 Before I get on to the hot stuff, there was a post-Civil War material, I just want to say a little bit about a newer revisionist book, a great book that's come out in the history of American technology. Not usually one of my major interests, but in history, American technology has usually been written in a boring fashion like this machine does this, this does that, and the flying shuttle and the loom and all that stuff. But David Hounshaw wrote a famous and excellent book in 1985 called From the American System to Mass Production. What he meant by American system was not the Henry Clay kind of tariff thing, he meant technologically the system of mass production interchangeable parts. And it was an excellent book, it's one of the best description I've ever seen of the importance of the bicycle, let's say in 1890s, what Hounshaw shows as it integrates technological history with social and economic history, especially social, and he shows that the necessary preparation for the automobile which comes in about 1900 was the bicycle, because the bicycle which flourishes in 1890s gets people, customers used to the idea of being mobile, not being stuck with a damn train route, of actually being individual and mobile, not being stuck with mass trains. And two, it gets technologists used to the idea of the wheel and the axle and handling and all that and the rubbered tire. And all this was necessary preparation for the automobile, which many of the first automobile shops were bicycle shops where they were already used to axles and tires and things like that. And it's also had a great excellent description of Henry Ford and what he did for mass production. The problem with the Hounshaw book for me, the troubling part of it was he claimed that mass production comes to America first in government armories. When the government armies were, or government contracted motor industrial complex armories, where you didn't have to worry about costs or economics and things like that, they can indulge in what he called technological enthusiasm and just be perfect, not worry about economics. And then this armory knowledge and the armories of mass production then spread the private enterprise. Well, there's a new book by Donald Hoke, H-O-K-E, called Ingenious Yankees, which Columbia University Press 1990. Hoke is not an enemy of Hounshaws, an old friend of his and he's a roommate and all that, part of the same, and Euthyrian Mills-Hagley Foundation movement, so to speak. By the way, that's a great, just in passing, Euthyrian Mills-Hagley Foundation is a DuPont museum and library, which specializes in American business history, American technology, technological history, especially in Delaware Valley. It's a wonderful place, it's got, it's very plush. It's got eight very competent librarians per every customer, so they're just super. Anyway, I strongly recommend it. Anyway, what Hoke says is he's a revisionist on this whole thing. He says, Hoke, Hounshaw is wrong for various reasons, that the mass production of interchangeable parts begins with a heroic figure named Eli Terry, who was a genius mechanic, namely engineer in those days, and entrepreneur who made, discovered a way to make mass produced wooden movement clocks. And the clocks is a complicated thing, it has to fit together and all that. He was before that, in 1807, before 1807, long before armories began this thing. In 180, before that, clocks were handmade. So if you made 100 clocks a year, you're doing very well. He was able to make it so that he was turning out 3,000 clocks a year, which is absolutely unheard of. And he did it by technological invention bound, but not only by technological enthusiasm, obviously, but also by economics. And he was just constantly looking for the reducing costs, lowering price, so that he can have, tap a mass market. And he first reduced costs on one thing, and this would lead to bottlenecks, and he would reduce costs on that. And so the whole thing was very logically derived that. Riven by economics, of course, economic consideration as well as technological. He starts it, and also made the clock, which previously had been a luxury item for the rich, into actually a very cheap item for the mass of the public. After that, in the 1830s and 40s came private acts manufacturing, which had previously been handcrafted and now became mass produced. Elisha K. Root was a heroic figure there. Interesting enough, instead of the armories starting the thing and then shifting to private enterprise, just the opposite. Elisha K. Root, who managed to produce mass production in max manufacturing, then moves the coal firearms factory and applied the same tactics or techniques to arms production. So just the other way around, starts with private enterprise and then shifts influences government enterprise. After that, also he points out, Hoke, that the whole thing, both the clocks and also the acts industry, and later that, the typewriter industry, a very complicated systems approach a little later on, and also the Wolfram Watch Company later on. All this was done purely private, no government subsidy, no government contracts, no government interest, no, nothing. So it's kind of a charming thing for free market types to realize this. So we redeemed the history of American technology from government armories. Anyway, I strongly recommend it. Also, he said that the problem with the reason why Hanchel and the other historians made a mistake on this, they don't know much about technology. They go through the documents, they don't really care much about the object. This guy is an antiquarian. He started as an antiquarian of technology. The whole movement of antiquarians are sitting around looking at these objects, you see. And so he said the key is the object and you can tell what's going on. One interesting thing here, just the last point, he said with the armory people, since they didn't care about cost, they made perfect interchangable ports, which means it's very costly because one thing breaks, it doesn't fit, you have to throw the thing out or whatever. But these private guys did, like the Ely Terri and Elisha Riches, they made adjustable parts. So each part with a screw or something becomes adjustable, it's going to fit in very easily, which made it much cheaper and much lower cost. So anyway, that's a good point for the private market, for social power as against state power. Okay, after the Civil War, we have a new whole new set up, as Pennsylvania, my friend Jeff Herbiner was in Pennsylvania, I reassured him Pennsylvania stops being the center of evil by 1870 after the collapse of Jay Cook. The focus begins to shift to New York, Wall Street, and other areas. Replacing Jay Cook as the evil investment banker was J.P. Morgan, who we'll heard of. Now there's nothing wrong with investment banking per se, it's a fine occupation, the problem is of course, one is major problems, they engage in a lot of government bonds. In addition to that, J.P. Morgan begins, first of all investing in the railroad, he manages to control most of the railroad in the country by 1860s and 70s, especially after Cook goes bankrupt, and immediately starts, he realizes freight rates are going down, it's a tremendous expansion of railroads, a tremendous drop in freight rates, everybody loves it, except the railroad, they wanted, and Morgan and other people aside, we have to have a cartel. We have the beginning of business cartelization in the United States. Time and time again, you know, Coco's book, Railroads and Regulation, it was the whole story of this, Morgan gets all these big railroad guys together and says, okay, let's have a cartel. Now those of you who are undoubtedly, most of you know about cartel theory, most people think cartels are very easy. Three guys get together, manufacturers or whatever, the washing machines, whatever, and they get together over drinks at the Union Lee Club, and one guy says, Jim, why don't we raise prices? Yeah, that's a great idea, why don't I think, let's raise prices. And then they have a secret price agreement, they raise prices and they're all happy, and they eat the way that works, because as you all know, I hope, in order to raise prices and make it viable, you have to cut production, you have to go up the demand curve, you have to cut production up and out vertical, and therefore they've got to agree on cutting production, no businessman ever likes to cut production, they hate it, they like to expand production, they have to grow, and so cutting production is a big pain in the neck to begin with. Second of all, if you cut production, you have to base it on some base year, like if you want three of us, one of former cartels starting in 1991, we have to base it, let's say, in 1991 output. So we each cut our output by 10%, let's say. Well as time goes on, 1992, three, these 1991 quotas become obsolete, conditions change, watch, and each businessman says, why am I stuck with this damn quota of 1990? I can have a better machine now, I've got better people, I've got better raw materials, I've got a new invention, I can outbid these guys if I weren't stuck with this goddamn quota. And so each businessman is itching to break the agreement. And the way to break the agreement is you go down, of course, your firm's demand curve, your elastic demand curve is against the industry's inelastic, and particularly engage in secret price cutting, which is a wonderful way of breaking