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Unprecedented Power: Jesse Jones, Capitalism, and the Common Good
In this poignant and timely biography, Unprecedented Jesse Jones, Capitalism and the Common Good shows how the Reconstruction Finance Corporation (RFC) saved the United States economy during the Great Depression and militarized industry in time to win World War II. RFC strategies and Jesse Jones’s approaches can be adapted now to address the impacts of the new coronavirus and climate change.
President Herbert Hoover had established the RFC in 1932 to make loans to banks, railroads and insurance companies and appointed Jesse Jones—Houston’s preeminent developer and a former finance chair of the Democratic National Committee—to the bi-partisan board. With clear implications today, Jones complained the RFC was slow and a year late and said if it had judiciously loaned five to seven billion dollars in 1931 and ’32, economic collapse would have been prevented.
Soon after his inauguration, President Franklin Roosevelt supercharged the RFC, made Jones chair and the government agency began buying preferred stock in banks to stabilize and help them lend again. Jones knew capital rather than debt was needed to save the banks and revive the flow of credit, just as it was when the program was duplicated in 2008 as the Troubled Asset Relief Program, better known as TARP. Under Jones’s leadership, the RFC became the largest investor in the nation and rescued banks, businesses, homes and farms; saved the railroads; rebuilt communities after environmental calamities; built bridges, dams and aqueducts across the nation; and brought electricity and appliances to rural America. The RFC helped people and saved businesses during the Great Depression through judicious lending, not spending, and remarkably returned a profit to the government and its taxpayers.
As war spread, Jones and FDR shifted the RFC’s focus from domestic economics to global defense. In its second cover story about Jones, TIME magazine reported, “In all the U.S. today there is only one man whose power is Franklin Roosevelt … The President knows Congress will give more to Jones without debate than he can get after a fight … Emperor Jones is the greatest lender of all time.”
Accordingly, after Germany’s European victories, Congress on June 25, 1940, gave Jones and the RFC the authority to build, buy and lease plants to develop and manufacture metals, ships, airplanes, tanks and guns; to train aviators; and, with FDR’s approval, to do anything required to arm the Allied Forces. Almost half of its outsized investments went to corporations to help convert their production to war-time needs. One of its largest new plants—the Dodge-Chicago plant—covered 145 acres and took in raw metal at one end and produced finished airplane engines at the other. Like all its new factories, the plant was built and owned by the federal government’s RFC, leased to corporations to operate and sold to private interests after the war. Likewise, coordinated national large-scale efforts and government investments can be made to address today’s daunting challenges.
Unprecedented Power dramatically describes how Jesse Jones and the RFC used every option to save life, democracy and capitalism during two of the 20th century’s most threatening events. Unprecedented Power provides models for today by looking at successes from the past.
President Herbert Hoover had established the RFC in 1932 to make loans to banks, railroads and insurance companies and appointed Jesse Jones—Houston’s preeminent developer and a former finance chair of the Democratic National Committee—to the bi-partisan board. With clear implications today, Jones complained the RFC was slow and a year late and said if it had judiciously loaned five to seven billion dollars in 1931 and ’32, economic collapse would have been prevented.
Soon after his inauguration, President Franklin Roosevelt supercharged the RFC, made Jones chair and the government agency began buying preferred stock in banks to stabilize and help them lend again. Jones knew capital rather than debt was needed to save the banks and revive the flow of credit, just as it was when the program was duplicated in 2008 as the Troubled Asset Relief Program, better known as TARP. Under Jones’s leadership, the RFC became the largest investor in the nation and rescued banks, businesses, homes and farms; saved the railroads; rebuilt communities after environmental calamities; built bridges, dams and aqueducts across the nation; and brought electricity and appliances to rural America. The RFC helped people and saved businesses during the Great Depression through judicious lending, not spending, and remarkably returned a profit to the government and its taxpayers.
As war spread, Jones and FDR shifted the RFC’s focus from domestic economics to global defense. In its second cover story about Jones, TIME magazine reported, “In all the U.S. today there is only one man whose power is Franklin Roosevelt … The President knows Congress will give more to Jones without debate than he can get after a fight … Emperor Jones is the greatest lender of all time.”
Accordingly, after Germany’s European victories, Congress on June 25, 1940, gave Jones and the RFC the authority to build, buy and lease plants to develop and manufacture metals, ships, airplanes, tanks and guns; to train aviators; and, with FDR’s approval, to do anything required to arm the Allied Forces. Almost half of its outsized investments went to corporations to help convert their production to war-time needs. One of its largest new plants—the Dodge-Chicago plant—covered 145 acres and took in raw metal at one end and produced finished airplane engines at the other. Like all its new factories, the plant was built and owned by the federal government’s RFC, leased to corporations to operate and sold to private interests after the war. Likewise, coordinated national large-scale efforts and government investments can be made to address today’s daunting challenges.
