Original Document
Original Document
Governor George H. Earle, Inauguration Address, 1935.

In this oath I have pledged myself to serve the people of Pennsylvania as best I can. These are desperately trying times, bitter times. You are asking "Where are we going?" Where do you want to lead us?"

Solemnly, with the echo of the oath-still upon us, I answer that we are going, along with the rest of this nation, to new ground. Politically and economically a change is necessary. The misery of millions, the insecurity of all, bids us vacate the too easy tolerance into which we were lulled during the past decade.

America in its pioneer days was hardy and barefooted, shirt-sleeved, sharp-eyed. America was then ready for whatever came, always striving for a better pasture over the hill. We're going back to that spirit today. Not literally, not seeking new land, but seeking into the future for the security and freedom that makes all land, all property, all life worth while. America is going pioneering across the mountains of special privilege and predatory wealth that fancies itself securely founded. Pennsylvania, in my administration, is going with America. The further we are toward the fore, the better.

Every now and then history sits down and rests. The short-sighted say "Now the last frontier is closed. Now change is ended." But the last frontier is never closed. This summons cannot be ignored or evaded with impunity.

The punishment of history has descended again and again on those who closed their eyes to the summons. Disintegration, decay, extinction are the inevitable fate of a nation which refuses to change when the times demand change. The jungle creeps back upon the untended clearing, the sea finds a way through the once adequate dyke. When the old enemy is stamped out, a way must be found to defeat the new.

We can no more shirk our pioneering task than the men who first landed on these shores could turn their backs to the wilderness in front of them. We must plunge into and cut away the undergrowth and build. We must explore and experiment; be watchful and not content to rest until our security is attained.

Our ancestors fought their way forward with axes and plows. Today's pioneering calls for the subtler, but not less necessary tools of the mind. The obstacles and dangers around us are not the work of external nature, but creations of our ancestors and of ourselves.

Our dangers consist of institutions, practices, fulcrums of political and economic power which exist to the detriment of the people as a whole.

We were building a vast technical machine in these last 100 years. We were improving the methods of agriculture, revolutionizing the processes of industry. We broke through one material frontier after another. But we forgot that no nation is stronger than the law and the morality that bind it together. We forgot one of the oldest lessons of history - that changed physical conditions call for new political institutions.

I do not mean, of course, that we must try to wipe out the past by revolution or too hasty change. There are fundamental institutions which, I believe, will endure in the fields of economics and politics for thousands of years. Democracy and private property, for instance, may no more be successfully replaced today than the ancient principles of the lever and the wheel have been displaced by our progress in the field of mechanics.

But the right of private property does not mean to me something exactly and precisely defined down to the last detail and the definition graven on stone and buried somewhere in the vaults of antiquity.

It means this: Individual ownership of material goods on terms adapted to best serve the needs of any given community at any given time. When private ownership has been a successful institution, it has meant just that. When private ownership, or any other institution, has set itself against fundamental changes, it has been found wanting. This I believe to be the liberal position, the attitude necessary for permanent recovery.

I believe in the profit motive. I believe in private ownership. They provide the only basis for our present civilization and its future progress. But we cannot escape the fact that today private ownership means the "ownership" of nothing by the majority of our citizens. Except through charity, they have not even obtained sufficient of the product of private ownership to keep alive. Could any situation be more calculated to undermine faith in private ownership than this?

The timorous cry of mistaken self-interest quavers that the slightest modification of the present political attitude toward business foreshadows the doom of capitalism.

If the reactionaries would turn their eyes in the opposite direction they would have more justifiable cause for alarm. Danger does lie ahead for capitalism and for democracy, unless we are ready to change many of our institutions and practices. Russia is the proof. All Europe today is a panorama of the decay of nations which will not face the necessity for sane, sensible progress.

From Austria I watched that disintegration with my own eyes and I returned to be your candidate for Governor with the question in my heart "Will my nation be strong enough, intelligent enough, courageous enough, to avoid that fate?" I believe the answer is "Yes" but I believe the victory will take some fighting and work. It is worth it.

I want to be a part of this fight. I want to share this work. My program was stated fully and I hope clearly during the campaign. As I restate it now, you will not find it changed. My convictions have not altered. Rather they have strengthened as the depression continues and the enemies of reform give stronger evidence that they intend to block recovery.