a cartel. You go to some customer and say, look, Jim, either the other guy's customer or your customer, you say, look, then you do drinks at Union League Club, and you say, look, Jim, for you, since you're my old buddy and a fellow Elko, whatever, I will give you a 10% cut in the price, but don't tell anybody, because we're stuck with this goddamn list price of which agreed upon cartel price, and I say, of course they don't want to tell anybody. This is not bribery by the way, this is simply a cut and agreed upon price, and he gets the business, he flourishes, it's great, he gets more money, but then, of course, eventually, industrial secrets don't last too long, the other guys find out about the other cartels, they're bitter, they're sore, the whole cartel breaks up in vicious recrimination, you know, back down to the old price again, except now they're bitter at each other instead of friendly. So that's what you can call the internal pressure that breaks the cartel. And Morgan found, by the way, the internal pressure was constant. I love the story, I love the story about the Iowa pool. Julius Groszinski is an excellent book, he was a great railroad historian. The book called The Iowa Pool, there are three key railroad routes competing against each other, because the railroads compete, even if they're not the same route, they're near each other, they compete geographically. Three key routes from Omaha, which is a terminus of the Central Pacific Railroad going to the West, excuse me, Union Pacific Railroad going to the West, the three ways to do it. Two of these roads were owned by one guy, James Joy, known as the railroad king, I think. So, you think of it easy to have a cartel, Jim Joy himself, his left hand is right hand, the other guy gets together over drinks, and they have, they say, well, cut shipment, and railroad, of course, is cutting shipments, production, of course, is shipping freight, and he raised rates and all that, everything's fine, except what happens is there's internal pressure to break the cartel and the president's in charge of sales. Sales management, your whole life is wrapped up in sales, you don't care about the big boss's agreement, each of James Joy's vice chairman, vice president of sales, broke the agreement, had secret discounting to try to pick up sales for his railroad, he didn't care that the other guy's, the other railroad was also owned by the same guy. You can't even keep competition out from your own companies, okay? The second big, so internal pressure, is one thing it always breaks the cartel, and the other thing it breaks the cartel is external pressure. What happens is, these three guys, whether it's railroads or washing machines or whatever, they have a cartel, they cut production, they raise the price, they have more profits, there's always a lot of capital looking for higher profits. Another outside capital says, hey, these guys over there, they have a great racket here, they have, they're getting 20% profits out of 10 or something, let's go in and build another railroad or another washing machine factory, we'll not compete these guys. A new guy comes in, we'll square one again, the cartel is busted, except now you've got a brand new dangerous competitor with brand new equipment, okay? So it's even more dangerous, even worse off than you were before. Same thing happened with railroads, new railroads will be built without competing with lower costs, without competing with old railroads. The whole thing was a flop peru, and I'm only to stick on my neck out and say that no cartel in the history of the world has ever succeeded on the free market for any likes of time for these two reasons. So what you have to have to keep a cartel successful is to have a government enforce it. A government can say, you must obey the price regulation, you must obey the quota regulation and keep new entrants out of the field. In other words, the government becomes the cartel enforcer. Now, when Morgan brought over from Germany, a veteran, plus Germany's had cartels alone before we did, a veteran railroad cartelist, that was a professional railroad cartel manager called Albert Fink, and Fink tried to organize cartels and always flopped in six months and all that sort of stuff, and finally Fink gave us a speech, I think, before the railroad industry, I think in the late 70s or so, and he says, look, railroad cartels are not going to work, just not going to work. We need to call on the government to enforce it. So, railroad has decided to call on the government, but they have a problem, a problem I mentioned alluded to last hour, namely, how do they get the public to accept this? And the way to get them to accept it is, we're fighting the propaganda that beams out, we need government regulation to combat big business monopoly. Notice the magnificence, the beautiful shell game, so it's a principle of reversal and conment or something, right? You try, there's too much competition for it, you want to use the government to oppose monopoly, led by big business, big railroads, and so you tell the public, we need government regulation in order to curb big business monopoly. So, the railroads wrote the law, they lobbied for it, now it's the Interstate Commerce Act, the first regulatory commission. They wrote the law, they lobbied for it, they wrote the draft of it, they staffed the first commissioners. The whole thing was railroad run. And the first thing the ICC did was try to raise the freight rates to the point that Morgan tried to get it and it flopped on the free market. They didn't try to lower the rates, they tried to raise them. So, and one of the ways which the agitation for was, and also what the ICC tried to do first, it was the outlaw secret price cutting, it's another very clever propaganda trick. Remember the way that cartel gets busted internally by secret price cut, if you do it openly, the other firms will immediately follow you, you won't pick up any money. So, the name of stopping secrecy, secrecy bad, open this good. So, you have to outlaw secret price cutting, secret rebates, freight rate rebates, and it's a and the name of advancing competition of the public interest. So, the public interest is the common wheel, the common good, the general welfare, only the other junk, was used as a gimmick, as a smoke screen to push through big, big railroad, in this case, cartel cartelization. And the average person, gee, open this good. Yeah, yeah, open the books. Don't cut secretly, of course, it tries to take away the weapon of breaking cartels. The ICC was not very successful even so, and they kept trying to strengthen it open, and through Teddy Roosevelt, strengthen ICC power. So, now we have the this, I think this is true of every regulatory commission for that and the whole progressive movement, which what really happens is big railroads of the first big business, coming in 1870s, 80s. By the 1890s, manufacturing becomes a big business. Manufacturing was partnerships, for example, Standard Oil begins as a partnership. Most other manufacturing firms are partners, they only begin to become incorporated by 1880s and 90s. And so, manufacturers thought the whole thing, they wanted to do something about this too. They wanted to restrict competition because their prices were falling. And they start the whole progressive movements idea of regulatory commission progressive welfare, or legislation, or the rest of it. One thing I want to emphasize here is what I call the Ralph Nader Golden Age myth. Ralph Nader Golden Age myth. The Ralph Nader types will admit the regulatory commission is now in the pocket of big business. The insurance industry regulators in the pocket of big business, they have to go to parties together and all that. But the Golden Age myth started out as a wonderful thing. All these regulatory commissions, the progressive, in the old days, were progressive and wonderful and they pushed the public interest. But after about 30, 40 years they started revolving doors of big business, the whole thing got lax and got corrupted. The real story is there wasn't any, there ain't no Golden Age. Business groups wrote the legislation and drafted it and staffed it from the very beginning. The whole thing was a cartel plot plan, I should say, from the very beginning. This is going to irritate Matt Hoffman here, but the reason why the question is why did Cleveland was basically a laissez-faire Democrat? Why did he go along with the interstate commerce commission? Why did he sign it? I believe because he was essentially a Morgan person. His whole life was in the Morgan ambit, even though he's laissez-faire oriented in general, and as I told Matt, he's my second favorite president. My first favorite is Martin Van Buren, my second favorite president is Cleveland, my third favorite is Warren Horning, kind of a lovable character who did nothing in the White House except play poker and play around with it. Okay, so the Cleveland himself was a Morgan lawyer, he was a Buffalo rarer lawyer, and he then, his law partner for many years and friend of the law partner was Francis Lynn Stetson, who was Morgan's personal attorney, his cabinet was almost completely Morgan oriented, and the Morgan's actually weren't that bad in those days except for the railroad regulation, and they got much worse later on. By the way, one of the problems with Chicago school historians, to the extent that economic historians in Chicago school