Unprecedented Power dramatically describes how Jesse Jones and the RFC used every option to save life, democracy and capitalism during two of the 20th century’s most threatening events. Unprecedented Power provides models for today by looking at successes from the past.
616 pages, Hardcover
First published January 1, 2011
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Displaying 1 - 8 of 8 reviews
November 14, 2012
The moral of this biography should be - to paraphrase George Santayana - "those who do not study history are doomed to repeat its mistakes." It speaks to the state of our current political debate in the Great Recession while describing the life and times of Jesse Jones and his incredible role in the recovery from the Great Depression and the success of America as "the arsenal of democracy."
Mr. Fenberg reveals how an entrepreneur, multimillionaire, landlord, and Democrat left his business empire in answer to the call of duty of his country in its darkest hour to serve both as President Hoover's and FDR's head of the Reconstruction Finance Corporation. It also is a tribute to public service over greed and pragmatism over ideology. Mr. Jones wrote his own tribute when he endorsed President Roosevelt at the 1936 Democratic National Convention:
"I am not one who favors government in business but when business runs amuck, and private credit is no longer available, the government must step in. I have seen so much distress, so much tragedy, so many broken men in the four years I have been doing relief work for the business of our country that I want no more of it. Lifting a hundred [and] twenty-five million people out of the depths of despair and degradation in which they found themselves by March 1933, bringing them to a state of comparative comfort and happiness in the period of three short years, is an accomplishment that none of us thought possible, and one for which the entire nation owes a lasting debt of gratitude..."
The book unveils how little the politics of power has changed between our times and Jones'. How politicians can chose power over public service, politics over the greater good, how man is condemned to the same errors under the same conditions when ideology and influence trump reason and humanism.
A very worthwhile read for our times.
Mr. Fenberg reveals how an entrepreneur, multimillionaire, landlord, and Democrat left his business empire in answer to the call of duty of his country in its darkest hour to serve both as President Hoover's and FDR's head of the Reconstruction Finance Corporation. It also is a tribute to public service over greed and pragmatism over ideology. Mr. Jones wrote his own tribute when he endorsed President Roosevelt at the 1936 Democratic National Convention:
"I am not one who favors government in business but when business runs amuck, and private credit is no longer available, the government must step in. I have seen so much distress, so much tragedy, so many broken men in the four years I have been doing relief work for the business of our country that I want no more of it. Lifting a hundred [and] twenty-five million people out of the depths of despair and degradation in which they found themselves by March 1933, bringing them to a state of comparative comfort and happiness in the period of three short years, is an accomplishment that none of us thought possible, and one for which the entire nation owes a lasting debt of gratitude..."
The book unveils how little the politics of power has changed between our times and Jones'. How politicians can chose power over public service, politics over the greater good, how man is condemned to the same errors under the same conditions when ideology and influence trump reason and humanism.
A very worthwhile read for our times.
January 15, 2012
A fascinating story of the "power behind the throne" throughout the FDR and Truman administrations. Reading what the RFC did with the banks to help bring the country out of the depression has striking similarities to the situation during the recent banking crisis. But there was no "too big to fail" then, and the some of the cures applied would have made much more sense this time around too.
What's really worth noting is how the industrial & banking response to the crisis of WWII really setup the United States to become the superpower of the 50's, 60's and 70's. It's interesting to speculate what might have been had the country never become involved in WWII. The growth of our economic and political power might never have occurred in the same way, and the current situation in the world might be very different as a result.
What's really worth noting is how the industrial & banking response to the crisis of WWII really setup the United States to become the superpower of the 50's, 60's and 70's. It's interesting to speculate what might have been had the country never become involved in WWII. The growth of our economic and political power might never have occurred in the same way, and the current situation in the world might be very different as a result.
April 26, 2012
Very detailed biography of Houstonian Jesse Jones who as
Secretary of Commerce helped get the US economy back on it's
feet. There are lots of similarities to how the Obama Administration
has worked to improve the economy.
Secretary of Commerce helped get the US economy back on it's
feet. There are lots of similarities to how the Obama Administration
has worked to improve the economy.
October 13, 2026
As a middle class man moving into your middle ages you are almost legally required to pick a serious interest to remain intimidating to other people (this might have a pinch of old-worldy machoism in it). Being into american presidents and their biographies is a tried-and-tested choice - but if you'd like that extra bit of security in case you meet the other man in your area who is ALSO into presidents, you can one-up him by your co-interest of not-quite-american president biographies. This includes books like The Man Who Ran Washington: The Life and Times of James A. Baker III or, of course, Unprecedented Power (we know that this very much means NOT vice presidents, whose sole role is to sit in a room waiting for the president to die, or, occasionally, dress in a silly oversized winter jacket and go make an ass of yourself and your country to Greenland).
