subject. He single handedly blocked many of Roosevelt's bills in the senate. While he helped elect FDR for his first election it quickly became evident that neither could dominate the other and they became political enemies with Long himself desiring the presidency. FDR quickly moved against Long by using Long's political enemies to distribute federal funds back in Louisiana. Long countered by helping to elect other national political figures who were aligned with him. While campaigning in Arkansas for the Hattie Caraway (the widow of the late Senator Caraway and in last place just weeks before the election) he mounted a last minute campaign tour of the state and swept her into office. Her opponents in Arkansas said Huey came to Arkansas and moved through the state like a circus hitched to a tornado. In Louisiana, stories of Long are legend. While Governor, Huey received a call late one Friday night from a panicked bank president in Lafayette. The bank president told Huey that they were experiencing a run on the bank and that they barely made it to closing time that afternoon. He was frantic that when the bank opened the next day on Saturday morning there would not be enough cash to last much longer. If they ran out they would be forced to liquidate the bank. Huey told him to just sit tight and he would do something. Huey called an associate and they drove all night from New Orleans to Lafayette. They arrived at 7:00 am and went straight to the bank. Huey slipped in the back door and told the banker not to worry. He seated himself at the bank president's desk and told them to send in the first customer. The depositor came into the office waving a check for $18,000 and said he wanted all his money right then. He was shocked to see the Governor calmly sitting at the desk waving a check of his own. Huey explained to the depositor that the State of Louisiana had $265,000 on deposit in this bank and there was just barely enough cash there to cover it. He further explained that since he got there first with the state's check he was first in line. If Huey cashed his check the bank would be forced into liquidation and no one else would get anything. Huey told the depositor, "How about I leave mine in and you leave yours in and that way no one gets hurt?" The depositor had no choice but to comply. He told the same story to each depositor that wanted to draw out all of his funds. Huey stayed in the office until the bank closed at noon. Afterwards he called several stronger banks in the state and helped arrange short term emergency loans to tide the bank over until the run settled down. In the State of Louisiana only 7 banks closed during the great depression fewer than any state in the country. While a US senator, a member of the House of Representatives charged the Hibernia Bank president (a friend of Huey) of impropriety. The New Orleans papers killed the news story but it leaked out over the radio and a run started on the bank. By Friday afternoon the bank mercifully closed its doors just before exhausting its cash reserves. The bank president called Huey and they arranged an emergency $20 million dollar loan from the Federal Reserve and the Reconstruction Finance Corporation. The problem was that it would be Sunday night before the funds could be moved. If the bank failed to open as usual on Saturday morning it would be catastrophic. Huey called Governor Allen and told him to race to New Orleans with the state seal. He told the Governor he had to declare a state holiday so the bank would have an excuse not to open on Saturday while they stalled for time to transfer the necessary funds. Huey had scores of people looking through libraries all night for something of historical significance as an excuse to declare a state holiday the next morning. The best they could come up with was the 16th anniversary of the severing of diplomatic relations with Germany by Woodrow Wilson prior to WW I. The next morning all of the state employees were pleasantly surprised to find out that they suddenly had Saturday off since it seemed it was some sort of new state holiday. The banks naturally followed the state's lead and closed as well since it was an "official" state holiday. Sunday evening the funds were transferred and the following Monday morning Huey arrived at Hibernia Bank and deposited $12,000 of his own savings and declared that he though Hibernia Bank was the safest place he could think of to deposit his personal funds. Huey was a master orator and rarely used notes. One favorite example of Huey's campaign speeches was when he was running for US senate against the incumbent senator Ransdell. He stated that under Ransdell's leadership"
However, so far he has managed to hold onto the US Post Office. During a speech he would feel out an audience. Once he had it figured out he held it in rapt, mesmerized awe. A man who bitterly opposed Long left one evening halfway through Huey's speech. The next day his friend asked him why he left early. He said he left because that guy was convincing me and I knew I had to leave before I started to agree with him. Another observer described Senator Long as, "Tom Sawyer in a toga". In 1934 FDR became increasingly alarmed at Huey's influence on a national scale. Huey had set up Share the Wealth Clubs all over the country. Their slogan was, "Every Man a King". The nation was in a deep depression and people were looking for answers. If the new deal didn't work the people might look to others and Huey just may be the strong man that the country turned to for help. Huey's plan was called, "Share the Wealth". He based it on biblical law of forgiveness of debt every 7 years and return of property every 50 years during the jubilee. The share the wealth plan was designed to keep the concentration of wealth from building up too large in the upper 1% of the population. In 1929 the top 1% of the population had amassed 44% of all the wealth in the country. (In 1966 the top 1% owned only 19.9% of total wealth. It is now back up to around 40%.) Huey's plan was to prevent a family from owning a fortune of more than $5 million dollars or more than 300 times the average family fortune ($77+ million adjusted for inflation). It would further prohibit a family from earning more than $1 million dollars ($15+ million, adjusted for inflation) a year or 300 times the average income. (In 1960 the average CEO received 40x the average worker's salary. In 1992 the average CEO salary was 157x the average worker's salary. Today the average is even higher.) The government windfall was expected to fund: a minimum sustenance salary of 1/3rd the average worker's salary, college assistance, veteran's benefits and old age pensions. Many considered this radical thinking but the times were hard and people were calling for change. Many of FDR's schemes were much more liberal in his second new deal. Today we would almost be relieved if this was all the government wanted from its citizens. At any rate ole Huey may have been onto something with his concentration of wealth theme. Today congress touts the inheritance tax as a redistribution mechanism but in truth the ultra rich pay little inheritance tax as a percentage of their wealth. It is only an annoyance to them that they have to pay lawyers to avoid by using loopholes in the law. The middle class with family fortunes far below $77 million pay the bulk of the inheritance taxes. Huey sounds crazy at first but when you adjust his plan for inflation it is not as bad as it first seemed. After all $1,000,000 doesn't buy what it used to. Why is that do you suppose? Does anyone think the dollar is not going to depreciate even faster in the coming decades? Get smart and get out of federal reserve notes. Larry LaBorde 321gold Ltd |