deal with this stuff, the extent they go beyond econometrics and equations, they recognize that these regulatory commissions are basically for the benefit of globalization and big business, where they slip up and sometimes in fact they don't do much of it, but they slip up as they don't recognize the financial interests, that finance investment banking, for example, is a cross industry process and managed to integrate financial networks which control the whole series of industries, so that's why they ignore the Morgan Rockefeller type, Morgan Coulomb, et cetera, influence. Okay, the political parties, I should say I don't want to do too much of this, because I could spend many hours on it, but the political party system in that period was very different from the current system. The entire 19th century political party system to me would be 7th Heavens, and I love political politics anyway, and political party struggles. Political parties 19th century, and this by the way, undercuts the whole public choice analysis, which is that political parties are always worthless and they don't do any, there's no ideological influence. Political parties, those there, are fiercely ideological. They hated each other because they had totally different sets of principles. And that's why when I was growing up in the 1930s, you had all these old conjures, I only vote, I vote only Democrat or only Republican. There's my grand peppy voter Democrat, my peppy voter Democrat. It sounds idiotic. I mean loyal to the Democrat or Republican Republican. What does that mean? It's ridiculous. It wasn't ridiculous in 19th century. Because in the 19th century, these parties were sets of principle, they didn't always hold other principles, but they were pretty much so. I mean, remarkably so. They had sets of ideological principles, which they, and they socialized, and they were public members. In other words, they educated the members and the members kept them on narrow. One interesting thing about it was nowadays, of course, we have the floating voters. We have, you know, increasing number of percentage of voters are independent. And so we have 60, 70, 80 percent are independent or whatever. So during campaigns, the politicians get even less principle than they are the rest of the time because they kind of catch the floating voters. They become indistinguishable during campaigns. But just the opposite of the 19th century, what a wonderful period of us to live. Because in the 19th century, if a guy wanted to waffle, he couldn't waffle in campaigns. Usually, the races were very close, outside of the south. They were very close. And it's just no Democrat would ever vote for a Republican or vice-versa, instead of them being satanic. But they'd stay home. If your guy waffled instead of leaking, as Rea would put it, they'd just stay home instead of heck with it, and they'd lose. So in order to get your vote out, you have to be even tougher and more hardcore than you were during the rest of the time. What a great period. So there's what we had then, the Democratic Party throughout the entire 19th century until 1896, you can pinpoint the time, was a laissez-faire party devoted to free trade, minimal government, hard money, rule arrest, everything goes along with it. No public works. And the Federalist Whig Republican parties were devoted to statism, big government, protective tariffs, excise taxes, central banking, inflation, the whole business, the whole set. Totally opposite ideology. And one of the reasons why ideology was so deeply rooted was religion. And I'm thinking one of the problems I have with secular historians approximately 1920 to 1970, because they're not religious at all. There's nothing wrong with my view of not being religious. The point of not being religious at all, they think that throughout history nobody could have taken religion seriously. So they just ignore it as a motivation for ideology and action. And most people have been religious, strongly religious in the history of the world. And what happens is with these parties that were rooted in clashing religious values, which, and the way it worked was this. The, for example, the Republican part, the Whig and particularly the Republican Party, starting about 1830s. Whig and Republican. The Protestant churches, particularly in the north, particularly in Yankee country, which is essentially New England through northern Illinois, northern Michigan, northern Ohio, it's northern Indiana, this Yankee area in particular, but general northern Protestants and general northern Protestants were swept and changed their entire religious outlook, entire religious theology and ethics that are changed in a sweep, in a massive sweep of revival movements around the 1820s and 30s, which transformed Protestantism. So the Protestant now was what we call post-millennial pietus. And we believe it's the obligation of mankind that Jesus will not return. Of course, the old Christian theology is that Jesus will eventually return to earth and establish the day of judgment. This particular wing of it believes that in order for Jesus to return, man first has to establish the kingdom of God on earth, a thousand year millennium. So that Jesus can return. This is called post-millennial pietus. In other words, Jesus will return to earth after a thousand year millennium. It means man has to establish a millennium. What is the millennium? Well, there are different series of this. Almost always it's heavily statist, not in the old case, but generally. Often coming, the kingdom of God on earth is going to be perfect, consists of perfect people. Perfect people don't have private property, they have everything in common, they love each other and they're equal. So you have a very strong, statist component with post-millennialists. And these Protestant churches then believed that in particular they have to stamp out sin. You know, they have to be perfect. How do you get people to be perfect? You either can slaughter over old heretics now, which is they try to do in the 16th century, or you can try to shape them up for a while. And the only way you can shape them was by government. So the post-millennial pietus adopted the doctrine that you need the state as Richard T. Ely, one of my least favorite economists in this United States. Economist, social philosopher, historian and Christian sociologist. Richard T. Ely, founder of the American Economic Association, by the way. Richard T. Ely believed that government is God's major instrument of salvation. Now notice the twist here. You need a very strong government in every area. In particular, a religious area. It's important for the government to stamp out sin so you can create a perfect world so that you have the money and the kingdom of God on earth. How do you stamp out sin? Sin is very royally defined by these people. Very royally defined. In particular, we have demon rum, all liquor, including of course wine and beer. All liquor has to be stamped out because the clouds men's mind stores your theological free will and salvation. Any activity on Sunday whatsoever, except going to church and praying, reading the Bible, anything else has to be outlawed, dancing, baseball, whatever happens to be moving, whatever. That's the outlawed. And finally, the Roman Catholic Church which is the instrument of the anti-Christ. So this is the triad of views. This of course is mostly local and state level except for immigration. Now what we hear from historians about the nativist movement who want to keep out immigrants. It's all baloney. They want to keep out Catholic immigrants and high church Lutheran immigrants. I'll say one later. But anyway, Catholic in particular and high church Lutheran, they loved Swedish and English immigrants who were pietists or low church Lutheran. Any Swedish immigrant that came to the United States would welcome him as an American immediately even if he didn't know English. He would welcome him as a true blue American because he was a post-colonial pietist. So what we have then, since they couldn't outlaw immigration, the idea is to crush the Roman Catholic Church. If that's unconstitutional, get the kids. Outlaw parochial schools which is a big constant movement and get the Catholic kids into the public school system since the Catholic adults are all doomed anyway. Get the kids and transform them into Protestants. The whole impetus for public schooling was not you know, crazed left-wing educationists or they were there. But the real impetus was what they call Christianized Catholics since the real post-colonial pietists not believe the Catholics are Christian. They're agents of the anti-Christ. So the thing is, the final twist on this thing, the interesting twist, the evangelical twist in the north was that in order to be saved, not only did you have to believe in Jesus and be born again, etc. You also have to maximize everybody else's salvation. If you slacken on this, you wouldn't be saved either. So it was necessary to your own salvation to try to stamp out sin, to try to shape up everybody else. So there weren't, you know, I guess Randi's would call that altruistic. It's not really altruistic. If you want to be saved, you've got to save everybody else. At least try to do the maximum to do it. As a result, these people were fanatic. They were extremely energetic, organized all the time, constantly being politically correct. And for a hundred years, people from night