Chương 33: President Hoover's Economics Lessons

That same afternoon, in the mayor's office at the city hall.

Jimmy Walker stared at the New York Times on the table, his face grim. The front page of this major Hearst newspaper bore a striking headline: "Honest Man on Wall Street: President Hoover's Economics Lesson."

He picked up the newspaper and began to read.

President Hoover sat in his White House office with a report on the stock market crash in front of him.

He told the finance minister, "This is terrible. We must do something."

"Yes, Mr. President," the Finance Secretary said.

"However, according to free market theory, the government should not intervene in the market. The market will self-regulate."

"But the market has already crashed!"

"That's because the market is still adjusting, Mr. President. We need to give the market more time."

"How long will it take?"

"That's... hard to say. Maybe a few months, maybe a few years."

"A few years?" President Hoover's eyes widened.

"What happened to those who lost their jobs in these past few years? What happened to those who went bankrupt?"

"They can rely on charities, Mr. President. The American people are generous, and they will help one another."

"But what if the charity also runs out of money?"

"That means the market needs more time to adjust."

President Hoover remained silent for a moment.

"I remember saying during my campaign that America's prosperity is built on a solid foundation."

"Yes, Mr. President. You are absolutely right."

"So where is this solid foundation now?"

"It's still there, Mr. President. It's just temporarily obscured by some... superficial phenomena."

"A superficial phenomenon? The stock market has fallen by 23%, and you call that a superficial phenomenon?"

"In the long run, yes, Mr. President," the Treasury Secretary said earnestly, "economics tells us that short-term fluctuations do not represent long-term trends."

"How long is 'long-term'?"

"Well... there's a famous saying among economists: In the long run, we're all dead."

President Hoover was stunned.

"You mean we have to wait until everyone is dead before the economy will improve?"

"No, no, Mr. President. What I mean is that we shouldn't focus too much on short-term fluctuations, but rather on long-term development."

"So what should we do now?"

"Issue a statement, Mr. President. Tell the American people that the fundamentals of the economy are healthy and that this crash is just a temporary adjustment."

"But is this true?"

"That's not important, Mr. President. What's important is making people believe it's true. As long as people believe it, the market will regain confidence."

"What if people don't believe it?"

"Then we'll issue another statement."

Walker put down the newspaper and turned to his secretary.

"Harst learned quickly. He saw the appeal of articles like Kennedy's, but turned his attention to Washington."

"Could this be a good thing for us?" the secretary asked tentatively.

"In the short term, it's a good thing. He's satirizing the Republican president, and I, as a Democratic mayor, am happy to see it."

"In the long run, once this trend takes hold, it's like opening Pandora's box."

"But if you look at the article, the core points are all copied from Kennedy's articles. It's not embarrassing to wear the same clothes as someone else, it's embarrassing to be ugly."

The secretary leaned closer to take a look:

"Indeed... it feels like satire for the sake of satire, lacking a bit of spirit."

Walker shook his head: "It's more than just lacking in spirit. It's a poor imitation. But that's okay. Hearst doesn't care how exquisite the writing is; he wants to use his huge circulation to dominate the concept."

"So what do we need to do?"

"Do nothing. Let Hearst and Kennedy fight first."

……

On October 31, the two newspapers were published simultaneously.

The front page of The New York Herald read, "Yes, Mayor: Economist."

The front page of The New York Times read, "Honest Man on Wall Street: Economics Lessons from President Hoover."

People started talking about it on the streets of Brooklyn.

"Did you see that? Two honest people have written articles about the economy," one worker said.

Another worker said, "I read both articles. They were both quite interesting."

"But which one is truly honest?"

"I don't know either." The first worker scratched his head.

"The one in the New York Herald satirized the city government. The one in the New York Daily News satirized the federal government."

"I think what's in the New York Herald is true," the second worker said.

Why?

"Because he dares to criticize the city government. The city government is in New York, and criticizing them is risky."

"But that guy in the New York Daily News dared to criticize the president."

"What's the risk in criticizing the president? The president is in Washington, he has no say in New York."

The two started arguing.

……

In a Manhattan café, several college students are having a discussion.

"I think the one in the New York Daily News is fake," said a student wearing glasses.

Why?

The student with glasses said, "Look at those dialogues, they're clearly imitating the style of that one in the New York Herald. But the imitation isn't good enough, it lacks that... how should I put it, it lacks that natural sense of humor."

"I think it's written quite well," another student said.

"Besides, with such a large circulation, if the honest people in the New York Daily were fake, they would have been exposed long ago."

"A large circulation doesn't mean it's true. Newspapers are commercial organizations; their goal is to make money, not to tell the truth," the bespectacled student immediately retorted.

"So the New York Herald isn't a commercial organization?"

"Of course. But the New York Herald is a small newspaper, they don't have as many concerns. The New York Daily News is different, they have to consider the feelings of the government and the political impact."

"So you mean tabloids are more credible?"

"It's not that they're more credible, it's that they're freer. They can say things that major newspapers wouldn't dare to say."

The third student, who had been listening intently, finally spoke up:

"I think you're discussing things in the wrong direction."

"What do you mean?"

"What matters isn't who's truly honest, but whether what they say is true. If they're all telling the truth, then who cares who wrote it?"

The other two students remained silent for a while.

The student wearing glasses admitted, "You're right. But the problem is, how do we determine if they're telling the truth?"

"Think about it. For example, that article in the New York Herald that says economists never understand economics. Is that true?"

"It should be true."

Why?

"Because if economists really understood economics, they should have predicted the stock market crash. But not a single economist predicted it."

"Yes. So this article is telling the truth," the third student said.

"What about that article in the New York Daily News? It said that President Hoover only issued statements. Is that true?"

"That's true. President Hoover did just issue statements saying the economic fundamentals were healthy, but he didn't actually do anything."

"So you see, both articles are telling the truth. So why should we get hung up on which one is the truly honest person?"