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#158 – Henry Morgenthau Jr.

#158 – Henry Morgenthau Jr. published on No Comments on #158 – Henry Morgenthau Jr.

In 1934, when William H. Woodin resigned because of poor health, Roosevelt appointed Morgenthau Secretary of Treasury; even conservatives approved.1https://archive.org/details/frommorgenthaudi0000blum pg. 74 Morgenthau was a strict monetarist. President Roosevelt, Morgenthau, and Federal Reserve Chairman Marriner Stoddard Eccles jointly kept interest rates low during the depression to finance massive public spending, and then later to support rearmament, support for Britain, and U.S. participation in WWII.2https://mises.org/library/origins-federal-reserve-23https://web.archive.org/web/20091229174605/http://www.minneapolisfed.org/community_education/student/centralbankhistory/4https://www.independent.co.uk/arts-entertainment/obituary-william-mcchesney-martin-1172986.html

Morgenthau used his position as Treasury chief to investigate organized crime and government corruption. Treasury Intelligence and other agencies were uncoordinated in their efforts; efforts to create a super-agency were stalled by J. Edgar Hoover, who feared his FBI would be overshadowed. Nevertheless, Morgenthau created a coordinator for the Treasury agencies; although the coordinator could not control them, he could move them to some cooperation.

Morgenthau believed in balanced budgets, stable currency, deduction of the national debt, and the need for more private investment. The Wagner Act regarding labor unions met Morgenthau’s requirement, because it strengthened the party’s political base and involved no new spending.  Morgenthau accepted Roosevelt’s double budget as legitimate, a balanced regular budget, and an “emergency” budget for agencies (ie. Works Progress Administration / Public Works Administration / Civilian Conservation Corps) that would be temporary until full recovery was at hand.