from about 1820s until about World War I on the state and local level all over the country had these people constantly trying to outlaw liquor, outlaw Catholic schools, all the rest of it. Now, he had the poor Catholics in High Church Lutheran. I'd say High Church Lutheran was also liturgical types against this whole sort of thing. The company in the United States were looking for freedom and all that. All of a sudden, they were sold out by these fanatics. Kill, outcrush, you know, particularly the Germans. I think they have a very lovable customer using a subjective evaluation here. Lovable customer, both German Catholics and German Lutherans, they went to the church on Sunday and after the church, they were all repaired to a beer garden. You're marching bands and all the rest of it. Drinking beer is first of all a high sin. Don't do anything on Sunday except going to church as a high sin, but drinking beer on Sunday is like ultimate evil. I mean, that's it. So he had these poor beer guns constantly being chomped on, ripped up, sold out by these band of fanatic wasps. So now all this gets translated into political parties. The home of the fanatic wasps, the first of Whig Party and the Republican Party, the home of the liturgicals, everybody else actually, is the Democratic Party. It's way back from the 1830s on. The opposition to the stuff of the same, the Catholics and high church Lutherans just want to be left alone. Their ideology at that time was they think sin is up to the sacraments and keeping the sacraments and going to church. There's nothing to do with the state. You don't need the state to enforce the stamp-out sin. So they were very much opposed to all that. Plus, of course, they used wine and church services and all that, which of course was supposed to be deep sin and all the rest of it. So they were on a defensive and the and everybody else flocks in, too. The other groups, the old Calvinists become Democrats. That's why Gover Cleveland was a Democrat. He was a Calvinist. Oostalk. Non-Pyatists, Calvinists. So most immigrants were Catholic and more than others, and so the Democratic Party gets bigger and bigger over time. And the way this gets translated to economics, I was always fascinated by the problem before I learned about all those prizes stuff. I was fascinated by the problem. How did people get so interested in the 19th century about money and banking and gold and silver and you write illiterates, write pamphlets about it? I can't get my students interested in that. How do these people get interested? How do they get interested in technical economics? And the interest in this solves that problem because they got interested in the start of local religious politics and they expand, their consciousness gets expanded by their leadership to national economic issues and it worked like this. The lost fanatics totally are people. Look, we need big government on a local level of stamp-out sin, right? Right. We need big government on a national level to increase purchasing power through printing paper and money, keeping out cheap foreign goods, keeping out cheap foreign labor, et cetera, et cetera. We need a paternalistic, mighty government. Okay. So in other words, they expanded the consciousness of their constituents, their mass base to broader economic issues. In the same way, the Democratic leadership tells the Catholics and Lutherans, look, the same lost fanatics and one of the privy of your liquor and your parochial schools, these SOBs are also trying to provide you with cheap foreign goods through protective tariff and trying to decrease the value of your purchasing power through inflation, et cetera, et cetera. And so they were able to expand the ideology of freedom and laissez-faire from religious, from personal liberty to economic liberty. And not only were the people absorbed, but they were very interested. They got interested in economics because they were originally interested in local religious battles. They could see the connection. And so what we have then is the as a matter of fact, the Democratic Party was called in this whole period the Party of Personal Liberty. And the Republican Party was called the Party of Great Moral Ideas, stamping out sin, right? So the prohibition movement, of course, was part of the prohibition movement since 1820 trying to stamp out liquor on the Toronto level. And the government, when the Republican Party had put in very high excise taxes on liquor and tobacco, that was part of that. That was part of this pious program. And by the way, it almost didn't make it to be the second major party. They were, as William Genap and his great book called The Origins of the Republican Party, as Fronium One had just come out, it was very detailed, it was a very interesting book on the early 1850s. As Genap points out, the No-Nothing Party almost became the major party, it really beat out the Republic as in 1854. The No-Nothing Party had one principle, crushed the Catholics. Appealed to apply this tremendously. It was a slavery agitation. Okay, the only way we can lick this is to merge with the No-Nothing. It was to absorb the anti-Catholic spirit, which they did. And Sam and Chase, for example, was a No-Nothing type, and most of the other Republicans were, too. As a matter of fact, Seward of New York was the only non-anti-Catholic on the Republican Party. That's why he didn't get the presidential nomination. He got the Secretary of State ship. Otherwise, he would have gotten the presidential nomination and the Catholic spirit that permeated the rest of the party. So, what happens is the Democratic Party gets bigger and bigger over in the late 19th century. This whole thing resumes, and the by 1892, a dramatic thing happened, namely that the Glover Cleveland wins the second term on a landslide. For the first time, after the Civil War, we have one party running presidency in both houses of Congress. And the Republican Party is very scared and decided to have to regroup. We've got to do something about this. We've got to change our whole orientation, otherwise we're going to lose that, because the Democrats are getting demographics for the Democrats, and more Catholics arriving all the time. So, what the Republicans did on the direction of John E. Rockefeller, and William McKinley, who was a very smart guy, but also was a paid agent, they decided to dump the crazies. It was a dump of the crazies. They said, look guys, we too love prohibition, we're just not going to win with it. They're the first Republican pragmatists. We're not going to win with it. We've got to dump prohibition. So, the prohibitions go craziness, they have the prohibition party and all that. And they start dumping the crazies, they start tapping down on that. And then, well, okay, then what happens is in the 1896, the fateful year, one of the tragic years in American history, the party of Catholics in high church, Lutherans, and Southerners were, the Southerners were lost pietas, but they were against the evangelical, they didn't want to convert everybody. They didn't believe it was necessarily their salvation. So, it was an alliance in the Democratic Party between the Southern Democrats and the Catholics and Lutherans. What happens is in 1896, the pietas get control of the Democratic Party, even more crazed pietas than the Republicans. The extreme pietas, headed by William Jennings of the Democratic Party. And it changed the whole tenor of the Democratic Party from then on. And you read the letters, like Cleveland is writing to his friends and said, this is the end of the party of our father has gone. And so, and the reason why Brian was able to do it, because he was able to put an alliance together, first of all, the Southern Democrats had shifted. By 1890s, they became evangelical too. They started adopting prohibition and all the rest of it. Now, we have a big new addition to the WASP fanatic group. And they were able to align themselves with the so-called Western Democrats of the Mountain States and get a coalition together to take over the Democratic Party. By the way, the Western states were put in, if you look at the list of new admissions of states, a huge number were admitted by 1890 of Idaho and all that sort of stuff. Only states would have no people in them now. Imagine how many people they had in 1890. So, all these empty states were folded in by the Republicans because they were all pious. There were no Catholics there. They were put in because they were all pious and two solid votes in the Senate for state. Okay? So, Brian was able to use this to take control of the Democratic Party. At that point, from then on, we were going to have a total collapse. After 1900, the parties no longer ideological. They become centrist. They become about the same and all the rest of it, the whole thing. So, the parties no longer, and this by the way is the reason, another puzzle of that, how come Laysday Affairs Senate disappeared so fast? In the 1880s, lots of people talking about Laysday Affairs by 1900, nobody's talking about it. What happened? I mean, intellectuals, guys who are getting PhDs in Germany, they shift. Okay, but what happened to the masses or in favor of it? What happened to the masses where the Democratic Party was taken over? And parties were very important to them because they socialized the public. They were the vehicle of public expression of ideology. When the party disappeared, a vacuum was