1929-1978: Progressives take over–And slowly grind down Atlantic City–and America.

In March, 1929, Republican Herbert Hoover became President following his landslide victory the previous November.? ???Eight months later, the stock market crashed, and the Dow Jones Average lost 39% of its value.???? By 1932, the economy in the United States and most of the world was so bad that it was called ?The Great Depression?.

Democrats and ?progressive? historians blamed both the 1929 Crash and The Great Depression on the conservative policies of Republicans Harding, Coolidge, and Hoover.? ?However, Hoover was a ?progressive?, not a conservative.?? Hoover?s ?progressive? policies turned an ordinary recession into The Great Depression because he rejected the conservative? policies of Harding and Coolidge.

Hoover was a mining engineer before he went into politics.??? He believed it was government?s job to fix economic problems the way engineers fixed mining problems.?? He did not believe in free markets or limited constitutional government.

In the 1912 elections, Hoover rejected conservative Republican Taft and supported ?progressive? candidate Theodore Roosevelt? for President.? ?In 1917, ?Hoover was appointed by ?progressive? ?Democratic President? Woodrow Wilson to run his newly created? U.S. Food Commission, where he took over food production and distribution in the U.S. and imposed price controls.??? In 1920, Wilson and other prominent Democrats? urged Hoover to run for President as a Democrat.?? Hoover declined only because he knew Democrats were too unpopular at the time for him to win.? During the 1921 food shortages in Russia, Hoover organized a food relief program that fed millions and may have saved the Communist regime.

Although Hoover served as Secretary of Commerce to Republican Presidents Warren Harding and Calvin Coolidge from 1920 to 1928, Coolidge mocked Hoover with the nickname ?Wonderboy?.??? Coolidge also said, ?For six years that man (Hoover) has given me unsolicited advice?all of it bad?.? However, Hoover was so popular that conservative Republicans were unable to block Hoover?s nomination.

After the stock-market crash of ?September, 1929, Hoover ignored the advice of his Treasury Secretary, Andrew Mellon to let the free markets correct themselves.?? Hoover instead tried to ?fix? the economy with massive Federal tax hikes, ?borrowing and spending.?? ??He borrowed and spent hundreds of millions of dollars on government construction projects including the Hoover Dam.? He had the federal government take over and subsidize the wool industry.???? He pushed through the Bacon-Davis Act of 1932 which greatly increase labor costs for all federally funded construction projects.? He touched off a trade war with our main trading partners by raising taxes on all imported goods with the Smoot-Hawley Tariff Act of 1930.?? Hoover doubled the national debt from 20% of GNP to 40%.??? He imposed massive hikes in Federal income and inheritance tax rates in 1932.? Hoover also imposed a new federal ?check tax? on every check written in the country.

Roosevelt Democrats later privately admitted that almost all of their New Deal programs were first started by Republican ?progressive? Herbert Hoover.?? Many economists agree with UCLA economics professor Lee Ohanian that the ?progressive? actions taken by Republican President Herbert Hoover between 1929 and 1932 ?caused what might have been a bad recession to slip into the Great Depression?.

Although the new ?progressive?? Federal income tax started in ?1913, it ??probably had very little effect on Atlantic City the Depression.??? ?Most Atlantic City workers and business owners were paid in cash back then, and they probably ignored the new Federal income tax the way they ignored new Federal laws against liquor.??? When conservative Republicans swept ?progressives? out of Congress and the White House in 1920, they made big cuts in income tax rates that made the income tax even less important?until Herbert Hoover raised income tax rates again in 1932.

The ?progressive? ?Federal Reserve Banking System of 1913 did cause big problems for Atlantic City and the rest of the country?but not until roughly 12 years later.???? The Federal Reserve Bank was designed to end the boom and bust cycles that had taken place in the free market American economy since the 1820?s.? However, it did not work that way.??? The government bankers who ran the Federal Reserve Bank were no smarter and no more honest? than ?private bankers in the past?but ?the Federal Reserve had far more money and power.?? ?Instead of ending the normal boom and bust cycles of free markets, ?the Federal Reserve created a bigger bubble in 1926 than during any boom in the past.?? And when that bubble burst, the Federal Reserve then turned a normal correction into the Great Depression that lasted 12 years?far longer than any bust in the past (and longer than the 1929 Depression lasted in ?any other country).? ???Also, because the people who ran the Federal Reserve banks were appointed by politicians,? they usually created inflation by printing too much money.?? Inflation rewards reward people who are organized into groups with political influence, and punishes ?everybody else.?? Inflation encourages people to? rely more on politics and government help, and less on their own work, saving, and investing.

The ?progressive? laws against cocaine and opium in 1914 and liquor in 1919 were very bad for America.???? They increased the size and cost of government.??? They encouraged organized crime, political corruption and disrespect for the law.?? They also created a new police culture that included wire-tapping,? frequent police searches, paid informers, and plea bargaining.??? But at first, this was good for Atlantic City.

Nucky Johnson?s ?Boardwalk Empire? organization was so effective at nullifying federal liquor and drug laws, that Atlantic City thrived from its monopoly on openly serving liquor in its hotels, restaurants, nightclubs and convention centers?even when the rest of the country suffered from the Great Depression.?? However, that monopoly ended in 1934 after the 21st Amendment to the U.S. Constitution repealed Prohibition.?? When that monopoly ended, its corrupt, expensive, and unresponsive political regime became a burden?not a benefit.