My fundamental conviction is that life must be made more secure for those millions who, by the accident of birth, are left at the mercy of economic forces. I see no just reason for the relative present security which I personally enjoy, by the grace of chance, while most of my fellow citizens are never at any time separated by more than a hair from want and misery. The gulf is too wide, the contrast too sharp. I have long felt in my heart that there is something basically wrong with this disparity. And with my eyes I have seen what is wrong during this depression.

The benefits of all our progress have gone to a few, though it was the masses that made the progress possible. The few cannot go further without the many. The few who enjoy wealth are chained, not only by bonds of humanity, but by bonds of cold economics to those who now falter by the wayside through no fault of their own.

What is our material wealth? It is made up of factories, farms, stores and mines in which the needs of men are made and distributed. When that distribution stops, when production stops, wealth vanishes. No man is so rich that his fortune can long endure without that foundation of all business - customers.

Customers - in this mass production age - means the whole body of labor. For a long time past, labor has not received its proper share of the profits of industry. The farmer is not getting his proper share of the profits of the farm.

By "proper" I do not only mean fair and just - I mean the share which is called for by the iron necessity of the business set-up of this country.

I mean that America needs new markets for the products of her machines and farms. We cannot find them abroad. We cannot find them on Mars. We must create new markets by increased purchasing power to the customers of industry, the masses who labor in field, factory and store.

As Governor of this State, which is truly the keystone of America's industrial system, I shall wage a determined fight to re-adjust the balance of purchasing power. Minimum wage laws, abolition of sweatshops, protection of the right of unionization and unemployment insurance are but a few of the lines on which this fight must be won. Child labor must never return.

Pennsylvania has lagged behind in legislation and executive policy in this vital field. Some of our so-called better citizens have boasted that labor was weak in Pennsylvania, that this was a "good" State for employers. That boast sticks in their throats today if they have intelligence enough to realize that the depression has been intensified here precisely because Pennsylvania lagged in labor legislation.

Nor am I going to forget the veterans of industry and the veterans of agriculture, who have just as much claim upon the State as the veterans of our wars. In settled rural communities of a century ago, old age brought its recompense. It brought rest and the security in which the younger members of the family carried on in the well-loved fields to earn the living by which they supported their parents.

That is gone now. Filial devotion has not dived. Sons still want to care for their parents. But often they cannot. The shift and strain, the insecurity has become too great. If they can save a penny, they need it for their own wives and children. No man knows today what economic misfortune tomorrow will bring. So the aged, who, in their prime, built the present are shunted out into economic and social oblivion.

This army of worthy old men and women is beaten into exile from the economic system at every crisis, just as aged inhabitants of besieged cities were once sent to die outside the walls so they would not deplete the rations.

We who revert to this barbarism have not even the excuse of necessity. We have the machines, the tools, the materials to produce enough for all without sacrifice. We can feed these aged.

Then in the name of humanity and hard-headed sense, let us feed them. Let us give them a decent life in their own homes when their work is done. An old-age pension system is not a sentimental gesture. It is as much a necessity of modern life as steel and electricity. It fits into the jigsaw puzzle the world is trying to reconstruct from the aftermath of the industrial revolution of the nineteenth century.

A moment ago I spoke of the ancient security of rural communities. They are no longer secure. Not only does the weight of an unjust taxation and monetary fluctuation bear them down, but they have fallen into the control of big business which has impoverished them, with one hand while it exploits the consumer with the other.

I refer in particular to certain of the large milk distributors, operating in this and other states. When I look at the recent history of these companies in their relation to farmer and to public, I am driven to one conclusion - that the men in charge of them hope to clean up personal fortunes in a few years and get out before public indignation catches up with them. They cannot be looking far ahead. After all, the human worn will turn. And if ever there was occasion for public resentment, these certain milk distributors have given that provocation.

Milk is the most vital of all necessities that can be dealt in commercially. The public is at the mercy of its milk supply. Moreover, in this part of the nation, dairying is the backbone of agriculture.

Yet these men have had the effrontery to attack the roots of both our rural and urban existence. Briefly, they kept up the price of milk through the depression so that fewer and fewer persons could buy enough. With the consumption of milk fallen below half the amount necessary for minimum healthful diet standards, they turn to the farmer and cut his income on the plea that a milk "surplus" exists.