left for administrative takeover by the power elite by technocrats, by big business, or by administrators. And that's when the party system began to collapse, when Congress began to collapse, my legislators began to collapse, and the takeover executive administrators began about 1900. Takeover, of course, is maximized around now. So, and so since ideology disappears, the control of political parties by big business begins to be maximized also. There's no check, there's no ideological check on them. And one thing I want to say about the presidential elections, for example, nominations. Basically, the Democratic Party was heavily influenced by the Morgans until 1896. At the 1896 convention, it was obvious that Brian was going to win, the Morgans people came to Rockefeller and said, look, or the McKinley, I should say, and Mark Hannah says, pal, and the campaign manager said, look, we propose a deal. The deal was this. The Morgans would support McKinley in 1896, provided, and leave the Democratic Party, provided that McKinley gives up silver and all sorts of stuff, and adopts the gold standard, because the Morgans were relatively hard money at that point. So McKinley agrees to this, the Rockefellers agree to this deal, and they keep only the protective tariff, which of course is the Republican principle. As a result of my 1896 election, the Republicans have become almost a centrist party. They've given up almost the old appliances, they've dropped the anti-Catholic stuff, they've dropped prohibition, they've dropped immigration restrictions and all the rest of it, they've become sort of like now. It's a vaguely centrist party. The Democrats were crazed status, and so the Republicans then McKinley wins on almost a landslide. McKinley, this deal, by the way, was represented by Henry Cabot Lodge of the Boston financiers. You have to realize that the Boston Brahmans, from way back the Forbes's, the Lee's, the Cabot's, the Lodge's, were all in the Morgan financial ambit, and still are. If you say Boston, it's going to be Morgan, in general. Okay, in those days, of course, as usual, the winning member of the party, the winning faction against the presidency, as a consolation prize, the loser against the vice presidency. McKinley was definitely a Rockefeller tool. First of all, a Rockefeller, I have to realize, for the first part of his career, Rockefeller was a great, innovative, big businessman. He was great, because he was a great course cutter, innovator in all that, but he was also a hip-deep in politics. He was also a post-millennial Baptist. And Rockefeller was Ohio Republicanism. In other words, Rockefeller was centered in Cleveland for a long time, his refinery was in Cleveland, in politics. And we have a strange situation. This is something, again, a speculative hypothesis, in a sense. From 1876 to 1920, which is, I think, 16, 7, yeah, it's 12 elections, 12 presidential elections, of which seven of which, the Republican nominees were from Ohio. Kind of strange, isn't it? Of course, the official Orthodox historians say, well, Ohio was a big state. Yeah, it sure was a big state, but it also was Illinois and New York and all sort of things. How come they weren't represented? And why is it always Ohio? It was always Ohio, because Ohio was John D. Rockefeller. We have Hayes in 1876, and Garfield in 1880, McKinley in 1896, 1900, Taft in 1908, and 1912, Harding in 1920, the last Ohio Republican, not the last Rockefeller's stooge. We have a Rockefeller's stooge in the White House right now. Anyway, the so McKinley gets the Republican presidential nomination and Garrett Hobart, I'm sure nobody in this room has heard of, gets the vice presidential nomination. He was the Morgan banker in New York. Hobart died in office. I'm beginning to wonder why he died in office. Maybe he was old. The whole Zachary Taylor thing has really got me going. I propose that every president who dies in office body be exhumed and poked that a lot. Now, what happens McKinley gets in, Hobart dies in office. They need another Morgan type to run in 1900 for reelection. They ask Chance Chauncey to pew of New York Central. He didn't refuse. A lot of Morgan people refuse. The Morgan people assisted on one of their beloved people, Theodore Roosevelt. McKinley and Rockefeller both hated Theodore Roosevelt. They hated him. They said he was crazy. I think it was a good, you know, good groundwork for that. I was definitely a nut. As a matter of fact, one of my favorite reviews of historical statements of reviews about Teddy Roosevelt was an inquiry magazine, the old libertarian magazine from years ago. A biography of Teddy Roosevelt came out, reviewed by Walter LaFieber, a great historian. His whole theme of the book was the great thing, the thing about Teddy Roosevelt was that he didn't like to kill. He didn't have where to kill, but his animals or people kill, kill, kill. He goes, hey, you're right. Teddy Roosevelt's whole life was on the Morgan ambit. Now, you have to realize here that there are two wings of the Roosevelt family, which we all know, but you don't realize they have different financial connections. The Oyster Bay, Manhattan, Teddy Roosevelt wing, always been Morgan. Teddy Roosevelt's first wife was Alice who was connected with the Morgan. The whole thing was Morgan. The Franklin Roosevelt wing, the Hyde Park wing of the Roosevelt was always connected with the Astros and the Haramans, who were their neighbors in the Hudson Valley. The Astros are not that important. The important things are the Haramans who were always, what happens by 1900 as an increasing rivalry in financial networks between the Morgans on the one hand, the Rockefeller-Haraman-Coonlowab coalition and others, begins in 1900 and continues through World War II, maybe up till World War II. So they have this mighty Titanic struggle. Haramans is a great, obviously brilliant financier who starts as a, I think, a stockbroker, a clerk or a stockbroker in Wall Street, and he marries a girl whose father owns a small railroad normally, but not much of an advantage. Anyway, he's a great financier, he manages to own a control, one after the other, northern Pacific, central Pacific, southern Pacific, whatever. He takes them all over except northern Pacific and that is a big fight for the power between Morgan and James J Hill on the one hand and Rockefeller-Haraman-Coonlowab on the other. So what you have is financial networks, Morgans reaching out and getting, for example, commercial banks and investment banks. Rockefeller beginning to control and own commercial banks and investment banks. For example, National City Bank was always a Rockefeller flagship in New York and Chase National Bank was, guaranteed trust were Morgan flagships and First National Bank was a Morgan flagship. Chase National Bank, by the way, shifted during the Depression, which I hope I get to, to Rockefeller control and, of course, still is. At any rate, so we have, what happens then with McKinley's around shortly after, about a year after second term, he succumbs to the ministrations of a lone nut. Now, there are many lone nuts in American history. Funny, every assassination in American history is always by a lone nut, almost every assassination. Every place else is always a conspiracy and they try to find what it is. United States is always a lone nut. And a lone nut is always disposed of very quickly. In the case of Gito shot the alleged lone nut, it was shot Garfield, killed Garfield. It was disposed of quickly. Had a trial and disposed of. In the case of Lincoln, by the way, obviously was killed by conspiracy. Yet, somehow in the public mind, it was killed by a lone nut. John Wilkes Booth gets up on the stage and he claims something and disappears after that. Actually, it was a conspiracy which was, people arrested in the military tribunal executed very quickly in secret. So that's never been explored either. I have to zoom all this stuff. Zoom it. Lincoln, zoom the whole thing. So, McKinley is assassinated by alleged lone nut anarchist, Leon Chogudge, which then uses an excuse to outlaw all anarchism, not only all anarchism, but all sedition. A lot of laws where they crack down on free speech even now, traced back to 1902 or whatever, and the anti-anarchist hysteria. Actually, Chogudge was not an official anarchist. None of the anarchist groups knew him. They thought he was sort of a marginal flake, attended a meeting or two. We know a lot about marginal flakes or whatever. So, but yeah, it was never deeply investigated. Who did anybody set up all this? He just executed very quickly and got rid of. And to me, I mean, the thing is this, you can call this a conspiracy theory if you will. In any police action, if somebody is murdered, if you're some wealthy grandpa is murdered, who's the first suspect? It's the heir, right? Who's the cheap beneficiaries, the granddaughter or whatever? The police investigate. It doesn't mean this heir is guilty. It just means he is the first suspect. How come and when the president is assassinated, the vice president is never the first suspect? I ask you, how come? Are vice president sacrosanct? Are they above the moral law? So in the case when Zachary Taylor's body, I was always sympathetic with the exhumation because I always thought there was something peculiar about Zachary Taylor's death. He attended a Fourth of July picnic. He ate ice-cold cherries and milk and he immediately got stomach cramps