The ?progressive? takeover? of the nation?s railroads by the federal government had little effect on Atlantic City before 1934.?? Although most passenger trains in America were no longer profitable, trains making the short trip to and from Atlantic City still made money as long as crowds flocked there for liquor.?? But after 1934, traffic declined and ?railroads had no reason to invest money to improve and modernize trains to Atlantic City either.?? During the next 20 years train service to Atlantic City got slower, less frequent, and more expensive.?? By the 1950?s, Americans found it quicker and cheaper to fly and drive to other tourist destinations.

?In 1929, ?Atlantic City copied ?New York City?s ?progressive? zoning laws.??? Those laws made it illegal to build or expand businesses in large areas of the city that were zoned ?residential?.?? ?Progressives? originally adopted zoning laws in New ?York to stop developers from building skyscrapers that block air and sun to neighboring properties.?? However, established business owners across America quickly adopted and expanded these ?progressive? laws in their towns and cities?to stop new buildings and businesses from competing with them!?? ?Atlantic City?s first zoning law of 1929 was pushed through by owners of the big uptown hotels to block a? proposed new high-rise hotel? by the Boardwalk between Raleigh and Kingston Avenues.????

?Atlantic City?s zoning laws discouraged new construction and improvements by raising costs of getting permits.??? They increased taxes and the cost of government to apply and enforce those laws.?? They encouraged political corruption by letting government officials punish some property owners for violations, while giving? ?variances? and exceptions to others.

There was no major construction project in Atlantic City from the adoption of the new zoning ordinance of 1929 until the 1950?s when motels were first built in Atlantic City 15 years later.?? In 1964, Atlantic City hosted the Democratic Party Convention, hoping that the presence of national media would boost the City.?? However, the opposite happened.?? The national media repeatedly reported how shabby and run down Atlantic City had become.

1964-1968:? Progressive Democrat Lyndon Johnson was elected President with a bigger landslide that Republican Warren Harding in 1920.?? A super-majority of Democrats are elected ?in both houses of Congress.?? During the next four years, these ?progressive?? Democrats? create dozens of new federal programs and borrow and spend billions of dollars as part of their ?Great Society?? and ?War on Poverty? ?agendas.??? These programs include:

  1. Low cost government housing and rent assistance
  2. Free medical care, food stamps, and welfare payments
  3. Government paid summer jobs where selected students with political connections are paid more for doing little or nothing Mondays through Fridays in air conditioned government offices, rather than work nights and weekends in hotels, restaurants, shops, and amusement arcades.
  4. Urban ?Renewal?:?? The Atlantic City Housing Authority is paid to use eminent domain to seize and demolish 80 acres of houses, stores, and rooming houses by the Steel Pier.?? ???Most of that land is still vacant 50 years later.

For the first time in history, most African-Americans in Atlantic City no longer part of the tourist economy.??? Most depend?far more on government jobs and programs rather than pleasing tourists for their income.??? They?form powerful political organizations to demand the continuation and expansion of those government programs–while opposing spending and programs than benefit business owners and tourists.??? Crime increases as young women no longer need husband?s to support them and their children.?? Many tourists and conventions stop coming to Atlantic City.

New Jersey adopts new 3% sales tax under ?Progressive? Democratic Governor ??Hughes on top of high real estate taxes.?? Raised to ?5% in 1970 (?Progressive? Republican Governor Cahill), 6% in 1982 (?Progressive? Republican Governor Kean, ?and 7% in 2006 (?Progressive? Democratic Governor Corzine).?? Most Atlantic City businesses? stop improving and investing in their businesses.?? Many close.? Others move to the suburbs.

1968:?? New Federal immigration laws admit 300,000 additional legal immigrants per year from Asian and Latin American countries.? New Federal education programs pay for ?bi-lingual? education for students who don?t speak English.???? These immigrants are welcomed by Atlantic City businesses, since they are willing to work? weekends and long hours at minimum wage jobs during the summer?jobs that few local students agree to do.? ??During this time, the Federal government also greatly expanded the F-1 and J-1 programs allowing foreign students to work summer jobs in Atlantic City.??? These students are exempt from most payroll taxes including social security and Medicare.

1968:?? New Jersey becomes ?third state in U.S. to let government employees form labor unions.?? In 1979, public employees who choose not to join unions are forced to pay ?representation fees? of 85% of dues to union anyway.?? Much of those union dues are used to elect and re-elect state and local officials who support more pay and benefits for government employees.?? Government employees soon earn more pay, better benefits, and larger pensions than employees of private companies who work more hours doing the same jobs.? This causes massive increases in taxes and debt in public schools and every level of government.

1966-1973:?? Many houses and apartment buildings become vacant as low income families move to new subsidized government projects.?? Summer tourism business declines. ???Violent crime increases.??? Middle class families flee to suburbs.??? Because subsidized housing pays small ?Payments In Lieu of Taxes (PILOT),? school, county, and local property taxes are increased to make up the difference.?? Year round population of Atlantic City declines from 60,000 in 1960, to? 48,000 in `1970 to? 40,000 in 1980.

1973:? New Jersey adopts ?Coastal Areas Facilities Act? which requires expensive state permits and approvals for all new construction in any town near the ocean or bay.? ????This law also applies to Atlantic City, even though the entire island was already built up more than 100 years ago. ??This new law made new construction and development more expensive.

New Jersey adopts new 2.5% income tax on top of sales tax and high property taxes.?? Tax hiked to 3.5% under ?progressive? Republican Governor Tom Kean, doubled to 7% under Democrat Jim Florio, and cut to 6.37% under ?progressive? Governor Christie Whitman.?? New Jersey is one of a handful of states to have high income, sales, and real estate taxes.?? High income retirees encouraged to move out of state.?? New businesses discouraged from moving in.

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