Jesse Jones, a harmless looking man (by elimination that must be him on the cover, since the other is Roosevelt) with a harmless sounding name was, at his time, for long periods the second most powerful man in the US (partially because the president is the first by default whatever they do). A skilled businessman with good connections, chosen to run the Reconstruction Finance Corporation, whose task was to bring the US out of the Great Depression and which served as a nice way for the president to get around the Congress's power of the purse, Jones used his common sense (back when that was a good idea) to rule over vast financial resources in a way that made pretty much everyone happy - and when you were one of the few he did not make happy, well, you might as well have jumped into the ditch yourself for all good your public criticism did you.
Unprecedented Power, to me, uncovered and connected parts of the US history I never thought much about. It describes how the US, post Pearl Harbor, was able to jump straight into the fighting with an epic fury (haha) - they had been arming themselves like crazy for a while before. It shows how sometimes personal choices being made in a not particularly democratic ways are the best ones, but you just have to be lucky (think of Terry Patchett's Lord Vetinari). It shows how, if we were somehow able to instill into our powerful people a strong need of good leadership, we might actually be able to get somewhere. And how, despite all the good that Jesse Jones did, he was still a thin skinned little man who did not take to criticism well.
An interesting detail was also the author's insistence of translating each monetary figure into its modern day (2011) equivalent, and seeing how it still does not particularly work, since simply multiplying by inflation still makes everything look ridiculously cheap (such as the example of FDR wanting to buy the Empire State Building for what would have been $30,000,000 and finding that a bit too steep). For an extra insight, check out the More or Less podcast episode about how much Jane Austen's Mr Darcy made in today's money.
Unprecedented Power is a great book for after you've read Robert Caro's LBJ work and perhaps a few more of the kind - it fills in gaps you did not even realise were there.
Jesse Jones, a harmless looking man (by elimination that must be him on the cover, since the other is Roosevelt) with a harmless sounding name was, at his time, for long periods the second most powerful man in the US (partially because the president is the first by default whatever they do). A skilled businessman with good connections, chosen to run the Reconstruction Finance Corporation, whose task was to bring the US out of the Great Depression and which served as a nice way for the president to get around the Congress's power of the purse, Jones used his common sense (back when that was a good idea) to rule over vast financial resources in a way that made pretty much everyone happy - and when you were one of the few he did not make happy, well, you might as well have jumped into the ditch yourself for all good your public criticism did you.
Unprecedented Power, to me, uncovered and connected parts of the US history I never thought much about. It describes how the US, post Pearl Harbor, was able to jump straight into the fighting with an epic fury (haha) - they had been arming themselves like crazy for a while before. It shows how sometimes personal choices being made in a not particularly democratic ways are the best ones, but you just have to be lucky (think of Terry Patchett's Lord Vetinari). It shows how, if we were somehow able to instill into our powerful people a strong need of good leadership, we might actually be able to get somewhere. And how, despite all the good that Jesse Jones did, he was still a thin skinned little man who did not take to criticism well.
An interesting detail was also the author's insistence of translating each monetary figure into its modern day (2011) equivalent, and seeing how it still does not particularly work, since simply multiplying by inflation still makes everything look ridiculously cheap (such as the example of FDR wanting to buy the Empire State Building for what would have been $30,000,000 and finding that a bit too steep). For an extra insight, check out the More or Less podcast episode about how much Jane Austen's Mr Darcy made in today's money.
Unprecedented Power is a great book for after you've read Robert Caro's LBJ work and perhaps a few more of the kind - it fills in gaps you did not even realise were there.
September 18, 2019
Incredible man but what a "slog" getting through this book. I blame the editor. It could have told the story just as well if it were about one-third fewer pages. It was frustrating that over half way through the book the author found it still necessary to remind the reader of the imposing figure that Jesse Jones was and repeat that he was 6'3"'. The description that he was the most powerful man in Washington outside of the president must have been used fifty times. probably could have used the acronym MPMIWOTP and it would have been clear as to the meaning. The middle part of the book with every speech that Jones seemed to have given including the financial figures of the RFC listed was monotony.
January 25, 2022
I've read a good number of books about both the Great Depression as well as World War II, but never have I read about these events from an Economic perspective. This was truly fascinating, to read about these events from the POV of Jesse Jones, the head of the RFC.
I also learned a lot about the growth of Houston during the first half of the 20th century.
I also learned a lot about the growth of Houston during the first half of the 20th century.
February 4, 2019
Very thorough biography on the builder of Houston and many other cities. At 584 pages though, you will get a very detailed picture of Mr. Jones’ work at the RFC.
This entire review has been hidden because of spoilers.
August 8, 2017
If you love Finance or just need a towering American of Finance to learn about then Jesse H Jones will not disappoint you. From his humble beginnings in Tennessee to his relationship with FDR, this book details an in depth look at Jesse H Jones life. Along the way you will learn about his relationship with his wife, his love of his adopted hometown of Houston, and his political successes. Jesse h Jones was a larger than American Financier who can have claimed to be the second most powerful person in the country behind the president. If you like Finance, building, or development this may be your can't miss opportunity to read how far you can go.
Displaying 1 - 8 of 8 reviews