became connected with a celebrity. The narrative started to pick up a little in the
1930s, and then went viral after that.
Throughout the 1930s, the idea took root that the Great Depression resulted
from an epidemic of “reckless talk” by opinion leaders who were oblivious to its
psychological impact.18 In reality, though, prominent people seem to have been
very aware of the possible psychological effects of their talk, which led to the
creation of another narrative: thought leaders were now so worried about their
talk inciting fear that the public began to assume a general bias toward false
optimism. In other words, John Q. Public believed that thought leaders were
trying to sound optimistic and that the listener had to correct for that
overconfidence. It is easy to see how expectations may have become much more
volatile in such an environment.
In keeping with earlier narratives of panic, many people also saw the Great
Depression as a stampede or panic. When people saw other people running from
the Depression, their fears made them run too. This sense of fear took strong
hold on the public imagination. Yale economics professor Irving Fisher wrote in
1930:
The chief danger, therefore, did not inhere in conditions at all. It was the
danger of fear, panicky fear, which might be communicated from the stock
market to business. “My only fear is the fear of fear” are the words of a
courageous man.19
Thomas Mullen, assistant to Mayor James Curley of Boston, made a similar
statement in 1931:
I believe the only thing we need to fear is fear itself.20
Later, in 1933, the worst year of the Great Depression, President Franklin
Roosevelt said in his inaugural address,
So, first of all, let me assert my firm belief that the only thing we have to fear
is fear itself—nameless, unreasoning, unjustified terror which paralyzes
needed efforts to convert retreat into advance.21
Thomas Mullen was not a celebrity, but President Roosevelt was. So
Roosevelt went viral as the originator of the idea, taking credit for an idea that
sounded right because it had already been repeated many times. This articulation

of the fear of fear itself may today be Roosevelt’s most famous quote,22 and
ProQuest News & Newspapers shows that it was used even more frequently in
the first decade of the twenty-first century than it was in the 1930s.
But viral narratives are not easily controlled, and they may have unintended
effects. Describing everyone as fearful and emphasizing the need for courage
may create some patriotic resolve not to be fearful. At the same time, such
exhortations make it doubtful that others will truly cast aside their fear. Thus
identifying the problem as one of fear may only worsen the problem.
Other narratives of the 1930s focused on ending up in a poorhouse so
overcrowded that one had to open a cot every night to sleep among many others
in a common area and to fold up the cot every night to yield the floor space to
other activities.23 There were also narratives of getting sick and having no money
to pay a doctor.24 Even if these narratives were exaggerated, they reduced
willingness to spend on anything but the barest necessities. As a result, people
neglected routine dental work to conserve money, ultimately leading to painful
dental emergencies.
Roosevelt also offered moral reasons to spend. Days after his inauguration in
1933, he took the unusual step of addressing the nation by radio during a
massive national bank run that had necessitated shutting down all the banks. In
this “fireside chat,” he explained the banking crisis and asked people not to
continue their demands on banks. He spoke to the nation as a military
commander would speak to his troops before a battle, asking for their courage
and selflessness. Roosevelt asserted, “You people must have faith. You must not
be stampeded by rumors or guesses. Let us unite in banishing fear.”25 The public
honored Roosevelt’s personal request. The bank run ended, and money flowed
into, not out of, the banks when they reopened.
We are still influenced by this narrative constellation. Although the overall
narrative has not been powerful enough, or not used well enough, to prevent
recessions, it remains in our consciousness and may reassert itself if conditions
change. Meanwhile, we are now in the habit of listening to the stock market’s
closing price at the end of every business day, often interpreting it as an indicator
of public confidence. We also follow the various monthly confidence indexes,
not because economists urge us to, but because we are still subject to the old
narratives suggesting that public confidence can break as suddenly as a shout of
fire in a crowded theater.