and died a couple of days later. Nobody else got stomach cramps in his picnic if it was Tom Mayn. How come he's the only one who gets Tom Mayn, right? At any rate, so the idea he was poisoned by arsenic was certainly very plausible. It turns out he wasn't. Well, okay, we investigate it by we, I mean the world in general. But the thing, interesting thing is when the Miss Rising's request to exhume Zachary Taylor's body was publicized, USA Today, which cover this more than anybody else for some reason, and went to Professor Roger Brown as a distinguished expert on violence in American history and they asked him his opinion. First of all his opinion was a little gobbledygook. Pretty difficult to understand it. Basically what he just translated in English and said that she hasn't established anybody would benefit from Taylor's death. What do you mean no way? The Vice President benefited. Miller's Film War should be obviously the first suspect. It doesn't take a Ph.D. in history to absorb that. So, so McKinley falls alone not a Rockefeller person he succeeded by a crazed Morgan tool, Teddy Roosevelt. Nobody's investigated as far as I know the possibility of Teddy Roosevelt or Morgan's behind the assassination. I don't say they did. I just like to see it investigated by my committee with subpoena power. Alright. So what does Teddy Roosevelt do? He immediately changes the whole policy of the United States interesting enough. He immediately takes the Sherman Act, the Anti-Trust Act which is totally in the clause that hasn't been used for a long time. He takes it out of the clause and uses it as a club to smash standard oil. Before that the Rockefeller and Morgan rivalry is more or less gentlemanly. All of a sudden he goes to the jugular. And he said he's not against all trusts. It's a famous formulation. It's not against all trusts. It's against good trusts. There are good trusts he said and bad trusts. He wants to smash the bad trusts and he loves the good trusts. What was the criterion of good and bad? The bad trusts of the Rockefeller and the good trusts of the good trusts of the Morgan trusts. Very simple. And then he gets a big reputation of a great progressive and trust buster. And also progressive legislation in general regulation, drug acts and all the rest of it starts with Teddy. Well, the Rockefellers were kind of bitter about this and they retaliated by in 19, well, Teddy Roosevelt was very popular. By the way, as long as I'm talking about Teddy Roosevelt, he's a little rough rider of visionism. The Morgan media parlayed the idea that he was a great military hero of the Battle of San Juan Hill. He helped get us into the war with Spain, of course, the famous assistant secretary of the Navy. He writes a telegram and I guess he was Seize Manila and helped generate the war. At any rate, he gets a little command, I guess it's battalion of people who go up the rough riders to go up San Juan Hill. First of all, it was a long hill. Second of all, a guy was half blind, Teddy and he managed to get over most of his men butchered in the attempt. It was a total fiasco and yet getting out of the army is transmitted by Morgan-dominated media to a great military hero the strength of which he becomes governor of New York because of Morgan campaign funds and everything and then becomes vice president and alone not gets into the president. So the Rockefellers were kind of bitter and in 1908 when Howard Taft, a higher Republican, succeeds Teddy even though he was a friend of Teddy the first thing he does, what does he do? He starts taking out the antitrust arm even more than Roosevelt and starts smashing what Morgan trusts. He tries to break up U.S. steel international harvester, two big Morgan trusts. He doesn't succeed but at that point, Morgan gets really bitter. They essentially say no more for now Mr. Nice Guy and they create out of sin air the so-called progressive party one of my least favorite parties in United States history which then running Teddy Roosevelt for president for a third term which smashes Taft and liberally elects the Democrat and Woodrow Wilson. So we already have and by the way the Wilson regime was pretty much Morgan-dominated also of contributions by the Guggenheims most of the copper industry and the Filenes or the big real estate retail store powers. So the basically however Morgan-dominated most of the administration so the Morgan's had both Teddy Roosevelt and Wilson's tails on when heads you lose the the during this I should not go back to about 1890s I remember I said manufacturing is now the big business becoming a big corporate business not just railroads from 1898 to 1901 very few years there was a mass merger movement American industry a fantastic merger move literally several hundred industries merged to try to form a monopoly firm to try to what race prices and cut production it's supposed to be better than a cartel because there were only one company left supposed to be one monopoly company which were then cut production rates price well the whole thing was a magnificent flop peru just absolute flop peru none of them worked US Steel which was the Morgan attempt to monopolize the steel industry with a total loser lost a share of the market from then on practically from then to the present day extremely inefficient company totally out competed with international harvester the whole thing was a flop the cigar industry, the glucose industry the whole business fascinating book by author S. Doing one of my real favorite economic historians lived unfortunately a long time ago wrote a great study called corporate promotions and reorganizations I think in about 1920 1912 which studied all these mergers and showed the whole thing as a flop peru and shows because this mergers or cartels don't work on a free market so what would happen is external pressure would come in let's say for example the sugar trust the sugar companies would form a merger they merged to have 100% of the sugar industry 98% and then a new company would pop up a new sugar refinery with newer equipment they out competed and they try to rearrange the cartel include a new company and they'd be a flop and hopefully just fall apart this wouldn't work so at that point by 1901 when all these mergers were flopped big business in general led by the Morgan Rockefeller's whole business decided the only way the only thing to do is to do the same thing that was done on the rare rows to cartelize all of industry now all of manufacturing in the name of free competition and the first step in doing that was to open the books replaying the old have no secrets stuff where various marriage economists said the thing to do about the trust problem they write books about the trust problem banks and other people they say the thing to do about trust trust are okay but two things one we should have federal incorporation so the federal government can regulate and control it and two should make them open the books so all the prices would be open so there wouldn't be any secret price cutting we know now for us what the purpose of that is to have a government basically a government to enforce cartel and all of these were flop peruse are Judge Gary who was the chairman of the board of US Steel tried to cartelize the steel industry by so called Gary dinners they have an annual some annual dinner of all the big steel executives they did what I was talking about over cocktails let's cut production and raise price yeah yeah we'll do it then they go out they do it just the opposite the usual view is if you try to have a voluntary cartel this is what happened on the farm cartel in the late 1920s they tell you look if you cut production by 10% let's say prices will go up by 20% everybody says yeah yeah we'll do it and in the middle of the night they say hey well all these suckers are cutting their production I'm going to increase my production to take advantage of the higher prices so they increase their production and the prices fall and the whole thing is a flop so they decided the Gary dinners were a flopper rule and they decided then that we have to have government enforce government cartelization there's an excellent book on big steel I think called big steel and something by Milman Urofsky there's a great quote there something like having found they could not successfully have a monopoly or cartel in a free market they had to turn to the government to enforce it namely World War I World War I it's about my least favorite war of all time and a war that was pointless a tremendous devastation a war that created almost everything we everything we think is evil in the 20th century government planning wartime planning peace time planning the whole business communism Nazism fascism none of these things would have happened without World War I total destruction of Europe and there's also of course no reason whatsoever if the United States get involved in it if the United States had not been involved in it there would have been a negotiated peace in 1916 which probably would have left which would have avoided most of the devastation avoided communism Nazism etc and Woodrow Wilson however insisted on going in so now we focus on Woodrow Wilson the first and I hope last PHD president the American History and he and his role on this whole thing Woodrow Wilson generally historians talk about his great believer in free competition Rubin she's a believer in regulated and cartelization and