Surplus, indeed. I know where that surplus is - and so do they. It is in the fat salaries that these men who dominate the milk trust receive. It is in the watered stock of some of these companies. That's the only surplus in the milk business.

These companies maintain a virtual monopoly. They fix prices to the consumer. They fix prices to the farmer. And the difference between the two returned some of the larger milk companies a profit of thirty percent consistently through the worst years of the depression.

This administration will end that in Pennsylvania. There is going to be a milk control law with teeth in it. Since prices are already being "fixed" for this public necessity, then the public is going to have the controlling voice in the milk business of this state.

Such regulation is the only alternative to public ownership. The big milk dealers are not the only ones who do not recognize this danger. Their brothers of the utilities seem quite as blind to the impending storm. They won't shorten sail although the hurricane warnings fly from every jack-staff on the political coast.

But the utilities do not yet realize that the golden goose is in his death throes. I want to save the utility companies. I want to protect the thousands of investors in utility companies in Pennsylvania. These investors will suffer if public ownership competition comes. The movement for municipal light and power plants is growing throughout the country.

I know we are supposed to have utility regulation in this state at present. But that is not the sort of regulation I'm talking about. This administration will introduce a public utility law so stringent that no Public Service Commission can stultify it without full public knowledge.

Relations between utility companies and their holding companies should be under the jurisdiction of the Public Service Commission.

Further, all expenditures of utility companies should be subject to public scrutiny and control.

It has been the practice for many years to use a part of the surplus profits squeezed from the public, to fight the public. Candidates have been bought with utility company campaign contributions, usually in secret. Lobbies have been maintained here at Harrisburg by these funds. So great has been the power of these extra-legal groups that not a bill passed, not a move could be made, without their consent.

We propose to root out the lobby evil. First, to destroy the utilities lobby by cutting off its source of revenue. Second, by striking at all lobbies.

There must be an end to the invisible government by lobbies and lobbyists in Pennsylvania. The legislation of Pennsylvania must be written in the State Capitol and not in the private parlors of Harrisburg hotels where special privilege lobbies have held forth so many years.

I intend to give the people a day by day account of the activities of these lobbyists if the necessity arises. Any legislator influenced by them will have to make his explanations to his constituents. It is time that this vicious system, which makes a mockery of representative government, be gagged out into the open and into the light of publicity. Only in that way can it be ended.

I have another word of warning, not unconnected with the utilities, for it refers to their real masters - a little group of all-powerful bankers. These bankers are the backbone of the reactionary opposition to the New Deal. These bankers have a fondness for masking their activities behind the phrase "protection for the widows and orphans."

Strike at excess milk profits and they cry out that widows and orphans are the shareholders of the milk companies. Strike at high utility rates and the same wail rends the skies. It is these bankers themselves who are endangering the funds of widows and orphans by driving the consuming public to desperation.

Wall Street sent fourteen billions of American funds abroad in the last ten years, exclusive of the war debts. How much of those foreign loans are coming back? Precious little.

We all know that now.

But these bankers knew it then. And whose funds were THESE? Widows' and orphans' and the ordinary American small investor. Do you hear them deploring this betrayal of the widows and orphans?

This administration will do its utmost to protect the investors of Pennsylvania. But it will take neither direction nor advice from this powerful banking clique which in the past has had so much to say about the operation of this state government. For the next four years, and I hope I speak loudly enough to be heard in Wall Street - it's "Hand's off Harrisburg."

I am deeply concerned over the plight of those thrifty men and women who, through no fault of their own, have suffered because their savings are tied up in closed banks. Liquidation of these deposits has been slower in Pennsylvania than in any other state. There is no excuse for this. We are going to speed up the process of returning these funds to their owners.

The banking lobby here has blocked certain legislation designed to strengthen the banking system of the state. If this legislation had been in effect, I am convinced the banking collapse would have been far less severe. Let us remember that lesson. We must enact restrictions which will make it more difficult for bankers to dissipate the funds of their depositors.

Building and loan associations have an almost unique and, in the main, honorable history here in Pennsylvania. But in recent years practices have crept into some of them which should be stamped out so that these splendid institutions may regain their real place in the financial life of the community.