the rest of it he had better rhetoric than the other guys talk about the new freedom watch out for anything you win it Teddy Roosevelt called his regime new nationalism Wilson called it a new freedom and it was a new era in the 1920s a new deal in the 30s the whole thing is statism it's not new at all it's the old racket with new clothes so the yeah New World Order exactly as the final so so Wilson was no good reason for him to get us in the war the best still the best book on our entry into World War I was a book written in 1938 by Charles C. Tansell while America goes to war and it's very clear from this book and other studies etc that one of the major reasons was this again once again the stain the blood and this came blood ridden rim stain of J.P. Morgan and Company J.P. Morgan and Company even though powerful it said it was getting shaky economically by 1910 or so New Haven Railroad one of the big centerpiece railroads went bankrupt they were big on railroads and not so big on manufacturing railroads started a big decline which of course continued throughout the 20th century around 1900 they were stuck with it they weren't too good in shifting the manufacturing they were losing money when World War I started 1914 and by the way there's a big role here of Morgan partners you have to realize some of the backers have been until recently maybe still are partnerships not corporations each partner in the Morgan Company had different functions and with some partners who were both major functions not regular banking but political banking relations with government and merging these be people like George W. Perkins who became the head secretary treasurer of the progressive party Morgan run party there was Harry P. Davidson Perkins and Dwight Marrow Morgan partner all these guys were extremely powerful people as soon as the war starts Davidson hops the first boat to Europe of course there was no concord which he would have done if there hadn't been and he reestablishes already existing ties cementing them with English banking Bank of England English government heavy financial interests Morgan's father was a British banker and had constant ties with Morgan so the Morgan's have always been a foreign policy called pro-British which essentially means pro themselves so Davidson gets over and negotiates the following deal with the British government British and French governments from 1914 on JP Morgan company have a monopoly in all government underwriting all British and French bonds in the United States and monopoly in all war orders all armament and other orders in the United States so these guys were like the monopolies of everything they were getting rake holes for the whole thing making minions out of this and then of course feeding war contracts to their Morgan controlled export companies in the United States there's unbelievable bonanza unbelievable bonanza for the Morgan to bail them out of trouble and it made them extraordinarily successful the Morgan's were committed to English victory and as a matter of fact JP Morgan himself admitted JP Morgan said something like from the very beginning of the war I determined to do everything I could to get the United States involved into it interesting point him doing everything he could to get us into was much more important than me doing everything I could to get us into it so by God he did now the interesting thing about any budding historians here is the mysterious figure of Colonel Edward House the orthodox he ran the entire American foreign policy from the time Wilson was elected almost through Versailles during the entire pre-war and war period he was never appointed anything no official post he was controlling foreign policy not the Secretary of State and who is this guy there's no real biography of Colonel House has yet been written historians have been writing biographies for every Civil War Colonel there's scads of stuff on everybody there's nothing on House there's a couple of small books on House of Versailles very spring narrow there's one antiquarian book about House in Texas okay and the only thing else is a multi-volume series of letters selected letters by House with an introduction by Seymour that's really the only biography of House not too many pages so House is totally unstudied we have a few leads however to House's activities the usual story about House are various cycle babble interpretations of House cycle shrink interpretations House and Wilson had a strange cycle on a leg type friendship and things like that it seems to me that's not the key here we have a situation of this sort House is a Texas politician he's fairly wealthy he's a Texas Democrat and Democrats would be a big day in the sun so he meets Wilson during the 1912 campaign and he says what would you like to do in my administration and he says Mr. Wilson I'd like to run your entire foreign policy Wilson says okay what kind of thing is this to an historian with a cynical eye or a realistic eye he says stop short of it what is this who is this Yoko coming in from the field and by God he does run not only does he run a foreign policy he picks almost the entire cabinet he picks the entire appointee all the Texas Democrat everything else runs through House not only that but House plans the peace the shrink historians say that House was very loyal to Wilson like psychologically loyal to Bologna because we know for example there's a Greek book called The Inquiry by Lawrence Gelfast an excellent historian and of course it talks about historians under the control of Colonel House who met for several years before we decided to plan the peace like carving up Austria-Hungary and all the rest of it so the interesting thing there are various statements there that Colonel House was obvious was plotting with the British ambassador if Wilson was reluctant to go into war House would plot with him and induce him to go into it so he was hardly loyal to Wilson he was much loyal to the British so here's a really unplowed area I'd love to see some really good biography of House it's not been done I toss it out as a research project there are certain leads however certain indications and hints first he was the owner of a Texas railroad Brazos and something in Valley Railroad which is connected with the Morgans there are other there are other indications it was in the Morgan Ambit but it's very shadowy I have to admit that but at any rate if he was a Morgan tool it certainly fits in with his general activities because the Morgans were hip-deep in trying to get us into war as I said and House is one of the major people that did it the okay the comes the in World War I we have a war collectivism which is unbelievable it was both by the way war collectivism running the war both in England, France, Germany and the United States and the thing about the war collectivism which fixed prices production had a sort of corporate state or fascist kind of system big government would appoint boards represented as a big businessman or say commodity sections there would be a steel commodity section a steel section of the U.S. government staffed by big steel men negotiating prices of production with representative of steel men across the table like their own buddies the vice president of U.S. Steel would negotiate with the president of U.S. Steel and the steel man and the government was allegedly it was a so-called dollar a year man working in the fund was considered very patriotic you're doing it for free but they're still getting a salary from U.S. Steel you see they have a very cozy unbelievable happy cozy partnership of interest I was going to say conflict of interest obviously a partnership of cartelist interest here they have a fantastically collectivized system and headed by Bernard Baruch and the how much longer do I have Lou okay Bernard Baruch was the point of the war dictator the head of the war industries huh that's a real feet of precedent agitation okay the Bernard Baruch was appointed the head of the czar of the war industries board industrial system during the war and by the way all these guys in charge of it Herbert Hoover was the food czar and had been in Britain all this time was essentially definitely in the Morgan Ambit and they had these teams of cartelists that were running everything the the railroads were running the governments quote nationalize the railroads unquote which meant that they were they appointed railroad people to run the railroads the government would pick up the tab and the railroads got guaranteed profits out of it that's the kind of nationalization everybody likes right you get the profits and the taxpayer picks up the money socializing the tab socializing costs again in a big way anyway this whole system, this whole fascist system is what it was corporate state system was unbelievably beloved these people all young, Baruch was young, Hoover was young they all start on this period John Foster Dulles was a kid of 21 or something and this whole gang was plaguing us for the rest of the 20th century they all lived long and constantly recalling the good old days of World War I why can't we do in peace like we did in war why can't we have a collectivized economy in peace time it was a wonderful economic system why does it have to disappear when the war is over so constantly these guys were trying to get back to the wartime collectivism the new deal was wartime collectivism reinstated as was World War II and all the rest of it the Korean War they tried the same thing the same stuff these people, it's amazing Bernard Baruch was unbelievably beloved you can't imagine how beloved he was I was, by beloved by the way usually with a capital B I mean somebody who was to criticize at all is considered a deep sin and somebody who automatically revered without any good reason for it and Baruch was in my lifetime he was about the most beloved person I've ever seen every idiotic statement he made was featured on the front page of the New York Times there were pictures of him on the park bench dispensing wisdom to every one and one of the most unbelievable advisor to every president of every party mostly Democrat but also Republican and he's always invited to be head of this and head of that the question is why was it all my life I've been trying to figure out why this was and the usual historical answer is that he made a lot of money in the stock market, well so on lots of people made a lot of money in the stock market and not made dictator of the war economy but he was beloved so what was it, this was finally this puzzle was finally solved by an excellent book the only really good biography of Baruch by the way by Jordan Schwartz called The Speculator and it turns out Baruch was a lousy investor when every investor on the zone in the stock market he lost money and the reason he made money and the reason he's beloved was obviously because he was a sort of a a hanger on I was going to use the term running dog it was a hanger of the Guggenheim family Guggenheim interests extremely powerful, extremely wealthy which owned the entire copper industry at one point which have kept a very low public relations profile what happened was that his father Baruch's father was a physician and by the way upper class physicians have been very powerful in American politics for some reason you always see on boards in the old days not so much now in the board you see so and so and such and such and some physician to some leading power elite person and by the Baruch's Baruch's father was a physician to the top Guggenheim I think I forget now it was Solomon or Daniel and who took a liking to the kid Baruch and anytime there was something to invest in he told Baruch about it Baruch essentially made powerful and influential and wealthy because of his relationship with the Guggenheim family well that solved it a historical puzzle finally solved and we have a situation very quick about it after World War I by the way I haven't seen this any place except an article by Paul Klepner one of my favorite historians in American history World War I was extremely unpopular domestically it was inflation, it was price control people didn't like it which was really the reason for the reaction against the Democrats by 1918-1920 1920 Democrats were shot they're going to lose so again as a struggle who should get the Republican nomination Harding gets it it was a Rockefeller person and although it also had some Morgan connections it was sort of perfect Harding dies in office a very short period of time the orthodox view was that he died of natural causes however his body's never been exhumed and tested, probed now Gaston's scene means it was a secret service agent in the White House the time wrote a sensational book after he died called The Strange Death of Warren Harding in which he claims that he was poisoned by his wife his wife had some good reason to poison him he was sort of a, was now known as a womanizer had a mistress in the White House and stuff and he said that also one of the reasons he means said was that the she was trying to save his name from the Tepadome scandal which was then erupting seems to be a contradictory reason what the heck it needs to be exhumed was he poisoned, was there arsenic and Warren Harding's cherries or whatever he ate at any rate he succeeded by Calvin Coolidge who was a Morgan person Calvin Coolidge is usually considered sort of a quiet, dumb police commissioner he was much more than that he was a member of the Coolidge family the Boston Financial Power Elite he was the cousin of T. Jefferson Coolidge head of United Fruit Company he was part of the Power Elite the Morgan M but his administration then becomes once again by the way a Rockefeller person dies in office on possibly a mysterious circumstance and replaced by a Morgan vice president and from then on we have a Morgan economic policy during the 1920s I can't go into it here it's a Morgan U.S. it's Benjamin Strong, Milton Friedman's favorite the Fed head the Fed director who's inflating credit in the United States in order to help England which really means helping the Morgans and we wind up with and Herbert Hoover was a Morgan person succeeding Coolidge and we wind up with the Great Depression in the Great Depression in 1932 Franklin Roosevelt Harriman Tool defeats replaces Hoover and then we have there's very interesting stuff on this just coming out Thomas Ferguson was a political scientist I think it's tough now the book has been forthcoming about 8 years now about dying to read it he's written some very interesting articles on it Oxford University Press to be entitled the full of the House of Morgan and the coming of the New Deal basically Ferguson's thesis I think it's correct I'd love to read more about it is essentially the New Deal policy economic policy is essentially a smashing of the Morgans there's a revenge of the Harriman Coomloeb group as against the Morgan Morgans got theirs for example the public utility law which for bad investment banks from the integrated commercial banks was directly ahead of the Morgan the whole thing was anti-Morgan thing and the course of that the Morgans lose control of the Chase National Bank to the Rockefellers and Albert Wigan I think was sent to jail the Morgan person was then replaced by Winthrop W. Oldridge the notorious kinsman of Rockefellers his father Nelson Oldridge was Rockefellers man in the Senate Nelson Oldridge his daughter Mary John Lee Rockefeller Jr it seems important by the way for historians to look at marriages too you know it's who are the in-laws of these people not just the same name from then on Oldridge becomes the power in the so-called Dewey Rockefeller Wigan Republican Party there's one wonderful moment which I don't remember the year but Thomas Dewey when a Rockefeller tool of his life decides to quit being governor and move into private law practice and make some money this came out in the Scripps Howard paper is a famous incident he's called by Winthrop W. Oldridge head of the Chase National Bank ordered to come to his office and Oldridge orders him to run again for governor which he which he does it's amazing things we don't often get a clear window on how the power elite works you know here's the great governor of New York presidential candidate separate ordered by the Rockefeller person to run again weekly obeys so we have to finish off on this on the we have basically the 1920s 1930s can be looked at as a Morgan versus Rockefeller fight with Franklin Roosevelt being a Harrowman Rockefeller person and Harrowman by the way being very powerful in the Democratic Party throughout and usually the role is overlooked and finally we get to World War II where the Morgan's and Rockefeller's have an alliance the Morgan's once again were a favor of intervention in Europe to save Britain and France the Rockefeller's were isolations in Europe they wanted to crush Japan which was threatening their oil and rubber resources and so I look at World War II as a mighty alliance between the Rockefeller's and the Morgan's each financial group gets their war and they go back together again they love the whole World War II as their favorite war and Rockefeller becomes Nelson Rockefeller becomes very important we emerge from the war with oil being very dominant and the Rockefeller-Morgan alliance then becomes a Rockefeller headship in other words Rockefeller becomes the primary figure in this alliance and from then on essentially Morgan's a junior partner with the Rockefeller's heading it this is symbolized by the fact the Council for Foreign Relations which was created in 1919-1920 by the Morgan's to have an internationalist policy and by the way during World War II we now know the Council for Foreign Relations really ran the entire post-war planning of the State Department headed by Norman Davis who was a long time Morgan person so we have after World War II the Rockefellers take over the Council for Foreign Relations and the rest of it and become sort of senior partners we then have a from then on the financial struggle is very different and from then on until now what we essentially have is one group it's not Republican or Democrat it's one group in both parties which are essentially Eastern establishment or Rockefeller-Morgan group and the other is a very loose coalition of Sun Belt types Southern Rim types self-made businessmen from usually from Florida, Texas and Southern California we're called the Cowboys it's a really suggestive look like Carl Oglesby a Yankee cowboy war came out 10 years ago analyzing Watergate and Kennedy assassination on the basis of bitter Yankee cowboy struggles on that basis of course Reagan was a cowboy coming from Southern California Bush is a quintessential Eastern establishment Rockefeller person I think was financed Israeli Zapata Oil Company was financed by the Rockefeller family so that brings the Bush