Pennsylvania plutocracy reflects itself also in our tax situation. Although sixty per cent. of the wealth within the state is in the form of stocks, bonds and other personal property, ninety per cent of local taxation is derived from real estate. This grossly unfair situation is a perfect example of the dead hand of the past crushing the present, which I mentioned earlier. When our present State Constitution was written in 1874, real estate amounted to ninety per cent. of the wealth and should have borne that portion of the tax. But is there any reason why a situation which existed sixty years ago should crush our home owners and farmers today?

The remedy lies in a graduated state income tax. The soundest tax is that based on the principle of ability to pay. We are going to bring that principle to Pennsylvania.

Revision of the State Constitution is absolutely necessary. Pennsylvania simply cannot continue further with the absurdly antiquated Constitutional provision which restricts its borrowing capacity to $1,000,000, an infinitesimal part of our annual expenditures.

No business could operate soundly on that basis. In times of stress such as these we ought not increase taxes drastically to meet the necessity for increased relief expenditures.

The sound way, the business way, is to borrow when expenditures must be increased and pay back in days of increasing income. This fossilized restriction causes the State Treasury to face today a grave financial crisis which would not have arisen under a modern Constitution.

Constitutional revision is one of the most immediate needs of Pennsylvania. We can all see it is no academic subject if a very ill-timed tax increase is made necessary in order to meet the needs of relief.
Can we reduce state relief expenditures? There is no escape in that direction as long as the Federal Government does not bear the full burden. As long as Washington does not assume entire responsibility, there can be no talk of cutting relief expenditures.

It is quite likely that we can effect some administrative savings by coordinating the various relief agencies which now duplicate each other to some extent. But such savings we must not keep. They must be passed along in increased benefits to the unemployed whose present subsistence level is shamefully low.

I know there is a sneering mention of Santa Claus whenever any public official advocates an increase in relief. Such propaganda fails to impress me. I know from whence it emanates.

The same banking group that shudders at a Federal expenditure of four billion dollars is the one that sent your fourteen billion dollars over to Europe and down to South America never to return. What of the eighty billions of inflated 1929 valuation which withered away? Where are the expressions of contrition from Wall Street for that debacle? Are they hiding their faces in shame? Not they. From behind the backs of the widows and orphans these brave grenadiers of high finance are firing their propaganda of so-called economy and budget-balancing against the unemployed, the helpless, the down-trodden.

I believe in work relief rather than the dole. Work is in this nation's blood and sinews. Americans do not want to idle about half-starved on Federal doles. We want to make, to build, to earn a living wage. We cannot in a day or a decade stop the trend of centuries which instituted the necessity of work. If we try, beware of disastrous psychological consequences. We will care for the unemployed, but let us beware of creating unemployables. This is a nation of workers. Please God it may not be saved from being a nation of economic slaves only to become a nation of drones. My administration will co-operate to the utmost in an intensified relief program. Above all, let the expenditures be concentrated so that business can feel a real impact of purchasing power. Only thus will confidence be restored. Only thus will business begin to re-employ our idle millions. We cannot use trench warfare tactics against the depression. We must strike with the full-focused strength of all our financial resources.

Do not misunderstand me. Because I believe in spending money for recovery, it does not follow that I do not appreciate the importance of economy in governmental administration.

I intend to conduct the State government on strictly businesslike lines. It is not supposed to be good politics to cut down on payrolls. But that is exactly what I intend to do.

Local communities, particularly Philadelphia and Allegheny Counties, can save money for their taxpayers by re-organizing their governments. Consolidation to meet modern conditions should be a part of the program of the State Constitutional convention.

In closing, let me explain that I know well that I have said things in this address which the timid souls will consider politically unwise. I have attacked powerful groups, well-established institutions. I am ready to take the consequences. This office of Governor is the realization of my political ambitions, not the stepping stone. I will make mistakes, I know, but they will be mistakes of the head and not of the heart. I will never do anything or refrain from doing anything because of considerations of my future political career or the future political career of any of my friends. This administration is going to live and work in the present.

That task is large enough.

I will be more than content if four years from today I can feel that I have played a small but willing part in the saving of this Nation from the dangers that encompass it; that I have helped it push forward to new economic and political frontiers.

We know in which direction the salvation of democracy and American ideals lies. Let us go forward!

Credit: Courtesy of the Pennsylvania State Archives, MG 342, Box 14, "Speeches"
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